State of the Nation Address by President of the Republic of Kazakhstan Kassym-Jomart Tokayev

 

UNITY OF THE PEOPLE AND SYSTEMIC REFORMS ARE A SOLID FOUNDATION FOR THE NATION'S PROSPERITY

Dear compatriots!

Distinguished Members of Parliament and Members of the Government!

This year we are marking the 30th anniversary of our Independence - this is our most cherished treasure.

Thanks to the forward-looking policy of the First President, Kazakhstan has had notable success and became known all over the world.

In unity and harmony, we were able to build a new state: this is our greatest accomplishment.

We have strengthened the spirit of the nation by laying a solid foundation for development. We have become an influential member of the global community. Thanks to the stability in our society, we have embarked on the path of sustainable progress.

Together we are building a strong state. Sovereignty is not just an empty slogan and a loud word. It is important for us that every citizen should feel the fruits of independence - a peaceful life, social harmony, increased well-being of the people, and the confidence of young people in their future.

All our endeavours are aimed at this. Thanks to the unity and constructive labour of the people of Kazakhstan, we have successfully overcome all difficulties and trials.

Our country is on the verge of the fourth decade of independence. It is already clear that this period will not be easy. Therefore, we must be ready for any challenges and threats, to continuously improve and always move forward.

My current State of the Nation Address is dedicated to the following issues.

І. ECONOMIC DEVELOPMENT IN THE POST-PANDEMIC PERIOD

Kazakhstan’s economy, the largest in Central Asia, is currently experiencing the effects of the pandemic. Nevertheless, despite the difficulties, we are consistently implementing our policies.

We adopted the National Development Plan 2025 and switched to a new system of state planning to determine the medium-term economic policy and systematise state initiatives. National projects will be approved.

The strategic goal is to ensure our leading role in Central Asia and strengthen our position in the global economy.

A new instrument - the Strategic Investment Agreement has been introduced to further attract direct investment.

Concrete actions have been taken to optimise the quasi-public sector. The merger of the Baiterek and KazAgro holdings has been completed. Portfolio companies have been cut by half, and their staff number by one and a half times. As a result, a new powerful development institution has been created.

The state provided large-scale and operational support to citizens and businesses during the pandemic.

The programme Economy of Simple Things has proven its effectiveness. As part of its implementation, more than 3,500 projects were launched, 70,000 jobs were created, goods and services were produced for 3.5 trillion tenge (over USD 8.2 billion).

Thanks to the Business Road Map programme, 66,000 projects received state support. This helped to create and maintain over 150,000 jobs.

The initiative for the early use of pension savings had a serious economic, but above all social effect. This measure has helped over a million of our fellow citizens to improve their housing conditions or reduce the mortgage burden.

Overall, there is a positive trend in the economic development of our country. Nevertheless, we must be frank that the situation is still difficult.

Therefore, I have decided to extend the term of the Economy of Simple Things and Business Roadmap programmes until 2022. The total amount of funds allocated for their financing will be at least one trillion tenge (over USD 2.3 billion).

Largely due to the low public debt and the presence of significant reserves, Kazakhstan is relatively successful in overcoming the consequences of the pandemic. This is our substantial competitive advantage, and it is important not to lose it.

However, recently there has been a tendency to increase the budget deficit and transfers from the National Fund to cover expenditure obligations. To follow such an "easy” path will not be possible all the time. The stock of financial stability is far from unlimited. Obviously, measures are needed to increase budget revenues. But first and foremost, we need control over the volume and efficiency of government spending.

To recover the assets of the National Fund, the implementation of fiscal rules should be accelerated. The corresponding legislative amendments should be adopted by the end of this year.

Overall, the country needs a set of rules for managing public finances: public debt, budget policy, the National Fund. I ask the Government and the National Bank to prepare a Concept for Public Finance Management by the end of the year.

Along with this, it is necessary to continue work on diversifying the economy, expanding the range of goods produced and the geography of exports.

At the end of 2020, for the first time in 10 years of industrialization, the contribution of the manufacturing industry to the development of the economy exceeded the share of the mining industry. The medium-term goal is to increase manufacturing exports by 1.5 times by 2025, to $24 billion, and labour productivity by 30%.

The law on industrial policy that is being drafted should focus on the challenges facing the manufacturing sector. One of them is the problem of access to raw materials. It is necessary to introduce a simple rule - the price of raw materials for the domestic industry must be affordable, and the volume must be sufficient. By the end of the year, the Government must find the best solution to this important task.

At the same time, it should be kept in mind that the resource potential of our country is not fully disclosed, the geological knowledge remains at a low level.

Investors’ access to quality geological information needs to be increased. To achieve this, an effective National Geological Service should be created on the basis of disparate subordinate organizations. This organization should not become a monopolist that decides to whom and how to give access to the subsoil. Its role is to provide comprehensive service support to investors.

The subsoil use industry needs a new impetus, especially in terms of geological exploration and integrated subsoil study. The reforms initiated under the Plan of the Nation should be brought to practical completion - an open digital database of geological information should be created, and investors should have access to it.

Mineral resources are a national treasure. Decisions on access to them through behind-the-scenes discussions in the quiet of offices should be outlawed. The relevant authorities will provide control on this issue.

The excessive presence of the state in the economy seriously hinders its growth and competitiveness, leads to corruption and illegal lobbying. State-owned enterprises still dominate many sectors and enjoy monopoly privileges.

We have started to solve these problems. As such, the Concept of Public Administration provides for measures to reduce the quasi-public sector, increase its efficiency, transparency, and accountability. The Supreme Council for Reforms has approved a new privatization plan. Now strict control is needed.

But there are other questions as well. In particular, why do individual national companies and state-owned enterprises operate at a loss, while their top leadership are not responsible for this? The Government has to solve this problem.

We also faced uncontrolled inflation growth. The National Bank and the Government turned out to be powerless in the face of inflation, referring to global trends. Excuses like these highlight the vulnerability of the national economy. Another question arises: what then is the role of our professional economists?

The main task of the National Bank and the Government is to return inflation to the 4-6% corridor.

As a result of the implementation of anti-crisis measures with a total volume of 6.3 trillion tenge (over USD 14.7 billion), an excess money supply appeared in the economy. But there are niches to which these funds do not flow. Second-tier banks do not invest in small projects, especially in rural areas.

Therefore, it is necessary to use the potential of microfinance organizations. They work in the field, they know the clients, their business, and their opportunities. The National Bank and the Financial Regulatory Agency should prepare a package of decisions on this issue.

Work to reduce the level of stressed assets is of great importance.

We decided that the state should not help bankers. In addition, frozen assets need to be returned to economic circulation, but exclusively on a market basis. This requires a legal framework. The Government, together with the Agency for Financial Regulation, should submit the legislation to Parliament by the end of the year.

Now regarding the non-monetary components of inflation. The main one is food prices.

Much has been said about the enormous agrarian potential of Kazakhstan. But in the field of the agro-industrial complex, a lot of problems have accumulated.

First of all, it is ineffective pricing and distribution of food products. Earlier I talked about the importance of creating a network of wholesale distribution centres. This task is underway.

It is important to provide access to them for small agricultural producers, including, possibly, personal subsidiary plots. Monopolization of this market is unacceptable.

It is also necessary to ensure uniform control over prices along the chain from producer to consumer. Several departments are now responsible for this work. After the next jump in prices, instead of a thoughtful analysis and taking effective measures, they begin to "point fingers at each other”. It’s time to put things in order in this regard. It is necessary to delimit areas of responsibility, define one body as the main one, and prescribe clear regulations for the interaction of other departments. The Government must make a decision on this issue within a month.

Secondly, unfavourable weather conditions exposed serious problems in livestock. We took prompt measures to stabilise the food supply situation. However, systemic action is still needed in this area.

It is necessary to expand the area of ​​cultivation of fodder crops and strengthen control over the observance of crop rotation, to make wider use of the possibilities of space monitoring and remote sensing of lands. It is also important to improve the efficiency of pasture use.

Today, farmers do not have access to grazing areas as they belong to persons with well-known surnames, who have built impregnable fortresses around their possessions. Governors cannot solve this problem for various reasons, including personal dependence.

The Government, together with authorised bodies, needs to take decisive measures to remedy the situation. Particular attention should be paid to providing the private farmsteads of villagers with pasture lands. Their legal status and support tools must be prescribed in a separate Law "On Personal Subsidiary Farms”. The Government needs to develop legislation as soon as possible.

The sphere of veterinary medicine also requires improvement, which needs a clear delineation of functions and powers between the center and the regions. The health and productivity of livestock depends on the effective work of veterinarians in the field. And this, in turn, directly affects the well-being of rural residents.

Expansion of exports of a significant part of agricultural products is impossible without a modern veterinary service. Therefore, consistent work is required in this area: digitalization of processes, automation of data collection and transmission, personnel training and salary increases. By the end of the year, the Government must take concrete measures to reform the veterinary system.

Thirdly, there is inconsistency in our agricultural policy. Politics also changes with the change of ministers. In such conditions, it is difficult for farmers to plan work for the future. It is necessary to work out a single general position. In accordance with it, it is necessary to revise and stabilise the mechanisms of subsidies.

Over the past five years alone, more than 2 trillion tenge (USD 4.7 billion) has been allocated for subsidies. Unfortunately, more than half of the criminal cases in the agro-industrial complex are related to the theft of subsidies. This situation is unacceptable.

