Agriculture Minister proposes changing subsidies to agriculture

17 августа 2011, 17:43
Kazakhstan’s Agriculture Minister Assylzhan Mamytbekov has suggested reforming the nation’s system of subsidies to the agriculture sector.

“The system of subsidies needs changing”, he wrote in his Twitter account. According to Mamytbekov, “the focus should shift from the so-called highly-scattered subsidies (2-3% of the costs per hectare) to solving three vital issues …First of all, we should make loans [to finance floating assets] more affordable; secondly, state programs to finance leasing of agricultural machinery should be made cheaper for agribusiness; thirdly, we need to stabilize the produce markets through intervention purchases".

Earlier in August had reported, citing KazAgro National Company Vice Chairman of the Board Kairat Aituganov, that starting from 2012 Kazakhstan would stop subsidizing crops growing.

“We believe subsidies to wheat growing are not effective. The state has decided to stop subsidies to crops growing”, he said on his working visit to Kostanai oblast.

At the same time the Agriculture Ministry is considering a program of “cheap loans” secured against land. “$123.2 million is to be earmarked out of the state budget to finance the project”, according to Mr. Aituganov.

A day before Mr. Aituganov's comments President Nazarbayev had publicly announced that “from year to year it has been more complicated to sell grain. (…) If a ton of meat is fivefold more expensive than a ton of grain (…) it is a viable initiative (…) Lands under grain should be transformed to accommodate forage crops”.

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