Interview for Kazakhstan Magazine with Mrs. Z.K. Kanapianova, Board Chairman, KFICA
What role does your Association play in ensuring interaction between Kazakhstan and foreign investors?
The Foreign Investors Council under the President of the Republic of Kazakhstan (FIC) was established in 1998 as an advisory board to ensure there is a direct dialog between the Government of Kazakhstan and investors operating in Kazakhstan to quickly solve any issues related to their investment activities and to further improve the investment climate in Kazakhstan.
The Council is one of the first forums of that type in the former Soviet Union enabling a productive exchange of views and experience between government, and domestic and international businesses. Kazakh President Nazarbayev Nursultan Nazarbayev pays much attention to FIC; he personally heads the Council and guides its activities, including chairing plenary sessions.
The Kazakhstan Foreign Investors Council Association (KFICA) was established in 2000 as one of FIC’s structures to include representatives of those foreign companies who deliver their investment activities in Kazakhstan. At the working level, we ensure there is interaction between the representatives of foreign companies and those of government authorities. Our activities, just like the activities of the Kazakh government, serve one common goal – creating attractive investment climate in Kazakhstan to facilitate successful economic development of the country.
In his address to the people of Kazakhstan in March 2009, Kazakh President Nursultan Nazarbayev called his fellow countrymen to use this period of history for renovation and further development: “We are not just prepared for these trials… We will leave the crisis as a stronger and more prosperous nation”.
In support of this, we, in the Council, also consider the current financial crisis as an opportunity for further development and new investments. This year has been fruitful for FIC in spite of the global economic crisis. We held our first offsite plenary session of the year in Kostanai in June to find alternative funding sources for Kazakhstan’s further economic development in the environment of a changing situation at global financial markets.
During his speech in Kostanai, the President emphasized the need to diversify the national economy as a required and “right way of post-crisis development to enable sustainable and long-term well-being for the citizens of the country”. In this connection, the twenty second plenary session involving representatives of the Kazakh government and foreign companies, which we plan to hold on December 4, is devoted to involvement of foreign investors in diversification and technological development of Kazakhstan. We hope that it will be very useful dialog, which will allow companies to share their most successful experience and jointly develop principles for further development in the above areas.
Please outline the most important matters on the agendas of the FIC working groups?
In addition to plenary sessions, one of the key and important activities of FIC is to ensure that its working groups work fruitfully. Currently there are five groups: RoK Investment Image Enhancement Working Group (IEWG); Legal Working Group (LWG); Taxation Working Group (TWG); Oil and Gas Working Group (OGWG); and Foreign Investors Operations’ Working Group (OWG).
The FIC Working Groups conduct active work to review issues in the various directions of investment activities in the country and to develop appropriate recommendations for the FIC members and government. The Working Groups regularly meet and report on their results at FIC’s interim and plenary sessions. Each working group is generally guided by co-chairs from the Kazakh and foreign side. The Kazakh side is represented by vice ministers, while foreign companies delegate their top management representatives.
This year the working groups continued their active work on discussing and working out recommendations on such important areas as: recommendations to the Ministry of Labor and Social Protection on the adopted international practice of the emergency reporting and of providing correct information fitting the UN Convention requirements; gas utilization and petrochemical industry development; local content development; analysis of Kazakhstani legislation and preparation of recommendations on improving the legal environment for foreign investment in the country; analysis and creation of the recommendations in the field of taxation, improvement of the tax legislation and tax administration.
The key subject of FIC’s 22nd session is involvement of foreign companies in diversification and technological development in Kazakhstan. How in your view can TNCs help in this?
In our view, in addition to financial investment, leading international companies recognized worldwide for their high business ethics, transparency and technological achievements are an invaluable source of innovations, operational excellence and diversification, which Kazakhstan could use for its successful economic development.
Today, many foreign countries have been successfully applying advanced technologies in Kazakhstan and creating breakthrough diversification projects using local resources and increasing the Kazakh content in the country’s economy. We therefore expect that FIC’s forthcoming plenary session will be a forum for a broad sharing of experience and achievements. We also plan to jointly identify the principle directions for further development in the above areas.