In 1998, Kazakhstan hopes to raise at least as much money in direct investment as it did in 1997 when investment totalled USD 1.3bn, the Executive Director of the Kazakhstan State Investment Committee (SIC), Anvar Saidenov, said to Reuters. In his opinion, the initial 1998 forecast of USD 1.2bn may be exceeded due to recent large deals totalling USD 500m whereby Kazakhstan sold its share in the Caspian shelf project. Saidenov said that direct investment in Kazakhstan in the first six months of 1998 totalled USD 425m.

According to the information released by the SIC, most of the investment in the past five years has been made in the oil and gas sector—45.4% of the total investment. The non-ferrous metal sector attracted 26.1%, and the ferrous metal sector, 4.7%. (Reuters)

President Nazarbaev said on September 25 that of the USD 500m gained by Kazakhstan from selling its shares in the Caspian shelf project, USD 200m had been channelled to the state budget. (Reuters)

The National Bank of Kazakhstan (NBK) issued a statement on Monday, September 21, saying that it has never performed transactions with Russian Federation Government debt securities, nor has it such securities among its assets. The NBK's portfolio of gold and hard currency assets worth USD 2bn is formed of highly liquid and reliable assets, the NBK said. These include hard currency, IMF special drawing rights (SDR), refined precious metals, and U.S. Treasury bonds. (Kazakhstanskaya Pravda)

According to the State Committee for Statistics and Analysis (SCSA), investment in Kazakhstan's fixed capital totalled KZT 103bn (USD 1.3bn) in January-August 1998, which is up 56% compared to the same period in 1997. Fifty-seven percent of the investment in fixed assets was made by corporations and individuals, down 14.0pp compared to the same period in 1997. Construction absorbed 97.0% of the republican and local budgets. The mining and processing industries, as well as transport and telecommunications, remained the priority sectors in which to invest.

Foreigners invested in the construction of hotels and restaurants (71.0% of the total investment), education (44.0%), health care facilities (45.0%), processing industries (40.0%), and transport and telecommunications (40.0%). (Reuters)

The State Committee for Statistics and Analysis reported that copper outputs fell 1.9% to 26,225 tonnes in August compared to July (+0.1% YoY change). The production of other non-ferrous metals in August was as follows: zinc—21.575 tonnes, an increase of 6.5% compared to July (+31.8% YoY change); lead—8,135 tonnes, an increase of 7.4% (+22.1% YoY change); bauxite—342,500 tonnes (+3.3% MoM and +2.3% YoY); alumina—98,550 tonnes (+0.1% MoM and +7/0% YoY). (Reuters)

Kazakhstan's oil production increased 14.9% to 2,054 million tonnes in August from 1,787 million tonnes in July, the SCSA reported on Monday, September 21. (This figure, however, was 1.8% lower than last year's August figure.)

The natural gas output was 0.7bn m³, an increase of 23% compared to July (+6.1% YoY change). (Reuters)

President Nursultan Nazarbaev chaired the first meeting of the recently-formed Foreign Investors' Council that was held in Almaty last week. The council, headed by Nazarbaev, unites senior executives from 10 foreign companies working in the Kazakhstani oil and gas, metals, banking, energy, and legal sectors. Also attending the meeting were Prime Minister Nurlan Balgimbaev and the First Vice President of the EBRD, Charles Frank, who had come to Almaty especially for this meeting.

According to Nazarbaev, the Council intends to work out recommendations on the development of the Kazakhstani investment climate, legal framework, and fiscal policies. It will be a co-ordinating body between central and local authorities and foreign investors. He said that the meeting had a symbolic meaning amid the international financial crisis and showed "a high level of confidence" in Kazakhstan. Nazarbaev called for more diverse investment. "Given your support, we would like not only to produce and ship to world markets our oil, gas and metals, but also to produce manufactured goods," he said. The president pledged to create more favourable conditions for foreign investors in Kazakhstan.

At this first meeting, the investors talked about corruption as well. Nazarbaev said he would personally cut the red tape hindering investment in some regions of the country. He also said that laws, including taxation laws, would not be changing as frequently as in the recent past. Finally, he promised to take extreme measures against Kazakhstani corruption.

Charles Frank of the EBRD said that a stronger legal framework would mean stronger investor interest in Kazakhstan, even given the international crisis. "I believe that foreign direct investment is not going to be negatively affected," he said. In his opinion, Kazakhstan is unlikely to suffer from the crisis to the same extent as Russia, because investors here "are looking for profits over a long period of time". (Reuters & Interfax)