1ASTANA CALLING / ISSUE 270 /

CICA Celebrates 20th AnniversaryPresident Nazarbayev addresses Foreign Ministers on CICA’s future role

World Bank and World Economic Forum Recognize Improved Business Environment Kazakhstan advances in global rankings

A WEEkly onlInE puBlICAtIon oF thE

MInIstRy oF FoREIgn AFFAIRs oF thE REpuBlIC oF kAzAkhstAnCallingastana

student olympians honored on CampusSetting an example for the whole student body

kazakhstan Welcomes osCE secretary general OSCE and CICA discuss stronger links

Business Roadmap 2020 Ministry maps out progress

things to

Watch

IssuE no 270 FRIDAy, 14 sEptEMBER 2012

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Also inthe news

south korea’s president visits kazakhstanConstruction of Balkash power plant begins

president of Vietnam Visits kazakhstanAgreements herald increased cooperation

2ASTANA CALLING / ISSUE 270 /

CICA Celebrates 20th Anniversary

On September 12, Astana marked the 20th anniversary of the founding of the Conference on Interaction and Confidence Building Measures in Asia (CICA) in a special commemorative session on the margins of a meeting of foreign ministers from its 24 member states.

Attending the anniversary meeting, President Nazarbayev thanked member states for making CICA an efficient channel for multilateral, preventive diplomacy. He said that CICA’s role as a forum for joint decision-making on security and cooperation is crucial at a time when Asia’s economic and political influence in global relations is taking center stage.

The President underlined the importance of nuclear non-proliferation in a region with the greatest concentration of nuclear weapons in the world. Calling on all CICA members to adopt the Universal Declaration for a Nuclear-Free World, he asked them to support Kazakhstan’s initiative to host an international nuclear fuel bank under the auspices of the International Atomic Energy Agency.

President Nazarbayev highlighted CICA’s vital role in contributing to a settlement of the conflict in Afghanistan. He urged fellow member states to support a peaceful resolution, as Kazakhstan has done in its role as OSCE Chair and continues to do through humanitarian and educational aid. He also reaffirmed Kazakhstan’s commitment to a peaceful resolution of the conflict in Syria, by the people of Syria, through dialogue and negotiation

During the meeting of Foreign Ministers, member states exchanged views on the situation in the Middle East and North Africa, Afghanistan, nonproliferation, combating transnational crime and economic cooperation within CICA.

In 1992 President Nazarbayev proposed the creation of a regional dialogue platform to work towards “a common and indivisible security space on the Eurasian continent”. This was an early sign of Kazakhstan’s commitment to developing cooperation in Asia to manage the diverse security challenges facing the region.

Today, CICA’s membership accounts for over 90% of the territory of Asia and three billion people, stretching from Turkey to South Korea and from Russia to Thailand. During Kazakhstan’s eight-year Chairmanship from 2002-2010, relationships were forged with both regional and international organizations and the membership continued to grow. Turkey took on the Chair in 2010 and will be succeeded in 2014 by The People’s Republic of China.

Supported by its secretariat in Almaty, CICA now provides well-established mechanisms for member states to discuss a wide range of issues related to economic and environmental security as well as broader military-political issues and new security threats, including human trafficking, money laundering and radicalization within societies.

“At a time when Asia is undergoing rapid development, we especially need a comprehensive and effective security institution and cooperation. In this context, CICA should take its rightful place in the new global security architecture.” Nursultan Nazarbayev, President of Kazakhstan

“It is CICA that embodies one of the most important principles of our policy - dialogue and interaction for peaceful resolution of conflicts and effective countering of challenges and threats in the Asian continent.” Foreign Minister, Yerzhan Kazykhanov

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president of Vietnam Visits kazakhstan Vietnam’s President, Truong Tan Sang, visited Kazakhstan on September 10-11 at the invitation of President Nazarbayev.

Relations between the two countries have developed steadily since they established diplomatic ties in 1992. The Vietnam-Kazakhstan Inter-Governmental Committee on Economic-Trade and Scientific-Technological Cooperation has convened five sessions to date: the most recent, held in Astana in 2011, concluded with the signing of the Vietnam-Kazakhstan Joint Action Plan for 2011-2013.

During the visit, the leaders discussed their countries’ socio-economic development and a wide range of bilateral and international issues.

