Late November a decision might be taken to use assets of the National Oil Fund to finance small and middle-sized businesses, which will enable the latter to rely on long cheap money, KazTag Agency reports, citing Ablai Myrzakhmetov, Chairman of the Atameken major business lobbying group.

“The assets of the National Oil Fund are managed by the National Bank, with the investment yield standing at 1.7%. Second-tier banks are ready to borrow the funds at the APR of 2.5% to finance small and middle-sized businesses. Head of State has supported the suggestion (…) The Government along with the National Bank are to come up with some specific schemes. We expect a solution found by early December”, Ablai Myrzakhmetov said when meeting business community reps of East Kazakhstan August 15.

“We have heard the National Bank Governor Gregory Marchenko saying that banks currently have $13 billion in deposits; however banks are not actively lending (…) The $13 billion is short money; it’s expensive credit resources and S&MBs cannot procure a loan lower than at the APR of 14%”, he said.

With the assets of the National Oil Fund used to finance S&MBs, the APR could stand at 6-7%.
As of May 1, 2012, the National Fund’s assets made up $51.4.

The National Fund of Kazakhstan was created in 2000 as a stabilization fund that accumulates windfall revenues from oil sales and ensures the economy of Kazakhstan will be stable against the price swings of oil. The assets of the National Fund assets are monitored by the National Bank of the Republic of Kazakhstan.

In his latest State of the Nation Address [January 27], President Nazarbayev suggested the National Oil Fund money be used in the form of loans to the national economy rather than kept with foreign banks.