NUR-SULTAN – Kazakh President Kassym-Jomart Tokayev on Friday slammed his government for moving too slow on the economy and demanded “deep and radical” reforms in the Central Asian republic.
“I consider it necessary to prepare a program of deep and possibly radical reforms of the country. We need a new economic course. Reforms require will and decision and this is precisely what I demand from the Government,” Tokayev told an extended government session.
After taking office last year from Nursultan Nazarbayev, who held the reins of the country for three decades, Tokayev promised continuity, but also pledged to modernize Kazakhstan by implementing social and economic reforms.
The visibly dissatisfied president demanded that the Government fulfill its responsibilities more actively.
“The president cannot assume the role of foreman to force officials to perform the necessary work quickly and with quality, monitor the progress of the programs,” he said, demanding “efficient and agile” work.
“Only in this way can we meet the important strategic goals we face as a State,” he said.
Tokayev described during his meeting with the Government “serious problems” of labor productivity in the country and the slow increase in exports of processed products.
Kazakh Prime Minister Askar Mamin reported during the session that the economy grew last year by 4.5 percent, to which the president set 5 percent as a target increase in Gross Domestic Product in 2020.
According to Tokayev, to reach these levels of growth it is necessary to increase the amount of capital investments to 30 percent of GDP by 2024.
“The Government and the regional governors must guarantee full compliance with the investment projects planned for 2024. The amount of these projects is 44 billion Kazakh tenge” (approximately $116 million) the Kazakh president said.
Tokayev noted that the banking sector’s role in economic development was in decline and stressed that the country faced serious problems in the financial sector.
Loans to the corporate sector have dropped by 8.7 percent, small and medium businesses by 18 percent and agriculture by 48 percent, while consumer lending has increased by 24 percent, with two thirds of those loans issued to individuals without collateral, he noted.
“The financial system is ill. Last year we helped more than 500 thousand Kazakhs and paid off their debts. We also wrote off fines and penalties on the loans of 1.2 million of our citizens,” he said.
In addition, Tokayev demanded that policies and strategies to attract foreign direct investment take shape swiftly.
“This is a key tool for the development of the country,” he said, noting that during the first nine months of last year the gross amount of foreign investments in Kazakhstan increased by 4.8 percent, to exceed $18 billion.
However, he regretted that the volume of foreign net direct investments fell by 57 percent during this period, to $2 billion.
Tokayev said there was “no time to lose” and set a deadline of May 15 for the Government to present a new work plan.
“It is time for the Government to take on new approaches to meet the strategic objectives set,” he concluded.