Describing Vietnam as a strategic partner in south-east Asia, President Nazarbayev emphasized the importance of the agreements and the significant potential for growth in bilateral trade. He also signaled increased cooperation in the oil and gas industries with the confirmation that KazMunaiGas will soon begin offshore exploration in Vietnam, while a Vietnamese company is to conduct exploration in the Aral Sea and plans are underway for a joint venture to produce titanium slag in Vietnam.

In the week in which Astana hosted the 20th anniversary celebration of the founding of the Conference for Interaction and Confidence Building Measures in Asia (CICA), President Nazarbayev also expressed his satisfaction with Vietnam’s contribution to the activities of CICA.

President Sang spoke of the opportunity to deepen the partnership through the early conclusion of a free trade agreement between the Customs Union and Vietnam, as well as expanded cooperation in areas such as education and science as well as technology and communications.

Bilateral trade between Kazakhstan and Vietnam currently stands at USD 100 million.

A number of agreements were signed in the presence of the two Presidents, including the establishment of a direct air transportation link between Kazakhstan and Vietnam, the twinning of the cities of Astana and Hanoi and the setting up of links between the National Bank of Kazakhstan and the State Bank of Vietnam.

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Vietnamese President Truong Tan Sang with President Nazarbayev

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south korea’s president visits kazakhstan

South Korea’s President Lee Mung-bak met with President Nazarbayev in Astana on 13 September. The two leaders discussed international issues and cooperation across a wide range of trade, economic, technological, cultural and humanitarian issues, as well as future collaboration on energy, tourism and agriculture. This was their seventh meeting in the past four years.

After the meeting, President Nazarbayev outlined the rapid growth in bilateral economic cooperation which has flowed from such intensive high-level dialogue: last year, trade between the two nations reached USD 900 million, while in the first half of 2012 it surpassed USD 600m. Investment by South Korea in Kazakhstan has reached USD 3 billion – higher than in any other CIS country.

President Lee Myung-bak attributed the steady growth of friendly partnership between Korea and Kazakhstan to shared cultural values and economic goals. He paid tribute to the dynamic development of Kazakhstan and confirmed plans for further cooperation in the production of railway and high-speed trains – following a successful collaboration on the Almaty subway– and on a new Science and Technology Park at Nazarbayev University. He also confirmed that South Korea and Kazakhstan will work together to spearhead the development of sustainable “green growth” in Central Asia.

In the week that Astana hosted the 20th anniversary of the Conference on Interaction and Confidence Building Measures in Asia (CICA), President Nazarbayev thanked South Korea for its commitment to CICA, as well as its support for Kazakhstan’s bid to host Expo 2017. President Lee Myung-bak expressed his appreciation of Kazakhstan’s contribution to this year’s successful South Korea World Summit on Nuclear Safey and the World Expo in Yeosu.

The opening ceremony for the construction of the Balkash thermal power plant was a focal point of the visit. A USD 2.3 billion project agreed two years ago, the Balkash plant will have a capacity of 1320 MW and deploy the greenest technology to reduce the power deficit and provide a reliable electricity supply across southern Kazakhstan. Samsung and Korea Electric Power Corporation will construct and manage the Balkash plant to the highest international environmental standards. Commissioning of the first 660MW unit is scheduled for December 2017 and the second will be up and running by April 2018.

The two leaders pledged to continue to deepen the strategic partnership and cooperation between Kazakhstan and South Korea.

South Korean President Lee Mung-bak and President Nazarbayev with a model of the power station

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“The visit confirmed once again that our strategic partnership will further deepen and develop on the basis of trust and achievements accumulated over the years”

The President of the Republic of South Korea

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Business Roadmap 2020

At a press conference in Astana on September 10, the Ministry of Economic Trade and Development (METD), together with the DAMU Entrepreneurship Development Fund, provided an update on progress in implementing the “Business Roadmap 2020” program.

The program was initiated in the second half of 2010 to support the stable growth of regional businesses in Kazakhstan’s non-energy sector.

To date, more than 30,000 business people have benefited from the program, while 132,000 existing jobs have been preserved and 19,000 new jobs created, with a further 3,000 new jobs in the pipeline.

