In 1997, president
Nazarbayev changed the Capital from Almaty
to Astana. What were the reasons behind this
change?
In the past, the Capital of our country
was determined in the light of the former
Soviet Union and the territory that existed
at that time. When Kazakhstan became independent,
the geographical location of the capital
was no longer appropriate for the administrative
functions of the Capital. Almaty is located
on the border of our Republic. Astana is
located in the center of the country and
on equal distances from all other regions.
Due to specific geographical location of
Almaty, which is surrounded by the mountains,
the city was restricted in its development.
Another reason for this change was an economic
one, which was accompanied with the revival
of the production of construction goods
as well as creation of new jobs. Many people
that lived in almost dieing towns moved
to Astana.
As an illustration, Kazakhstan had three
cement plants, which did not operate before
the movement of the capital. They did not
have market for their products. That is
why, when we began construction of the capital,
we had to import cement from Russia and
Kyrgyzstan. Right now these three plants
are working and located in other regions.
Due to this, people in those regions got
jobs. There are also other examples when
people found jobs due to construction of
the new capital. In other words, it is similar
to the United States in 1930s, when it began
the construction of new roads and electric
power stations in order to create jobs.
Therefore, one of the reasons of change
was economic one, which has had positive
impact on the economy of Kazakhstan.
In 2000 a new program was initiated
"Rise of Astana - Rise of Kazakhstan",
in which the Special Economic Zone (SEZ)
has an important part. Could you please
indicate the specifics of the SEZ, and benefits
that investors can expect from it?
Indeed, in 2000, according to the law issued
by the President, a new program called "Rise
of Astana - Rise of Kazakhstan" was
initiated. As a further development of this
program a new decision about the creation
of Special Economic Zone on the left bank
of the River Ishim was made.
According to the mainstream directions of
the Programme and the Master Plan of the
development of Astana city, in the not far
future the administrative, business, social
and economic, scientific and educational
centres will be built, which will bring
the capital to the international standards
of the capitals of the developed countries.
In the view of the above mentioned, it is
especially important and necessary to ensure
a good climate for attraction of local and
foreign investments into high priority objects
of the social infrastructure of Astana city.
The Special Economic Zone was especially
designed for the construction of the left
bank of the river. It is a new administrative
center of the city and privileges are available
for investors that make direct investments.
I think that privileges are unprecedentedly
high. The term of this zone is five years.
The Special Economic Zone gives tax holidays
with respect to the taxes on land and property,
value added tax, and custom duties.
Astana has invited investments to come
in and the SEZ do indeed offer investors
golden opportunities. Could you go into
further detail on this?
The SEZ is established to enhance the development
of the left bank of Ishim River by attracting
investments and employing modern building
technologies, as well as by creating a modern
infrastructure in the territory of 1 052.6
square hectare.
The main industrial direction of the SEZ
is construction of administrative, infrastructural,
and living complexes in the capital. To
fulfill this mission a special regime of
privileged taxation is established:
- exemption from VAT on the goods and services
in the territory of the SEZ for construction
of infrastructural, administrative, and
living complexes;
- applying zero rate for VAT on the goods
consumed in construction of infrastructural,
administrative, and living complexes in
the territory of the SEZ;
- exemption from the land tax the areas
in the territory of the SEZ where there
is construction of infrastructural, administrative,
and living complexes;
- exemption from property tax the balance
cost of the constructions and buildings
of juridical and physical bodies without
juridical education, situated within the
territory of the SEZ.
The customs regulation in the territory
of the SEZ is applied in the accordance
to the customs legislature of the Republic
of Kazakstan. The territory of the SEZ is
considered to be a part of the territory
of the Republic of Kazakstan with customs
free regime.
The following goods and equipment are admitted
to the free customs zone:
- machines and equipment for construction;
- goods, which will be completely consumed
in construction;
- goods and equipment necessary for construction.
