Fair Kazakhstan - Law and Order, Economic Growth, Public Optimism: Toqayev Addresses Nation

On September 2, 2024, The President of the Republic of Kazakhstan addressed the nation. We have compiled the highlights from the President's speech.

“Kazakhstan Needs a New Law on Banks”

In the address, Toqayev initially mentioned eliminating monetary and fiscal policy imbalances.

Lending to the real sector is still not at the proper level. The matter of sufficient funding for small and medium-sized businesses has not been resolved. We need a new law on banks that meets the current challenges of stimulating economic activity and further dynamic development of the fintech sector. The current law is almost 30 years old, it was accepted in other realities. It must be said frankly that a major miscalculation in the work of the previous and current governments was the failure to implement the revenue part of the republican budget. It is unacceptable for this problem to become systemic and hinder the development of the country.

The government and the National Bank must take adequate measures to use budget funds efficiently and limit and strictly control expenditures.

Necessary to Optimize Tax Regimes

The president believes that inter-budgetary relations also need to be improved. He believes that the government should develop rational mechanisms to find sources to cover the budget deficit.

It is necessary to create favorable conditions for increasing business activity by attracting private investment into the economy. To do this, first of all, a stable tax policy is needed that stimulates high-quality development and responsible business behavior.

The new Tax Code is designed to reboot the existing system. Toqayev emphasized the importance of simplifying it and making all provisions understandable to all economically active citizens to eliminate the possibility of different interpretations of the regulations.

We need to optimize tax regimes without worsening the current favorable conditions for entrepreneurs. An example is the introduction of a retail tax. Businesses trusted this norm, began to come out of the shadows, and fragmentation decreased. But entrepreneurs who work primarily with the population should fall under this regime. For the fiscal reform to be successful, total digitalization of administration is needed. In order to mitigate corruption risks and ensure transparency, it is necessary to accelerate the transfer of tax processes to an electronic format.

It is desirable to adapt the entire tax policy to changing fiscal conditions, including revising tax rates, Toqayev concluded.

Differentiated Individual Income Tax Rates May be Approved in Kazakhstan

According to Qasym-Jomart Toqayev, the punitive approach to tax administration should be abandoned.

I believe it is possible to increase the threshold of tax arrears, at which notifications will be sent without the use of forced collection. In the event of exceeding the threshold of tax arrears, restrictions should be imposed only within the limits of the debt, i.e. the entire bank account would not be blocked. In the case of large tax arrears, payment installments should be provided without collateral. We must strive to completely abandon tax audits according to a plan. To do this, we must improve the risk management system.

The president instructed the government and parliament to hold a thorough discussion of the draft of the new Tax Code.

Complex but necessary solutions must be found. Haste in this matter is unacceptable. Therefore, I consider it possible to postpone the adoption of the new Code until next year to prepare the law at a high-quality level.

High Share of Direct State Participation in Economy Violates Market Condition Equality 

As the head of state noted, the country has not developed an optimal policy for managing state-owned enterprises.

It is necessary to regulate by law the goals, functions, types, financing methods and other aspects of activity. In addition, it is essential to ensure stability and a systematic approach to the issues of financial relations between holdings and the government, says Qasym-Jomart Toqayev.

The president emphasized that entrepreneurs continue to lodge complaints about excessive control and supervisory activities of government agencies.

The president instructed the government and the Prosecutor General’s Office to eliminate negative phenomena affecting the investment climate.

Referendum on NPP to Be Held on October 6

The President announced the date of the referendum on the construction of the NPP. The Government of the Republic of Kazakhstan adopted the corresponding resolution on August 27.

Considering the growing global energy deficit, we are in dire need of reliable and clean energy sources. Therefore, in my opinion, it is necessary to pay close attention to the development of nuclear energy. Currently, there are about 200 nuclear power plants in 30 developed and developing countries. We must think about the future, taking into account long-term national interests and the specifics of Kazakhstan. I have always insisted on a well-thought-out decision on the construction of the NPP (with broad discussion). Every critical step must be taken with the support of the people. This should be the case with the referendum on the NPP. The national referendum will be on on October 6, and I will sign the decree today. 

The referendum will be another manifestation of a broad national dialogue and an example of implementing the concept of a “listening state,” Toqayev notes.

Asset Recovery: Toqayev Calls on Oligarchs “Not to Bargain for Every Tenge”

The head of state recalled that an investment in Kazakhstan's economy is a mandatory condition for capital amnesty.

The central aspect is that they work for the benefit of the country. This point must be enshrined in law. Entrepreneurs included in the relevant register can be given the opportunity to conclude an agreement without recognizing the illegality of the transferred assets. This is a big step in the interests of large entrepreneurs. But the entrepreneurs themselves must meet the government and the Prosecutor General's Office halfway. And do this based on goodwill, without bargaining over every tenge.