The Vice Chairman of METD’s Committee of Business Development, Bakytzhan Sarkeev, described the program as highly effective: “The Business Roadmap is an important instrument for implementing Kazakhstan’s business development policies and furthering innovation. He noted that the program is popular with both business people and banks.

Financial support totaling 555.4bn tenge (USD 3.7bn) has been made available to over 1,900 applicants for business loans and guarantees. Over 300 businesses have received support for building and renewal of production infrastructure, with a total of 52 billion tenge (USD 348m) paid out in this category.

In addition to direct financing, the program offers a range of support to develop business potential, including short intensive course on business basics, service support as well as training at Nazarbayev University (NU) for senior managers and assistance in developing business links.

There has been strong demand across the range of offerings: in 2011 almost 16,000 people completed the intensive business course; 10,000 business people made use of service support; 210 SME managers were trained at NU; and in the Business Links section, over 500 people took part in business training in Kazakhstan, while a further 82 have embarked on internships abroad - 58 in Germany and 24 in the US.

The 2012 programs started in mid-July and the level of take-up remains strong: already 1,300 business people have completed the two-day training course and 6,000 have sought service support.

The “Business Links” program provides advice and support to compani es on forming strategic alliances and joint ventures. In the two years since the Roadmap program began, 17 companies have concluded agreements on cooperation while 30 are in negotiations on cooperation, three companies are implementing joint projects and one has entered a joint venture. Over 1 billion tenge (USD 6.7m) has been secured in contracts with foreign companies through “Business Links”.

World Bank and World Economic Forum Recognize Improved Business Environment

The drive to improve the business environment in Kazakhstan continues to yield results, with the country significantly improving its position in the global rankings of both the World Bank and the World Economic Forum.

In the 2012 World Bank annual report on the ease of doing business in different countries Kazakhstan rose 12 places this year to rank 47th out of 183 countries surveyed, while in the World Economic Forum’s latest annual report on global competitiveness, Kazakhstan gained 21 places to reach 51st position out of 144.

The improvement in Kazakhstan’s competitiveness ranking brings within close reach the national goal set by President Nursultan Nazarbayev - accession to the ranks of the 50 most competitive countries in the world. In his yearly State of the Nation address, the President has repeatedly stressed that a positive business environment that attracts investment is the foundation for building sustainable economic growth and improving living standards.

Developing a competitive, dynamic business community focused on creating new, high-value-added technology products has become one of the key priorities of the government’s economic policy. A range of state-sponsored programs have been put in place to support this: “Business Roadmap 2020” to offer advice and support to regional enterprises; “Exporter 2020” to stimulate non-energy exports; “Productivity 2020” to support technological advances and productivity increases; and “Investor 2020” to attract investment.

The experience of developed countries shows that small and medium businesses contribute heavily to growth in competitiveness and diversification of the economy. The economic growth of countries such as Taiwan, Singapore and Indonesia was specifically linked to the development of small and medium enterprises (SMEs). Governments around the globe have recognized this fact and are providing comprehensive state support to the SME sector.

Similarly, the focus in Kazakhstan is on developing and supporting the SME sector, which as a result, has grown substantially. In 2011 SMEs employed 29% of all those in employment, an increase from 23% in 2009. However, there is still some way to go before the figure for SME employment in Kazakhstan approaches the level of developed countries - ranging from 47% in Canada to 75% in Japan.

In its analysis of Kazakhstan’s improved ranking, the World Bank highlighted the rise of the SME sector and the reduction in the business tax rate from 41.7% to 35.9%. Areas singled out for attention included the financial market, infrastructure, technology and innovation.

In the World Economic Forum’s survey, Kazakhstan’s rise to 51st position (from 30th the previous year) is the result of high scores on key indicators including the efficiency of the labour market, higher education and vocational training. Categories for improvement noted by the report include health, primary education, business sophistication and innovation.

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6ASTANA CALLING / ISSUE 270 /

kazakhstan Welcomes osCE secretary general

This week saw the first official visit to Kazakhstan by OSCE Secretary General Lamberto Zannier, who met with President Nursultan Nazarbayev, Foreign Minister Yerzhan Kazykhanov and Defence Minister Adilbek Dzhaksybekov. Mr Zannier also attended the 20th anniversary meeting of Foreign Ministers of the Conference on Interaction and Confidence Building Measures (CICA) in Astana.

