NUR-SULTAN
Kazakhstan is set to receive up to $500 million in foreign investment , led by British and Dutch companies keen to capitalise on the country’s developing agro-industrial and chemical industries.
British company Brown and Co, together with Kazakhstan’s Eco Meat Vostok, plan to build a $273 million meat processing plant in eastern Kazakhstan, in partnership with the Kazakh Invest, FinSight Ventures Investment Fund. A workshop for waste processing into organic fertilizers is also expected to be built next to the plant.
“The plant will operate using advanced technologies including robotic production, ” Nartai Beysekov, Kazakh Invest regional director, said. “All breeding stock will be imported from Denmark.”
Dutch company Van Der Hoeven will invest $35 million in the construction of a greenhouse facility in western Kazakhstan. Other Dutch companies, including Food Ventures, KUBO, Certhon, Gakon, Dalsem, Hoogendoorn, Svensson, Gakon and Priva, signed six agreements with Kazakhstan’s government worth more than $238 million.
COVID-19 has taken its toll on investment into the country. Foreign direct investment is forecast to decline by 5 to 10 percent in 2021, before recovering in 2022. With oil prices taking a hit last year by slowing demand and difficulties in controlling supply, and its own resources showing signs of diminishing, Kazakhstan, like many of its neighbours, is seeking to diversify its economy.
A vast country with a relatively small population, Kazakhstan attracts about 60 percent of all capital invested in the five former Soviet Central Asian states. For investors, oil is the primary attraction: of the $150 billion in foreign investment in the Central Asian country since independence, $120 billion – or more than 70 percent- has been in natural resources extraction.
While agriculture only represents a small share of the economy , 4.44 percent of GDP in 2019, largely held back by a lack of infrastructure, industry contributed just above 33 percent.
Another issue is property rights. Though Kazakhstan has advertised itself abroad as a country where the property rights of investors will be protected, foreign investors have on occasion registered complaints about the arbitrary application of laws, with some claiming they are designed to demand bribes. Enforcement has also sometimes been labelled opaque. Other investors have complained about alleged tax harassment, including snap audits and inspections, or about threats of criminal charges being made to resolve civil disputes.
Still, investment interest has continued.
U.A.E. company Al Dahra also plans investment in Kazakhstan’s agro-industrial complex.
Kazakh Invest has also drafted investment proposals on nine projects worth $600 million to potential investors in the chemical industry.
Turkish company Brimstone Sulfur Provider will invest $10 million into sulfur bentonite production in western Kazakhstan.