Invest in KazakhstanInvest in Kazakhstan

National Export & Investment Agency “KAZNEX INVEST”

Ministry of Investment and Development

Invest in KazakhstanInvest in Kazakhstan

Basic Facts

● Area: 2,724,000 km2 (1,051,742

sq.miles), 9th largest

National Flag National Emblem

sq.miles), 9 largest

● Population: 17,476,141

● Official language: Kazakh, Russian

● Currency: Tenge (KZT)

● Capital: Astana

● Administrative division: 14 regions + 2 cities of

republican significance

● Member of organizations: UN, IMF, WB, OSCE, OIC

DOING BUSINESS 2016

Rank Country1 Singapore

8 South Korea

20 Turkey

25 Kazakhstan

36 Azerbaijan

49 Armenia

57 Belgium

66 Russia

81 Hungary

Protecting minority investors

Economy

Kazakhstan ranked 41st

43

42

41

35

25

4

1

Belgium

Hungary

Kazakhstan

Armenia

Poland

South Korea

Singapore

81 Hungary

134 China

Rank Country1 UAE

5 Singapore

18 Kazakhstan

34 Azerbaijan

41 Armenia

47 Russia

61 Turkey

90 Belgium

95 Hungary

132 China

Paying taxes

Source: World Bank, Doing Business 2016

84

83

68

63

61

60

55

53

51

45

44

43

China

Ukraine

Qatar

Azerbaijan

Luxembourg

Greece

Turkey

Israel

Russia

Italy

Belarus

Belgium

GLOBAL COMPETITIVENESS INDEX RANKINGS

Economy

Rank Country Score

1 Switzerland 5,76

2 Singapore 5,68

3 USA 5,61

4 Germany 5,53

5 Netherlands 5, 50

Source: World Economic Forum, Global Competitiveness Report 2015-2016

5 Netherlands 5, 50

6 Japan 5,47

… … …

42 Kazakhstan 4,49

45 Russia 4,44

51 Turkey 4,37

80 Tajikistan 4,03

102 Kyrgyz Republic 3,83

Economy

TAXATION: COMPARISON WITH CHINA AND RUSSIA

Kazakhstan Russia China

Corporate income tax

(CIT)20% 20% 25%

Value-added tax (VAT)12% 18% 17%

TAXES

Land taxfrom 0.03 to 0.16 USD

per 1 sq.m (10.8 sq.ft);0.3%, 1.5% -

Property tax

1.5% 2.2%

1.2% assessed value;

12% rental property.

Source: Ministry of Finance of the RK; Federal Tax Service of Russia; State Administration of

Taxation of the People’s Republic of China

Top 5 host economies, FDI inflows

Transition economies, 2014, $ bln. (change)

Top 5 host economies, FDI inflows

Landlocked developing countries, 2014, $ bln. (change)

Economy

FDI ATTRACTION

4,4

9,6 (-6,4%)

21 (-69,7%)

Azerbaijan

Kazakhstan

Russia

3,2 (+2,8%)

4,4 (+68,3%)

9,6 (-6,4%)

Turkmenistan

Azerbaijan

Kazakhstan

Source: UNCTAD, World Investment Report 2015

According to the UNCTAD, in 2014 Kazakhstan has entered top 5 host economies for FDI

inflow among transition economies and became the largest FDI recipient in the landlocked

developing countries group. Among all countries Kazakhstan was ranked the 28th.

2 (-2,7%)

3,2 (+2,8%)

4,4 (+68,3%)

Serbia

Turkmenistan

Azerbaijan

1,2 (+26%)

2,5 (+37%)

3,2 (+2,8%)

Ethiopia

Zambia

Turkmenistan

Metallurgy1

1. Ferrous metallurgy

2. Non-ferrousmetallurgy

3. Agricultural chemistry4. Production ofchemicals for industry

5. Oil refining6. Petrochemical industry

Chemical Industry2 Petrochemical Industry

3

Machinery4 Production of5 Food Industry6

Priority sectors

13. Production ofconstruction materials

7. Manufacture of motor vehicles8. Electrical equipment9. Agricultural machinery engineering10. Railway machinery engineering 11. Mining equipment12. Oil producing equipment; oil and gas refining equipment

14. Food production

Machinery4 Production ofconstruction materials

5 Food Industry6

INCENTIVES

IN-KIND GRANTS

In-kind grants of not more than 30%

of the total investment in fixed assets.

EXEMPTION FROM CUSTOMS DUTIES

1) When transporting manufacturing

equipment and spare parts for it the exemption

from customs taxation is granted for the term

of investment contract but not later than 5

Investment

Free land

of investment contract but not later than 5

years after the investment contract

registration.

2) When importing components for the

manufacturing equipment, raw stock and (or)

materials for term up to 5 years the exemption

from customs taxation is granted to the legal

companies depending on the volume of

investment in the fixed assets.

