Industrial Zones in Kazakhstan

Home , Aktobe, Aral District, Kapchagay, Shardara, Talgar

content

Introduction to Kazakhstan ...... 4

Support for investors ...... 8

Definition of Industrial zones ...... 12

Industrial zones of Kazakhstan ...... 14

Aktobe region’s Industrial zones ...... 16

Almaty region’s Industrial zones ...... 18 3

Atyrau region’s Industrial zones ...... 20

East Kazakhstan region’s Industrial zones ...... 22

Kyzylorda region’s Industrial zones ...... 24

South Kazakhstan region’s Industrial zones ...... 28

Useful contacts...... 32 4

Introduction to Kazakhstan

National Flag National Emblem

Area: 2,724,000 km2 (1,051,742 sq mi) 9th largest Population: 18,192,958 Official language: Kazakh, Russian Political system: Presidential Republic Head of state: President Currency: Tenge (KZT) Capital: Astana city Administrative 14 regions+2 cities division: of republican significance Member of organizations: UN, IMF, WB, OSCE, OIC, WTO 5

• The Kazakhstan’s geographical location makes it a natural crossroad for major transit corridors from East to West, form North to South. • Kazakhstan is a member of the Customs along with Russia, Belarus, Armenia and Kyrgyzstan: - Free trading without customs duties; - Access to population over 183 mln. people. • The transcontinental automobile road corridor «Western Europe – Western Chi- na» passes through the territory of Kazakhstan. The corridor will allow to deliver freights from China to Europe in 10 days. • There is a territory with population of more than 3.3 bln. people within a radi- us of 2 thsd. km (1,243 miles) from Kazakhstan. • The flight time from most European destinations is 5 hours. 6

Political stability and FAVORABLE INVESTMENT CLIMATE

Platforms for dialogue between public authorities and investor

Foreign Investor’s Council chaired on strategic issues by the President

Council for improvement of investment climate on systemic issues chaired by the Prime Minister

Investment Ombudsman chaired by the Minister on current problems of investors on Investments and Development

ease of doing business

Source: World Bank, Doing Business 2017 7

Protecting paying taxes minority investors

Rank Country Rank Country 1 Singapore 1 UAE 3 Kazakhstan 8 Singapore 13 South Korea 40 Azerbaijan 22 Turkey 45 Russia 32 Azerbaijan 60 Kazakhstan 42 Poland 66 Belgium 53 Russia 77 Hungary 63 Belgium 88 Armenia 81 Hungary 128 Turkey 123 China 131 China Source: World Bank, Doing Business 2017

Global competitiveness index rankings

Rank Country Score 1 Switzerland 5,8 2 Singapore 5,7 3 USA 5,7 4 Netherlands 5,6 5 Germany 5,6 6 Sweden 5,5 ...... 43 Russia 4,5 53 Kazakhstan 4,4 55 Turkey 4,4 77 Tajikistan 4,1 111 Kyrgyz Republic 3,7

Source: World Forum, Global Competitiveness Report 2016-2017 8

Support for investors

INVESTMENT PREFERENCES*

Tax - CIT – 0 % up to 10 years incentives - Land tax – 0% up to 10 years - Property tax– 0% up to 8 years

Investment Up to 30% of costs associated with subsidy construction and installation works and (cashback) equipment

Migration - Free quota regime and no need in work incentives permits to employ foreign labor during construction period and 1 year after commissioning - From January 1, 2017, a 30-day visa-free regime introduced for citizens of 60 countries

Guarantee Stability of tax legislation for all taxes except of laws VAT and excise (subject to investment stability contract)

OTHER INCENTIVES

Customs Customs duties 0% on the import of: incentives - equipment and its components; - spare parts; - raw materials and supplies.

State Land plots, buildings, machinery and in-kind grants equipment, etc.

*for priority investment projects 9

Priority types of activities: 1 Metallurgy (ferrous and non-ferrous) 2 Petroleum refining 3 Machinery (automotive industry and electrical engineering) 4 Chemical industry (petrochemistry and agricultural chemistry) 5 Processing industry (food production)

Investors Service Centre (One Stop-Shop)

Provision of 363 public services for investors (investment contract, land, visa support, etc.)

