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Kazakhstan can become a real "window to Europe", but to achieve this we need to put favourable conditions in place for investment.
If the citizens of a country are educated and professional, then that country will be respected among professionals from other countries - they will speak the same language. I am convinced that poverty and destitution must only be fought with a high level of professionalism, quality education, and an adequate system of training. We need to develop ourselves rather than wait until somebody comes along and gives us something or helps us.
What are the basic steps that need to be taken for increasing the flow of foreign investments into the economy of Kazakhstan? Why is Kazakhstan still so far away from the path taken at one time by Singapore? What attracts investors from Singapore to Kazakhstan? These topics and many others are discussed in an interview with renowned Kazakh businessman and head of Arman Holding, Serikbay Biskeev. You said that you want a visa-free regime to be set up between Kazakhstan and Singapore. What is being done about this issue - have negotiations already taken place at an official level and if so, what stage are they at? Yes, a visa-free regime between Kazakhstan and Singapore is what we'd like to see. But I do not know when it will happen. As a delegation, we plan to meet individually with the Minister of Foreign Affairs of Kazakhstan. I hope he will tell us what stage the issue is currently at. Right now the visa issue is a very serious one. For example, to obtain a visa to Kazakhstan, citizens of Singapore have to complete the documents in person - that is, they have no possibility of applying using an electronic format, while a visa to Singapore can be issued electronically. It is also impossible to pass the visa application documents on to a travel agency. It would seem that these bureaucratic trifles do not pose a big problem, but in reality they create certain barriers. Because, as a rule, businessmen are always busy, and such bureaucratic obstacles in Kazakhstan can play a negative role in terms of attracting foreign investments, or reflect badly on the country's image. You raised this question a year ago, and your speeches - about what the state is doing to improve conditions for investors - were quite critical. Maybe at times I have been critical in my speeches, but my goal is to find concrete solutions to financing the economy. The president and the government are now saying that the state does not have enough funds for the development of new projects, and the budget has to be cut. As a result, many projects that would help people to develop and improve are being cut and cancelled. To avoid this, the government must introduce laws that will remove barriers to third-party investors from developed countries, such as Singapore. Only then will the number of investors in Kazakhstan increase. Most importantly, it is not necessary to spend money from the budget in implementing such simple measures. If you put all the appropriate conditions in place, the investors themselves will come - and they will pay taxes, thereby pouring money into the state budget. That's to say, we need to follow the same path that was taken by Singapore in its time - maximum transparency for investors? Right! We just need to put the favourable conditions in place and we will have a waiting list of investors. We shouldn't be doing it manually, as we are currently trying to do - inviting businessmen and escorting each one individually. This does not have to be dealt with by each minister. If we establish transparent conditions, people will be able to come and open a company here without the need for calling on the minister himself. What do you consider to be the investment potential of the two countries? For example, what joint ventures can be set up in the near future? What is Kazakhstan's appeal to investors from Singapore? Singapore, of course, is interested primarily in our logistics industry and our transit potential. They are world leaders in this business, and want to deliver goods from Southeast Asia to Europe by the shortest route - through Kazakhstan - since much more time is required to deliver goods by sea. This is the first reason. The second, I think, is tourism. Singapore has a very well-developed tourist industry, and we could establish the conditions for attracting tourist companies to Singapore - those who can build world-class hotels, resorts, motels, and so on in the shortest time, thereby contributing to the construction of our tourist infrastructure in general. What else? I think another attractive sector, where development would benefit both Kazakhstan and Singapore, is the food industry. Singapore has a highly-developed food processing industry, and we have a lot of raw materials such as grain. The bottom line is that we need to make sure that the raw materials are processed in this country, and not sold abroad. We need to make and sell finished products, not just our resources. Only then can we create added value, boost our industries and move away from dependence on raw materials. Speaking of transit potential, Singapore is one of the countries that makes strategic plans for the next hundred years. What do you think - how does the Eurasian Economic Union or the Silk Road, which passes through Kazakhstan, fit into these plans? What do ordinary businessmen in Singapore think about this? The Eurasian Economic Union is a good opportunity for Kazakhstan to enter the Russian markets. We can supply products to Russia through the customs union, creating industries and enterprises in Kazakhstan. Singapore is, of course, aware of this. All they need now is for us to put all the conditions in place for them to invest in production and logistics, so that they are not afraid to set up businesses. Singapore is serious about the export business - they