It is necessary to strengthen the regulatory framework, introduce a system of effective planning and monitoring. The procedure for issuing subsidies should be clear and transparent. Subsidies should be fully available to small and medium-sized farms.

It is necessary to study in detail the instruments for stimulating the technological re-equipment of agriculture. About 90% of the technologies used in the agro-industrial complex are completely outdated and in need of modernization.

The agricultural subsidy policy needs to be brought in line with the industrial policy of the state. I ask the Government and the Baiterek Holding to prepare a package of proposals on these issues.

In general, the main task of the agro-industrial complex is to fully provide the country with basic food products.

This year I signed a law that finally put an end to the sale and lease of agricultural land to foreigners and companies with foreign participation.

The Land Code has been amended to encourage domestic investors to invest in the development of rural areas. These changes make it possible to involve agricultural land in a full-fledged economic turnover.

I am sure that all these decisions will have a beneficial effect on our agro-industrial sector, which will become one of the key points of growth of the national economy.

Next issue. In the modern world, one of the main factors of competitiveness is extensive digitization.

The transfer of modern digital technologies, the introduction of elements of Industry 4.0 are extremely important for Kazakhstan. We must actively work with our strategic partners abroad.

At the same time, it is important to nurture and strengthen the domestic IT sector. The country needs young, educated, motivated personnel. In line with the National Digitization Project, it is necessary to train at least 100,000 highly qualified IT specialists.

The export of services and goods of the digital industry should reach at least $500 million by 2025.

These and other challenges will require a complete digital reboot of the public sector. Here, the main and long-standing problem is the lack of effective integration of information systems of state bodies. This issue requires a radical, speedy solution.

First, a fundamentally new architecture of "digital government” has to be built. All IT initiatives of the public sector will be based exclusively on the new platform of the Kazakh state technical supervision. It will eliminate duplication, ineffective costs, and bureaucracy, 100% of public services will be available to citizens from smartphones.

Secondly, we are launching a Digital Transformation Centre, where all business processes of government agencies will be revised and converted into a digital format.

Thirdly, it is necessary to create a platform for interaction between national companies and the IT community. The digital needs and demands of the quasi-public sector should be met as much as possible by the efforts of domestic companies.

Fourth, it is necessary to gradually expand and update data transmission lines, linking them with international corridors. Modern data centres should be built that can serve neighbouring countries.

We must realise our enormous information and telecommunications potential. In the new digital age, it will have geopolitical significance. Kazakhstan should become a central digital hub in a broad part of the Eurasian region.

To solve this issue, it is necessary, of course, to strengthen the personnel plan. I ask the Prime Minister to give me his suggestions.

The situation in Afghanistan and the general growth of global tensions has put before us the task of rebooting the military-industrial sector and the Military Doctrine.

Strengthening our defence capability and increasing the responsiveness to threats should also become priorities of national importance. We must prepare for external shocks and worst-case scenarios. Modelling of risks coming from the outside has become highly relevant. It is necessary to conduct stress tests, work out scenarios, on the basis of which the action plans of the state apparatus will be developed and adjusted.

II. IMPROVING THE EFFICIENCY OF THE HEALTHCARE SYSTEM

Our proverb says, "Health is our main wealth”.

The coronavirus has become a serious challenge for the health care system. The pandemic that has gripped the world is not receding. Every day, thousands of our fellow citizens fall ill, many die.

Since the early days of the pandemic, we have taken immediate action to control the spread of the infection.

Kazakhstan is one of the few countries that has released its own vaccine against the virus. We have no doubts about the efficacy and safety of our QazVac vaccine, in which other countries are already showing interest.

We have a sufficient supply of vaccines; Kazakhs have the opportunity to choose while many nations do not have this privilege.

Mass vaccination continues in the country, but its opponents are still present in society. They not only refuse to be vaccinated, but also urge the population not to do so. Succumbing to their influence, many have become disoriented.

All these people should understand that they are responsible not only for themselves, but also for the lives of others. Therefore, people should not follow the lead of individuals campaigning against vaccination.

Humanity has experienced more than one epidemic. We must not forget that many dangerous diseases were stopped only after the advent of vaccines.

In the near future, new strains of coronavirus may appear in the world, experts predict other pandemics. We cannot simply wait out these processes. We have to learn to live and thrive in such conditions.

Therefore, it is now important to purchase booster vaccines, to speed up the purchase of vaccines registered by the World Health Organization.

It is also necessary to prepare the entire health care system for the transition to regular vaccinations.

A National Biosafety Forecasting System of the country should be established. This measure is provided for in the relevant legislation. I ask Parliament to ensure its adoption by the end of the session.

Many laboratories for sanitary and epidemiological expertise do not meet international standards. As part of the "Healthy Nation” national project, it should be envisaged to equip at least 12 laboratories with high-tech equipment. This will increase the level of compliance of our laboratories with international standards up to 90%.

The situation with diseases not related to coronavirus should not be allowed to worsen. In a pandemic, routine screenings and surgeries are postponed. Many children do not receive routine vaccinations. Of course, this state of affairs is unacceptable.

The medical field needs substantial funding. We are talking about infrastructure, personnel, drug supply.

The pharmaceutical industry requires special attention. The fight against the virus has shown that the industry has become an important factor in competitiveness and security. Therefore, it will be necessary to create a Centre for laboratory and technical testing of medical devices, accredited in accordance with all international standards.

Cooperation with global pharmaceutical corporations should be intensified. It is important to attract investors, to ensure the transfer of technologies and the latest developments. It is necessary to expand the volume and range of off-take contracts with domestic producers. The share of medicines and medical devices of domestic production must be increased from the existing 17 to 50% by 2025.

The key to health is the culture of exercise. I reiterate, it is necessary to create all conditions for mass and children's sports. Governors of the regions should ensure the phased construction of the sports infrastructure.

Overall, in connection with the results of the Tokyo Olympics, there is a need to consider the state of affairs in sports at a separate meeting.

III. QUALITY EDUCATION

Since January of this year, the salary of teachers has increased by 25%. Over the next three years, we will additionally allocate 1.2 trillion tenge (over USD 2.8 billion) for these purposes. The measures taken are bearing fruit - the average score of applicants to pedagogical specialties has grown sharply.

We will continue our policy of supporting teachers. At the same time, in the context of global changes, it is highly likely that the knowledge acquired will become outdated before the graduate enters the labour market. Therefore, the relevant ministry faces the urgent task of adapting curricula to new realities.

The results of distance learning during a pandemic indicate the insufficient efficiency of national communication networks. This led to the emergence of a large number of students who do not possess basic, elementary knowledge. Another problem has arisen, one might say, trouble: children drop out of school because they do not see the need for it.

The Government is instructed to seriously address this issue, in particular to improve the quality of information systems for remote learning formats. Our education must be accessible and inclusive.

But there are some positive news as well. This year, several Kazakh schoolchildren became winners of international Olympiads.

Such talented children need to be fully supported. We will provide them with grants for admission to universities on a non-competition basis and pay one-time cash bonuses. Teachers who taught these children should also be encouraged morally and financially.

It is fundamentally important to support children from socially vulnerable families within the framework of "universal education”. Material support measures should be supplemented with an educational project Digital Teacher.

The education system needs motivated and qualified teachers. I believe that retraining of teachers is required every three years, and not every five years, as it is now. After all, they should be the carriers of new knowledge, real enlighteners. At the same time, cases should not be allowed when teachers take courses at their own expense.

The shortage of places in schools remains an acute problem of the secondary education system and the deficit is 225,000 places. If urgent measures are not taken, then by 2025 it could reach one million places. Earlier, I gave instructions on the construction of at least 800 schools by the end of 2025. Today I set the task to bring this figure to 1,000 schools.

In addition to construction at the expense of the budget, it is necessary to involve the private sector in solving this acute problem.

A phased transition to per capita financing and full-fledged rural schools should begin.

Early vocational guidance for children is of particular importance. The younger generation should be conscious of the choice of a future profession. The Government, together with the Atameken National Chamber, needs to tackle this important task.

We will continue to implement the Free Technical and Vocational Education project.

Today, 237,000 people from among the NEET (Not in Employment, Education, or Training) youth remain unreached. Every year 50,000 applicants enter on a paid basis, 85% of them are classified as low-income. This situation needs to be corrected. It is necessary to ensure 100 percent coverage of free TVE (Technical and vocational education) for in-demand specialties.

Another opportunity for obtaining a profession should be the army. It is necessary to work out the issue of the development by conscripts of job specialties necessary in the real sector of the economy.

The task of the relevant ministry is to ensure the improvement of the quality of higher education. Universities are obliged to be responsible for the proper training of personnel.

The most important priority is the development of science. To solve the accumulated problems in this area, it is necessary to amend the legislation by the end of the year.

First of all, it is necessary to ensure a stable and decent salary for leading scientists, including it in the basic funding of science. At a meeting of the National Council of Public Trust, I instructed to introduce direct funding for research institutes involved in fundamental science. The relevant ministry should develop clear and transparent rules for the selection and funding of such scientific organizations.

Furthermore. A serious barrier to the development of basic science is that grants are limited to three years. In such a short planning horizon, it is difficult to achieve any meaningful results. Consideration should be given to increasing the period of grant funding for science to five years.