Assistance in obtaining of the required approvals and permits

Investment law consultations

Informational, organizational and other support to the investor

Functioning of the Institute of Investment Ombudsman, objected at protection of the rights and legitimate interests of foreign investors, that carry out activity in the Republic of Kazakhstan. 10

Export support Kazakhstan provides a full cycle of support for the promotion of products produced in Kazakhstan in foreign markets.

Informational and analytical support: • Preparing and conducting country reviews; • Developing brief analyses; • Reference and information services.

Export development and promotion: • Training entrepreneurs on export performance; • Creating the ideology of «export orientation»; • Organizing trade missions in foreign countries; • Organizing the participation of Kazakhstan enterprises in foreign specialized exhibitions.

Partial reimbursement of costs for entities of industrial-innovative development: Support is provided through the reimbursement of 50% of the costs of entities engaged in industrial and innovation activities. The costs are reimbursed on a NON-REPAYABLE BASIS! 11

Types of refundable costs: - Costs associated with advertising of domestic products abroad; - Expenses on direct participation in international exhibitions, fairs, and festivals; - Costs for catalogues development and publication; - Costs for representations, maintenance costs of sales outlets and warehouses abroad; - Costs associated with registration of trademarks and products abroad; - Costs associated with certifying products abroad

Full details on

www.export.gov.kz 12

Definition of Industrial zones

INDUSTRIAL ZONE is a non-farm uses land with installed utility systems which is provided for private entrepreneurs by State for placement and operation of industrial facilities in the order established by the Land Code of the Republic of Kazakh- stan and other laws of the Republic of Kazakhstan (Article 249 of the Republic of Kazakhstan Business Code No. 375-V of October 29, 2015 ).

Purpose of creating: Industrial zones are created to ensure economic and organizational conditions to develop entrepreneurship activitives of industrial zones: 1. to assure accelerated assistance in development of entrepreneurship in industry; 2. to optimize costs to create and develop new production in frastructure; 3. to improve production efficiency; 4. to provide employment of population. 13

Preferences for participants in industrial zones: • Provision of land plots; • Provision of infrastructure ready for use; • Rent-to-own options of land plots at a low price and non-competitive basis (at cadastral value).

Main advantages of IZ (according to the analysis of international experience): • Reduction of infrastructure construction costs; • Lack of strict sectoral specificity; • Unlimited time operation; • Simplified issuance of permits; • Minimum demand of the main city networks; • Ecology issues solving for megacities; • Creation of conditions to produce competitive products. 14

Industrial zones of Kazakhstan 15 16

Aktobe region’s industrial zones

Aktobe region Aktobe region is the second largest region by area in the country, where all domestic chromium reserves, 55% nickel reserves, 40% titanium reserves and 34% phosphate reserves are located. Favorable geographical location of the region predetermines its specialization on transport and logistics services, also increases competitve position to promote the product of manufacturing industry to foreign market. Metal processing, chemical and food industries are developing due to domestic raw materials. In the region, agriculture specializes in livestock with a focus on meat and dairy.

Basic information

Population, GRP, GRP per Investments per Area, km2 Major cities th.people mln $ capita, th.$. capita, $

839,15 300600 Aktobe, Kandyagash 5,99 7,13 1230,8 17

information about iz in operation

75 1 50

Available land, ha Industrial zones in Permanent jobs operation

2 4

projects In operation Projects UNDER ImPlementatIon

75 2 4 Private IZ «Aktobe» Available land, ha projects In Projects UNDER operation ImPlementatIon

100 % High quality traumatic safe coatings with the use of innova- Infrastructure tion technologies, antifreezes and other chemical reagents completion status Products 18

Almaty region’s industrial zones

Almaty region Almaty region is one of the densely populated regions in Kazakhstan. Transit ca-pacity has developed due to favorable geographical location and transcontinental roads passing through the territory of the region. Natural climatic conditions, availability of wind, solar, and hydro-energy resources potential contribute to the development of alternative energy.

