GOVERNMENT Weekly REVIEW
Prime Minister visited Pavlodar region. New Customs Code of Customs Union to be signed. President addressed V Congress of Judges. ASTANA 20 November KAZINFORM /Rizvana Sadykova/ Prime Minister Karim Massimov paid a working visit to Pavlodar oblast last weekend, where he held the session of the State Commission on the issues regarding modernization of economy, energy and metallurgy.In case if it is too wasteful we must prohibit construction and assembly of such mechanisms", Mynbayev considers. 358 domestic and foreign investors proposed to invest in development of energy after introduction of cap rates. According to Minister Mynbayev carrying out 83 projects out of 100 ones will lift the threat of energy shortage in future.Minister of Energy and Mineral Resources Sauat Mynbayev explained expansion of consumption of electric power by 2015 from 77 bln MW to 100 bln MW." We need to adopt a law on energy saving and develop regulatory acts on new equipment. Prime Minister also visited a construction site of the Pavlodar Electrolysis Plant with an annual capacity of 125, 000 tons of aluminum. In spite of complicated economic situation its construction was started in 2009. USD 305 mln was invested in it. The second stage is planned to be put into service in the second half of 2010. The project capacity of two stages of the plant is to make 250,000 tons of aluminum per year. Minister of Industry and Trade Assdet Issekeshev told about the ways of development of metallurgy in Kazakhstan. Production of ferrous metals, aluminum, zinc and copper must be increased. Mining and mineral resources allow building and reconstructing metallurgical plants and works. Following the sitting the Head of the Government summed up the results. He said appropriate programs of development of the sectors must be elaborated and submitted to the President in order to adopt decisions on all investment projects. On Monday within a conference in the Akorda Palace President Nursultan Nazarbayev approved a Concept of development of the country's financial sector in post-crisis period. During discussion the conference participants noted that realization of the concept would allow building an efficient competitive financial system satisfying demands of various sectors of economy and population in financial services. As the President stated the new financial architecture had to provide solution of all problems and prevent new threats ad challenges. The new Concept provides for enhancement of the role of the National Bank as a central body bearing responsibility for ensuring financial stability and carrying out macro-prudential regulation. In this view the Head of the State charged the National Bank to develop an efficient mechanism of disclosing and prevention of misbalances, "holes" on the markets of real and financial assets as well as on minimization of the risks of the financial sector of economy. As earlier reported, Prime Minister Karim Massimov, Chief of the Presidential Administration Aslan Mussin, Chairman of the National Bank Grigory Marchenko, Chairman of the RFCA A. Arystanov, Chairman of the Financial Supervision Agency Y. Bakhmutova, Chairman of the Association of the Financiers of Kazakhstan and heads of second-tier banks took part in the conference. Realization of mechanisms of the Kyoto Protocol" was discussed at the Governmental Hour in the Majilis (Lower House of the Kazakh Parliament) on Monday. "Insignificant part of incoming environmental payments is applied on environmental protection measures", Kazakh Minister of Environment Protection Nurgali Ashimov reported regarding problems of integrated wastes management. According to him, the funds allocated for environmental protection measures amounted to KZT 22.3 bln of 29.9% out of total incoming refunds and fines in 2008. During 9 months of 2009 the funds allocated by the akimats for environmental protection measures amounted to KZT 13.5 bln or merely 17.7% out of the total sum of incoming payments. Mr. Ashimov noted that "Zhasyl Damu" center will be established within the State Program "Ecology o Kazakhstan for 2010-2020". The center will co-finance different environmental protection projects, using funds of the National Fund. This will promote attraction of foreign investors. To date preliminary agreement on attraction of funds of the UN Clean Technology Fund, the World Bank, the Global Environment Facility, and the UNDP was achieved. The Minister noted that the incoming refunds and fines are offered to be directed to the National Fund. From the National Fund the money will be directed to "Zhasyl Damu" center and further - to realization of projects. Another speaker at Governments' Hour Kairgeldy Kabyldin President of the KazMunaiGaz JSC Company announced that 9.7 mln tons of crude oil have been processed countrywide in 10 months of 2009, the share of KazMunaiGaz JSC makes 17% in it. "There are such large oil processing companies as Gelios and TurgaiPetroleum which take 32% and 18% of the total volume of processing. The volume of the produced petrol makes 2 mln tons in which KazMunaiGaz's share makes 10%. Alongside, the share of Gelios and TurgaiPetroleum made 48% and 18% correspondingly", he noted. According to Kabyldin, petrol supply in 2009 increased significantly compared to the same period in 2008. For example, Almaty experienced 49% of growth in petrol supply this year. "Thus we support the proposition of the Ministry of Energy and Mineral Resources on elimination of high-octane petrol from regulation and fix its threshold price", Chief of KazMunaiGaz concluded. On Tuesday the 23rd sitting of the State Budgetary Commission under the chairmanship of Prime Minister Karim Massimov was held in Astana; The Commission considered and approved a draft resolution of the Kazakh Government "On introduction of amendments to the Resolution of the Government of Kazakhstan as of December 18, 2008 no.1184". The resolution is aimed at carrying into effect the law on amendments to the republican budget for 2009-2011 signed by the President of Kazakhstan on November 2009. Besides, the Commission approved the