Official Statements:

The enlarged Governmental session on the results of socio-economic development of Kazakhstan in the first half of 2008

The enlarged Governmental Meeting held on 6 of August focused on the outcomes of Kazakhstan’s socio-economic development in the first half of 2008.

    These outcomes identified make it evident that those pessimistic expectations, related to advertised crisis of the national economy did not come true.

    Last autumn the Government elaborated the set of measures aimed at providing the support for various branches of the national economy, affected by unstable financial markets, which proved to be largely effective.

    Apart from keeping the liquidity and sustainability of the national financial system, the measures were aimed at ensuring macroeconomic stability and encouraging economic activity. On the part of the Government the financial support was provided for the most vulnerable sectors of the economy.

    As a result the amount of investments into the original capital grew by 12,4% in the first half of the year 2008.

    The index of the physical volume of the industrial output grew by 3,8%.

    The volume of construction activity (services) increased by 10,7%.

    In January-May of 2008 the monthly average nominal salary of one employee was 56 686 tenge and grew, compared to the same period of the last year by 17,3% and decreased in real terms by 1,4%.

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    The expectations of considerable declining in amounts of crediting from the part of the banking system, due to its limited access to international financial markets also did not come true.

    Despite of slower growth of single indictors, the financial system proved to be stable and effectively functioning.

    The volume of credits during the first half of the current year remains constant, that stems from the growth of the volume of legal entities deposits.

    Thus, the volume of residents deposits from the beginning of the year grew by 13,8%.

    Since the beginning of the year the private capital, according to the second tier banks statements, has increased by 5.8%. The amount of joint assets of banks increased in May 2008 by 2.1%.

    The growth of prices for energy supplies made it possible to get first time in several years the positive balance of the current account (3.8 billions US dollars in the 1st quarter) and balance of payment in general.

    International reserves of the country including the assets of the National Fund (27.7 billions US dollars) have increased by 21.4% and reached 46.9 billions of US dollars.

    Foreign trade turnover for six months has increased by 42.5%, including the export by 60.7% and the import by 15.5%.

    There is the ongoing decline of unemployment rate that equals to 6.6%, which is considerably lower compared to the last year indicator.

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First six months of the year 2008 brought the growth of production in all sectors of the economy, except those ones, related to processing industry.

Estimations for the first half of 2008 indicate that in comparison with the corresponding period of 2007 the GDP has increased by 5.1%.

48.8 billions of tenge from the budget have been allocated through the “Kazyna” Fund to the second tier banks in order to ensure further stable crediting of small and medium-size business projects. 2207 small-size business projects are funded through these budgetary resources.

Moreover, the situation at the world food markets made the Government to take extra measures to provide the support for the agricultural sector industrial sector and ensure food security. Extra 51 billion tenge has been allocated to provide for these goals from the Government’s Reserve Funds and the revised budget.

The volume of the gross agricultural production has increased by 4.2%.

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In order to timely reveal any negative tendencies the Government developed the Fast Reaction Plan to the systemic risks.

The monitoring system over the ongoing economic processes in the country and across the world has been introduced to ensure timely reaction to outside shocks.

There is also Plan of Stabilization Actions, that is directed to keeping the sustainable economic growth and effective management over it.

As a whole, Kazakhstan is determined to carry out a policy of balanced growth based upon the priority to development of export-oriented sectors of the economy.

Following this aim Kazakhstan plans to enforce the implementation of “30 Corporate Leaders” Program, which is to boost further development of the economy.

President Nursultan Nazarbayev Received Kanat Bozumbayev, the Board Chairman of the Samruk Kazakhstani Holding for Managing State Assets

At the meeting, Kanat Bozumbayev informed the President on results of the work done by Samruk’s subsidiary companies over the first half of this year and prospects of developing the holding. He reported on the implementation of large investment projects in the railroad industry.

“Those are a locomotive assembling plant, project for modernizing electric locomotives, establishment of a new enterprise producing wagons in Ekibastuz. The implementation of these projects will satisfy the needs of the Kazakhstan Temir Zholy National Company except for passenger wagons,” Kanat Bozumbayev said at a press briefing.

The holding’s head also talked to the President about projects being implemented in the electricity power industry, namely Balkhash Heat Power Station and Moinak Hydro Electricity Power Station. The President instructed to accelerate the work on their completion.

President Nursultan Nazarbayev made a working trip to a number of districts of the Almaty region.