The problem of the objectivity of the decisions of the National Scientific Councils is still on the agenda. I believe that a need has arisen to introduce the institution of appeal.

Ultimately, Kazakh education and science are faced with a large-scale, urgent task - not just to keep up with new trends, but to be one step ahead, to generate trends.

IV. IMPROVEMENT OF REGIONAL POLICIES

The main principle of the "listening state" is that the state apparatus should work in the interests of citizens. This primarily concerns local authorities.

It is the governors’ offices that are called upon to interact with citizens and promptly solve their problems. However, this often does not happen. Central management occasionally has to correct decisions made in the regions or even make decisions for them.

Governors of different levels are not always capable of strong independent decisions; they look to the Centre. This is largely due to the fact that the current level of accountability of governors to citizens is insufficient. The assessment of their activities practically does not depend on the opinion of the residents of the regions themselves. Therefore, it is necessary to optimise the mechanism for evaluating the work of governors at all levels.

Independent opinion polls should be an important approach. They give an objective picture of the real attitude of the population to the quality of the work of the authorities. Citizens’ voices are heard directly through polls, not through formal reports. The Presidential Administration should prepare a package of proposals on this issue.

In regional policy, primary attention should be focused on reducing imbalances in socio-economic development. It is necessary to correctly combine the tasks specific to each region with national priorities.

As part of the National Development Plan, 25 specific tasks were identified to improve the quality of life of citizens. These are the main directions of our work. Therefore, the Government and governors will have to update the Regional Development Plans in accordance with the approved national goals.

Of course, one of the main tools for reducing imbalances is the prioritization of budget expenditures. The allocation of funds from the state budget should not depend on the "pushy power” of governors, any personal preferences, and other subjective factors.

To "reboot” the budgeting processes, it is necessary to use the per capita financing mechanism more widely; it is necessary to introduce an objective method of allocating budget limits.

It is necessary to simplify budget processes, radically reduce bureaucracy in this matter, and expand the use of digital tools for planning and budget execution. It is necessary to introduce a block budget with increased responsibility of administrators of budget programmes. The Government needs to develop a package of amendments to budget legislation and by-laws.

An extremely acute problem is the systematic overestimation of the cost of projects. This applies to both small facilities, such as kindergartens and schools, and large infrastructure projects. The current regulatory framework and practice should be radically revised as soon as possible. The Government, the Accounts Committee is instructed to submit proposals by December 1.

The next question is to increase the financial independence of the regions.

Since 2020, the corporate income tax from SMEs has been transferred to local budgets. During this period, despite the decline in economic activity, revenues to local budgets were 25% higher than the plan. This indicates the increased interest of governors in the development of local business, an increase in investment and the tax base.

The trend in this direction must continue. I ask the Government to prepare a package of relevant proposals by the end of the year.

Kazakhstan is in line with a steady trend towards urbanization. Millions of cities should become the backbone of the global competitiveness of Kazakhstan, and regional centres – points of growth for the regions. Therefore, it will be necessary to develop a Law on the Development of Agglomerations and new standards for integrated urban development.

Adherence to the "people and infrastructure” principle is essential. The focus should be on the development of promising villages. The main goal is to ensure their compliance with the System of Regional Standards. These approaches should be enshrined in the Territorial Development Plan.

27 monotowns now account for about 40% of industrial production. They are home to 1.4 million of our fellow citizens. We need substantiated decisions regarding the further functioning of monotowns. In the near future we will discuss this issue at a separate meeting.

Development of local self-government is an important priority. In the cities of central subordination and regional centres, a public participation budget has been successfully introduced. Dozens of improvement projects have been implemented in accordance with the real needs of citizens. This has been a successful experience. Now it is necessary to increase by 10 times the share of residents’ participation in the budget for improvement and housing and communal services.

To strengthen the internal connectivity of the country, it is necessary to complete all the initiated projects on transport infrastructure. As part of the state programme Nurly Zhol, a single transport network is being formed connecting the centre with the regions. Strategically important infrastructure and social projects have been implemented. The task of the governors and the Government is to launch similar Infrastructure Development Programmes for each region.

On the ground, there are long-standing issues of infrastructure modernization.

The Government, together with the Samruk-Kazyna Fund, should start implementing the following large-scale projects: the construction of a combined cycle plant at the site of Almaty Combined Heat and Power plant-2, the modernization of Combined Heat and Power plant-3 and the expansion of Combined Heat and Power plant-1, commissioning of 1000 MW of new generating capacities in the southern region, and the reconstruction of cable networks in Almaty and the Almaty region. The total investment in these projects will amount to more than one trillion tenge (over USD 2.3 billion).

Together with strategic investors in various regions of the country, we will commission about 2,400 MW of renewable energy capacities.

Much attention should be paid to environmental problems in the country, especially air quality.

In the medium term, the 10 most polluted cities need to be supplied with gas and to switch to alternative energy sources.

To improve the situation with gas supply to the western regions, implementation of three projects totalling 700 billion tenge (USD 1.6 billion) will begin this year. They include the construction of a gas processing plant at Kashagan, the construction of a looping line for the Makat-North Caucasus gas pipeline, and the modernization of the Beineu-Zhanaozen gas pipeline.

Now we come to the next important question. In the next ten years, the United Nations predicts a global water shortage. By 2030, the world's water shortage could reach 40%. Therefore, we need to improve water conservation through the latest technology and digitalization. This is a strategic task - there is no other way to prevent water shortages. The government needs to prepare specific solutions that will stimulate the introduction of water-saving technologies and effectively regulate water consumption.

To preserve the ecosystems of water bodies and the careful use of resources, we will begin the reconstruction of 120 canals. 9 new reservoirs will be built in Akmola, Almaty, West Kazakhstan, Zhambyl, Kyzylorda, Turkestan regions. We have all the necessary resources to implement this large-scale project.

To provide drinking water to the districts of the Atyrau and Mangistau regions, the Astrakhan-Mangyshlak main water pipeline will be modernised, and a new desalination plant will be built in the Kenderli village.

In general, the problem of access to drinking water has not been resolved, despite the fact that colossal funds have been allocated for this purpose for decades. Therefore, I set a task as part of the National Regional Development Project to provide 100% of cities and villages with clean drinking water within five years. This is a priority task for the Government.

There is one more question that I would like to touch upon separately. The world is moving towards greening industry and economy. Today these are no longer just words, but concrete decisions in the form of taxes, duties, and technical regulation measures. We cannot stand aside, as all this affects us directly through export, investment, and technology transfer. This is, without any exaggeration, the issue of sustainable development of Kazakhstan.

Therefore, I have set the goal of achieving carbon neutrality by 2060. It is necessary to work in this direction very pragmatically. The population and economy of our huge country are growing, and energy is needed for quality growth.

With the gradual decline of the coal era, in addition to renewables, we will have to think about sources of reliable basic energy generation. By 2030, there will be a shortage of electricity in Kazakhstan.

Global experience suggests the most optimal solution - a peaceful atom. The question is not an easy one, therefore it is necessary to approach its solution as rationally as possible, without speculation and emotions. During the year, the Government and Samruk-Kazyna should explore the possibility of developing safe and environmentally friendly nuclear energy in Kazakhstan.

This issue must also be considered from the point of view of the development of engineering, the formation of a new generation of qualified nuclear engineers.

A promising area is also the production of "green" hydrogen and hydrogen energy in general. The government is instructed to prepare proposals on this issue as well.

V. FORMATION OF AN EFFECTIVE ECOSYSTEM IN THE LABOUR MARKET

The pandemic has brought about a significant transformation of the labour market, first and foremost the rapid development of the remote work format.

A new trend is gaining momentum amid the emergence of many new professions, automation, and digitalization of most processes. In such realities, personal competitiveness can only be ensured by repeated retraining and mastering of new professions. Therefore, a law "On professional qualifications” is needed. It should regulate the issues of recognition of qualifications, stimulate employees to improve their competencies.

Total digitalization has led to new forms of employment based on online platforms. Striking examples of this are taxi drivers, couriers, and others. This area needs government assistance in terms of social and health insurance, pensions, and taxation.

Migration processes also have a great influence on our labour market. Kazakhstan is the second country in the Commonwealth of Independent States in terms of the number of received labour migrants. We need the right solutions to problems in this area. The government will have to develop a new Migration Policy Concept. It should also reflect the mechanisms for protecting the rights of our citizens working abroad.

New approaches are also required to the issues of internal labour mobility. The Government will have to reformat the current mechanism for allocating benefits to citizens moving from the south to the north of the country. In particular, benefits can be provided not only through governors’ offices, but also by reimbursing the costs of employers who independently hire workers from the southern regions.

It is necessary to actively help internal migrants who want to be engaged in independent business. It is also necessary to consider the possibility of providing them with land plots not only for the construction of houses, but also for agricultural activities, to provide wider access to government support measures.

I would like to touch upon on one more issue separately. Kazakhstan is a social state. Comprehensive assistance to citizens in difficult situations is one of our priorities. Unfortunately, paternalistic sentiments and social dependency are strengthening in society.

There are many citizens in the country who deliberately exploit state social programmes. This situation creates wrong attitudes in the public mind. As in any civilised country, they must answer before the law and society. At the same time, those who need real help remain outside the perimeter of support measures. Of course, the possibilities of our country are great, but they are not limitless.