Oligarchs included in the register must invest assets obtained illegally in the construction of schools, hospitals, stadiums, museums, and other socio-cultural facilities. Toqayev said their names may remain on the "golden list" of philanthropists.

In case of refusal or delay of the process, the conversation with such entrepreneurs will be different. At the same time, it is necessary to organize all information about the assets returned to the state and their intended use.

Direct Subsidies to Agriculture May Discontinue

According to the President, the most crucial task is the gradual transition from direct subsidies to the agro-industrial complex to ensure affordable lending.

All allocated funds must be used effectively. However, unreliable data, or in other words, falsifications, do not allow us to assess the actual situation in agriculture. A special commission has already identified 2 million heads of cattle and more than 3 million heads of small cattle that do not exist. The same facts have been identified in crop production. These are essentially falsifications for which state subsidies were allocated. Such criminal practices should be stopped, and those who did this should be held accountable, said Qasym-Jomart Toqayev.

Many Land Users Not Concerned about Rural Population

Qasym-Jomart Toqayev reminded the government of the need to stimulate legal employment of citizens in rural areas.

It is no secret that many land users live thousands of kilometers away from the land that brings them profit and are not concerned about the lives of rural residents. We do not need such landowners. The government and the Prosecutor General's Office must deal with them. The issue of introducing "commodity credit" should be considered. At the same time, it is vital to create an infrastructure for processing and marketing products produced by villagers. In each district, it is necessary to launch centers to train residents in cultivating various agricultural crops. 

Single-industry Towns: “Actively Developing New Growth in the Regions Is Crucial”

Efforts should be made to develop the country’s industrial potential fully, believes Qasym-Jomart Toqayev.

I recently visited the Karaganda region and visited the Qarmet metallurgical plant. With the arrival of a domestic investor, the situation at the plant has noticeably stabilized, modernization of the enterprise has begun, which should lead to a significant increase in production. As part of the diversification of the economy, the production of car tires and household appliances was launched in Saran, which allowed this city to be excluded from the category of single-industry towns. This experience should be applied to other single-industry towns to breathe new life into them. As you know, this year the city of Alatau was established, which should become a place of advanced development, attracting innovations and talents. The government should create attractive conditions for investment, life and work in this city.

Acceleration of Construction of Gas Processing Plants in Zhanaozen, Kashagan and Karachaganak

This is a priority task. For the successful development of the industry, it is necessary to introduce effective incentives aimed at ensuring the return on investment, including the provision of adequate tariffs and wholesale prices, as soon as possible. Such conditions are extremely important for new investments in the geological exploration of gas fields. Otherwise, it is simply impossible to provide the economy with sufficient volumes of gas, the head of state noted.

Unjustified Tariff Increase Impermissible 

Toqayev spoke about infrastructure issues, particularly the energy sector and public utilities.

The standard terms of lending for the construction of new generation facilities cannot be called acceptable. Therefore, the government needs to think about how to ensure affordable lending from financial institutions. The state will need to clearly plan its tariff policy for the long term. This is an essential condition for attracting "long money" to the industry. At the same time, unjustified increases in tariffs for consumers cannot be permitted.

Qasym-Jomart Toqayev has instructed the approval of a national project to modernize the energy and utilities sectors by the end of the year.

The issue of creating a culture of saving utility resources remains acute. From next year, it is necessary to introduce clear standards for their consumption based on the principle of 'the more you consume, the more you pay.' At the same time, consumers should not be left alone in their relationships with private monopolists. The concept of socially significant services should be introduced into legislation and regulated by analogy with the processes of providing public services.

Necessary to Revise Railway Industry Tariffs 

This is an obvious fact. The new tariffs will allow maintaining the proper condition of the railway network and expanding its capacity. The company "Kazakhstan Temir Joly" is implementing three major infrastructure projects to construct railways with a total length of over one thousand kilometers. These projects must be completed within the established deadlines and at a high-quality level, noted Qasym-Jomart Toqayev.

The president also discussed the state of the country's roads and emphasized that quality is a special priority. According to the president, a single digital platform that will reflect all information about the construction and repair of roads, including intracity ones, is necessary to strengthen public control.

Cryptocurrency Exchanges, Air Hubs, AI center — Digitalization Development

Kazakhstan should become a country where artificial intelligence is widely used, and digital technologies are developed. I ask members of parliament to join this work. Next year, a National Center for Artificial Intelligence should be launched in Astana, which will be open to schoolchildren, students, researchers, and entrepreneurs. 

According to Qasym-Jomart Toqayev, it is also necessary to continue improving the regulatory framework for digital assets and mining and further developing crypto exchanges.

Along with this, the president spoke about the development of air hubs.

