Today in Ukimet Uyi, Prime Minister of Kazakhstan Bakytzhan Sagintayev chaired a regular meeting of the Economic Policy Council.

The meeting addressed issues of the effectiveness of subsidies and concessional lending to the entities of the agro-industrial complex of the country.

In the Address to the People of Kazakhstan “Growing Welfare of Kazakh Citizens: Increase in Income and Quality of Life”, the Head of State instructed the Government of Kazakhstan to additionallty allocate in the next three years at least 100 billion tenge annually to support the agro-industrial complex.

The keynote address at the meeting was made by the Deputy Prime Minister - Minister of Agriculture U. Shukeyev. According to him, first of all, these funds are proposed to be sent to stimulate the introduction of modern technologies in the industry and the update of agricultural equipment, as well as accelerated pedigree transformation in animal husbandry. It is possible to accomplish the assigned tasks by increasing the availability of financing for agribusiness entities, including by increasing the volume of investment subsidies, cheapening and expanding the availability of bank loans, both for negotiable and for investment purposes.

Minister of National Economy T. Suleimenov, Finance - A. Smailov, Investment and Development - Zh. Kassymbek and others took part in the discussion of the issue.

The annual volume of subsidies (2015 - 180.8 billion tenge, 2016 - 220.7 billion tenge, 2017 - 260.5 billion tenge, 2018 - 227.6 billion tenge), on average is no more than 4-5% of the gross agricultural output, which is below the acceptable level of 8.5%, in the framework of WTO. In order to increase the availability of financing for the AIC, work is underway to improve existing and introduce new financial instruments. In the current year, subsidies for interest rates on loans for fixed assets, as well as leasing of agricultural equipment, were resumed.

To accomplish the objectives, a package of amendments to the legislation has been formed, which are currently under consideration in the Mazhilis of the Parliament.

Also, in accordance with the instructions of the Head of State, to improve the effectiveness of state support, ineffective subsidies are being cut down and will soon be completely eliminated. The rest will be maximally simplified and fully automated by the end of the year. This will reduce the time for consideration of applications by an average of 2.5 times (from 18 to 7 days) and reduce corruption risks. As a result of the reform, out of 54 types of subsidies, 34 subsidies will remain.

www.primeminister.kz               

Published: 23 October 2018

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