The desire to receive unreasonable social benefits discourages a person from earning through their labour. This inappropriate lifestyle has already begun to negatively affect the value system of young people. Therefore, we need fundamental changes in the consciousness of citizens, society, and legislation. In the upcoming Social Code, all these issues need to be given close attention.

VI. POLITICAL MODERNIZATIONAND PROTECTION OF HUMAN RIGHTS

Phased political modernization is one of the main tasks of the strategic course of our state.

Over the past two years, we have managed to carry out a number of substantial transformations in this area. A new law has been adopted, which enshrined the principle of notifying of the plan to hold a rally; the threshold for political parties to enter the Mazhilis has been reduced to 5% of votes received; and the option "against all” has been added to ballots.

These and other steps were widely supported by the society. They strengthen our vector for sustainable democratic development, qualitatively change the political system, and promote wider involvement of citizens in government.

But there is no room for complacency. Our goal is to further improve the efficiency of the state, transparency, and competitiveness of the political process. Therefore, political reforms will continue.

For the consistent strengthening of statehood, we will carry out all the transformations gradually, taking into account our specifics. This is the only true way to build a strong, just, and progressive state. Our citizens fully share this approach.

The most important step was the introduction of direct election of rural mayors. This is a fundamental moment of the political reform proposed by me in last year's Address. This decision directly affects the interests of the villagers, that is, more than 40% of Kazakhs. We are on the right track. And already in 2024, citizens will have the opportunity to elect district mayors in a pilot mode.

An important factor in the further modernization of local self-government is the development of civic culture.

The Presidential Administration will need to develop an effective mechanism to support civil initiatives in rural areas. It is necessary to adapt the system of grant financing to the requests of rural NGOs, to introduce a simplified procedure for their receipt. This will give a good impetus for social activity in the countryside.

The introduction of a 30 percent quota for women and youth in the electoral lists encouraged the parties to work more actively, to rejuvenate their ranks, and to look for new faces. At the same time, the quota was not properly reflected in the final composition of the members of parliament. Therefore, in order to obtain a full-fledged effect, it is necessary to legislate the norm on the mandatory consideration of this quota when distributing mandates of members of parliament.

We are building an inclusive society. So far, in our country, people with special needs are poorly represented in social and political life. I propose to expand the list of quota categories of citizens. In addition to women and youth, a quota for people with special needs will be established.

As you know, I always highlight the field of human rights protection as a separate issue. Over the past two years, we have made significant progress in this direction.

In January of this year, I signed the Law on the Ratification of the Second Optional Protocol to the International Covenant on Civil and Political Rights, aimed at abolishing the death penalty. Now we have to harmonise the norms of the Criminal Code with the provisions of the Second Optional Protocol. I hope the corresponding law will be adopted by the end of the year.

At the beginning of the summer, in accordance with my decree, the Government approved the Comprehensive Plan for the Protection of Human Rights. This important document lays down a long-term institutional framework for further improvement of the human rights protection system in Kazakhstan.

After the adoption of the Comprehensive Plan, active work began on ensuring gender equality. In this regard, it is necessary to ensure maximum support for the economic and political positions of women in society. The Presidential Administration is responsible for this work.

Changes should also be made to the Concept of Family and Gender Policy.

Substantial changes are taking place in the law enforcement system. Administrative justice has been functioning since July 1, 2021. This institute is established a new type of a relationship between the state apparatus and citizens. Modern formats are being introduced to courts; redundant court procedures are being reduced. At the legislative level, the interpretation of all contradictions and ambiguities of the legislation is provided in favour of citizens and business.

With the introduction of the three-tier model, the protection of participants in criminal proceedings has increased. Since the beginning of this year, the unjustified involvement of more than 2,000 citizens in the law enforcement system has been prevented.

The efficiency of prosecutorial supervision has increased - 98% of baseless decisions were cancelled within three days. It is necessary to gradually expand the competence of prosecutors in the preparation of indictments. This will increase their responsibility and strengthen mechanisms for the legal assessment of the results of the investigation.

The internal affairs bodies are freed from a number of non-core functions. The status of district inspectors has been increased, and they are endowed with additional powers in the field of crime prevention.

In a number of regions, a police service model has been launched in a pilot mode. The next step is scaling it up. The success of this work largely depends on the involvement of local authorities, which must understand the essence of the reforms and provide assistance to the police.

At the same time, the practical issues of combating crime must not be overlooked. Just indignation of citizens is causing an increase in fraud. The Prosecutor General’s Office will have to develop a set of measures to combat fraud and financial pyramids.

The prevention and suppression of sexual crimes against children, especially those left without parental care, should be under special control.

The spread of drugs, including synthetic drugs, poses a terrible threat to the well-being of future generations. Law enforcement agencies are instructed to create a powerful barrier against the spread of this infection among our citizens, especially among young people.

An effective fight against corruption should be continued. By the end of the year, the specialised agency needs to submit for approval a strategic document that defines the programme of our actions for the medium term. At the same time, special attention should be paid to the eradication of "everyday corruption”.

While defending the rights of citizens, we must not forget about the rights of human rights defenders, including lawyers. It is necessary to ensure the safety of their activities, to suppress illegal actions that impede their work.

All of the above measures are an integral part of our strategic course aimed at improving the political system and protecting human rights. 

VII. CONSOLIDATION AS A MAIN FACTOR FOR FURTHER PROGRESS

Kazakhstan is entering a completely new era, bringing fundamental changes in all spheres of life. In the context of global instability and a multitude of new challenges, we need to strengthen our values ​​and form a clear image of the future.

Our main principle "unity in diversity” is unshakable. Therefore, the harmonious development of interethnic relations has always been and will be one of the main directions of the state policy of Kazakhstan. And this is not just rhetoric, this approach is supported by the absolute majority of Kazakhs. For our citizens, consent, tolerance is life itself, a living reality, conditioned by the linkages of cultures and languages.

We, according to the Constitution, are a single nation, and this is our unconditional strength. While supporting pluralism of opinions, we will at the same time strictly suppress any forms of radicalism, we will not allow encroachment on our state sovereignty and territorial integrity.

We must protect the unity and harmony in society as the apple of our eye. It is essential that all citizens realise the importance of harmonious interethnic and interfaith relations.

We have always been immune to disunity. And we will not tolerate any discrimination on the basis of language, nationality, or race, insulting and humiliating people, we will prosecute this according to the law. Such irresponsible steps, contrary to the Constitution, run counter to the interests of our country.

The development of the Kazakh language is one of the key priorities of state policy. We have achieved substantial results in this.

The Kazakh language is becoming the language of education and science, culture, and office work. It is consistently expanding the scope of its application. This is a natural phenomenon. Therefore, there is no reason to talk about the disadvantaged position of the Kazakh language.

In accordance with our Constitution, the state language is Kazakh. The Russian language has the status of an official language. Its use, according to our legislation, cannot be hindered.

Every citizen who connects his future with our country should make every effort to learn the state language. This is one of the manifestations of true patriotism.

The fact that our youth speaks different languages, including Russian, is an advantage for us.

The border between Kazakhstan and Russia is the longest in the world, and Russian is one of the six official languages ​​of the United Nations. Therefore, this issue must be approached from the point of view of common sense.

We need to develop a culture of civilised dialogue and mutual respect. A large role in this is assigned to the Assembly of the People of Kazakhstan. Each of us should feel responsible for our Homeland, for all our citizens.

Effective use of the country's historical heritage and cultural potential is a crucial element in consolidating society and strengthening national identity. In this regard, Kazakhstan has ample opportunities, also for positioning itself advantageously in the international arena.

At the same time, our policy on this issue should be revised. Right now, for some reason, the state most often finances projects only of certain figures who are keen to absorb budgets.

Young and talented sculptors, painters, theatre actors, musicians, writers who master new genre formats and constantly experiment, while surviving at the expense of patrons of the arts, remain "underground”. Yet Kazakh culture is gaining global traction thanks to them.

Therefore, by the end of the year, the Government, together with experts, need to present a plan of practical measures aimed at promoting a new culture and its talented representatives.

We should consider establishing a Creative Industry Support Fund.

The intelligentsia at all times played a special role in our country. They have always led our nation forward, guided the youth, fought against ignorance, and was engaged in enlightenment. These qualities are at the heart of our national code, and we must not lose it.

This is the age of the Internet. A huge flow of negative information poisons the consciousness of the modern generation. False meanings and short-lived values ​​are becoming widespread. This is a very dangerous trend.

At such moments, the active position of the intelligentsia is especially important. Its credibility is determined not by awards, but by real deeds.

The main task is to instil universal human values ​​in young people. In our society, it is necessary to cultivate such qualities as patriotism, passion for knowledge, hard work, solidarity, and responsibility.

Therefore, I urge our intellectuals and creative people not to stay away from solving problems that affect the future of the country.

It is important for us to develop traditions of dialogue and civic participation, to cultivate progressive values that are deeply ​rooted in our internal solidarity and unity.

Only together can we strengthen our unique country identity. As the First President of Kazakhstan Nursultan Nazarbayev has repeatedly emphasized, interethnic and interfaith harmony is our invaluable asset.

For the sake of the future of our state, we are obliged to preserve and strengthen internal stability and national unity.

Dear compatriots!

