Ashgabat, 27 June 2016 (nCa) — Astana International Finance Centre (AIFC) will be ready to receive its first clients after the exhibition EXPO-2017, says Kairat Kelimbetov, the managing director of AIFC.
The western investors may look at the idea with some skepticism and Russia possibly fears that AIFC could turn out to be another offshore destination, making Kazakhstan potentially a ‘financial harbour’ in the Eurasian region.
However, Kazakhstan has apparently done considerable homework before the launch of AIFC. The groundwork to make Astana the financial hub was started with the presidential plan ‘100 concrete steps,’ clearly defining the route to new impetus for economic, political and social development.
The companies that want to benefits from the AIFC structure and framework must meet stringent criteria: They should be free of tax obligations for the past 50 years (including VAT on imported raw materials used for investment projects), working under the Anglo-Saxon model of law, and accommodative of special visa and foreign exchange regimes.
The operational work of AIFC in Astana will include the Kazakh exchange listing and trading, and launch of IPO of state owned companies. Together with this, AIFC will provide management services for the National Fund and the single pension savings fund. There would also be the exchange for Islamic securities.
President Nursultan Nazarbayev of Kazakhstan said in an address to the management board of AIFC, “We understand that this project is large and complex. It is important to attract interest to our region, to turn AIFC into the centre for financial services in the framework of Silk Road Economic Belt.”
He said, “We need to take up this niche and begin to develop it gradually. We look forward to the participation of international financial institutions, and big businesses, coming to Kazakhstan with full confidence. I am confident that the full range of services provided by AIFC will make their work here enjoyable.”
The investment opportunities at AIFC will be unveiled by the end of this year. The management board says that with all the prescribed legislation and working conditions in place, Kazakhstan will join a small group of countries that are fully integrated into the modern stream of state-building, something unheard of in this part of the Eurasian space.
According to the development plan, AIFC will provide services to the markets in Kyrgyzstan, Uzbekistan, Tajikistan and Mongolia and in future to Caucasus.
Talking to the Russian businessmen at the St. Petersburg Economic Forum, President Nazarbayev pointed out the reduced level of investments from Russia to Kazakhstan and said that the entrepreneurs should take advantage of strategically important opportunities at the AIFC.
The foreign financial analysts consider that the creation of the financial centre in Kazakhstan is a good idea. They see some encouraging signs: The national currency of Kazakhstan has withstood devaluation and shock, the macroeconomic indicators have moved to inflation targeting, and consequently the prices in Kazakhstan are suitable for investors and companies. This is also the special provision for transition of major public sector enterprises into private hands.
The AIFC is working to create partnership with the leading exchanges the world over for the development of the capital market. The talks are in hand with the London Stock Exchange, and Metals Exchange, NASDAQ, the Chicago Mercantile Exchange, NASDAQ Dubai, New York Stock Exchange, etc.
While every effort is being made to attract the foreign partners, there is equal drive to win the local players. The participation of the local business community in the activities of AIFC will carry several benefits that may multiply over the years and be an asset for Kazakhstan.