Special Edition
President’s 2004 State of the Nation Message Stresses Economic Competitiveness, Social Programs, and Commitment to Democracy
Human Development, Private Home Ownership Are Priorities
Healthcare, Education to Undergo More Reforms,
Social Security Benefits to Increase
President Declares Course for Further Democratization
President Nazarbayev Calls for Closer Efforts in Fighting Terrorism, Calls for Stable Relations with U.S., Russia, and China
President’s 2004 State of the Nation Message Stresses Economic Competitiveness, Social Programs,
and Commitment to Democracy
President Nursultan Nazarbayev, in his annual state-of-the-nation address on March 19, said: “The economy remains our paramount development priority, and achieving high rates of economic growth remains our primary goal.”
He noted Kazakhstan will achieve this
through “maximum liberalization and
openness of the economy, and
working to build infrastructure and
attract private sector investment to
develop key industries.” The
Government will promote
competitiveness through further
systemic reforms and cutting
“red tape”, the Strategy of Industrial
and Innovation Development (SIID),
and supporting growth in agriculture.
The economy of Kazakhstan has
grown 50 percent in the past four
years, and is currently ranked by
British-based Oxford Analytica as
'one of the most dynamic of the
transition economies. The World Bank ranks Kazakhstan among the developing countries with income above the middle.
Traditional monopolies such as telecommunications, power generation and transmission, and railways will be the first to be liberalized. Aiming to cut bureaucracy, Kazakhstan plans to expedite the introduction of e-government in all sectors.
Kazakhstan will continue to press for membership in the World Trade Organization (WTO) which President Nazarbayev called “the most important goal” for ensuring the competitiveness of the economy. The country needs to move fast toward introducing the European Union’s financial standards by 2007 and ISO international quality standards for all products made in Kazakhstan by 2006.
The SIID will remain the Government’s top priority as the economy diversifies. One of the directions will be cluster-type development of specific industries, such as software and biotechonologies.
Kazakhstan will work to develop its own space program in cooperation with Russia, which provides for the launch of the first Kazakhstan’s commercial satellite in 2006.
The Government will also work to improve the investment climate further, the President said. It will need to support fledgling innovation businesses, adjust tax preferences for investors to promote long-term investment, as well as promote leasing options.
Human Development, Private Home Ownership Are Priorities
President Nazarbayev called for the people of Kazakhstan to raise their competitiveness through quicker adjustments to market conditions, saying the idea of using oil revenues to do that would lead to a culture of dependency.
“We have heard numerous times that some oil-producing countries open up bank accounts for their newborns. When I visited Saudi Arabia recently, I found out it wasn’t true. There is no dependency culture there. And in the West, a child is brought up knowing to respect the job, seeking to earn their own living independently of parents or the government.”
The President dismissed the idea of building government-sponsored housing, saying currently private home ownership amounts to 97 percent and will stay that way. He outlined several measures to promote private housing construction and ownership under a new housing program to begin in 2005.
These include increasing calendar terms of return for mortgages from the current 10 years to 20 years; reducing the down payment from 20% to 10% of the cost of the housing, and the interest rate is to be reduced from 13 percent to 10 percent.
The down payment on construction loans will drop from 50 percent to 25 percent, and homeowners will benefit from an extension of the repayment period from 15 years to 25 years.
This new housing program will provide private housing for around 200,000 families (or almost 1 million people) when fully implemented by 2007, the President said. It will create potential growth of the GDP by 2 percent and 45,000 new jobs and generate about 80 billion tenge ($1=138 tenge as of March 19) in additional taxes.
Healthcare, Education to Undergo More Reforms,
Social Security Benefits to Increase
President Nursultan Nazarbayev declared reforms will continue to provide better healthcare, competitive education and strong social protection for the people of Kazakhstan.
The President declared Kazakhstan will work toward a system of joint responsibility of the government and an individual for their health. Under this system, the government will guarantee free basic medical services while everything beyond that will have to be covered by private medical insurance or direct payments by citizens.
President Nazarbayev announced plans to introduce 12-year primary and secondary education and 4-year higher education to ensure Kazakhstan’s “competitiveness as a nation.” By 2005, up to 75 percent of all schools will need to have access to the Internet.
The President also announced an increase in payments to disabled persons by up to 50 percent, as well as in social security benefits to World War II veterans in the run up to the 60th anniversary of the V-day in 2005.
President Declares Course for Further Democratization
President Nazarbayev has declared a commitment to further democratization of the society and called for stronger focus on three major areas—developing civil society institutions, decentralizing political power and creating a sustainable multi-party political system.
“We need to take steps to strengthen stability, democracy and the protection of human rights,” the President noted. “The new election legislation aims at raising the professionalism and transparency in the activities of election commissions of all levels.”
“We will continue to develop further our political party system, improving legal norms regulating the activities of political parties and public associations,” he said.
The President noted although the 2002 law setting the minimum party membership at 50,000 was criticized at that time, already “nine political parties are registered which easily overcame this limit and nobody is questioning whether that amendment was democratic.”
President Nazarbayev said: “The same will happen with current bills on the media and elections.”
The President believes issues of financing of political parties and NGOs by domestic legal entities and private individuals will need to be worked out in legal terms. The support for the non-governmental sector needs to grow.
He called the upcoming election to the Majilis of the Parliament in the fall of 2004 “a test of maturity for political parties.”
The President said: “Our common duty is to ensure the election is held in strict compliance with the law.”
President Nazarbayev Calls for Closer Efforts in Fighting Terrorism, Calls for Stable Relations with U.S., Russia, and China
President Nazarbayev has called for consolidation of regional and international efforts to fight terrorism, religious extremism, drug trafficking and other modern challenges and threats to humanity.
The President said: “The recent events in Russia and Spain shocked everybody and made us all think once again that there is no single country that is protected from the barbaric acts of terrorists.”
Kazakhstan has supported the anti-terrorist fight and is providing assistance within Operation Enduring Freedom in Afghanistan and Operation Iraqi Freedom. U.S. President George Bush, speaking at the White House on March 19, applauded Kazakhstan’s contribution to stabilizing Iraq.
President Nazarbayev spoke for the development of stable and mutually beneficial relations with the United States, Russia, China, the countries of Central Asia and the European Union.
He declared: “We stand for mutually beneficial relations with the East and the West. Kazakhstan’s foreign policy needs to be oriented toward promoting our speedy economic development and raising our status internationally.”
The President believes Russia is “a very important country for Kazakhstan” and “the current high level of economic integration and trust needs to be sustained.”
“A stable and friendly relationship with our neighbor China is important,” the President noted. “We need to expand bilateral trade.”
Speaking of relations with the U.S., President Nazarbayev said: “Kazakhstan values the quality of its relationship with the United States. We understand well the importance of cooperation with America for ensuring favorable external conditions for our development.”
“The investments by American companies in Kazakhstan are an important factor of our cooperation,” the President said, noting that of US$ 25 billion in foreign direct investment into Kazakhstan so far the U.S. accounts for US $7.5 billion.
“We expect our broad cooperation to continue further,” he declared.
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News Bulletin of the Embassy of the Republic of Kazakhstan to the USA and Canada
(Compiled from own sources and agency reports)
Contact person: Roman Vassilenko
1401 16th Street NW, Washington DC 20036
Tel.: (202) 232- 5488 ext. 104, Fax: (202) 232- 5845
