Azernews.Az

By Aynur Jafarova

Kazakhstan needs to attract additional investments worth $80 billion over the next seven years to achieve a seven-percent growth of GDP, Director of McKinsey Global Institute Richard Dobbs believes.

"To achieve GDP growth by seven percent, Kazakhstan needs to attract additional investments worth 80 percent from 2013 to 2020, which is equivalent to $10 billion a year," Dobbs said at the second meeting of the steering committee on "Improving the funding model of the industrialization program of Kazakhstan", which was held by National Management Holding Baiterek Joint Stock Company on October 1.

According to him, these investments should come from the domestic and private sector and inflow of foreign direct investments.

"The experts do not envisage a substantial increase in government involvement in the economy, because effective functioning of the private sector and small and medium-sized businesses is necessary to ensure long-term growth," Dobbs said.

According to him, the development of financial sector is an important condition for attracting investments in Kazakhstan's economy.

"Therefore, it is necessary to solve one of the major problems of the banking system of Kazakhstan - the extremely high level of non-performing loans (NPL)," he added.

Baiterek National Managing Holding was established in accordance with the decree of the Kazakh President, dated May 22, 2013. The purpose of establishing the holding is to promote the development and diversification of the economy, to attract investments, and to improve the corporate governance system in its subsidiaries. The holding's trust management includes such state financial institutions as Development Bank of Kazakhstan, DAMU Entrepreneurship Development Fund, Investment Fund of Kazakhstan, Kazyna Capital Management, as well as Kazakhstan Mortgage Company.

Mining sector needs $100 bln investment

Chairman of the Board of the Baiterek National Managing Holding Kuandik Bishimbayev believes that Kazakhstan's mining sector requires about $100 billion of investment.

"The whole mining sector, including ore mining, requires about $100 billion of investment by 2020," Bishimbayev said.

According to him, Kazakhstan needs to rehabilitate the banking system to provide for such financial inflows.

"However, not only the banking system, but also private investment, both domestic and foreign, and budget funds partially, can be a funding source," Bishimbayev said. "So, the sources are clear, now it is necessary to create conditions for these investments to enter the economy."