“The Bank urgently needs to make adjustments to policy” — Tokayev

On 15 October under the chairmanship of President Kassym-Jomart Tokayev held a meeting on economic issues.

381622e299529451c25f85f74a4ab556 - "The Bank urgently needs to make adjustments to policy" — TokayevPhoto by press service of Akorda

During the meeting were discussed the results of socio-economic development of the country, the execution of the plans, the implementation of monetary policy, the reform of targeted social assistance, social development and employment, reports the press service of Akorda.

Presentations were made by Prime Minister Askar Mamin, Chairman of the National Bank of Kazakhstan Yerbolat Dossayev, Kazakh Minister of labor and social protection of population Birzhan Nurymbetov.

Kassym-Jomart Tokayev noted that the overall macroeconomic situation in the country is stable, the main indicators of socio-economic development of Kazakhstan showed positive dynamics, however, the problem of diversification of the domestic economy, productive employment, incomes, access to social benefits have not been fully resolved.

According to the head of the state, from high-quality implementation of strategic programs depends on the solution of the main task –increase of level of living of the population.

The President instructed to develop a complex of measures on maintenance of macroeconomic, financial and social stability of the country under different scenarios in the world, and focused on the tasks of the current stage of implementation of the Strategy “Kazakhstan-2050”.

Kassym-Jomart Tokayev stressed that in the government decision-making should be to fundamentally strengthen the analytical component.

The President believes that the average business should become the driver of economic diversification. The program of industrialization have helped to halt the decline in industrial production and manufacturing sector, to start production of new types of products. However, in the opinion of the head of state, major shifts in the structure of the economy did not happen.

“The emphasis needs to be placed on labour productivity growth not less than 1.7 times and a significant increase in Kazakhstan’s exports of processed products. The government will have to increase non-oil exports by 1.5 times by 2022, and 2 times in 2025”, — the President ordered.

The head of state pointed to the necessity of forming at least 3-5 technologically advanced industries, competitive at least on a regional scale.

“To industrialization attracted the attention of local and foreign expert community. To the previous programs of his attitude more than restrained. We can not allow discredit the very idea of industrialization”, — was noted in the statement.

According to Kassym-Jomart Tokayev, the development of economic potential of the country needs to promote economic integration within the EAEU. The President believes we need to strengthen analytical work with a view to strengthening the country’s position in the EEU and the protection of domestic producers exporting products to the Eurasian market. He believes that for the economic modernization of the country is extremely important issue is also attracting investment.

“We are constantly improving our investment climate. But how such a climate is the amount of investment? Why no explosive effect? To attract foreign investment is important not only fiscal incentives. Systemic problem – the narrowness of the internal market, the complexity of the output for export, lack of coordination of actions of state bodies at Central and local level”, — stressed the head of state.

Kassym-Jomart Tokayev instructed to ensure the development of a chain of promotion of products to stores in all regions of the country, as well as to promote an integrated approach to the formation and development of national distribution systems across all sectors of the economy.

“Today we have many tools to support exports, which have 3 operators: NCE “Atameken”, national company “KazakhExport” and QazTrade. Talking about the need to unite all available measures to support export in single window. I instructed the government to carry out a professional survey of exporters to determine problem areas, urgent needs and to build the instruments of state support. I hope you’ll accept and organizational decisions,” the President said.

Speaking about fiscal policy, the President expressed the opinion that we should sustain its policy of gradual reduction of transfers from the National Fund. According to him, there will need to apply only in cases of extreme necessity.

“The government should primarily rely on the revenue of the national budget. The national Bank shall revise approaches in the management of the national Fund in order to improve the resulting investment income. Proper asset management can substantially increase the volume of the national Fund,” said Kassym-Jomart Tokayev.

The President criticized the situation when commercial banks in the pursuit of profit redirect resources to consumer credit and reduce the lending business.

“The national Bank urgently needs to make adjustments to the current policy. According to the regulator, more than 50% in every sector of the economy is sustainable and financially independent enterprises of interest to the banks. However, they are not interested in attracting Bank loans. Why? Perhaps this means that these companies consider themselves unattractive to the conditions imposed by commercial banks. Standing in front of a dilemma: the stability of the financial sector or the development of lending to the real sector, the national Bank needs to make a rational decision”, — said the head of state.

The President instructed to develop a monetary policy Strategy until 2030. Kassym-Jomart Tokayev has urged the national Bank to improve communication and ongoing awareness-raising policy that will help to increase confidence in the actions of the regulator on the part of market participants and of the population, and to reduce unreasonable expectations of devaluation.

The head of state is not left unattended and implementation of a unified housing policy.

“It is necessary that each citizen would have a clear understanding of the prospects for the acquisition or rent of housing, the conditions of its receipt. For this we have to determine the criteria for housing affordability is system to reduce construction costs, to establish the proportion of apartment buildings and individual housing, to civilize the apartment rental market,” said Kassym-Jomart Tokayev.

In conclusion, the President stressed that the priorities and solutions with the proper approach will improve the rate and quality of economic growth, and will raise the standard of living of the population.

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