Measures to implement the instructions of the Head of State, given at the meeting on social and economic development of the country on April 19, were considered in the Government under the chairmanship of Prime Minister Alikhan Smailov. 

The Minister of National Economy Alibek Kuantyrov reported that in order to ensure GDP growth at 6%, additional sources of growth in the sectors of the economy will be worked out. The main emphasis will be placed on intensifying the development of the mining sector, including the implementation of major oil and gas projects, manufacturing, agribusiness, SMEs and the service sector.

To improve the balance of macroeconomic policy, measures will be taken to reduce the budget deficit, stabilize the national debt and reduce transfers from the National Fund. The balance of the budget will be ensured by increasing non-oil revenues, including through the abolition of inefficient tax benefits.

In order to reduce inflation, together with the National Bank will continue implementation of the relevant updated Comprehensive Plan. The main accent will be made on stabilization of prices for food products due to saturation of domestic market with domestic products.

Under the new Tax Code the issues of reorientation of tax benefits to attract investments in the production of goods with high added value and stimulate technological exports, as well as reducing the tax burden on marginally profitable new projects for the extraction of solid minerals in exchange for job creation, construction of processing facilities and performance of social obligations are being worked out.

In order to reduce the wear and tear of networks in the electricity, heat, water and wastewater supply, the work on the transition to the principle of "Tariff in exchange for investment" has begun. Today all the legal grounds for changing the tariffs have been formed. Their growth will be adjusted gradually, taking into account the social and economic situation in the regions. At the same time, in order to ensure a fair cost of utilities for all consumers, mechanisms for introducing social norms of consumption will be worked out.

Work on the administrative reform will also continue. Thus, in 2023-2024 it is planned to conduct direct elections to akims of districts and cities of regional importance in the pilot mode, and everywhere in 2025.

First Deputy Minister of Trade and Integration Arman Shakkaliyev spoke on stabilization of prices. He noted that the main emphasis in this work is made on the analysis of pricing chains from production to sale to identify and exclude unproductive intermediaries. So, for today 1,389 chains were analyzed, risks of trade violations were revealed in 332 of them. When concrete facts are established, state control measures are taken. In particular, since the beginning of the year 132 unproductive intermediaries have been excluded.

At the same time the work on automation of price monitoring process on food products using data of electronic invoices and operators of fiscal data is carried out. As a result, the price formation process for each food product will become transparent, which will make it possible to identify unproductive intermediaries and resellers remotely.

In his report, Energy Minister Almassadam Satkaliyev noted that in execution of the instructions of the Head of State a comprehensive modernization of the Ekibastuz energy hub, which will introduce about 3 GW of new generation. In December the power unit 1 at Ekibastuz GRES-1 with capacity of 500 MW will be reconstructed. The work is underway to expand GRES-2 by commissioning power units 3 and 4 with a total capacity of more than 1,200 MW. Pre-project works on the construction of Units 5 and 6 with a total capacity of 1,200 MW will begin.

Within the framework of Ekibastuz TPP modernization this year it is planned to complete the reconstruction of heat networks with the length of 5.3 km, carry out repair works on 5 hot-water boilers and complete the modernization of 3 power boilers of the TPP as well as auxiliary equipment, buildings and structures.

In general, 17.3 GW of new capacities will be commissioned by 2035 to cover the growing demand of the economy for electricity.

The Minister also noted an increase in total stocks of diesel fuel to 370 thousand tons, which is enough to cover 21 daily needs of the country. On the whole, the adopted vector on market economy will allow to provide technical re-equipment and reliability of oil refineries, as well as to increase investment attractiveness of the industry.

Deputy Minister of Industry and Infrastructural Development Azamat Beispekov reported that by 2029 the country plans to put into operation more than 800 investment projects worth over 33 trillion tg with the creation of about 147,000 jobs. Of these, 122 projects worth 3.1 trillion tg with the creation of about 22.1 thousand jobs are aimed at deepening the localization and production of goods with high added value. These are projects in mechanical engineering, construction industry, light industry and metallurgy.

According to him, the average wear and tear of public utilities in the country today is 51%. In this direction, the local executive bodies will develop regional plans for construction and reconstruction of public utilities infrastructure, taking into account the needs. Through different sources of funding, it is planned by 2029 to reduce the wear and tear of utility networks to 40%.

He also noted that today 4,900 villages have access to water services. By the end of 2025, issues on the remaining 1,395 villages will be resolved. This will bring the country indicator of water supply to 100%.

Deputy Minister said that the development of complex design-projects has begun in the cities of national importance. Through these projects the unified architectural style of buildings' appearance, requirements for landscaping and landscaping will be ensured in line with international experience.

