Fulfilment of President instructions: 20% reduction in wear and tear on networks by 2029

The measures on implementation of pre-election program of President Tokayev and instructions, given at the enlarged Government session on Dec. 12, 2022, were considered at the Government session of the Republic of Kazakhstan. Timur Zhaksylykov, First Vice Minister of the Ministry of National Economy of the Republic of Kazakhstan, made a report on the main directions of social and economic development of the country.

At the expanded meeting of the Government, the Head of State set specific tasks. In the implementation of these tasks 8 instructions fall within the competence of the Ministry of National Economy.

Thus, in order to reform the tariff policy the initiative "Tariff in exchange for investment" is being elaborated. It is aimed at upgrading the communal infrastructure by encouraging new investments in the industry. 

"It is planned to reduce the network wear and tear indicator by 20% by 2029. The transition to new approaches to tariff policy will be ensured through the implementation of the relevant roadmap. Amendments to the legislation on natural monopolies are currently being prepared to increase investments for the renewal of utility networks," the First Vice Minister said.  

This year's high inflation rate has a negative impact on household incomes. In addition, the minimum wage will increase to 70,000 tenge on Jan. 1, 2023. Given these changes, government agencies are currently working on new approaches to update the programme.

"Amendments to the Entrepreneurial Code have been prepared to facilitate the process of concluding investment agreements. The corresponding draft law is under consideration by the Senate of the Parliament. In particular, by moving from the priority to the list of prohibited activities, the scope of investment agreements will be expanded. In order to reduce investors' costs and accelerate the adoption of investment decisions, work is under way to provide ready-made production sites of the ready-built factory type," Zhaksylykov explained. 

At the same time, we're working on approaches to launch the National Children's Fund initiative from 2024. All children under 18 years of age will receive personal savings accounts to which funds will be deposited annually. The accounts will be operated by the JSC UAPF. The accumulated funds will only be available for use after reaching the age of majority. Next year, the necessary legislative changes will be made to implement the initiative.

Work on the Rural Development Concept for 2023-2027 is currently in progress. It is expected to be adopted by the end of March 2023.

According to the First Deputy Minister, the main purpose of the Concept is to improve the quality of life of the rural population and create a favourable environment for them. For this purpose, the efficiency of the regional policy will be improved through the development of institutional support. Currently, the working version of the Concept is under discussion with the local authorities.

The issue of extending credit terms in key sectors of the economy under the "Economy of Simple Things" programme has been elaborated. It is proposed to provide loans for 7 years in 15 priority activities in the agro-industrial complex and manufacturing industry.

"As part of the amendments to the terms and conditions of state support measures, there is a transition to the establishment of a subsidized interest rate. At the same time, differentiation of interest rates for final borrowers is envisaged," Zhaksylykov said.

In order to realize the presidential assignment on provision of functionality of akimats and enhancement of coordination on the most important issues for the population it is suggested to increase number of deputy akimats by 1 unit compared to the current one. In this case the initiative will be implemented within the limits set for financing the activities of local executive bodies.

Budgeting approaches with an emphasis on increasing the autonomy of central and local bodies are being reconsidered. Additional revenue sources will be devolved to local levels, while spending responsibilities will be transferred from the centre. This will ensure the self-sufficiency and autonomy of the regions.

"Reforms in this direction are ongoing. A new Budget Code is being developed. As part of this work, some elements of the Block Budget are being worked out. The document will be aimed at a radical simplification of the budget process and further decentralization of the public administration system. The document is planned to be submitted to the Parliament next September," the First Deputy Minister assured.

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