President’s Speech

The Next Phase of Industrialization

Plan for the Next Phase of Industrialization

The first five year action plan of the accelerated innovative industrialization program will come to an end in two years time. The Government must develop a thorough plan for the next phase of industrialization. We need a development scenario of technological trends with high potential.

As a result the share of non-energy export in total export must double by 2025, and triple by 2040.

What Needs to be Done?

• By 2050 Kazakhstan must apply the latest technology standards to all of its production assets. In most competitive sectors we need to develop strategies for domestic producers on forming new market niches. This will allow Kazakhstan to avoid the potential destructive effects from deindustrialization, especially considering the perspectives of entering the WTO.
• Domestic goods must become more competitive. January 1st 2012 marked the start of the single economic area between Kazakhstan, Russia and Belarus. This is a huge market, with combined GDP of 2 trillion US dollars and 170 million consumers forcing our business to compete. Our political sovereignty remains guaranteed.
• We must develop new industries with an emphasis on expanding export oriented non-energy sector.
• We must focus the state program of forced innovative industrialization on importing industrial capacity and exchanging technology. For that we need a sub-program for creating and developing joint international companies and beneficial partnerships.
• By 2030 Kazakhstan must expand its niche on the world market for space services and bring to fruition a number of current projects. These projects include the assembly and testing facility of spacecrafts in Astana, a remote sensing space system, the national space monitoring system and ground infrastructure and our high-precision satellite navigation system.
• We need to continue the development of our two leading innovation clusters – Nazarbayev University and the Park of innovation technologies.
• We need to make an accelerated transition towards low carbon economy. To do this I suggest we create an international organization “Green Bridge” in 2013, and also launch the Green4 project based on four satellite cities around Almaty.

The upcoming EXPO 2017 in Astana will provide a powerful impetus for transition of the country towards the “green” path of development. The world’s best achievements in science and technology will be presented in the capital of our country. Our citizens would be able to witness the “energy of the future” with their own eyes.

Now I have raised the most fundamental issues, which would determine the preparedness of the country for the Third Industrial Revolution.

Modernization of the Agricultural Sector

We need large scale Modernization of the agricultural sector, especially under the conditions of growing global demand for agricultural products.

For us to become a global leader on agricultural market and build up agricultural production, we need to:

• Increase sowing area. I note that not all countries are able to do so.
• Ensure significant rise in crop yield, primarily by introducing new technologies.
• Creating a world class livestock forage base.
• Create nationally competitive brands with a focus on eco-friendliness.
• As a result I set the task before our agricultural industry – to become a global player in area of eco-friendly production.

Development of farming and SME in agricultural processing and trade.

In this area we need to:
• Change the culture of farming and revive our tradition of animal breeding using the latest techniques and achievements in science, technology and management.
• Determine which products we are going to produce in large quantities to win major export markets.
• As a result of adopting these measures the share of agriculture in GDP must increase 5 fold by 2050.

I instruct the Government the following tasks for 2013:
• Adopt a new development program for agricultural sector of the country until 2020.
• Increase state support for agriculture by 4.5 times by 2020.
• Set out the system of legal and economic incentives for creating medium and large agricultural enterprises, oriented on applying new agro technologies.
• Introduce an increased tax rate on those lands that remain undeveloped for longer than certain period since they were provided.

Policy regarding water resources

• It is necessary to develop a new policy regarding water resources of our country. • We need colossal volumes of water for our agricultural purposes. In this regard we must:
• Carefully examine the best practices in addressing water supply issues in other countries, such as Australia, and modify them to our conditions.
• Introduce the most advanced extraction technology and prudent use of underground water reserves that are abundant in our country. • To move to modern water-saving agricultural technologies.

Our society needs to change its overall thinking. We must stop wasting water, which is one of our most precious natural wealth. By 2050 Kazakhstan must once and for all solve the water supply problem.

I instruct the Government to develop a long term state program on water, which will resolve the supply of drinking water by 2020, and then the supply of irrigation water – by 2040.

Leading force in the national economy

Domestic entrepreneurship is a driving force in the new economic policy. The share of small and medium enterprises in the economy must double by 2030.