PPP is seen in Kazakhstan as a tool for «smart» investment


PPP is seen in Kazakhstan as a tool for «smart» investmentAccording to the World Bank , Kazakhstan is recognized as a country with successful reforms to improve the business environment and took 49th place in the rating of «Doing Business 2013 “. By the volume of foreign direct investment per capita, we rank among the top positions in the CIS and ahead of a number of countries in Eastern Europe. At the same time, Kazakhstan holds a number of initiatives to improve measures of state public- private partnership ( PPP).

In 2011, at the legislative level, we adopted a new measure of state – compensation for investment costs, by means of which an investor can offset his costs of construction in the operational phase. This is an important motivation for the investor, in addition to the pure form of such a tool in the world does not exist, we can say that Kazakhstan is know-how. Since 2012 the Ministry of Economic Development and Budget Planning of Kazakhstan has been actively promoting new legislative initiatives that will introduce in Kazakhstan the practice of this kind of state as payment for access, and “guarantee of consumption.”

The world practice uses successfully for more than 20 kinds of contacts like PPP. In this regard, Kazakhstan makes a great breakthrough and expands the field for PPP projects , introducing such basic types of contracts, as the operation and management, build- transfer – lease, rental, management and maintenance, operation and maintenance, design, construction, financing and operation.

In addition, granting a private company with the right to build, refurbishment, operation of the facility of state property through public- private partnership, the state will receive the qualification, experience, technology and know- how of the private sector, as well as the transfer of project risks to the private sector, the development of domestic markets capital and banking sector. These measures will help to increase the innovative potential of interaction between government, business and science, will contribute to the progress of infrastructure and ensure public access to better quality services. Consumers and the public will benefit from realization of PPP projects in the form of the optimal ratio of “price-quality” in the field of goods, works and services.

For the private sector there will be created new investment opportunities and, consequently, new sources of income, risk sharing with the government, thus gaining experience in managing large projects .

On the scope of PPP, then, as in other developing countries, we are interested in large-scale infrastructure projects related to the construction of roads and railways, gasification, and power generation. In addition, since 2012 the scope of PPP were supplemented by health care and education, as all restrictions on the transfer of the education and health care in the concession were lifted.

Today, PPP is considered in Kazakhstan as a tool for “smart” investment. For the convenience of investors, as well as to improve the quality of PPPs there has been created a unified information platform that will work with investors on the principle of ” one window”. The operator of this platform will become Kazakhstan PPP Center.

It should be noted that Kazakhstan has the fastest mechanism for preparation of PPP projects. The procedure lasts one and a half to two years. For comparison, in the world such procedures take about 4 to 5 years. But given that the aim is to develop long-term projects, the implementation period is 30 years, as well as the steady profits in the long run, waiting draft within two years worth it.

It is known that 80% of the domestic economy is in the trade sector, while the share of the real sector is still less than 30%. Therefore, the development of PPP in Kazakhstan is as relevant as ever, as the benefited from this form of partnership between government and business are members of society. When an investor as a result of the successful implementation of the project brings back the invested funds, this is good business.