These are the key priorities of our immediate agenda.

The main wealth of Kazakhstan is its people.

Ensuring the well-being of the people is a key goal of my work as President.

Therefore, today I would like to voice a number of additional initiatives aimed primarily at improving the welfare of Kazakh citizens.

FIRST INITIATIVE

I believe that there is a need to revise the minimum wage level. On the one hand, it is the most important macro indicator, on the other, it is an indicator clear to everyone.

The minimum wage has not increased since 2018. The global coronavirus crisis has increased the pressure on the incomes of the population. In addition, in terms of the minimum wage, Kazakhstan is inferior to a number of CIS countries. Therefore, I have decided to increase from January 1, 2022, the minimum wage from the current 42,500 tenge (USD 100) to 60,000 tenge (USD 140).

This measure will directly affect more than one million people, and indirectly – all the workers. It will reduce the "shadow” salary fund, the size of which today reaches 30% or maybe 40% of the declared.

An increase in the minimum wage will have a positive economic effect in the form of an increase in domestic consumption. This, according to experts, will lead to an increase in GDP by 1.5%.

At the same time, it is necessary to move away from the inappropriate use of the minimum wage as an indicator in tax, social and other spheres.

I ask the Government and the Parliament to ensure that the necessary amendments to the legislation are made by the end of this year with entry into force next January.

SECOND INITIATIVE

More than 6.5 million people in Kazakhstan are hired workers. You know this well. The main source of income for them is wages.

At the same time, over the past ten years, the growth of the wage fund has lagged behind the growth of profit for business owners by almost 60%. In this regard, the Government will develop "soft” measures to stimulate businesses to increase the wages of their employees.

Benefits through regulated procurement, as well as preferential access to government support, will be provided for employers who raise wages of employees.

THIRD INITIATIVE                                                      

The burden on the wage fund needs to be made clear and simple. Micro and small businesses are particularly affected by this. I propose to introduce a single payment from the wage fund with a reduction of the total burden from 34 percent to 25 percent. This will stimulate businesses to bring thousands of employees out of the shadows, who can become full-fledged participants in the pension, social and health insurance systems.

Inconsistencies should not be allowed on this issue. Appropriate payment systems need to be prepared to avoid disruptions and business costs. The system should be operational starting January 1, 2023.

FOURTH INITIATIVE

Since 2020, the salaries of more than 600,000 public sector workers including teachers, doctors and social workers have been increased.

However, this measure did not affect other public sector workers, including employees of cultural institutions, archivists, librarians, technical workers, gamekeepers, drivers of vehicles in public companies, and others.

Therefore, from 2022 to 2025, the state will annually increase the salaries of these categories of public sector workers by 20% on average. This initiative will directly affect 600,000 of our citizens.

FIFTH INITIATIVE

The housing issue will always be one of the most important for people.

Programmes such as "Baspana Hit” and "7-20-25” will end soon. At the same time, market mortgage rates are still high and are far from affordable for all Kazakhs. In this regard, a comprehensive housing programme will be developed. Its administrator will be the Otbasy Bank, which is being transformed into a national development institution. The bank is faced with the task of ensuring the accounting and distribution of housing among citizens on the basis of the "one window” principle.

I have already noted the positive effect of the initiative for the early use of pension savings. It also pushed people to demand payment from employers transparently. To maintain this trend, I consider it necessary to allow a transfer of a part of pension savings above the sufficiency threshold to an account with Otbasy Bank for the subsequent purchase of housing. This will also stimulate the habit of accumulating funds and managing them wisely.

Dear members of parliament!

During the first session, the Parliament of the VII convocation adopted 63 laws.

As a result of the well-coordinated work of both Chambers, a legislative foundation was created for the implementation of the systemic transformations and reforms carried out in the country.

The regular session of the Parliament has started today. We have many important tasks before us. All legislations must undergo a high-quality and detailed study. You should always be persistent in upholding the interests of the people.

Each decision must be made, taking into account not only the needs of society, but also the capabilities of the state.

I wish you success in this responsible work!

Dear compatriots!

Our course is unshakable, the goal is clear.

We know what needs to be done to achieve it. We consistently transform our plans into reality, and we will complete all endeavours. We are ready for any challenges and difficulties.

As the Head of State, I will do my best for the good of the people.

Today, in order to solve the tasks that we are facing, it is necessary to consolidate the state and the entire society. Otherwise, tomorrow it might be too late.

Anyone who doubts the course of the Head of State, does not cope with the work, perhaps wants to somehow sit out, or evades the implementation of the President’s instructions - it seems to me that they should leave their posts.

We are now entering a decisive stage in our development. The state apparatus is obliged to function as a single mechanism. Only in this case will we ensure the achievement of the set goals.

The cohesion of the nation is the main factor in the success of our country. When we are one, we are invincible.

It is not for nothing that the people say: "Where there is agreement, there is happiness.”

Our strength lies in unity! Together we will work for the good of our country!

May our sacred Homeland be eternal!

President of Kazakhstan Kassym-Jomart Tokayev’s State of the Nation Address, September 1, 2020. Part 1

KAZAKHSTAN IN A NEW REALITY: TIME FOR ACTION

The work of the next session of Parliament begins at a challenging time.

Our country continues to confront the pandemic that threatens the entire global community.

We have joined all our efforts to protect the life and health of our citizens.

At this critical time, our friendly people have rallied together as one.

The fight against coronavirus was conducted thanks to the essential features of our people. It showed the importance of mutual assistance, compassion and readiness to jointly confront an unprecedented disaster.

I express my sincere gratitude to doctors, law enforcement officials, military personnel, volunteers, entrepreneurs, conscientious citizens and all concerned for the steadfastness and responsibility they have demonstrated. You have been a vivid example of resilience and great commitment. I consider this a manifestation of genuine patriotism.

In such difficult conditions, our main task is to maintain social and economic stability, employment and income for the population.

Two packages of emergency anti-crisis measures have been adopted. More than 4.5 million Kazakhs, who temporarily lost their income, have received assistance in the amount of 42,500 tenge ($1.1billion). More than 450 billion tenge ($1.1 billion) have been allocated for these purposes. In neighbouring states and even in other developed countries this kind of assistance has not been provided.

Over a million people have received food and household packages.

On the initiative of the Leader of the Nation, the Chairman of the Nur Otan party, more than 550,000 families were covered by the one-off financial support from the Birgemiz Fund.

The pandemic has become a stress test for all states. They are undergoing many difficulties in combatting the virus. One moment the situation stabilises, and the next moment new outbreaks appear.

The government has learned from its mistakes, and managed to reorganise, literally on the run.

The main thing is that we did not hide anything from our citizens, we speak openly about our losses. We tell the truth no matter how bitter these losses may be. This distinguishes Kazakhstan from some other states.

The improvement in the epidemiological situation, however, is no reason for complacency. The fight goes on. According to the forecast of the World Health Organisation, it will take at least two years to defeat the pandemic.

The coming months will be devoted to increased mobilisation. We must be ready for this.

We must act not when a problem appears, but take measures in advance, and work thoughtfully.

All decisions must be based on evidence-based forecasting.

The Government is introducing targeted restrictions and an adaptive quarantine mechanism. A Comprehensive Programme to fight the pandemic will be developed.

All the State’s obligations in the social sphere and in terms of supporting the economy will be fulfilled. For these purposes, 1 trillion tenge ($2.4 billion) has been allocated from the National Fund.

Indexation of social payments will continue. By 2023, it is planned to allocate over 1 trillion ($2.4 billion) tenge to this end.

There is no doubt that we will overcome the current difficulties. But we must not forget about the long-term development of our state in the new geopolitical circumstances around us.

Today, the world has plunged into the deepest recession in a century. The restoration of the global economy, according to experts, will take at least 5 years.

Meanwhile, the competitiveness of future leading states emerges in these times of crises and fundamental change. Kazakhstan must find its decent place in the new world.

Thanks to the far-sighted policy of our First President – Leader of the Nation, Nursultan Nazarbayev, a solid foundation has been created for economic development, and the country has earned its name on the world stage.

In the context of a new global order being forged, it is essential we give substantial impetus to reforms, the quintessence of which is the Plan of the Nation and the Five Institutional Reforms.

It is our duty to ensure a decent life for our citizens, protect their rights, strengthen the rule of law, and reinforce the fight against corruption.

So, what is our plan of action?

A NEW MODEL OF GOVERNMENT

Reforms in this area should be carried out systematically.

Let us start by changing the approach to public administration, human resources policy, the decision-making system and the responsibility for their implementation.

In the context of a pandemic and crisis, the current public administration system is operating at full speed. Solving operational tasks takes time and resources. But in no case should you lose sight of the distant horizon. I have therefore decided to create an Agency for Strategic Planning and Reform, which will report directly to the President.

Such a body did exist in the past and indeed successfully carried out the tasks it was assigned. Now it will once again become the central link in the entire system of state planning. The reforms developed by the Agency must be specific, realistic and, most importantly, mandatory for all government agencies.

A Senior Presidential Council for Reform is being established, the decisions of which will become obligatory. In the interests of greater integrity in assessing the rapidly changing situation, the Statistics Committee is being transferred to the Agency.

It has so evolved that in the system of state planning, the state apparatus acts as the main planner, executor and evaluator. This is not right.

