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Kazakhstan’s economy needs long-term funding, but the budget and development institutions cannot provide enough. In his address to the people of Kazakhstan, President Kassym-Jomart Tokayev ordered the development of lending mechanisms involving banks and UAPF (kz.kursiv.media). He also proposed expanding the capital market’s capacity to attract investment.
What funds Tokayev wants to channel into business
The president said banks have large amounts of idle funds and should help finance businesses. He proposed channeling this money into the economy by establishing the necessary rules for banks.
In his statement, Tokayev linked the launch of new lending mechanisms to the management of idle funds in the banking system. The president stressed the need for solutions to provide long-term financing for key sectors of the economy.
“We need to create the right regulatory conditions for this, including through effective management of excess liquidity in the banking system. And there is a great deal of that liquidity. We have no time for endless discussions. We need decisions that will put the country on a path to progress. New mechanisms for long-term lending to key sectors of the economy should be launched, involving banks, development institutions, international financial institutions and UAPF,” the president said.
How UAPF features in the instructions
UAPF is named among the participants in the future long-term lending mechanisms. The president also listed banks, development institutions and international financial institutions.
The instructions concern the development of mechanisms involving these organisations. Tokayev proposed bringing them in to meet the economy’s need for long-term funding, which the budget and development institutions cannot fully cover.
The role the president sees for the capital market
Another priority is raising money through the capital market. Tokayev proposed expanding its capacity and encouraging businesses to use exchange-traded instruments to raise financing.
Specific mechanisms for tapping additional sources of investment are to be included in the capital market law now being drafted. The president linked this work to expanding financing opportunities for the economy.
What the financial platforms were asked to do
To build a single national financial ecosystem, Tokayev called on the Kazakhstan Stock Exchange, the Astana International Financial Centre and Alatau City to work closely together. He called for this cooperation alongside his proposals to develop the capital market.
Further work on these priorities will involve developing long-term lending mechanisms and drafting a capital market law. The law must set out specific ways to tap additional sources of investment.