want to capture markets. We have to take advantage of this. Besides which, the global Silk Road project offers us even more possibilities. With all this in mind, Kazakhstan can become a real "window to Europe" for entrepreneurs from Singapore who are looking for new outlets in new markets. So what exactly can we do so as not to miss the moment? According to the Doing Business rating, we are in a good position in terms of starting up a business, reimbursement of capital costs, and tax breaks for investors. All this is in place, but investors are still not actively coming here. The point is that in addition to the positions where we're strong, we need to look at the ones that are preventing us from even getting into the top 100 countries. This means judicial reform and security-related issues. A thorough analysis needs to be conducted to find out what we need to change: what are the possible reasons for investors being deterred, and what can be done to rectify the situation. Until we provide investors with complete security, they will not come here. How can that be done? After all, the judiciary and security systems cannot be changed overnight. Is a systematic approach called for? The wheel has already been invented. We can take Singapore as an example for the provision of security. Singapore is the most transparent country in the world. Why do we make investment conditions attractive, while the judicial system remains unchanged? Let's start with this - otherwise all that money will have been wasted in vain. From this point of view, what experience from Singapore could we adopt right away, for example, in the next year? We have already begun the fight against corruption, started prosecuting Ministers. However, in order for this process not to be selective, it is necessary to build an entire anti-corruption system that allows all the expenses of officials, their relatives and their nearest cohorts to be monitored. In this respect, everything in Singapore is transparent - the mechanisms to achieve this have been developed and applied. Such a system would allow us, for example, to check how a particular official has purchased a hundred apartments in Astana or a fleet of expensive cars. Singapore's anti-corruption model has been functioning for a long time, but for some reason our state agencies prefer to enforce it with regard to certain specific parties. In my opinion the system needs to be fully implemented. You said that you went to Singapore inspired by the first Prime Minister, Lee Kuan Yew, and the ideas he outlined in his book. Which of his ideas have inspired you the most? Lee Kuan Yew's policy was to turn Singapore into a globally-respected country, and it has been successful. To achieve this it was necessary for the people to be educated and highly professional. This idea is the closest to mine. If the citizens of a country are educated and professional, then that country will be respected among professionals from other countries, since they speak the same language. Poverty and destitution must only be fought with a high level of professionalism, quality education, and an adequate system of training. This is the first thing that was carried out systematically in Singapore. The second thing is probably the creation of a judicial system that is transparent to the fullest degree, making it impossible for an individual to buy his way out if he has committed a crime. In this country, for example, some laws work to "look after number one", with the help of which certain senior and influential people manage to escape justice. For example, there is a law that allows officials to simply pay a fine as punishment. In other words, the state itself motivates officials to grab more while they can, only to use that same money later for pay-offs so they can carry on living in the way they have become accustomed to. Such things do not help us to become effective. Or another example: I cannot understand why certain companies from the wind and solar energy sectors are awarded special rates that differ by 300% from the tariffs offered to the other companies on the market, who are able work without these special rates. Such behaviour from the state is not clear to me or the other market players. If such an attitude to market players continues, with no transparency, we will not be able to develop as a country. Singapore has managed to overcome these barriers, and that pleases me, so I went to live there. Everyone knows that for the time being all the decisions in Kazakhstan are taken from the top down. That is, until there are orders from above, there won't be any major changes. Have you prepared any official documents with proposals, addressed to the Prime Minister or to the President? Maybe you have already held some negotiations? No, I have not conducted negotiations with anyone. I can even say that the President is so surrounded that no letter of proposals could be passed on to him. Several of my friends have tried to write to the President, but none of their letters were delivered. Because there is a certain circle of people who don't allow such letters to get through; they don't give anyone the chance to meet with the head of state. In comparison, Lee Kuan Yew held meetings with interesting and successful businessmen: he invited them so as to listen to their independent opinions. But our President, unfortunately, is surrounded by people who do not give him the opportunity to meet with successful people and listen to their views as Lee Kuan Yew did. I think that he is currently in a kind of vacuum - surrounded by his people, he is closed off from any real information. But if our President were to do what Lee Kuan Yew did - not just to do it, but to put it into practice, then we the businessmen would be able to convey the real situation to him. Then everything would happen much more quickly and efficiently, and the country would evolve. Source: AND.KZ