The state planning system should ensure the mobilisation of all human resources and involve the private sector and society as full partners at all stages: planning, execution, evaluation.

We must stop drawing up state programmes with a large number of indicators. It is time to move on to a new format, one of concise national projects, understandable to all citizens. In terms of goal-setting, the result should hold primacy over the process.

Carrying out such radical reform will require revision of the activities of the entire state apparatus. Synergy in the planning and implementation of reforms takes on particular significance here.

It will require a rebooting of the entire system of the civil service. The pandemic and the transfer of most government officials to working remotely showed that the state apparatus can and should be reduced.

I instruct that there should be an acceleration in the timing of the reduction of the state apparatus and quasi-public sector empolyees. This year they should be cut by 10%, and next year by another 15%. Thus, we will solve the problem of reducing officials by 25% in 2021. Depending on the results and taking into account digitalisation, we will then decide on further reduction necessity.

The funds thus saved will increase the salaries of the remaining employees. Low-paid public service is too expensive for society. Misunderstanding of this issue leads to negative selection, loss of competencies, initiative and, most importantly, to corruption. Therefore, from July 1, 2021, a factor-point scale should be introduced. This will lead to increased responsibility and motivation of civil servants.

We are in dire need of new personnel - professionals with fresh views and initiatives. The civil service cannot be allowed to turn into an exclusive caste.

At the same time, it is important to ensure continuity and institutional memory without letting professional and ethical demands fall. Here I would like to touch upon the question of the institution of executive secretaries.

With the introduction of this institution, it was assumed that their unchanging nature would release ministers from administrative and personnel work and ensure the stability of the apparatus. In fact, however, this did not happen. Moreover, there are frequent cases of lack of mutual understanding between ministers and executive secretaries. As a result, the common cause suffers.

Only one person should bear an overall responsibility - a minister appointed by the President. It follows therefore that the institution of executive secretaries should be abolished, their responsibilities being assigned to the heads of staff in the various the ministries.

To implement the above proposals, I am instructing the adoption of a package of amendments to civil service legislation by the end of the year.

Law-making issues should also be reviewed.

During the quarantine, the sluggishness of the legal system gave rise to a "bottleneck" effect. I had to introduce a state of emergency and adopt the so-called "Emergency Decree". But such measures cannot be a systemic response to crisis situations.

The main problem lies in the excessive legislative regulation of the executive branch. We make demands of ministers and governors, but their powers are limited by detailed legal and regulatory norms. This slows down the work not only of the state apparatus, but also overburdens Parliament. Its Chambers are forced to work on detailed rules, which should become the competence of executive bodies.

In a rapidly changing world, slow decision-making becomes a threat to national security. Therefore, within the framework of the Concept of Legal Policy, in changing the legislation, a balance should be ensured between the various levels of legal regulation. We must not hesitate in doing this.

Improving the corporate governance of quasi-state companies is another important problem to be addressed.

There are dozens of national companies and tens of thousands of state-owned enterprises operating in the country. At the same time, large quasi-state organisations are joint stock companies, the purpose of which is to ensure profit. But if part of the state functions is transferred to them, then their activities should be of a purely service, auxiliary, nature for citizens and the economy.

In many joint stock companies a conceptual confusion has occurred. Corporate governance can become an additional bureaucratic procedure.

The reform of the entire quasi-public sector must be continued. Some decisions will be announced today, the rest will be submitted to me in the form of Government proposals.

ECONOMIC DEVELOPMENT IN THE NEW REALITY

The long oil super-cycle appears to be over. We should be prepared for a completely new world market environment.

The creation of a truly diversified, technological economy is not just a necessity for us, but a scenario where there is no other alternative.

At the same time, the economy must work to improve the well-being of the people. We must find a positive answer to the growing public demand for a fairer distribution of benefits arising from the growth of national income and for effective social "lifts".

The new economic course of our country should therefore be based on seven basic principles:

1. Equitable distribution of benefits and responsibilities.

2. The leading role of private enterprise.

3. Fair competition, opening markets for a new generation of entrepreneurs.

4. Increased productivity, complexity and technological efficiency of the economy.

5. Development of human capital, investment in a new type of education.

6. A "Green" economy, environmental protection.

7. Adoption of well-grounded decisions by the state and responsibility to society for them.

In doing so, we must base ourselves on our competitive advantages and real capabilities.

* * *

The most important task facing Kazakhstan is the full deployment of its industrial potential.

Despite successes in this area, we have not yet managed to realise the full potential of the domestic market; about two-thirds of processed goods are imported from abroad.

To ensure the strategic self-sufficiency of the national economy, we must urgently start the development of new procession stages in ferrous and non-ferrous metallurgy, petrochemicals, automotive industry and mechanical engineering, the production of construction materials, food products and other sectors.

The development of a qualitatively new national industry requires a modernised legal framework.

Regulatory and support issues for industry are contained in many disparate pieces of legislation. However, they fail to define cross-cutting goals: there is no link between policies and measures.

There are many laws that govern specific sectors or industries. For example, the Law "On Electricity" or the Law "On Transport".

By the end of the year, a unified Law "On Industrial Policy" should be developed, which will define the basic principles, goals and objectives of the manufacturing industry.

To support industry we also need to improve measures with concrete content. We do not have enough consistency, there is no holistic approach. Because of this, we are dispersing resources on too many projects.

We will continue of course to maintain broad "horizontal” measures in support the industry. At the same time, the Government will have to identify strategically important production facilities, key export priorities, and significantly expand the toolkit of support measures.

For strategic projects, a package provision of grants in kind, concessional financing, partial guarantees and export support mechanisms should be envisaged. Some of the capital expenditure of investors can be recovered by offsetting these against tax liabilities.

It is important to ensure guaranteed procurement from the state, quasi-state sectors and subsoil users.

The main novelty will be the stability of legislative conditions for the entire duration of the project.

It goes without saying that these measures are not exhaustive. The specific level of support will depend on the volume of capital investment and the priority of the project.

In order to fix the agreements between the state and investors, a new instrument will be introduced - a strategic investment agreement.

This initiative should be implemented by the end of the year through elaborating a draft law on economic recovery. The pool of projects that will be included in strategic agreements will be drawn up by the Government by April 2021.

The issue of full access of processing enterprises to domestic raw materials at affordable prices requires a systemic solution.

I instruct the Government to develop regulatory mechanisms by the end of the year to ensure full supply of Kazakh manufacturing industries with raw materials.

Regulated purchasing has a direct effect on industrial development. Their volume is about 15 trillion tenge ($35.7 billion), or a fifth of GDP. The task of the Government and governors is to maximise this potential.

On my instructions, a new law was adopted that improved the procurement system of government agencies. However, procurement by national companies is still non-transparent and inaccessible to ordinary entrepreneurs.

I am instructing that a unified law covering all purchases of the quasi-public sector be developed by the end of the year. All regulated procurement should be carried out as transparent as possible and exclusively through the Single Procurement Window.

Any improvement in legislation will be useless unless there is an appropriate law enforcement practice.

It is not uncommon for cheap and low-quality imported goods to be passed off as domestic produce, which go on to win procurement bids. The register of domestic manufacturers and industrial certificates has not yet become a real barrier for counterfeit manufacturers.

By the end of the year, the Government, together with the Atameken National Chamber, shall submit specific proposals to increase the domestic content.

Our common task in the sector is to increase production in the manufacturing industry by at least 1.5 times over the next five years.

However, significant progress in industrialisation cannot be achieved through industrial policy measures alone. It is imperative that monetary, fiscal and other key policies should not isolated from the needs of the real sector. I will discuss this further.

* * *

A competitive economy cannot be created without a developed agriculture.

In this area, such key problems as limited access to land, lack of available long-term financing and a shortage of professional personnel still remain unresolved.

Measures are urgently needed to develop warehouse and transport infrastructure, in order to avoid being limited by the increasing production of raw materials.

In our country, we can establish 7 large ecosystems for the production and processing of meat, fruits, vegetables, sugar, cereals, oilseeds, dairy products. The fishing industry deserves close attention.

Large projects have a key role to play as the centerpiece of value creation.

Within the framework of vertical cooperation, we should also make effective use of the potential of personal subsidiary plots.

A private household can provide an opportunity for millions of villagers to receive income. We need to involve them in the creation of regional food hubs.

We need to be mindful of potential and horizontal cooperation. Without it, there will be no breakthrough in the development of the agro-industrial complex.

Scattered personal subsidiary plots are at present on the brink of survival. There can be no talk of high productivity, product quality, or regularity of commodity deliveries. Hence our low-level competitiveness and the dominance of imports.

With cooperation, all rights to land and assets are retained and at the same time the efforts of many farms in the purchase of raw materials and  production and sale of products can be consolidated.

It is no secret that hard rural labour is extremely underavalued, and retailers derive the main profit.

Therefore, within the framework of subsidies and tax remissions programmes, a package of measures should be prepared to stimulate cooperation in the countryside.

Another important question relates to the fact that at the end of next year, the moratorium on certain norms of the Land Code on the Use of Agricultural Lands will come to an end.

Our land will not be sold to foreigners. But the Government has to develop other ways of involving agricultural land as a real driving force of economic growth. Investment in the agricultural sector is critical.

The systemic problems in the agro-industrial complex are lack of professional personnel, as well as the low level of development of agricultural science. Here decisive measures are needed from the executive branch.

