Minister of Industry opposes closure of economic zones in Kazakhstan

The Ministry of Industry and New Technologies of Kazakhstan is trying to dissuade the Government from closing the Special Economic Zones (SEZs), Tengrinews reports citing the Vice Minister of Industry and New Technologies Albert Rau as saying at today's government meeting. In October President Nazarbayev scolded the Kazakhstan Government for inefficiency of some of the economic zones. He tasked Prime Minister Serik Akhmetov with making an analysis and and subsequently closing down the ineffective ones. The Vice Minister admitted that Kazakhstan SEZs had problems and said that lack of adequate infrastructure was the key one among them. All 10 SEZs in Kazakhstan required around 1 million dollars, but he added that it was possible to reduce the government expenses 2-3 times by attracting funding through the Public-Private Partnership (PPP), optimizing the size of the SEZs and other methods. “Closure of the SEZs should be out of the question, through, and that is what we are suggesting to the President,” Rau told Tengrinews at the sidelines of the meeting. The Minister explained that closure of any of the economic zones would harmfully affect the image of the country and discourage investors. “Also, we were fighting to keep the SEZs up and running during accession into the Custom Union and negotiation of our accession into the WTO. And we cannot afford to lose such an instrument. (…) We were fighting for them no to just close them down later,” added Rau. The Ministry of Industry and New Technologies of Kazakhstan hired JURONG International, a Singapore company, to analyze the economic zones. JURONG competed the analysis and released its statements. Commenting the conclusions, Minister Rau said that the company made a set of recommendations for each of the SEZs and would start managing several of them, but did not specify which ones exactly. He added that JURONG made several suggestions on improvement of the Kazakhstan legislations governing the SEZs. JURONG had been managing Taraz and Atyrau Oil Chemical Park special economic zones even before they got the new contract. “We are suggesting to create a management company, most probably the one based on Kaznex, so as not to breed new ones. (…) JURONG is ready to enter this management company to share their management standards and experience,” said Rau. Kazakhstan created the SEZs to stimulate production of competitive goods, attract investments and foreign companies ready to share their experience and technologies and ensure growth of the economy through industrialization of the country. By Altynai Zhumzhumina