data obtained from the analysis of legal acts providing for the increase in budget expenditures or cut in budget revenues. New Customs Code of the Customs Union is to be signed by heads of Belarus, Kazakhstan and Russia in Minsk on November 27, 2009. Minister of Finance Bolat Zhamishev made it public at the Government's session. According to him, this document will enter into force from July 1, 2010. Development of the Customs Code was conducted by the Kazakh leadership. This document was based on the Kyoto agreement. The draft Customs Code consists of 368 articles. Main amendments are introduction of the "unified customs territory of the Customs Union" definition, creation of uniform conditions of transit across the territories of the Customs Union, abolition of customs clearance and customs control. "We should bring the domestic legislation in line with the Customs Code of the Customs Union taking into account that the national Customs Code is almost ready", he noted. The draft national code will be introduced to the Government in January, 2010. Kazakh Prime Minister urged to carry out a public presentation of this document. Prices at the Kazakh fuel and lubricants market are to be comparable with the Russian ones with the Customs Union creation -as Minister of Energy and Mineral resources Sauat Mynbayev has announced. "Considering that the borders are opened (with the Customs Union creation), the goods movement will be greatly simplified in comparison with what we have now. Whether we like it or not, we will have more or less comparable prices on oil products", Mr. Mynbayev said. According to Minister of Economy and Budget Planning Bakhyt Sultanov Kazakhstan's accession to the Customs Union with Russian and Belarus will promote reduction of imports from third countries. "As a result of customs tariffs unification with partners higher tariffs on goods from third countries will be set for us. It will promote reduction of imports from there", he noted. Besides, it will give a chance to the Kazakh goods to occupy those niches at the internal market, which were occupied by the goods from third countries. "The Government and business should clearly understand that this advantage is very limited in time. Because of it we must use it effectively", he noted. The same time Prime Minister Massimov expressed concern over growth of smuggling of Chinese goods through the Kyrgyz territory. "Creation of the Customs Union will cause high illegal goods turnover from China to Kyrgyzstan and from Kyrgyzstan to China since rates of duties in Customs Union and in Kyrgyzstan will differ significantly. Therefore to my mind, we will face large smuggling of goods. Our colleagues in Customs Union in particular the Russian Federation officials are concerned over this issue", Mr. Massimov said. On November 18 Kazakh Secretary of State - Minister of Foreign Affairs Kanat Saudabayev met with Foreign Affairs Minister of the Russian Federation Sergey Lavrov in Moscow. First of all, it should be noted, that the Russian side backed the initiative of the Kazakh President on holding the OSCE Summit within the framework of Kazakhstan's chairmanship. The diplomats discussed the issues of bilateral cooperation in the political, trade-economic and cultural-humanitarian spheres. The parties agreed to interact next year in the OSCE-CIS format since in 2010 Russia will chair the CIS. They also considered the issues of cooperation within the framework of the integration organizations CIS, SCO and the UN, security in Central Asian region including the Afghanistan situation and exchanged opinions on a legal status of the Caspian Sea. An action plan on cooperation between the foreign affairs ministries of Kazakhstan and Russia for 2010 was signed. The sides also reached an agreement between the governments of the two states on order of medical support of personnel in Baikonur. "Kazakhstan - Russia are closest strategic partners at present and will continue to be in the future", Kazakh Secretary of State Foreign Minister Kanat Saudabayev said Tuesday delivering speech at the workshop with participation of Russian experts at the Lomonosov State Moscow University. Mr. Saudabayev noted that Kazakhstan compliments successes of Russia in such spheres as economy and foreign policy. "We believe that strong and democratic Russia is benefit for the Russian people, your friend and partner Kazakhstan as well as for the whole world", the State Secretary said. According to him, in the world financial crisis overcoming Russia and Kazakhstan assured themselves once more of the similarity of development strategies of two countries, vision of regional and global security and necessity of further fair development of the world order. As Mr. Saudabayev noted, the negotiations with Russian Foreign Minister Sergey Lavrov are another evidence of the fact that there is no unsolved problems between our countries. The V Congress of Judges of Kazakhstan with the participation of President Nursultan Nazarbayev held in the Palace of Independence in Astana. About 460 delegates from Kazakhstan's courts and representatives of lawmaking bodies and nongovernmental organizations as well as judges from Russia, Kyrgyzstan, Azerbaijan, Georgia, Spain and France rate part in the event. The progress of the Kazakh judicial reform and new priority tasks for further development of the judicial system will be discussed at the Congress. Besides, the issues regarding the updated Code of Judicial Ethics and the charter of the Union of Judges were on the agenda. Kazakh President and Supreme Judge Mussabek Alimbekov addressed to the participants of the meeting. President Nazarbayev urged to consider the issue concerning rising of status for the Court Administration Committee. Delivering his speech at the 5th Congress of Judges Kazakh leader also noted that judges must not be authorized with the functions non-relevant for them. "The main and principal task of the court is justice. It is important to develop the court administration system based on clear separation of functions between ministering of justice and court administration", - he added.