Technologically outdated irrigation systems remain a serious barrier. Water loss reaches 40%. For water-scarce Kazakhstan, such indicators are unacceptable.

We need to ensure legal regulation in this area, as well as develop economic incentives for the introduction of modern technologies and innovations.

The current state programme for the development of the agro-industrial complex will be completed next year. I instruct the Government, together with business, to start developing a new National Project for the Development of the Agro-Industrial Complex over a five-year period.

Our main tasks are:

- self-sufficiency in socially significant food products;

- stable increase in the income of millions of rural residents;

- increase in labour productivity by a factor of 2.5;

- doubling the export of agricultural produce.

* * *

The development of the transport and logistics industry remains an urgent issue.

The implementation of the first stage of the "Nurly Zhol” programme has been successful, enabling the capital of the country to connect up with the regions according to the "sunray” principle. A new infrastructure framework for the transport system has been formed, the country's integration into global transport corridors has been ensured and the historical status of Kazakhstan as a connecting link between Asia and Europe has been restored.

However, competition in this area is very high. Alternative projects have appeared in the Central Asian region that could reduce the transit potential of Kazakhstan.

The second stage of "Nurly Zhol" should therefore be aimed at consolidating the leading role of the transport and transit sector of our country.

Kazakhstan's competitiveness should grow due to breakthrough infrastructure projects, attracting new countries and companies, upgrading the level of service and the speed of transit routes.

The task is to reconstruct and load road services with over 24,000 kilometres of roads by 2025, that is, all roads in the country.

* * *

President of Kazakhstan Kassym-Jomart Tokayev’s State of the Nation Address, September 1, 2020. Part 2

* * *

Small and medium-sized businesses are going through difficult times. In fact, they are bearing the brunt of the pandemic.

To overcome the negative economic consequences, tax breaks were provided to more than 700,000 entrepreneurs, payments have been deferred and an opportunity has been given to refinance loans on favourable terms. However, the situation remains difficult.

As an additional aid to small and medium-sized businesses, I am instructing to provide state subsidies for interest rates of up to 6% per annum on all existing loans to SMEs in the affected sectors of the economy. The subsidy will cover a period of 12 months, starting from the moment of the announcement of the state of emergency, that is, from March 16 of this year.

The National Bank is implementing a special working capital replenishment programme for SMEs in the most affected sectors. Previously it was assumed that it would terminate its operation this year.

In the current crisis conditions, I instruct that this programme be extended until the end of 2021, and that its coverage be expanded. For these purposes, an additional 200 billion tenge ($476 million) should be provided, bringing the total volume of the programme to 800 billion ($1.9 billion) tenge.

I also instruct the suspension until the end of the year of charging rent from SMEs for real estate objects owned by government agencies and the quasi-public sector.

In the current conditions, maintaining employment and the population’s income is an absolute priority. It is therefore important over this period to reduce the burden on the wages fund for SMEs in the most affected industries. For this category of business, I instruct that deductions from wages to extra-budgetary funds be suspended for the period until the end of the year.

The next question is business climate. This area needs reform, since the regulatory system remains cumbersome, even punitive.

The basic principles of regulatory policy need to be changed. State regulation can only be justified by protecting the health of citizens and the environment.

Both on a legislative level and in practice, the predominance of essence over form should be fixed: common sense and content should prevail over strict legal norms. The three-year moratorium on inspections provides a good opportunity to introduce such regulation from scratch.

We should start with the most corrupt spheres: architectural and construction activities, sanitary and epidemiological supervision, veterinary medicine, certification and others. I am instructing that a new regulatory framework for small and medium-sized businesses be developed within the next year.

I repeat: any unlawful interference of state structures in entrepreneurial activity, obstruction of the work of businessmen, should be perceived as the gravest crime against the state. In the event of illegal pressure on them by officials, businesses should not hesitate to contact the prosecutor's offices.

Supporting entrepreneurship also means paying special attention to medium-sized businesses, which contain the key components of market success. Such companies should be focused not only on the domestic but also on foreign markets. Their export support should be strengthened.

I instruct the Government to launch an export acceleration programme aimed at medium-sized non-resource enterprises in order to provide targeted support from the concept stage right through to implementation.

The main result of work on the development of SMEs should be an increase by 2025 of its share in GDP to 35%, and the number of employees - to 4 million people.

* * *

Reconfiguring cross-cutting government policies will be a critical factor in the success of our work.

A new approach to monetary policy needs to be taken.

We are faced with a crisis of confidence in the tenge on the part of national and international investors. The low level of economic diversification and high volatility of the exchange rate restrict the inflow of foreign investment, especially in non-resource sectors.

Problems of regulating the foreign exchange market and capital movements also play a negative role. A significant part of export earnings does not even reach the domestic foreign-exchange market, it remains abroad. The Government and the National Bank should motivate exporters to sell foreign-exchange earnings.

The stimulating role of monetary policy needs to be strengthened as well. Today, it is largely constrained by fears of an overflow of funds to the foreign-exchange market. Banks are in no hurry to lend to the real economy, since they have a good opportunity of earning money on the foreign-exchange market and on the instruments of the National Bank.

I am instructing that measures be taken to reorient this liquidity towards lending to businesses and thus putting a stop to currency speculation. The powers and functionality of the Financial Markets Regulatory Agency and the National Bank are sufficient to solve this problem. I expect a significant improvement in the situation by the end of the year.

The imbalance between lending to the consumer segment and business also remains a negative factor in the financial sector. Reckless, sometimes irresponsible, lending to consumers, which is fraught with serious social consequences, should be regulated. Lack of financial literacy on the part of citizens should not be a reason for imposing credit products on them.

This year, on my instruction, the legislative and regulatory framework was changed and the requirements for assessing borrowers’ solvency were significantly tightened. Microfinance organisations, pawnshops and other financial institutions that previously issued consumer loans without control came under state regulation. But risks remain. Especially during the crisis and falling incomes.

The Financial Regulatory Agency and the National Bank need to take additional regulatory measures in terms of increasing the responsibility of credit institutions, as well as differentiating and lowering marginal interest rates on loans.

We must in addition increase confidence in monetary policy. It has therefore been decided to create a Monetary Policy Committee within the structure of the National Bank. It will also include independent members.

Since we are talking about the importance of a fair redistribution of national income, then a uniform tax policy should be developed, one which is understandable to all citizens of the country.

Today, about 40 different taxes and fees are levied, administration is complicated and it has moreover a pronounced compulsory character.

I instruct the Government, together with the National Chamber of Atameken, with the involvement of the deputy corps, to revise the Tax Code and by-laws. The goal is to radically simplify the fulfilment of tax obligations and minimise the number of taxes and payments.

We should also think about the differentiation of tax rates as an additional lever for diversifying the economy and replenishing the budget.

In the SME sector, I consider it possible to empower entrepreneurs working in the sectors most affected by the pandemic to pay retail sales tax.

International taxation rules require special attention. They should do maximum to stimulate the influx of foreign investment and the reinvestment of profits in Kazakhstan.

At the same time, reliable control over transfer pricing and capital withdrawal from the country is needed. According to expert estimates, about a third of the country's GDP is in the shadow economy - a huge potential for increasing budget revenues.

Digitalisation of the tax and customs spheres will seriously contribute to combatting the "shadow economy” in all its manifestations. Moreover, corruption is fuelled by the shadow economy.

Therefore, I instruct the Economic Investigation Service of the Ministry of Finance to largely reorient its activities to fighting the shadow economy.

We have to work out a new budgetary policy that is lean and responsible. Only priority areas and projects should be financed. The period of monetary excesses has sunk into oblivion. It is necessary to develop a set of key budget coefficients and rules.

To give a complete picture, it is necessary to introduce the so-called "extended budget", in which, in addition to the state budget, extra-budgetary funds should be taken into account.

The new budget planning system should support national priorities and become a subordinate part of the national planning system.

Government agencies should be given budgetary independence. This will enable swift resolution of problems and move away from collective irresponsibility and red tape.

Demand, however, should also be tightened. To this end, I am instructing that the functionality of the Accounts Committee be strengthened. In order to avoid conflicts of interest, a separate procedure for its financing should be envisaged through the specialised committees of Parliament, and not through the Republican Budget Commission under the Government.

Competition policy is becoming increasingly important. It is necessary to seriously diversify the competitive field, create truly equal opportunities for every entrepreneur and stop monopolising markets.

It is no secret that many market niches are densely "concreted" by far from market methods. Entrepreneurs cannot enter the market, and if they do manage to enter, they are forced to obey private monopolists.

Anti-competitive situations persist everywhere: the market for coal, electricity, oil products, communications, pharmaceuticals, airport services, housing and communal services and logistics. The list goes on.

At regional level, the administrative resource is often the main component of commercial success.

It is essential that we deal with the so-called "monopoly players" - public and private. It is important to accept clear rules: in what cases and in what form they are created, where the profit is spent. Strong public monitoring is needed.

We need to put things in order with exchange trading, and, first of all, in the field of oil products, electricity and coal. Imitation of transparency on the part of large players is unacceptable.

A strong and independent body for the protection and development of competition is therefore required. I am instructing the creation of an Agency for the Protection and Development of Competition which will report directly to the President.

Denationalisation of the economy plays an important role in the development of equal competition.