Basic information

Population, Area, GRP, GRP per Investments per Major cities th.people km2 mln $ capita, th.$. capita, $ 1,953.6 223,540 Taldykorgan, Kapchagay, Talgar 6.7 3.41 923.1

information about iz in operation

323 2 3,500

Available land, ha Industrial zones in Permanent jobs operation

50 6

projects In operation Projects UNDER ImPlementatIon 19

Private IZ «Taldykorgan» 245 5 6 Available land, ha projects In Projects UNDER operation ImPlementatIon 100 % Infrastructure Construction materials (asphalt and concrete mixture, completion termal insulator, building blocks), synthetic detergents status

Products

Private IZ «ILC «Damu» 78 45 0 Available land, ha projects In Projects UNDER 100 % operation ImPlementatIon Infrastructure completion Milk drinks, non-alcohol drinks, shaped tube, car filters, status pharmaceutical products, storage facilities, civil and mil- itary hats

Products 20

Atyrau region’s industrial zones

Atyrau region The key factor determining the long-term economic specialty of Atyrau region is large hydrocarbon reserves, which are accounted for 73% of Kazakhstan reserves. The region is attractive for investments in oil and gas production and related activities. The region specializes in oil and gas production; coke industry and petrochemicals; profes- sional, scientific and technical activities Basic information

Population, GRP, GRP per Investments per Area, km2 Major cities th.people mln $ capita, th.$. capita, $ 598.9 118,600 Atyrau, Kulsary 15.37 25.57 10,462.2

information about iz in operation

50 3 762

Available land, ha Industrial zones in Permanent jobs operation

10 1

projects In operation PROJECTS UNDER IMPLEMENTATION 21

Private IZ «SGT Group» 32 4 1 Available land, ha projects In PROJECTS UNDER operation IMPLEMENTATION 100 % Infrastructure Technical gases, production of corrosion-resistant pro- completion tective coating by hot galvanizing method, flange status

Products

Private IZ «ZhigerMunay 0 1 0 Service» Available land, ha projects In PROJECTS UNDER operation IMPLEMENTATION 100 % Infrastructure Large scaled drilling assets, metal structures produced completion by automatic welding status Products

Private IZ «Daulet» 18 5 0 Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion bakery products, canned meat, uniforms and sewing prod- status ucts, drinking water

Products 22

East Kazakhstan region’s industrial zones

East-Kazakhstan region East-Kazakhstan region’s industry structure is dominated by manufacturing sector (its share is 83%). The region is a major ore mining producer in the country. The region’s mineral raw material base is rich with mineral, mainly ore deposits. Non-ferrous metallurgy is a leading industry in East Kazakhstan region. Livestock production is the main sector of agricultural industry specialized in production of meat, milk and wool.

Basic information

Population, GRP, GRP per Investments per Area, km2 Major cities th.people mln $ capita, th.$. capita, $

Oskemen, Semey, 1,396.5 283,220 8.62 6.19 923.1 Ayagoz 23

information about iz in operation

89 1 40

Available land, ha Industrial zones in Permanent jobs operation

3 0

projects In operation PROJECTS UNDER IMPLEMENTATION

IZ «Ondiris» 89 3 0

Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion status Brake pads for railway rolling stock, foam concrete products, Medical waste disposal

Products 24

Kyzylorda region’s industrial zones

Kyzylorda region The region’s industry structure is dominated by mining sector with a focus on oil production. Key factors determining opportunity for economic diversification of Kyzylorda region are large non-ferrous and rare metal reserves (vanadium - 66%, uranium - 14.7%, zinc - 16.4%, lead - 11.1%). Economic concentration is located in the city of Kyzylorda and districts of Zhanakorgan and Shieli.

