Kazakhstan’s government plans to support small and medium-sized businesses in a new way

Business correspondent
The Ministry of National Economy has revealed new measures to support small and medium-sized businesses / Photo: Shutterstock

National Economy Minister Alibek Kuantyrov has revealed details of the unified comprehensive program for small and medium-sized businesses. As the official noted, the government plans to cut subsidies and provide more guarantees to entrepreneurs instead.

During a meeting with members of the country’s cabinet, Maulen Ashimbayev, speaker of the Senate, the upper house of the national parliament, said that medium-sized businesses are almost stagnated. He cited data showing that medium-sized businesses account for just 6% of the national GDP. This figure hasn’t changed since 2019. Moreover, about a third of the sector participants reported losses in the first half of the year.

Ashimbayev also pointed out the rapid increase in the number of small businesses, which is a result of the deliberate fragmentation of business to reduce tax burden. The senator also highlighted that the vast majority of small businesses in Kazakhstan represent low-end sectors. For instance, 35% of small businesses are engaged in trade, while the government should facilitate the development of the processing sector and make it more attractive for small businesses.

According to the Ministry of National Economy, there were 2.2 million small and medium-sized businesses in Kazakhstan as of October 1. Roughly 99.9% of them are small businesses, while medium-sized businesses account for just 0.1%. Kuantyrov said that his ministry is working on a new program designed for supporting and developing small and medium-sized businesses. This new program is meant to absorb two other public programs: the Business Roadmap and the Economy of Simple Things, which were mainly focused on subsidizing businesses.

«We have prepared comprehensive incentives aimed at consolidation of small businesses and strong growth of medium-sized businesses. In this new program, we are going to shift our focus from subsidizing businesses to providing them more guarantees and improving instruments for facilitating bond-secured loans. We also want to think about what we can do to open access to syndicated funding for small and medium-sized businesses,» Kuantyrov said.

In addition, the ministry suggests introducing a set of measures to support businesses and their cross liabilities. According to Kuantyrov, the government will put priority on those businesses that are technologically advanced, export-oriented and with high potential for further growth.

«We are also going to prepare some incentives for medium-sized businesses with the aim of letting leaders of this segment emerge. In other words, the new agenda designed for the supporting of entrepreneurship will ensure non-stop development of business at every stage of its evolution,» the minister underlined.

Moreover, the Ministry of National Economy also plans to introduce tax holidays for some new projects and digitalize the tax control procedures. Kuantyrov believes that this new approach will boost business activities in the country.

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