Entrepreneurs of all countries, unite!

The idea of uniting councils of foreign and domestic investors that was proposed during one of the Exclusive National Club of Top Managers will most likely find some practical application. The executives of the largest Kazakhstani and foreign business associations: the Council of Foreign Investors (CFI) , the European Business Association of Kazakhstan (EuroBAK), the Kazakhstan Association of Turkish Investors (KATIAD), the German Business Club (GBC), the Forum of Entrepreneurs of Kazakhstan (FEK), and the American Chamber of Commerce (AmCham) have unanimously confirmed that the problems with which groups must deal are common, and can be solved solely through consolidated efforts.

Nurlan Smagulov believes that over the past several years foreign and Kazakhstani investors have been operating in a parallel manner without crossing paths. Foreign investors have received more preferences, which was understandable: they brought in capital, technology, and new business processes. Now, 15 years later, Kazakhstani business has formed its consciousness, and can provide investment volumes comparable with those of foreign ones. At the same time, both foreign and Kazakhstani investors have encountered a problem related to protecting their investments. The creation of a council, or union, of investors would not assume to replace the CFI. More important would be the demonstration of a commitment to joint action. At the same time, the parties predict that such an idea will not be welcomed by the government of Kazakhstan. However, it could hardly ignore a consolidated opinion put forth by the country’s largest investors. The forms of cooperation could vary: joint discussion on many issues, mutual campaigns, conferences, and letters to the government. Moreover, according to the opinion of the majority [of investors], the activities of the most influential organization, the CFI, can manage regular meetings with the head of state, which occur along an unchanging backdrop, inclusive of complaints by foreign investors, followed by the regimented criticism of government.

Mirgul Isanova, executive director of the CFI, has admitted that meetings with President Nursultan Nazarbayev occur more along the lines of protocol. They are important only because certain issues are agreed and confirmed with signatures, which further on are mandatory for execution. This is why she supports the idea of a united council, but still suggests that its realization should be made within the framework of CFI.
As of today, aside from the CFI, there is domestic business association working at the level of the government – the FEK. Probably, their joining would increase the effectiveness of both organizations. However, such a form will hardly find support with other business associations. EuroBAK is not supporting the idea, nor are Turkish or German businesspeople.
At least one thing is clear – the situation over the last 15 years has dramatically changed. Before bowing to the largest transnational corporations was quite justified, as Kazakhstan required their presence as a sign of possessing a good investment climate. Currently, we need a rival to those businesspeople who represent foreign businesses not operating in the subsoil sector. Thus far, the majority of the CFI is made up of representatives of the subsoil sector, the interests of which are simply ridiculous to protect, at least because the turnover of those companies is several times higher than the consolidated budget of the Republic of Kazakhstan itself. In the opinion of a EuroBAK representative, any entity should develop and upgrade in a manner dependent upon the goals that have just been met and the objectives that have been set forth. At the same time, it is quite important that initiatives originate from below, instead of coming from above, as happens most often in the creation of a business environment.

Raimbek Batalov, chairman of the FEK, considers the mutual work of the CFI and FEK has shown that all business associations have similar tasks and goals. Presently, the Parliament of Kazakhstan is working on 18 draft laws, which are all concerned in one or another way with the formation of an investment climate: licensing, taxes, certification, customs regime, and others. Such is the daily work, requiring administrative and financial resources. If business circles are able to present a consolidated opinion, then the authorities will at least not be able to avoid listening to that argument.
The participants of the joint meeting [of representatives of different business associations] decided to carry out thorough research of the investment market among themselves, regardless of the country each represented. A decision was taken to sign a memorandum on this issue, and to establish a working group.
The first dialogue between domestic and foreign investors has occurred. Whether they will be able to unite in their efforts, or if the authorities will wish to hear from them, a clear view will be given as to the establishment’s view on real modernization of the economy.

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