Seven of the 24 CICA member states are also OSCE participating states and a further seven are OSCE Partners for Cooperation. In his address to the CICA forum, President Nazarbayev called for closer cooperation with international organizations and envisaged stronger links between the OSCE and CICA forming a common platform for Euro-Atlantic and Eurasian security.

Mr Zannier highlighted the shared objectives and common ground between CICA and the OSCE, stating: “…we fully recognize that not only our similar approaches to security, but also our membership commonalities, provide an excellent opportunity for co-operation based on building trust, finding common ground among States and developing common initiatives for achieving shared objectives.”

The Secretary General also outlined a number of areas for interaction, including sharing expertise on the implementation of confidence- and security-building measures, combating transnational threats and reducing the risks posed by cyber and ICT threats, as well as promoting security in and around Afghanistan.

During his visit, Mr Zanier also met the Chairman of the Senate Kairat Mami and other members of Kazakhstan’s delegation to the OSCE Parliamentary Assembly. Mr Mami said that the visit by the Secretary General would give a further impetus to the development of cooperation between Kazakhstan and the OSCE and Mr Zannier welcomed the prospect of stronger ties, citing the “untapped potential for closer cooperation”. The institutional development of the OSCE, re-balancing the three dimensions of the organization, and developing a common methodology for election observation by ODIHR were also discussed during the meeting.

student olympians honored on Campus

The Rector’s Cup sports competition at Al-Farabi Kazakh National University (KazNU) got off to a celebratory start this year on September 8, with an honors ceremony for 11 students who represented Kazakhstan at the London Olympics.

One of the 11, law student Svetlana Podobedova, won a gold medal in the 75kg weightlifting category. The other student members of Team Kazakhstan were Ayman and Sholpan Kozhakhmetovy, Viktor Leptikov, Anastasiya Pilipenko, Nikita Filippov and Georgiy Sheyko, all competing on the athletics field; Yuliya Zhhivitsa and Elmir Alimzhanov in fencing; Gulzhan Isanova in judo; and Aleksey Shmider in water polo.

University Rector, Galym Mutanov, warmly congratulated the student Olympians and wished them further sporting success. He reminded the students that President Nazarbayev, in his recent interactive lecture at Nazarbayev University, had held up the example of the student Olympians and called on all students to take responsibility for their own wellbeing by leading healthy lives and participating in sport.

KazNU students are well placed to do this. The University has a comprehensive range of sporting facilities – including a stadium, a sports complex, open pitches and a dedicated PE and sports department – making it possible to pursue over 30 different sports on campus. Large numbers of KazNU students compete in national and international sporting competitions and many have gone on to represent Kazakhstan in the Asian and Olympic Games.

The student Olympians were awarded certificates and prizes before lighting the torch to start the traditional Rector’s Cup sports competition.

“The individual is first and foremost responsible for their own health…Students, I urge all of you to turn away from bad habits in honor of our Olympians and to take up sport and lead healthy lives” Nursultan Nazarbayev, President of Kazakhstan

“…our similar approaches to security […and] our membership commonalities, provide an excellent opportunity for co-operation based on building trust, finding common ground among States and developing common initiatives for achieving shared objectives.”

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OSCE Secretary General Lamberto Zannier with President Nazarbayev

7ASTANA CALLING / ISSUE 270 /

AstAnA CAllIng is a weekly online publication of the Ministry of Foreign Affairs of the Republic of kazakhstan

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Also in the news…

• On September 12-14, Almaty hosted the IV meeting of trade ministers from landlocked developing countries, and the world thematic meeting on international trade facilitation. The event was attended by ministers of 30 countries and representatives from international organizations. Kazakhstan is the world’s largest landlocked country.

• Prime Minister Karim Massimov and Prime Minister Dmitry Medvedev discussed bilateral economic cooperation in Moscow on September 13. They also talked about the international economic situation and their tri-party Customs Union with Belarus. The meeting comes a week before a regional economic cooperation forum where the two heads of state will meet.

• Chairman of the national statistics agency Alikhan Smailov, Kazakhstan’s GDP grew by 5.6% in the period from January to August 2012. He noted that there had been some slowdown in industrial production due to reduced demand for steel products from foreign markets. The agricultural and construction sectors had shown increased growth in this period.

