OREANDA-NEWS. December 15, 2009. EBRD President Thomas Mirow used a key investment conference in Astana in December 2009 to encourage the Kazakh authorities to improve the business climate for small companies and so help broaden the base of the country's economy, reported the press-centre of EBRD.

Speaking at the 22nd Plenary Session of the Foreign Investors’ Council (FIC), chaired by President Nursultan Nazarbayev, Mr Mirow said Kazakhstan had successfully attracted major blue chips with targeted benefits but added that this strategy was not drawing in smaller firms.

Kazakhstan needed to send a clear signal that there could be a successful small and medium-sized business sector in the country, President Mirow said, adding: “The first priority should be to improve the business environment and its predictability.”

Concrete projects
As well as engaging in policy dialogue, the EBRD delegation, which included Business Group Director for Central Asia, Caucasus and south east Europe, Olivier Descamps and was joined by EBRD Board Director, Kurt Bayer, came to Kazakhstan armed with concrete projects.

Two days before the plenary session of the FIC, President Mirow signed a loan agreement in the Kazakh business capital Almaty to provide financing for small and medium-sized enterprises (SMEs) via a US 50 million credit line to Bank CenterCredit (BCC).

BCC is a particularly attractive partner for this investment. Its extensive branch network means credits will be available especially for companies operating outside of the major centres of Almaty and Astana.

Later in Astana, Mr Mirow signed a loan to support the agricultural sector in Kazakhstan. The EBRD is lending US 35 million to Kazexportastyk, a leading agro-holding company, to help it implement an ambitious programme of advanced agricultural technology and practices.

Early victim
So far, the EBRD has invested more than US 600 million this year in Kazakhstan. Because of its banking system’s heavy dependence on foreign wholesale funding, Kazakhstan became one of the first countries in the EBRD region to be hit by the credit crunch when it started to bite in the summer of 2007.

The Kazakh economy is now bottoming out, although the EBRD’s forecasts – which are less optimistic than official government predictions – are still calling for an economic contraction of 1.3 per cent this year before a return to modest growth of just over 1.5 per cent in 2010.

Key to longer-term sustainable growth will be a successful diversification of the economy. This was the main theme of this year’s investors’ conference and a major priority for the EBRD’s strategy for the country.

Mining event
Running parallel to the FIC in Astana was a separate EBRD conference on health and safety in the Kazakh mining industry. It was attended by government officials, mining executives and health and safety practitioners.

Keynote speakers included Kazakh Prime Minister Karim Massimov and Lakshmi Mittal, the chairman and CEO of steel group ArcelorMittal, as well as President Mirow.
“Progress in health and safety remains an important factor in bringing Kazakhstan's mining sector up to international standards,” President Mirow said. He added that it “plays an important role in the sector’s attractiveness for foreign partners and investors who also have the experience and capacity to introduce the latest technology and equipment.”