Legalization of capital in Kazakhstan - Cui bono?28 may 2014, 19:03
The upcoming legalization of capital in Kazakhstan will benefit primarily the state officials - this is the opinion of the head of the Association of Entrepreneurs of Almaty Viktor Yambayev, Tengrinews reports citing Tengri FM Radio. He believes that the legalization of capital will help to legalize the money that was once laundered from Kazakhstan national companies or from companies with state participation.
Yambayev believes that the amount of offshored money is so large that it is impossible to “launder” it via small shops or surrogate businesses. "We have to understand that this legalization is not about entrepreneurs’ money, and certainly not that of medium-sized businesses that are the real sector of the economy. This money is that of civil servants…,” Yambayev asserted.
He also gave an opinion of the reasons behind the legalization. The upcoming amnesty of capital is a rehearsal before the bigger event - introduction of the universal declaration regime (all the citizens will have to submit incomes reports). "You have to understand that the government is doing this for economic reasons. Amid toughening of the global competition and acute shortage of funds in Kazakhstan there is a need to create an economic ‘airbag’. However, in this situation the government must be very careful and, above all, understand whose money in this case should be legalized," Yambayev said.
In this regard Yambaev suggested introducing declarations for civil servants that would include both income and expenses information. He also called to make the reporting a mandatory requirement for all the government officials including those working in state-run companies. ”These are monopolist companies, the entire state-run sector, various funds with state participation. And all the businesses where the state has a share, including JSC’s," he added.
Yambaev emphasized that the government was responsible for both the technical work to develop the appropriate law and the practical part of its implementation. “It is counterproductive to legalize the money hastily. The hot money would gush into the economy and repeat the situation with the construction bubble," he said referring to the real estate boom right before the global economic crisis.
The legalization will begin on September 1. It will be possible to legalize cash, real estate, securities and stock capital. Kazakhstanis also will be allowed to legalize their property that is located outside of the country.
According to the Minister of Finance of Kazakhstan Bakhyt Sultanov, around $10 to $12 billion dollars will be brought back into the economy. He said that this would outshine the success of the legalization campaign held by Kazakhstan in 2006-2007. Notably, the government of Kazakhstan declared that property obtained by criminal means will not be eligible for legalization.
By Dinara Urazova