• Figures from the national statistics agency show that the population of Kazakhstan stood at 16.8 million on 1 August 2012, a growth of 137,938 in the period from January to July 2012.

• According to a UN-sponsored study published by the national statistics agency, Kazakhstan’s literacy rate stands at 99.9%, one of the highest in the CIS. The study carried out in 2010-2011 also shows significant progress in child immunization, cleaner water sources and iodine deficiency prevention, resulting in a significant improvement in the health and quality of life of the population.

• The L.N. Gumilyov Eurasian National University and Al-Farabi Kazakh National University have been ranked among the top 400 universities in the QS World University Rankings, at 369th and 390th respectively. “The fact that two Kazakh universities have appeared in the top 400 this year shows the effectiveness of stable investment in higher education”, said Ben Sowter, Head of Research at QS.

• 15-year-old chess champion Dinara Saduakasova, one of the youngest contestants at the International Chess Olympiad in Istanbul, won the title of International Grand Master. The two-time world number one (2010-2012) has won 45 medals at numerous national and international championships.

• Three Kazakhstani work have been nominated for the “Taffy - Commonwealth” television festival held in Astana from 14 to 16 September, the CIS equivalent of the Emmy awards. One of the pieces depicts the life of Kazakh poet Abay, who has become a familiar figure to Russians in recent months. The other two are works about Kulash Baiseitova, a Kazakh opera singer and People’s Artist of the USSR in 1936, and about Astana, Kazakhstan’s thriving new capital.

• Eurocopter Kazakhstan Engineering has signed an agreement to establish a EC145 helicopter maintenance center in Mongolia which will also train flying and engineering crews. Kazakhstan, as the only EC145 producer in the CIS, has exclusive rights

to supply helicopters to Mongolia, Uzbekistan, Tajikistan, Kyrgyzstan, Belarus and Azerbaijan. Eurocopter Kazakhstan Engineering is a joint venture of the Franco-German company Eurocopter and Kazakhstan Engineering JSC.

• Kazakhstan’s car manufactuer ‘Asia Auto’ has released a limited, sportier, edition of the three-door KIA Cerato Koup, its most popular model on the domestic market. Over the past eight months ‘Asia Auto’ has produced 9,239 cars, 2.6 times more than last year.

• Kazakhstan’s statistics agency has released data on the country’s trade performance in the first half of 2012. The figures show that trade surplus grew by nearly 6% on 2011 reaching $30.193 billion, whilst the foreign trade turnover was 17% higher than last year at $77.982 billion. Italy, China, Russia, Ukraine and the Netherlands were Kazakhstan’s main foreign markets in this period.

• The Ministry of Economic Development and Trade has published estimated production figures for oil and gas condensate: 81 million tonnes (mt) in 2012, 82 mt in 2013, 83 mt in 2014 and 90 mt in 2015. Production in 2011 was 80 mt. Kazakhstan’s oil exports in 2012 are expected to reach 71 mt.

• By September 10, Kazakhstan had exported over 12.5 million tons of grain and grain-derived products since the beginning of the year. This record figure is two and a half times more than last year’s exports for the same period.

• Samruk-Kazyna, KazMunaiGas, KazMunaiGas Processing & Marketing, Atyrau Refinery and OmskNefteHimProekt (Russia) have begun the construction of a deep oil processing plant in Atyrau. The plant will increase Kazakhstan’s fuel production capacity, processing around 1.745 million tons of high-octane gasoline, 1.64 million tons of diesel fuel, and 244,000 tons of jet fuel annually.

things to Watch…

• Russia-Kazakhstan Interregional Forum On September 19, the city of Pavlodar will host the 9th

Interregional Cooperation Forum between Kazakhstan and Russia that will be attended by President Nazarbayev and President Putin. The Forum will focus on cooperation in the areas of sustainable development and high technologies as well as the prospects for implementing joint scientific-technical projects. A number of agreements are expected to be signed.

• UN International Day of Peace September 21 marks International Day of Peace dedicated to strengthening the ideals of peace, both within and among nations and peoples around the world. This year, the theme “Sustainable Peace for a Sustainable Future” echoes the Rio+20 Conference on sustainable development that took place in June. The day was first inaugurated in 1982 and coincides with the opening day of the annual sessions of the UN General Assembly.

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