Basic information

Population, GRP, GRP per Investments per Area, km2 Major cities th.people mln $ capita, th.$. capita, $

769.5 226,000 Kyzylorda, Baikonur 3.83 4.97 923.1

information about iz in operation

709 6 1,493

Available land, ha Industrial zones in Permanent jobs operation

10 27

projects In operation PROJECTS UNDER IMPLEMENTATION 25

IZ «Ondiris» 636.8 1 8

Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion Wall and pavement materials, production of PU foam for status pipes isolation, flat glass, primary processing of scrap METAL, foam concrete blocks, gas-concrete blocks, technical processing of molibdenium dioxide to molibdenium trioxide, ferrous-based alloys, ELECTRIC SUBMERSIBLE IN- STALLATION Products

IZ «Shieli district» 33.5 1 4

Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion licorice processing, sand-lime brick, asphalt, concrete, re- status inforced concrete products lime, polypropilene bags, slag blocks stones

Products 26

IZ «Aral district» 4 1 2

Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion status Meat, meat products, dumplings, facing bricks, processing of wool and hides

Products

IZ «Kazaly district» 5.9 3 7 Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion Vegetables’ and fruites’ storage, production of bottled wa- status ter, electricity supply ricity, concrete products, auto park, hides and furs collection/processing

Products 27

IZ «Serpin» 18.05 4 2

Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion Feeding, sale of cattle and butchering. Production of status black cattle and poultry meat, of milk. Breeding of thor- oughbred goats.

Products

IZ «Karmakshi district» 10.9 0 4

Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion status reinforced concrete products, processing of iron resi- dues, furniture, storage

Products 28

South Kazakhstan region’s industrial zone

South-Kazakhstan region The key factors determining the industrial production of South Kazakhstan region are population size and concentration, favorable climatic conditions for crop farming, geographical proximity to big cities (by population) and international corridors passing through the territory of the region. Shymkent agglomeration, the second largest agglomeration in Kazakhstan with 1.6 mln. people, creates a potential market for services of main industries of region’s economy, such as commerce, construction and transport. Basic information

Population, GRP, GRP per Investments per Area, km2 Major cities th.people mln $ capita, th.$. capita, $ 2,861.3 117,300 Shymkent, Turkestan, Kentau 8.64 3.04 307.7

information about iz in operation

258 9 4000

Available land, ha Industrial zones in Permanent jobs operation

65 91

projects In operation PROJECTS UNDER IMPLEMENTATION 29

IZ «Ontustik» 10 46 38

Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion Fertilizers, bulding materials, plastic pipes, leather prod- status ucts, footwear, clasp blocks, medical gloves and etc.

Products

IZ «Turkestan» 63 4 9

Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion Plastic products, office furniture, burnt brick status Products

IZ «Tulkibas district» 32,7 0 7 Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion status 30

IZ «Sozak district» 35.5 4 1 Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion status Metal barrels and polyethlene pypes for uranium production enterprises, table salt processing

Products

IZ «Shardara district» 31.3 2 1 Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion BuIlding materials from agricultural wastes, corrugat- status ed cardboard and packaging made from this cardboard, brick foam blocks, foundation blocks and other building materials

Products IZ «Maktaral district» 16.5 1 4 Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion status Construction of high-tech cotton-processing factory

Products 31

IZ «Kazygurt district» 26.7 2 5 Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion status Fast food products,aerated concrete

Products

IZ «Kentau» 19.8 2 3

Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion status Asphalt and concrete mixtures, vacuum switch and com- ponent parts for transformer equipment

Products

IZ «Tassay» 22.5 4 23

Available land, ha projects In PROJECTS UNDER 100 % operation IMPLEMENTATION Infrastructure completion status Furniture products, orthopaedic articles, LED luminaires

Products 32

Useful contacts

«KAZAKH INVEST» National Company Joint Stock Company Tel.: +7 (7172) 62 06 01, fax: +7 (7172) 62 06 00, call-center: +7 (771) 977 58 00 email: [email protected] web: www.invest.gov.kz

Department of special economic and industrial zones (Investment Committee of the Ministry of Investment and Development of the Republic of Kazakhstan) Tel.: +7 (7172) 75 45 68 web: www.invest.mid.gov.kz

Investors Service Centre («One Stop-Shop») call-center:: +7 (7172) 75 45 40 E-mail: [email protected]