FREE ENTRY FREE WORK PERMITS

Visa-free entranceVisa-free entrance for citizens of Australia,

Hungary, Italy, Monaco, Belgium, Spain, the

Netherlands, Norway, Sweden, Malaysia, the

Foreign labor

Without permit

NEW INCENTIVES (since 2014)

Investment

Netherlands, Norway, Sweden, Malaysia, the

United Arab Emirates, Singapore, the United

Kingdom, the United States of America,

Germany, Finland, France, Switzerland, and

Japan for the period from 16 July 2015 till 31

December 2017 if the stay does not exceed 15

days (general application).

Without permit

for the duration of construction + 1 year after

commissioning of the investment project for

those with investment contracts

In 2017, Kazakhstan plans to abolish visa

requirements for citizens of the 34 member states

of the OECD,

CASHBACK ON INVESTMENTS

Reimbursement up to

Corporate income

tax (10 years)

TAX EXEMPTIONS:

Incentives for priority investment projects*

NEW INCENTIVES (since 2014)

Investment

30 %

*Criteria for priority investment projects:

- matching the List of Priority Activities (approved by the Government)

- newly created legal entity with investments of more than 2 million MCI (MCI – monthly calculated index,

approved by the Law on the national budget)

of the actual expenses for installation and

construction works and equipment

acquisition without value added tax and

excises on the basis of supporting

documents, but not exceeding the cost of

expenses provided by preproject

documentation having the conclusion of

state expertise.

tax (10 years)

Land tax (10 years)

Property tax (8 years)

30 %

0 %

STABLE LEGISLATION STRONG PROTECTION OF INVESTOR’S RIGHTS

Stability of tax legislation for all taxes except

VAT and excise (subject to investment contract)

Ombudsman’s Office

For ensuring protection of the rights and legitimate

interests of the investors, the investment

Investment

Incentives for priority investment projects*

NEW INCENTIVES (since 2014)

interests of the investors, the investment

ombudsman:

1) considers addresses of investors on issues

arising during the implementation of investment

activity and gives recommendations for their

solution, including interacting with government

bodies;

2) assists to investors in solution of arising issues

in extrajudicial and pre-judicial procedures.

*Criteria for priority investment projects:

- matching the List of Priority Activities (approved by the Government)

- newly created legal entity with investments of more than 2 million MCI (MCI – monthly calculated index,

approved by the Law on the national budget)

SPECIAL ECONOMIC ZONES

«Pavlodar» SEZ

Petrochemical industry

«Burabai» SEZ

Tourism

«Astana

- new city» SEZ

Mixed

Investment

«NIPT» SEZ

Petrochemical

industry

SEZ «Saryarka»

Metallurgy

«Seaport Aktau» SEZ

Mixed

«Ontystik» SEZ

Textile industry

«Chemical

Park Taraz» SEZ

Chemical industry

«Khorgos – Eastern

Gate» SEZ

Logistics

«Park of Innovative

Technologies» SEZ

IT - Innovations

Social Tax (for 5 years)

FISCAL INCENTIVES

INVESTMENT INCENTIVES IN SEZs

Investment

Corporate income tax

Land tax

Property tax0 %

Social Tax (for 5 years)

• Free plot of land for the entire period of existence of a SEZ

• Simplified procedure for employment of foreign labor

NON-FISCAL INCENTIVES

Exemption from VAT (for products consumed in SEZ)

EXEMPTION FROM CUSTOMS DUTIES

Exemption from customs duties for goods imported into the SEZ territory and exported* from the

SEZ territory to the rest of the customs territory of the Customs Union (CU).

*CU commodities produced (processed) by SEZ residents registered before January 1, 2012 with the use of imported

components, but recognized as EAEU products, are not subject to customs duties until January 1, 2017

LOCATION AND INFRASTRUCTURE

● The Kazakhstan’s geographical position makes it a natural crossroads for major transit corridors from

East to West, from North to South.

● The transcontinental automobile road corridor “Western Europe – Western China” passes through the

territory of Kazakhstan. The corridor will allow to deliver freights from China to Europe in 10 days.

● There is a territory with population of more than 3.3 bln. people within a radius of 2 thsd. km

(1,243 miles) from Kazakhstan.

● The flight time from most European destinations is five hours.

Infrastructure

RUSSIAN FEDERATION

143.5 mln.

KAZAKHSTAN

17 mln.

PEOPLE’S REPUBLIC

OF CHINA

1.4 bln.

MONGOLIA

2.8 mln.

INDIA

1.3 bln.

BELARUS

9.5 mln.

IRAN

77.4 mln.PAKISTAN

182.1 mln.

TURKEY

74.9 mln. LianyungangLianyungang

St. PetersburgSt. Petersburg

AktobeAktobe

ShymkentShymkent

Western Europe – Western China

corridor on the territory of Kazakhstan

(2,787 km=1,732 miles)

Western Europe – Western China

corridor (8,445 km=5,247 miles)

SUCCESS STORIES

Investment

Ministry of Investment and Development of the RK

www.mir.gov.kz

Electronic Government

www.egov.kz

Useful Links

National Export and Investment Agency

«KAZNEX INVEST»

www.kaznexinvest.kz

www.facebook.com/KaznexInvest

National Investment Internet Resource

www.invest.gov.kz

Thank you Thank you

National Export & Investment Agency “KAZNEX INVEST”

Ministry of Investment and Development

Thank you Thank you

for your attentionfor your attention