Kurultai ratified the Framework Partnership Agreement between Kazakhstan and the Asian Infrastructure Investment Bank (AIIB). The document opens up the possibility of attracting, on preferential terms, around $6 billion for projects in transport, energy, healthcare and the sphere of "green" finance.
WHAT CONDITIONS ARE ENVISAGED
According to Deputy Prime Minister — Minister of National Economy Serik Zhumangarin, AIIB loans may be granted for a term of up to 35 years at a rate of 1% to 1.5%.
Kazakhstan is one of the founding countries of the AIIB. The republic's subscribed capital amounts to $730 million. According to Zhumangarin, to date Kazakhstan has paid 20% of its share, or $145 million.
The Framework Agreement establishes general rules for the bank's projects, including requirements for financing, procurement, financial control, anti-corruption measures and environmental standards.
HOW KAZAKHSTAN INTENDS TO ATTRACT FINANCING
Kazakhstan intends to use the state guarantee mechanism when borrowing from the AIIB. According to Zhumangarin, such an instrument does not increase the state debt.
Kurultai deputy Gulnaz Atamkulova explained that when a state guarantee is used, responsibility is distributed between the state and the private partner. At the same time, the potential borrower must comply with the AIIB's internal requirements and provide the necessary documents.
According to her, the international bank's requirements also include information, social and environmental standards. They apply directly to the project initiator.
HOW FINANCING IS LINKED TO SMALL BUSINESS
The impact of infrastructure projects on small and medium-sized businesses was discussed separately at the briefing. Zhumangarin noted that at present it is impossible to speak of specific small and medium-sized enterprises that have already received financing directly through the AIIB.
At the same time, infrastructure projects create demand for the products, works and services of local enterprises, which can act as suppliers. He noted that financing should come through local banks and development institutions that will be able to provide funds to business.