The Government of Kazakhstan has made significant efforts to remove bureaucratic obstacles to investment and the creation of an attractive business environment, which has been consistently reflected in the last four editions of the World Bank’s Doing Business report as well as other internationally recognized indices.
The Constitution affords foreign investors the same rights and obligations as Kazakh nationals. The Investment Code guarantees foreign firms equality between local and foreign investors, protection of investor’s rights, arbitration of disputes, guarantees against nationalization and affirms the right to repatriate profits. Thanks to these, the country ranks 22nd in the Investor Protection Index of the World Bank. Foreign firms invest in almost all sectors of the economy.
The country has a comprehensive system promoting inflow of FDI into domestic-oriented production and export-oriented local production. The government provides investment preferences such as exemptions from customs duties, state grants in kind, privileges relating to land tax and property tax for legal entities carrying out strategic investment projects, and industrial privileges for legal entities carrying out strategic investment projects in residential areas with a low level of social economic development.
In 2019, FDI amounted to almost $25 billion, the equivalent of 10% of GDP, and has brought new technology and jobs for domestic suppliers and subcontractors and has generated new types of employment and training for Kazakhs. The majority of FDI has targeted the oil, gas and mining sectors and associated services, so the government puts a large emphasis on encouraging investment in industries other than oil & gas and mining as part of its 2050 Strategy. To eliminate the dependence on resource extraction industries, the government adopted plans to focus on diversification of economy to become knowledge-based modern economy.
The government’s efforts to strengthen the state’s fiscal balance, reduce national debt, and aid the recovery of the banking sector following the 2007-08 crisis prompted Fitch Ratings to upgrade Kazakhstan’s sovereign rating to BBB + with a stable outlook in November 2012. Kazakhstan’s progressive, pro-business laws also support the growth of foreign investment and stronger economic growth. Doing business in Kazakhstan becomes easier and more inviting for foreign investors each year.