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The registration
and control of the goods admitted to the free
customs zone in the territory of the SEZ are
carried out according to the regulations of
the central customs organ of the Republic
of Kazakstan. The special economic zone will
comprise 6 areas with the total area of 1
052.6 square hectares. The perimeter is 36.8
km. The perimeters of the selected areas are
the borders of the SEZ and will be equipped
with special fence.
The developed technical and economic basis
enabled to point out a number of important
positive aspects of the creation of the
SEZ:
- in short time this ensures real and high
incentives, for instance direct governmental
support of the attraction of the local and
foreign investments into construction of
Astana city;
- in short time the Master Plan of the development
of the capital can be brought into life,
all the necessary conditions for the development
of the objects of social infrastructure
and construction of living complexes are
established;
- big opportunities for labour employment
and production of construction materials,
i.e. an effective additional demand is created,
which will raise GNP;
- local and foreign construction companies
registered in Astana will be employed at
the construction sites of the capital;
- about 3 000 extra workers are expected
to be employed during the period of the
existence of the SEZ;
- local and foreign banks will be interested
in investing the projects of construction
the left bank of Ishim River.
The system of privileged taxation will allow
not only to bring to life commercial projects,
but also to make more attractive placing
investments into construction of non-profit
objects of high social significance
- roads, bridges, parks, planting trees
and gardens, developing water resources
- which are important both for the construction
of the new capital and to make higher the
level of comfort for the people staying
in the city.
- through the creation of the SEZ the economy
of the region will actively cooperate and
integrate with the world's economy, the
region will attract more high technologies
from abroad into the field of construction;
- according to the Master Plan of the development
of the capital, the volume of the investments
into development of the left bank of Ishim
River is expected to be 238.6 billions tenge.
The creation of the SEZ will be beneficial
both for the state and for the potential
investors
The benefits of the investors:
-The state support of direct investments
into construction of Astana city.
- Significant tax privileges and preferentials.
- Opportunities to introduce modern technologies
and scientific achievements in the field
of construction.
- Getting land for construction in the new
centre of the capital.
- Formation and development of real estate
market.
- The guaranteed right to prolong the investment
activity on the initial terms until the
expiry of the SEZ period, but not more than
for 10 years, irrespective of the changes
in the juridical regime of the SEZ or its
liquidation before the appointed time, including
the extension of the area.
You as a Mayor will have to be in a
contact with the business community during
the development of Astana. Could you please
elaborate on this and the means by which
you maintain this contact?
We conduct various investment conferences
in London, Cairo, and Moscow. I think that
businessmen as well as constructors already
know about Astana very well. We are interested
in investments. I would like to highlight
that during these years more than 4 billion
Dollars have been invested in Astana, of
which more than 70% are direct foreign and
local investments. Today, Astana, along
with West part of the country, is one of
the most attractive regions for an investment
in Kazakhstan. The number of population
has increased sharply. During the last 4
years, it doubled. At the same time, there
is almost no unemployment in Astana. Moreover,
it is a very good market for entrepreneurs.
Another advantage of Astana is that it is
located in the center, at equal distances
from big cities, which allows people come
to Astana and use its services.
It has been said that the rise of Astana
is the reflection of the rise of Kazakhstan.
With this in mind, what is the major challenge
for Astana future?
We have a problem with the number of population
because we did not expect that it would
increase so sharply. Japanese architects
that worked on the general plan of Astana
made estimates, where they indicated that
the number of population would reach the
level of 500,000 in 2008. However, we already
have more than that number. Therefore, we
have to take into consideration new standards.
We also have other problems that exist in
every other city. We are aware of them and
we are trying to solve them.
As a Mayor of Astana, what is your final
message to our readers?
As a Mayor of Astana and as a person that
lives here, I would like to invite all your
readers to Kazakhstan and Astana. If they
come here, they will find many interesting
and beautiful places. Besides, Kazakhstan
is the place of new business opportunities
where Astana is one of the most attractive
ones. The more we visit other cities and countries
of the world, the more we come to the conclusion
that our country Kazakhstan and the capital
Astana are one of the most interesting. |
V.I.P. INTERVIEWS 