According to the Minister of Agriculture Yerbol Karashukeyev, the issue of involving "Prodkorporatsiya" as a trusted agent in the process of implementing the "turnover scheme", which will increase the effectiveness of mechanisms to stabilize prices for socially important food products is currently being worked out.

In addition, in order to stabilize the situation on the domestic food market a new norm is introduced into the mechanism of subsidizing, according to which from January 1, 2024 in a pilot regime the recipients of subsidies, engaged in the production of socially important food products or raw materials for their production, will have to take on cross liabilities for the sale of products on the domestic market at market prices.

In order to create storage infrastructure and reduce the deficit of vegetable storage facilities implementation of the Comprehensive Plan on construction and modernization of vegetable storage facilities till 2025 will be continued. The given plan assumes realization of 97 projects with total amount of storage of 342,6 thousand tons of fruit and vegetable production. To stimulate businesses in this direction amendments are made to the rules of investment subsidies to bring the rate of compensation from 25% to 40-50% in the construction of such facilities, depending on the storage technology used.

The reports on implementation of instructions of the Head of State in the supervised industries were also made by Ministers of Ecology and Natural Resources Zulfiya Suleimenova, Labor and Social Protection of Population Tamara Duisenova, Healthcare Azhar Giniyat, Education Gani Beisembayev and Deputy Minister of Foreign Affairs Almas Aidarov.

Prime Minister underlined that all actions of the employees of the state agencies and akimats on executing instructions of the head of state should bring concrete results. Modernization of tax, budget and tariff policies must first and foremost consider the interests of citizens and business. All implemented tools and mechanisms must be flexible and conducive.

"Many complaints of the population must be solved by preventive actions, proactively. This is especially true for healthcare, education, and labor relations. This will be actively promoted by a unified Center for the reception of citizens. All first heads of state bodies should effectively use this resource to solve problems raised by citizens," Alikhan Smailov said.

He reminded that one of the main tasks of the Government is to reduce the inflation rate by 2 times by the end of this year. In this regard, it has been instructed to update the package of measures to control and reduce inflation with its consideration at the next meeting of the Cabinet.

Prime Minister pointed out that in order to stabilize food prices, regional akimats together with the Ministry of Trade and Commerce need to ensure the quality implementation of systematic measures to establish the trade and supply chain from producer to consumer.

"It is necessary to expand the effective trade and logistics infrastructure, to complete the construction of vegetable storage facilities, to exclude all unproductive intermediary schemes. The regional commissions should ensure timely response to unreasonable price increases," he said.

Alikhan Smailov added that "Food Corporation" and Stabilization Funds should play an important role in the stabilization of food prices, and the Ministry of Agriculture should coordinate their work strictly. At the same time it is necessary to ensure careful control over budget funds allocated for the development of agriculture, to build productive work on the development of processing enterprises in the regions and improve the efficiency of state support measures in the manufacturing industry.

As Head of the Government noted, it is necessary to keep a special control over policies to attract investment. In this regard, the Ministry of Foreign Affairs has been instructed to introduce an interactive investment map with a database of investors and investment projects, as well as to update the Foreign Policy Concept.

Prime Minister also identified the need under the new Tax Code to revise the taxation of projects for the extraction of solid minerals, to encourage the growth of production, investment, innovation, as well as to increase employment.

Another important area is to provide small and medium-sized businesses with affordable credit. In this regard, the decision-making process on granting loans to entrepreneurs, who conduct transparent activities, should be simplified.

In addition, the Head of Government drew attention to the need to take measures to introduce the principle of economical water consumption in the country, to reformat the operation of Kazvodkhoz and to perform effective reconstruction of water and irrigation systems. The Ministry of Ecology was instructed to approach the issues of stray dogs taking into account the international experience and develop relevant amendments to the legislation.

In conclusion, the Prime Minister stressed the importance of taking effective measures to close the gap between in-school and external evaluation of students, taking into account the standards of the Organisation for Economic Cooperation and Development, development of legislation to strengthen measures to protect children from violence, increase transparency and efficiency in financing medical services, accelerate the launch of E-Densaulyk system with the integration of all health systems, and complete updating of data coming to the Digital Family Map.

"The Head of State has defined the main objectives and tasks in the socio-economic sphere for the Government and akimats. To achieve them effectively, we have to implement a number of reforms. The result should be a significant improvement in the quality of life of citizens by increasing incomes, creating comfortable living conditions, ensuring security and expanding opportunities for all-round development. To implement all transformations, it is necessary to actively develop a strong market economy, including at the expense of new additional sources of growth. In the current conditions we have to show real results, the society is waiting from us concrete and effective measures," Alikhan Smailov concluded.

#Alikhan Smailov #The Prime Minister of the Republic of Kazakhstan #Economy