The Astana International Financial Centre (MFC) announced that the Republic Kazakhstan will spend 8 percent of the country’s GDP on post-pandemic economic recovery. According to the centre’s manager, Kairat Kelimbetov, COVID-19 not only spurred already emerging trends in the global economy, but also launched new ones. One of these trends is a technological race, somewhat reminiscent of the arms race during the Cold War in the field of access to new technologies.
In the post-viral period, the transfer of manufacturing from China back to other countries will continue. Kelimbetov mentioned that Kazakhstan will chart a similar course to Russia and will be able to overcome the economic consequences of the pandemic with fewer economic hardships than many other countries. This optimistic view is based on the fact that these countries have rather modest public debts in addition to its accumulated large quantities of sovereign reserves.
As the COVID-19 cases surged in the Central Asian nation, Kazakhstan adopted unprecedented measures to establish a universal basic income programme, whereby the nearly 4 million citizens who lost their jobs due to lockdown in large cities were given supplementary income equivalent to about USD 90. Kazakhstan has the largest number of COVID-19 infections and deaths among the OIC member countries in Central Asia.
The MFC’s manager also said that Kazakhstan will have to decide which products besides oil, gas and uranium are going to be the country’s export alternatives, indicating that agriculture and refined products from the mining or chemical industries may top the list of options. For that to happen, Kazakhstan needs outside investment, which poses another challenge as investors are reluctant to embark on new ventures at the moment.
Kazakhstan can also play an important role in shoring up global food security. “The supply of Kazakh agricultural products will be very much in demand. This is a national advantage, which must be fully taken advantage of.” Kairat Kelimbetov.
Understanding this, the country’s authorities have created a “common law territory friendly to the entire post-Soviet space” and formed a legal platform arbitrated with a court by an international financial centre and with an international arbitration centre to settle disputes. An exchange was established in the Republic of Kazakhstan with the participation of NASDAQ and the Shanghai Stock Exchange. “We have created a platform where Western and Eastern investors can meet and interact,” said Kelimbetov.
In this regard, The Government of Kazakhstan plans for the Astana MFC to become a platform for attracting investments and for the placement of government securities in national currency, a place for the influx of investments and innovations. Therefore, considering it mandate within and beyond the borders of Kazakhstan, the role of MFC in Astana is to be a friendly platform not only for traditional investors, but also for innovative companies.