The Head of the state participated in presentation of the “Damu” industrial and logistics center in Ili district.

"Damu” industrial and logistics centre is a territory of production facilities, administrative structures, infrastructural and storage premises, established for development of transport and logistics infrastructure, both domestic and foreign small and medium business. Construction of this center became the first stage in realization of the “Amanat Invest Group” company’ project which plans to establish a network of the industrial and logistics centers across Kazakhstan.

The total volume of investments attracted in the “Damu” center amounted to more than USD 150 million. About 870 experts are working in the centre at present. More than 20 international and domestic companies are among the partners of the “Amanat Invest Group”.

“Kazakhstan has significant transport and transit potential, and I am very glad that development of the logistics centers in Almaty, Astana and Аktobe has started”, Nursultan Nazarbayev told.

Within the framework of the visit to the Almaty region Nursultan Nazarbayev has also surveyed production workshops of KNAUF Gypsum Kapchagai LLB. The German company KNAUF privatized this enterprise and the investment contract amounting to USD 19,5 million had been successfully implemented in 2004.

The project capacity of the Kapchagai plant is 26 million square meters of gypsum wallboards per year, more than 20 per cent of which is produced for export.

Nursultan Nazarbayev also visited the “Silk City 3 D Constriction” Ltd in Kapchagai town. This enterprise produces three layers panel made of foamed polystyrene stuff, which is widely used in large panel construction. On the territory of the plant the Head of the state visited an exhibition of goods from the leading Kapchagai enterprises.

Almaty region is one of the most densely populated regions of the country. There are more than 1,7 million people live here. Since 2005 the production output has increased twofold. The new university will be constructed in the Almaty region near Kaskelen as well as the “Alatau” Information Technologies Park is being developed near Almaty.

“Despite of financial difficulties the volume of construction works not only decreased, but it increased. 400 thousand square meters of residential housing had been constructed last year. This year, we need to construct half a million square meters. Deposits are growing; the agriculture sphere has been successfully developed. We are starting construction of hydroelectric power stations on the small rivers. The first Hydroelectric Power Station will be put into operation on the river Yesyk’, the President of the country stressed.

Head of the state Nursultan Nazarbayev received in his Almaty residence Akim of Almaty Akhmetzhan Yessimov and president of “Kazakhmys” corporation Vladimir Kim.

The separate issues on Almaty social and economic development were discussed during the meeting with Akhmetzhan Yessimov. Akim of the southern capital reported on the establishment of a new Alatau district in Almaty and on the issue concerning share construction. As Akhmetzhan Yessimov said, the problem of the equity holders would be solved, for this purpose it was allocated 20, 4 billion tenge.

Nursultan Nazarbayev has paid a special attention to the issue on inappropriate building in Almaty.

- I urge to stop infill construction of the city especially its historical district. We opened a new Alatau district, and new construction works should be started in this area. This district will be developed in the future. It is necessary to improve environmental situation in the city and to facilitate road traffic. The following year we will open subway in Almaty. Two years ago I gave instructions to stop any construction activity along the rivers of Almaty (Bolshaya and Malaya Almatinka) and in the “Zailiskiy Alatau” National Park as well as to remove fences and clear the rivers, the President stressed.

The CEO of “Kazakhmys” corporation Vladimir Kim reported on the investment plans of the company. It is planning to invest in production development two billion US up to 2010.

The President emphasized that issues on social responsibility of business and ecological situation should be in the centre of attention.

Kazakhstan’s PM Karim Massimov met US State Department delegation headed by Boyden Gray, the current Special Envoy for Eurasian Energy

The sides discussed further prospects of cooperation between Kazakhstan and the USA in the realms of energy and investments. July 22, 2008 at the Government’s House in Astana, Kazakhstan’s Prime Minister Karim Massimov met US State Department delegation headed by Boyden Gray, the current Special Envoy for Eurasian Energy.

The sides discussed further prospects of cooperation between Kazakhstan and the USA in the realms of energy and investments. K. Massimov noted that Kazakhstan, being a major trade and investments partner of the USA in Central Asia, adheres to principles of open and constructive partnership.

In the course of the meeting, the sides also dwelt on issues of food and energy security, economic cooperation of Kazakhstan with other states of Central Asia, as well as Kazakhstan’s accession into the WTO.

Those attending the meeting pointed to progress achieved in relations between Kazakhstan and the USA and expressed confidence in further successes in cooperation.