On July 24, 2019, the second discussion of the draft State Programme for Industrial and Innovative Development of the Republic of Kazakhstan for 2020-2025 (SPIID 3.0) was held on the site of the Atameken NCE RK. The meeting was attended by representatives of the National Chamber of Entrepreneurs, project developers - QazIndustry JSC, government agencies, national holdings, and the business community.

The project was presented by the deputy chairmen of the Management Board of QazIndustry JSC Turar Zholmagambetov and Murat Bekmambetov.

This is the third state programme to support non-raw industries. The main focus is on export-oriented enterprises, which are divided into 4 groups: New Industrial Players, Strong Rear, Growth Drivers and Centers of Gravity. At the same time, support measures will be fixed for each group.

One of the measures is the Agreement to improve competitiveness, which provides for the provision of a combined package of support measures and mutual commitments.

During the presentation, the participants also voiced some problematic issues, as well as comments on the draft.

"Kazakhstan's industrial development programme cannot be based on the methodology of the Russian, Chinese or other countries. It seems to me that the first thing we should do is to adopt our Methodology for Classification of Commodities of Raw Materials and Non-Raw Materials Distribution. Second, we should identify export flagships that will bring the greatest added value to the economy. At the same time, I agree with you that each group of goods may have a different picture of support measures, but in this case, priorities are also important i.e. the most popular support measures. Then we will understand the volume of necessary funds," the Advisor to the Chairman of the Presidium of the Atameken NCE RK Yuliya Yakupbaeva said.

The Chairman of the Board of the Chamber of International Commerce of Kazakhstan Ayan Yerenov supported his colleague.

"First of all, they need to consolidate to be of some serious interest to foreign procurement organizations. Second, if you want to make real points of growth, let's consider end-to-end support measures. Big (business - author's note) of course will support you, and the representatives of the average and even slightly less than the average business will say: why the priority, in this case, is done to large enterprises, we are again left behind," Ayan Yerenov said.

The PharmMedIndustry Association believes that businesses should be focused on the production of products that are attractive in foreign markets as well.

"We have to produce what will be sold in the foreign market, this is the main purpose of the SPIID. Not necessarily in 5 years' time, the growth drivers are already today, and some internal support measures should help the producer to become more competitive and export... In my opinion, the export ideology itself is correct from the point of view of the industry. We have to shape the ideology of a competitive entrepreneur," Ruslan Sultanov said.

The entrepreneurs who took part in the presentation were more critical in their assessments.

"First of all, 80% of the discussion time comes down to the export potential. 80% of Kazakhstan's exports are made by 20 companies. Another 20% of exports are made by the companies that you have included in the group "Growth drivers", and maybe a maximum of 10% - all the remaining 12,000 companies. Your programme does not include an action plan for each group. To what extent the funds allocated for the implementation of this program will be effective. Because, as you said yourself, these 20 companies depend on world prices in the world markets, and 300 companies can be involved in some targeted work. The remaining companies should understand their export potential and when it will be realized," Director of ZBI LLP Vladimir Lee said.

"Business needs financial support - soft loans, subsidized loans, guarantees, etc. These obligations will fall on development institutions, including subsidiaries of the Baiterek Holding. If, for example, the MIID (Ministry of Industry and Infrastructure Development of the Republic of Kazakhstan - Author's note) holds a tender and the results of the initial analysis will determine the most promising projects with which the MIID will conclude an agreement, how will Baiterek, DBK or Damu participate in it as the financial operators? Baiterek's subsidiaries are selected and examined in several stages. At the initial stage, when we see a presentation or pre-business plan, we can say that the idea is excellent, but we cannot guarantee that we will finance this project. It happens that the project is rejected at the last stage of bank expertise. If we sign this agreement after your initial analysis, we cannot guarantee that the company will receive financing. Accordingly, there will be a precedent, where the company will say that the state represented by the Ministry of Foreign Economic Relations signed the agreement, give us a loan, and we will refuse it," the representative of NMH Baiterek JSC said.

The experts discussed agricultural issues.

"As far as I know, we have a special investment contract, within the framework of the agricultural machinery development programme, there is an agreement on industrial assembly. Will they be duplicated or replaced?" the representative of the Ministry of Agriculture of the Republic of Kazakhstan Yerzhan Tuleutaev said.

The developers of the SPIID 3.0 project noted that they are considering the possibility of unifying investment contracts, special investment contracts with the new Agreement. The issue is still under discussion.

In conclusion, the Deputy Chairman of the Board of the Atameken Eduard Kvyatkovskiy noted that the meeting was constructive and in order to detail specific measures and mechanisms it is necessary to hold a series of meetings to consider the program on blocks.