Member of the Board, Deputy Chairman of the Board Yuliya Yakupbaeva made a presentation at the meeting of the Economic Policy Council of Nur Otan Party, where the issues of improving the mechanisms of public-private partnership were discussed.

First deputy minister of national economy Ruslan Dalenov, chairman of the board of LLP "Kazakhstan Project Preparation Fund" Adil Utembayev, deputy Berik Ospanov spoke before the deputies-members of the Council. The Chairman of the Economic Policy Council of "Nur Otan" Party Beibut Mamrayev was a moderator. In the course of her speech, Yuliya Yakupbaeva noted that this year there was a breakthrough in the negotiations on resolving the 3 main business issues in the direction of PPP. The entrepreneurs consider such issues as the lack of a long-term order, complicated procedures for preparing and approving PPP projects, as well as unclosed investor risks. As a result of the execution of the instructions of the Prime Minister of the RK, given at the meeting of the Government in May of this year, there were introduced amendments, providing for a long-term state order over 3 years in the framework of PPP projects and the corresponding registration of contracts in the treasury bodies.

"Now the entrepreneur will be confident in the future, his financial model will be more stable. The expensive concept of the project is replaced by a business plan, which will simplify the development of PPP projects for entrepreneurs. To make it clear, the price of the issue of developing a concept for entrepreneurs can be from 1 to 50 million tenge. Also, in order to simplify procedures, a software PPP mechanism has been developed. A typical approach to small projects will create business conditions for small companies that would like to carry out activities in the field of PPP", - the deputy chairman said.

Along with this, the speaker pointed to a number of unresolved problems, in particular, unclosed investor risks. She focused on the issues of tariff formation within the framework of PPP projects.

"The structure of tariffs does not include a number of real costs that are borne by the private partner. For example, depreciation costs, interest on a bank loan, the cost of purchasing expensive equipment, the cost of capital repairs, the rate of profit, and others", - she explained.

The essence of the problem is that public and private enterprises are in unequal conditions. The cost of borrowed funds for the state enterprise is 0.1%, for private traders – market one. Rental of buildings, overhaul, advanced training for employees for the state enterprise will be at the expense of state financing, for private traders at their own expense.

 State enterprises are guaranteed to receive state orders and per capita financing, and the private owner must annually renew the state order.

"We are working together with MNE, MH, MES in this direction to improve the structure of tariffs and per capita financing. But, unfortunately, not all business proposals have been taken into consideration", - the Board member said.

The risks of currency fluctuations and the issue of pledges within the framework of PPP projects are also of concern: "It is important to observe a balance of interests in the issue of distribution of currency risks. Of course, the state can’t completely take over. Therefore, we propose to fix the compensation normatively at the level of 15%. On the issue of pledges for PPP projects, work is being done with the National Bank and second-tier banks. Banks are ready to finance PPP projects more actively if future payments under PPP agreements are recognized as solid pledges, and this will be regulated by the National Bank of Kazakhstan and PPP legislation.

The problem is that the available mechanisms of state reimbursement are related to the reimbursement of costs to the private partner, but there are no mechanisms for the private partner to return funds to the bank.

"Now, after the adoption of amendments to the Budget Code on guaranteed order, it has become possible once again to return to this issue and revise the rules of prudential regulation, taking into account possible risks for depositors of second-tier banks. Also in the world practice, the mechanism of replacement of a private partner is actively used. Today, the National Bank is ready for dialogue", - Yuliya Yakupbaeva announced.

In conclusion, the speaker put forward a proposal on the formation of actual statistics of PPP projects, which will allow to structure projects by sectors, form of implementation. For the purpose of comprehensive assessment of the implementation of projects in the republic, it was proposed to set up a Council for monitoring PPP projects at Atameken site, with the participation of deputies, the business community, experts, authorized state agencies with field visits to the regions. Within the framework of the Council, it will be possible to monitor facilities, centralize the accumulation of the most successful experience in the implementation of PPP projects for further replication. The voiced proposals were generally supported.