New City of Alatau to Operate as Independent Ecosystem With Own Tax Rules

The Senate and the Mazhilis at a joint meeting of the chambers of parliament in the first reading adopted the draft constitutional law on the special status of the city of Alatau, Orda.kz reports.

The government has developed a draft constitutional law which provides for the creation of a separate economic and management system in Alatau. The city is considered an independent ecosystem with its own financial model, special tax conditions and a new management system.

In particular, the Alatau City Council will become the highest governing body of the city. It determines the strategic directions of the city's development and ensures the coordination of Alatau state bodies. The composition of the council is approved by the President, and the council is headed by the Prime Minister.

The main executive body is proposed to be the Administration, a state body in the form of a state fund. It is endowed with all the powers for the development of entrepreneurship and performs the functions of a regulator of investment projects and infrastructure development. At the same time, the usual akimat will also remain.

The draft law provides for the adoption of Alatau's own acts in the field of:

• investment relations;
• entrepreneurial activity;
• urban planning;
• digital administration.

In order to promote the development of the city of Alatau, the local executive bodies of the city of Almaty and Almaty region have the right to conclude an agreement with the administration on joint resolution of issues of local importance.

Separately, the government explained how the role of the city akim will change. The Deputy Prime Minister said that the akim will act as a city manager and be responsible for the implementation of already approved decisions, while strategic development will be formed at the level of the council with the participation of Kazakhstani and international specialists.

According to Kanat Bozumbayev, Alatau also plans to introduce enhanced requirements for construction safety and responsibility of designers. This involves a transition to international standards and the introduction of personal responsibility for projects.

Every designer and engineer will be responsible for the decisions they make and will bear high responsibility, up to criminal liability. In addition, compulsory professional liability insurance will be introduced so that any possible damage is covered financially.said the Deputy Prime Minister. 

At the same time, the government recognizes that such requirements may increase the cost of construction, but considers it justified.

Yes, it will be a little more expensive in terms of design because personal responsibility is introduced. But this means that specialists will approach their work more responsibly, and safety will be additionally ensured through the insurance system.Kanat Bozumbayev noted. 

When developing the document, international experience was studied – in particular, cities such as Shenzhen, Singapore, Dubai, Hainan and Doha. The authorities expect to apply a similar approach: to give the city more independence in management, tax policy and attracting investments.

According to Bozumbayev, a pool of 44 investment projects worth 1.8 trillion tenge has already been formed. It is expected that they will create about 30,000 jobs. Among the projects are the participation of international companies, the development of logistics hubs, high-tech industries and educational centers. It is also planned to introduce unmanned technologies and create innovative clusters.

At the same time, the project states that foreign investors will not be granted land ownership. Sites will be provided only for specific projects and on limited terms.

They also plan to launch air taxis and cargo drones. They also want to build shipports to connect Alatau, Almaty, Konayev and tourist locations. For example, a tourist will be able to fly from Almaty airport by air taxi to Medeu.

The authorities expect that the city will become a point of attraction for investment and technology and will compete with international economic hubs.

Earlier we wrote that Alatau received a special status. Tokayev granted Alatau the special status of a city of advanced development. A new center for investment, innovation and digital technologies will be created here.

Original author: Elvira Ivannikova

Read also:

• National Economy Minister Discussed Alatau City Construction Financing
• Tokayev Meets Chinese Business Leaders, Discusses Projects