A series of meetings with representatives of the agricultural industry is held in preparation for the parliamentary hearings in the Senate.
Senate Speaker Dariga Nazarbayeva met today with representatives of the Ministry of Trade and Integration of the Republic of Kazakhstan, Qazindustry Kazakhstan Center for Industry and Export JSC, Food Contract Corporation National Company JSC, QazTrade Trade Policy Development Center JSC, KazakhExport Export Insurance Company JSC, Atameken National Chamber of Entrepreneurs of the Republic of Kazakhstan, Kazakhstan Foreign Trade Chamber LLP.
The Vice Minister of Trade and Integration of the Republic of Kazakhstan, Azamat Askaruly reported that over the 11 months of last year, the country export of goods decreased by 4.7%, agricultural exports increased by 7.1%, while export of processed goods decreased by 4, 1%. According to A. Askaruly, the decrease in exports is explained by the fall in world export prices for food products. “The issue of import substitution is a priority. Funds were allocated for import substitution under the “Economics of simple things” program, so that we can provide ourselves with essential goods, such as food industry, furniture industry,” the Vice Minister said.
The Senate Speaker stressed that farmers' unions do not agree with such statistics. “We can hardly have our products get to our own shelves. Large shopping centers put manufacturers in enslaving conditions. Intermediaries make 200-300% extra charge. It turns out that it is unprofitable to sell products on the domestic market. There should be a policy for regulating trade margins, especially for retail. At least for essential goods, on the basis of which we estimate the cost of living,” D. Nazarbayeva said.
Talking about food security, Dariga Nazarbayeva specifically focused on rising food prices. “People are worried that prices for basic necessities, such as potatoes, buckwheat, etc., are rising. We do so much, subsidize, invest, have different programs, roadmaps, but the situation is not improving. The increase in prices outweighs all the measures of state support that are provided to socially vulnerable segments of the population,” the Senate Speaker said.
According to the Chairperson of the Senate, there are a number of proven mechanisms for regulating export policies. They are, for example, applying tit-for-tat measures in relation to importing countries, tightening quality control measures for imported products. At the same time, on the other hand, it is necessary to develop a program to optimize the logistics of agricultural products, with the possibility of active involvement of private companies, in order to develop and reduce the cost of exports.
Senator Ali Bektayev raised the issue of different product names in statistics and different understandings of certain items in various government agencies. “Such data are misleading to state authorities,” the Senator noted and called for putting this system in order.
During the meeting, a report was made by the Chairman of the Board of Food Contract Corporation National Company JSC Kanat Karaulov. He voiced the problem of quantitative and qualitative preservation of grain at grain-receiving enterprises, associated with dishonesty of owners, theft, as well as the lack of state control. As a solution to the problems, K. Karaulov suggested developing electronic grain receipts in terms of automation of the processes of accounting for acceptance and shipment of grain at grain-receiving enterprises; transferring to the Food Corporation the grain receivers pledged to the Fund of problem loans; periodically checking the actual availability and quality of grain from market participants and their compliance with reporting data.
Continuing the topic of agricultural production, the event participants spoke about the inaccessibility of credit resources for business entities. According to industry representatives, second-tier banks classify the agricultural sector as a high-risk category, characterized by low liquidity and the absence of a collateral base, which reduces the size of issued guarantees.
According to the First Deputy Chairman of the Board of Atameken Eldar Zhumagaziyev, one of the most pressing issues for entrepreneurs is the VAT refund on export of products, which has not been resolved for many years. “Millers of Kazakhstan are constantly faced with the problem of VAT refunds by tax authorities. In this regard, there is a need to revise the procedure for VAT refunds for exports through a simplified mechanism for exporters,” added E. Zhumagaziyev.
The head of the National Chamber of Entrepreneurs also pointed out high tariffs for transit of grain and flour through other countries. E. Zhumagaziev believes that the situation could be improved through creation of favorable tariff conditions in transit countries for Kazakhstani exporters of grain and flour when transported by rail.
Concluding the meeting, Dariga Nazarbayeva specifically focused on the problem of duplicate functions of key institutions responsible for development of non-resource exports. “Who is involved in the analysis of performance evaluation of these organizations? Why not create a “one stop shop” for those who are interested in exporting? You can come to the “one stop shop” with your flour or potatoes, receive all the necessary information, consulting support, subsidies that I have the right to receive, and start working,” D. Nazarbayeva said.
Upon the end of the meeting, the Senate Speaker instructed the Committee on Agrarian Issues, Nature Management and Rural Development to study the problem issues raised by the meeting participants and prepare them for discussion at the parliamentary hearings.