We need to create all the conditions to expand the cargo transportation capabilities of our airports. The development of domestic air routes should also be the focus of close attention, especially concerning the infrastructure at the main tourist sites. We need to unlock the potential of the resort areas of Katon-Karagay, Zaysan, and Kendirli. In the resort areas, we need to build airports and airports with high-quality road infrastructure. Small aircraft should be purchased through the Industrial Development Fund. I would like to especially note that when implementing tourism projects, it is important not to disturb the ecological balance and avoid damage to nature.

Spring Floods: Learn Lessons

According to Qasym-Jomart Toqayev, it is necessary to modernize hydrological posts and organize work to save water. In particular, this concerns agriculture, where water-saving technologies should be used more widely.

The authorities at the center and at the local level need to learn the relevant lessons. In the current reality, we must be prepared for any challenges, so we must learn to create water reserves by collecting flood waters for the needs of farmers. Irrigation, water storage and use systems, if properly approached, can become an attractive sector for investment. Therefore, it is necessary to regulate the tariff policy.

Human Resources

Qasym-Jomart Toqayev emphasized the importance of increasing the country's human resources potential.

First of all, we need to overcome the acute shortage of industry specialists: water specialists, builders, power engineers, and many others. We are also talking about training specialists in the professions of the future. Work in this direction has already begun. It is also impossible to turn internships of scientists abroad into some kind of sinecure and "academic tourism." Qualified personnel should be trained not only in universities but also in technical and vocational education organizations. The government should consider the possibility of taking on college graduates who have demonstrated high results in industry-specific government agencies

Toqayev Declared 2025 Year of Working Professions

The reform of vocational education is becoming absolutely important in terms of ensuring economic growth and its investment attractiveness. I declare 2025 the Year of Working Professions. During this time, we will have to implement a reform of the technical and vocational education system. The Year of Working Professions will also promote the idea of ​​hard work and professionalism in our society.

Per Capita Funding for Preschool Education 

Preparing children for school is of great importance. Parents bear joint responsibility for preschool education and teaching of a child, along with the state. Therefore, per capita funding for preschool education should be linked to the real income of each family. Thus, further improvement of the education system will help citizens who genuinely need it, will increase the transparency of state support, and, in general, will contribute to strengthening the human potential of the country, said Qasym-Jomart Toqayev.

Sport: There is a Pressing Need to Update Legislation 

As you know, I pay special attention to the development of mass sports. Without this, it is impossible to achieve the goal of raising healthy youth and strengthening the health of the entire nation. Recently, at a meeting with participants in the Olympic Games, I formulated key tasks and priorities in the field of sports. I believe that there is a pressing need to update legislation in this area, the president noted.

According to the president, the expected amendments will stimulate the development of mass and children's sports and provide the basis for training a new generation of champions. Toqayev instructed the deputies to pay close attention to the relevant bill.

Nobody Has Canceled Meritocracy Principles 

As Qasym-Jomart Toqayev noted, all appointments should consider candidates' professional and moral qualities and performance in previous positions.

There are positive changes in this work. All state bodies have been transferred to a single personnel information system. Now the Agency for Civil Service Affairs and the government should ensure automation of personnel issues of organizations financed from the state budget.

Necessary to Ensure Iron Discipline in The Military

Of primary importance is the observance of law and order in the army, where young men go to fulfil their duty to the Motherland. In order for soldiers to be able to properly perform their duties, iron discipline must first of all be ensured in the Armed Forces and other law enforcement agencies. Parents have entrusted their sons to the state, so it is the leadership of the army and law enforcement agencies that bears specific responsibility for their health and safety

Remarks about Kazakhstan, Discrimination, Geopolitics 

Well-known agenda-driven individuals, including those operating from abroad, are trying to manipulate public opinion and make unfounded remarks about Kazakhstan, noted Qasym-Jomart Toqayev.

All these well-paid attempts to sow discord in Kazakhstan are doomed to fail because we have never had, do not have, and never will have any "phobias" either at the public or political level. In Kazakhstan, there is not and cannot be any oppression on any grounds, be it linguistic, religious, ethnic, or social.

Kazakhstan firmly adheres to a peaceful and balanced foreign policy. Toqayev emphasized that diplomacy's main tasks remain strengthening the state's sovereignty and independence, protecting the rights of citizens abroad, and promoting national interests.

You can't constantly look back, search for the guilty, be it the system or individual political figures. You need to know and study your history, but not look for reasons for despondency and resentment in it. From the events of the past, no matter how tragic they were, you should learn valuable lessons. You see what fundamental shifts are happening in the world today. In the context of economic, political, climatic and many other challenges on a global and regional scale, we have to simultaneously solve a vast number of both current and strategic tasks. Naturally, there are not enough resources for everything, and no one promises immediate results. Many problems in the country have been accumulating for years.