The session defined economic policy for the current year along with medium-term measures.
First Deputy Prime Minister Bakytzhan Sagintayev, Deputy Prime Minister Berdybek Saparbayev, Minister of Investment and Development Asset Issekeshev, Minister of Energy Vladimir Shkolnik, Chairman of the Management Board of «Samruk-Kazyna» JSC Umirzak Shukeyev made reports, telling about major results of their work in the past year and future plans for 2015. Mayor of the city of Almaty Akhmetzhan Yessimov, mayor of Atyrau region Bakhtygozha Izmukhambetov, mayor of Pavlodar region Kanat Bozumbayev and mayor of Almaty region Amandyk Batalov were among the keynote speakers as well.
In his speech, Nursultan Nazarbayev stressed that in the current circumstances the country needs to adapt to the new reality, which requires prompt action of both economic and legislative character.
The Head of State set a number of tasks before the Government, National Bank and the mayors.
The President noted that the “Nurly Zhol” programme is an effective crisis management tool that attracts investment and creates new jobs.
“It is aimed at creating an effective transport and logistics infrastructure of Astana. In 2015-2017, the National Fund will allocate about 500 billion tenge, including 180 billion tenge this year”, Nursultan Nazarbayev said.
The President stressed that the funds must be timely used in the regions.
“I entrust the government to immediately start allocating funds for all projects, as they ensure internal demand for the products of Kazakhstan’s companies,” Nursultan Nazarbayev said.
The Head of State noted that given the current economic situation it is necessary to extend supportive measures, adding new anti-crisis provisions to the “Nurly Zhol” programme.
“This should include support of domestic engineering and exporters, infrastructure for small and medium-sized enterprises, increase of state support to agriculture, measures to protect domestic market and other areas. The government should establish a reserve fund for urgent operational measures in the amount of 250 billion tenge. I instruct the Government to augment the programme in a month and submit the document for approval”, he said.
In addition, the President said optimization of state spending is a key element of anti-crisis measures.
“New initiatives and proposals should be postponed, we need to finalise things that we have already started. This applies to all government agencies, local government bodies, national holdings, national companies and state-owned enterprises. I instruct the Government to cut down government spending in 2015 by 700 billion tenge or 10% of total expenditures. However, this does not refer to social commitments of the state. Tight fiscal policy should be also implemented by the mayors of Astana and Almaty, as well as other cities and regions”, Nursultan Nazarbayev noted.
The President mentioned that the national holdings have already developed appropriate measures.
“Current expenditures of “Samruk-Kazyna” will be reduced by 337 billion tenge or nearly 7%, including reduction of administrative costs by 64 billion tenge. Capital costs of “Samruk-Kazyna” will be cut down by 240 billion tenge or 18%. National holding “Baiterek” should optimize its administrative and capital expenditures by 3.8 billion tenge or 11.8%. In the holding “KazAgro” expenditure reduction is expected to be around 196 million tenge or 12%. In general, according to the government report, public savings will reach 4 billion tenge,” the President said.
Nursultan Nazarbayev stressed that each region should develop its own employment programme and highlighted the need to continue implementing “Employment Roadmap 2020” that has proved its effectiveness. In 2011-2014, 260,000 people were employed and 120,000 employees were trained through the programme.
The Head of State underscored the importance of preliminary work in solving labour disputes. In this regard, the mayors were instructed to conclude a memorandum of cooperation with large enterprises and solve the problem of employment of redundant workers.
The President stressed the need to continue modernization of education and health.
“This is a long-term investment in human capital that will create the foundation for future economic growth. In education, we need to continue the implementation of the “Balapan” programme, transition to per capita funding in secondary education and gradual transition to a 12-year education model”, he said.
Nursultan Nazarbayev stressed that in 2015 the country will continue the implementation of projects within Industrialization Map that envisions 75 projects worth over 600 billion tenge with the creation of more than 7.5 thousand jobs.
The President noted that the Government adopted an Action Plan to support industrial enterprises in 2015.
“We use the crisis to create modern infrastructure and make multi-billion dollar infusions. The state provides all necessary supportive tools, allocates funds and creates all the necessary conditions,” Nursultan Nazarbayev said.
The President reminded that the “Nurly Zhol” programme opens up great opportunities for engaging domestic producers of building materials.
“It is necessary to start holding local content forums to be followed by the conclusion of a memorandum. We should launch a new “Made in Kazakhstan” campaign so that each retail chain would have a section of domestic goods. Mayors of all regions should assume control over this issue. Let’s ask each person to be a patriot of his country during these difficult times and buy products, which are made in Kazakhstan,” he said.
The President noted that today the weakening of the Russian ruble and the growing pressure of Russian goods harm domestic producers.
“However, this has nothing to do with the Eurasian Economic Union. We are a part of world market economy, for which such fluctuation is a common thing. This is a temporary situation and the solution will be found. Reduction in demand in Russia is an incentive for export diversification of Kazakhstan’s goods. In addition, falling prices for energy, spare parts and accessories may have a beneficial effect on other sectors. We must use this opportunity to improve the manufacturing industry,” Nursultan Nazarbayev said.
The President stressed that given the new realities of the global economy a key focus is the development of agro-processing and food industries.
In this context, the Government was instructed to continue work on the financial recovery of agribusiness entities, which started in 2013-2014 and today covers 292 enterprises with the total amount of debt reaching 313 billion tenge. Due to growing interest to the programme, its funds are expected to increase up to 500 billion tenge.
Nursultan Nazarbayev highlighted that unprecedented conditions have been created for the development of business, including complete abolition of routine inspections and reduction of various permits.
“This year business sector will be provided with the required financial resources. At the same time, the drop in oil prices has led to a reduction in the cost of oil, which will have a positive impact on many sectors of economy and purchasing power of population. Cost of transport and agricultural products, as well as prices for regulated types of fuel should reduce,” he said.
The President noted a priority task for the National Bank should be the provision of financial stability in the context of low oil prices and a slowdown in economic growth.
“This implies avoidance of high inflation, sharp currency fluctuations, as well as providing financial resources for the real sector of economy. I instruct the National Bank to take measures to improve liquidity of tenge and intensify work on de-dollarization of the economy. We need to get rid of the legacy of bad loans, restore credit operation of banks and solve the issue of debt restructuring of mortgage loans,” he said.
Nursultan Nazarbayev stressed that money allocated from the National Fund should be spent for the benefit of the economy.
“A special commission will closely supervise spending transparency and report to me personally. A heavy responsibility rests upon all mayors. The “Nur Otan” party should be actively involved in this work. There should be no waste of money. The Government needs to consider reducing costs for public events,” he said.
The Head of State noted that government officials and employees of national companies should be an example of modesty and thriftiness.
“It is necessary to consider the possibility of reducing costs at all levels of government, from the Administration of the President to the local government offices, ministries and national companies. The task of each member of the Government and each mayor is to roll up his sleeves and get things done. The moment of truth has come. You should use funds to create jobs,” he said.
The President expressed confidence that Kazakhstan will successfully overcome all difficulties.
“After that we’ll restart the projects, which we have to postpone now. Therefore, I ask everyone to correctly understand the essence of government decisions to adjust the budget. This is a temporary measure. The Presidential Administration and the Government should regularly inform the public on issues that concern people,” Nursultan Nazarbayev said.
Closing the session, the President noted that Kazakhstan has all necessary resources to successfully overcome the current difficulties.
