The Republic of Kazakhstan

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MINISTRY OF INDUSTRY AND TRADE REPUBLIC OF
KAZAKHSTAN
INDUSTRIAL AND INNOVATIONAL DEVELOPMENT STRATEGY
OF THE REPUBLIC OF KAZAKHSTAN FOR 2003 -
2015 NEW HORIZONS OF COOPERATION
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Aim of Presentation of the Strategy

• Acquaintance of the main partner-countries with a
  state policy in sphere of industrial and
  innovational development
• Definition of economic opportunities and
  potential of bilateral cooperation in sphere of
  industry, an innovation and investment
• Creation of the mechanism of interaction on joint
  development and implementation of perspective
  investment projects in hi-tech branches

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Primary goals of joint action for presentation of
the Strategy

• Definition of innovational and industrial
  clusters of Kazakhstan, in which investments,
  technologies and management of foreign
  partner-countries would predetermine their
  future development
• Assistance to the Kazakhstan enterprises,
  development institutes and scientific
  organizations in establishing the international
  connections and business contacts

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Dynamics of Gross Domestic Product 1995 2003
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• Mid-annual rates of growth of industrial
  production in CIS countries
• for 1999 - 2003,

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Netto inflow of foreign investments per capita
in CIS countries, in million USD
1993-2003
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Dynamics of industrial manufacture
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Industry Structure 2003
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Dynamics of Kazakhstans foreign trade turnover
for 1995-2003
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Structure of Kazakhstans foreign trade turnover
on trade groups in 2003
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Share of main trade partner-countries in export
of products of Kazakhstan in 2003
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• Share of small enterprises
• in structure of GDP

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Enterprises with participation of the foreign
capital
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Tasks of the Strategy

• Maintenance of mid-annual growth in processing
  industry on 8,4 , growth of labor productivity
  not less than in 3 times and decrease of power
  consumption of GDP in 2 times
• Stimulation of creation of high technology and
  hi-tech export oriented manufactures
• Diversification of countrys export potential for
  the benefit of goods and services with high added
  cost
• Transition to the world standards of quality
• Attraction of the best practices of innovation
  and manufacture management
• Stimulation of private sector initiatives

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Principles of implementing the Strategy

• Partnership with private sector
• Orientation of investment and innovational
  offers on increase of competitiveness of goods
  and services produced in non raw branches
• Complex character of measures of the state
  support of the branches which provide development
  of a chain of added costs
• Development of cooperation with the largest
  international transnational corporations,
  carrying out activity in sphere of high
  technologies
• Maintenance of equal competitive conditions and
  the healthy competitive environment, and also
  refusal of any privileges and preferences of
  individual character

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• Expected results of realization of the Strategy

• Improvement of use of science achievements in
  increase of competitiveness of economy
• Creation of new private financial institutions
  on work with investment and innovational projects
• Increase of a level of appeal of Kazakhstan for
  investments and technology transfer
• Outstripping development of processing industry
  and export of finished goods due to manufacture
  of hi-tech and high technology production with
  the high added cost
• Increase of investment appeal of processing
  sector of the industry for foreign investors

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Key branches of economy - locomotives of
industrial-innovational development

• Oil and gas complex
• Mountain-metallurgical complex
• Agriculture complex
• Construction branch

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Oil-and-gas complex

• Expected investments in oil extracting in nearest
  15 years will exceed 80 billion USD
• Part of investment expenses will be directed on
  creation of manufactures which even after
  exhaustion of stocks of petroleum will be claimed
  on the external and internal markets
• Perspective branches and spheres of cooperation
• Petrochemical branch
• Oil-and-gas equipment
• Trumpet manufacture
• Manufacture of counters and measuring instruments
  for the oil and gas industry enterprises
• Engineering works on investigation deposits
• Recycling of waste products of oil and gas crafts
  
• Ecological engineering and monitoring

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Construction branch

• High rates of growth of construction on 20-25
• Growing rates of growth of import of construction
  materials (965 million USD in 2003)
• Significant stocks of raw material for
  manufacture of building materials
• Perspective spheres of cooperation
• Manufacture of facing and warmly isolated
  products from modern kinds of materials
• Release of steel rod armature and polymeric
  materials
• Organization of manufacture of concrete, cement,
  brick and slate on local raw material
• Manufacture of modern kinds of wooden and metal
  designs
• Architectural engineering works

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Mountain - metallurgical complex

• High competitiveness of black and nonferrous
  metals of the Kazakhstan enterprises on foreign
  markets
• World leadership on deposits and manufacture of
  separate kinds of seldom ground metals
• Presence of scientific - technological and
  industrial potential and resources for increase
  of technological processing of metals
• Perspective direction of cooperation
• Manufacture of heavy-duty metals and alloys
• Manufacture of new kinds of hardware and metal
  designs
• Creation of joint research centers on study of
  new metals and alloys from seldom ground metals
• Recycling and industrial processing of waste
  products of the enterprises of a mountain -
  metallurgical complex

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Agriculture complex

• Kazakhstan - one of the largest in the world of
  exporters of a grain - up to 6 million tons per
  one year
• High share of agrarian sector in structure of
  economy
• Presence of potential for escalating manufacture
  of mineral fertilizers
• Presence of large commodity markets of food
  products
• Perspective spheres of cooperation
• Increase of a level of processing of a grain,
  meat and wool and manufacture of mineral
  fertilizers
• Creation of the research-and-production centers
  on release of new kind of seeds and fertilizers
• Manufacture of export oriented kind of food
  products

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Competitive advantages of realization of Strategy

• Macroeconomic stability and leadership on
  economic reforms among the countries of CIS
• Financial security of the key actions directed on
  creation of development institutes, techno parks,
  scientific researches, and also on reforms in
  education and an infrastructure policy
• Presence of large commodity markets in
  neighboring countries - 827 million people
  (including Western China)
• High level of literacy of the population
• Favorable investment climate and forward
  reduction of tax loading
• High transit potential and construction of large
  infrastructure projects

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Cooperation in innovational sphere

• Participation in creation and management of Park
  of Information Technologies in Almaty city,
  Bio-techno park in Stepnogorsk city and other
  planned to creation techno parks
• Assistance in attraction of large transnational
  corporations in processing sector of Kazakhstan
• Creation of the centers on preparation of
  managers and experts of an average link for work
  with highly technological manufactures
• Formation of joint investment and innovational
  projects with development institutes of
  Kazakhstan
• Participation in realization of scientific and
  marketing researches by definition of competitive
  advantages of industries and creation of
  industrial clusters
• Assistance in development of venture industry

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Development institutes or institutional
maintenance of implementation of the Strategy

• Development Bank of Kazakhstan
• Investment Fund of Kazakhstan
• State Corporation on insurance of export and
  investments
• National Innovation Fund
• Fund for support of small business
• Kazakhstan Contract Agency
• Center of engineering and technology transfer
• Center of marketing and analytical research

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Cumulative volume of the attracted direct
foreign investments (increasing volume)
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Structure of direct foreign investments by
countries
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Investment preferences, stipulated by the
legislation at investment in priority sectors of
economy
Investment preferences are given for 5 years
as - privileges under the corporate tax -
property tax exemption - land tax exemption -
customs fees exemption at import of the
equipment - granting the state natural grant
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Priority sectors of economy for investment
preferences

• Information Technologies, Electronics and
  Telecommunications
• Chemistry and Petrochemicals
• Biotechnology and Pharmaceuticals
• Machinery building and Metallurgy
• Construction Materials
• Light industry (textiles and etc.), incl.
  Food industry

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• Thank you for your attention!