There was found an alternative to a bank guarantee in road construction
Kazakhstan has developed a policy on the organization of insurance and reinsurance for protection of risks of construction projects
In February 2015 companies engaged in road construction addressed to NCE RK "Atameken" with a proposal for the introduction of insurance mechanisms in contracts with JSC "NC" Kazavtozhol".
For example, if standard contracts of "NWF" Samruk-Kazyna" stipulate alternative opportunities to secure the fulfillment of obligations by a contractor under the contract (banking guarantee, insurance certificates), but the requirements of contracts with state institutions (operating under the law on public procurement), and JSC “NC” Kazavtozhol” are limited to bank guarantees.
NCE RK created a discussion forum on the issue and a number of meetings to discuss the possibility of applying insurance contracts as security for liabilities under contracts of procurement of works on construction and reconstruction of roads with the participation of JSC "NC" Kazavtozhol ", Insurers Association of Kazakhstan, Association of Financiers of Kazakhstan, banks and large insurance and construction companies.
As a result of studying the problem, the analysis of international practice, taking into account the interests of all sides. In July 2015 JSC "NC" Kazavtozhol" expressed the intention to develop and further approve the draft policies on the organization of the insurance and reinsurance protection of risks of construction projects financed by JSC" NC "KazAvtoZhol" for the means of the national budget and the National Fund of the Republic of Kazakhstan.
One of the main objectives of the policy is to create an additional mechanism for the protection of the national budget and minimizing the costs of suppliers in providing security for its obligations under the contract.
The banking sector conceptually agreed with the draft program, the insurers, in turn, noted the need to finalize the specific arrangements.
Under the chairmanship of Deputy Chairman Yulia Yakupbaeva at the last meeting on 4th of November 2015, participants reached the finish line and agreed on the need to start the project from the beginning of 2016 in order to determine its future performance.
Deputy Chairman of the Board of JSC "SK" Victoria "S.A. Lavrentyev focused on the need of a surveyor to participate in the process of building under government programs as a surveyor of the insurer or reinsurer, to carry out inspections and control of the construction and installation works of the insured object.
"The establishment of a monitoring mechanism provides full control of expenditure under the program "Nurly Zhol - The path to the future! "- Said the Member of the Board - Deputy Chairman Yuliya Yakupbaeva.
Managing Director of Legal Affairs of JSC "NC" KazAvtoZhol" S. Aytimbetov said that there will be launched internal procedures for the approval of the Policy. Originally it was scheduled to launch action policies in pilot mode and identify in the course of its operation the negative and positive sides.
This policy will contribute to the gradual harmonization of the domestic road construction to FIDIC standards.
In general, representatives of the insurance and the construction market support the initiative of the national operator and are willing to actively participate in the pilot project of the program.
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