The central government agencies, governors’ offices and holdings still own about 7,000 non-social facilities.

But the notion that the state is not the best business executive is already an axiom.

The Government needs to adopt a new privatisation plan. The state should cover only social aspects, as well as aspects related to ensuring the security and functioning of the state.

In the quasi-public sector, work should continue to reduce administrative and management personnel, unproductive costs and redundant subsidiaries.

I would also like to touch upon the role of the Baiterek and KazAgro holdings. They have made a significant contribution to the industrialisation and development of the agro-industrial complex and have in addition streamlined the activities of previously scattered financial institutions.

Now, however, we find ourselves in a different reality that requires a change in institutional structure. I consider it expedient to unite these two organisations and create a single development institution with essentially increased financial capabilities.

At the same time, the number of portfolio companies should be reduced by half, and the number of staff should also be reduced by 50%.

It is also necessary to be more active in our approach to the promotion of the economic interests of our state in the international arena, to defend national interests in a pragmatic and professional manner.

We need to maximise for the good of the country the use of extensive opportunities associated with Kazakhstan's participation in the Eurasian Economic Union, as well as in the "Belt and Road" project.

Work on attracting investments and promoting the export of Kazakh goods and services in the newly changing world is fast becoming a priority for the Government.

It is also necessary to effectively use the potential of the Astana International Financial Centre. This platform should become a key tool for attracting direct and portfolio investments.

* * *

Concluding this topic, I want to say that people will not be blessed by the abstract growth of GDP; they need permanent jobs, good roads, hospitals and schools and quality food.

Economic reforms are justified and supported only when they increase the income of a country’s citizens and ensure higher standards of living. We must always keep this in mind.

BALANCED DEVELOPMENT OF THE TERRITORY

It is essential that we substantially restructure our approaches to the country's territorial and spatial development.

Our regions differ in economic and industrial specialisation, living standards, and the quality of public services. Territorial development should therefore be conducted, mindful of the competitive advantages of different regions.

The industrial potential of the south and southeast of the country should be more actively developed. It is here that half of the state's labour resources are concentrated and high-quality jobs are critically important for the development of these regions.

In addition to traditional support for the agricultural sector, substantial attention should be paid to the thorough processing of agricultural products, the development of the food and textile industries, the production of building materials and other industrial sectors.

Industrialisation is important not only for solving social issues and raising the level of income; it also forms a new mentality in citizens, adapting them to the modern world. And this is one of the basic factors determining the nation's competitiveness.

A new vision of the development of regions where major metallurgical enterprises operate is required. These are, first and foremost, the East Kazakhstan, Karagandy and Pavlodar regions. These regions could become centres of high-tech, science-intensive industries and technical services.

The western regions of Kazakhstan should become the centre of attraction for investments in the construction of petrochemical complexes, the creation of new production cycles of high added value. The fact that we still do not have petro-chemistry and high-value gas processing is, "does not fit into any door" (is senseless), as the saying goes.

It is especially important to give "a second lease of life" to our single-industry towns. Here, great responsibility is assigned to city-forming enterprises. This task will not be achieved without their active participation.

Almost 30 million people live in the border regions of Kazakhstan and Russia, where there are several million-plus cities. Close interaction with Russian authorities and organisations to promote Kazakh goods and attract investment is a very important factor in the development of Kazakh border regions.

The problem of fully realising the potential of villages remains strategically important. The implementation of the "The Village is the Cradle of the Country" programme, aimed at solving the most acute problems in the countryside, will continue.

A new approach to regional development will help manage the process of urbanisation, thus ensuring the phasing of "migration waves" and avoidance of over-population and social tension in large cities.

THE SOCIAL WELL-BEING OF CITIZENS IS A TOP PRIORITY

The social well-being of citizens is inextricably linked, first of all, with the housing issue.

In market conditions, the affordability of housing for citizens is based on the availability of income and the ability to resolve this problem independently. As part of my instructions, the issue of the population being able to use a part of their pension savings was devised. This is especially relevant now.

Already in 2021, 700,000 Unified Accumulative Pension Fund contributors will be able to use part of their savings for the purchase of housing, medical treatment or for transferring it to the management of financial companies. I instruct the Government, together with the National Bank, to adopt all the necessary regulations and carry out preparatory work by the end of this year.

This reform will also become an effective tool for "whitewashing” labour relations, creating incentives for participation in the pension system.

Effective social support will be provided to citizens with insufficient income to resolve housing issues independently. 

This year the programme "5-10-25" came into operation. 390 billion tenge ($928 million) was allocated. The implementation of this programme must be constantly monitored by the Government.

The housing problems of those on the waiting list need to be resolved more quickly. Currently local governments are building rental housing for them on their own budget. Due to budgetary and procurement procedures, this is a lengthy process. The time has come to make changes to this scheme.

Funds should be directed not only to construction, but also to subsidising rent. In the first year, the coverage of this measure will increase 10-fold, more than 100,000 families will receive specific assistance. I have instructed Otbasy Bank to streamline this work, which is being created on the basis of Zhilstroysberbank. The bank's management bears personal responsibility in this matter.

In terms of the construction of individual housing, the Nurly Zher programme is being implemented at a slow pace. This is mainly due to the low rates of development of territories, since, according to the legislation, land can be provided only if there is water and electricity supply.

A house is not only housing; it can become an economic aid for low-income citizens, especially for large families. The Government and local governing bodies are obliged to accelerate the provision of communications for plots for social private houses, including through public-private partnerships.

I ask members of Parliament to take the solution of this important problem "under their wing". Is it the case that we cannot provide affordable housing for rural workers, force employers to build rented accommodation by subsidising costs and thus ultimately improve the quality of life of our many fellow citizens?!

* * *

The family and the demographic situation is a matter of serious concern.

Unfortunately, every sixth family in Kazakhstan cannot have children. Opinion polls show that about 20% of Kazakhs consider this a substantial reason for divorce.

The UN forecasts for the growth of the population of Kazakhstan in comparison with our neighbours in Central Asia are disappointing. I instruct the Government to launch a special "Longing for a Baby” programme starting 2021. We need to increase the number of quotas for IVF programmes to 7,000, that is, seven-fold.

Special attention should be paid to issues relative to the safety and protection of children's rights.

We have significantly increased criminal liability for sexual abuses against minors. But the problem remains acute.

Such criminals deserve more severe punishment, without the right to pardon and early release. They should be kept in maximum security facilities.

Each such case should be under the special control of the Office of the Prosecutor. Inaction or negligence on the part of social or law enforcement agencies will be severely punished.

Overall, we need a new paradigm of social policy.

The social security sphere is regulated by 17 laws and dozens of bylaws. This has led to the complexity and fragmentation of regulation. The result is a blurring of the responsibility of the state and a lack of understanding by citizens of their own rights. I instruct the Government to start developing a Social Code for the country.

Measures should be taken to digitalise welfare payments. To this end, there is a need to introduce a digital citizen’s "social wallet", as well as create an appropriate distribution system.

Our society will have to change its perception regarding the value of labour, and teach the young generation to value work, not to separate it into the prestigious and non-prestigious. 

Unfortunately, young people want to get rich quick, hence their passion for lotteries and betting. Inappropriate anecdotes about immigrant workers and a derogatory attitude towards their work have become popular in everyday life.

During these troubling months, we saw first-hand the enduring value of work. A huge effort has been made by junior medical personnel, utility and service workers. This is a real feat of labour. The people who carried it out will not be left without the attention of the State.

President of Kazakhstan Kassym-Jomart Tokayev’s State of the Nation Address, September 1, 2020. Part 3

ACCESSIBLE AND QUALITY EDUCATION

In connection with the coronavirus pandemic, the vast majority of schoolchildren and students in the world have switched to distance learning. This entails a completely different style and content of work.
The government's miscalculations in organising distance learning are well known.
There is still essentially no operational online platform. Teachers, students and their parents have to use WhatsApp for days.
There is an urgent need to develop a unified educational online platform complete with a full set of all the necessary functions for a full-fledged educational process.
At the same time, quality education implies traditional lessons, communication with teachers and peers. We need therefore to consider procedures for returning to the traditional form of full-time education in compliance with epidemiological requirements. This is especially important for schools.
In addition to addressing pressing issues, we need to develop systemic measures to ensure equality of opportunity for children. Our children should receive quality education, regardless of where they live and the language in which they are being taught.
One of the main problems of our education is the low salaries of teachers.
I have already made a decision to increase the salaries of teachers by 25% as from January 2021. This will be increased in the future.
For these purposes, an additional 1.2 trillion tenge ($2.8 billion) will be allocated over the next three years.
We need to solve the problem of the all-round development of children before they enter school. I have set the task of ensuring that by 2025 there will be 100% coverage of pre-school education and teaching for children under six years of age.
Merely building state kindergartens will not solve this problem. We need to attract private business, find new forms of support, including a voucher- financing mechanism. Parents will be able to choose any kindergarten or school and pay with a voucher from the state.
Experts reasonably argue that state support only for gifted schoolchildren would increase the societal distance between children. This would be unacceptable.
In this regard, the state will support the so-called "ordinary" schools. It will also help bridge the gap between urban and rural areas in education.
In order to increase the level of citizens’ literacy and digital knowledge, I instruct the Government to develop a Concept of Lifelong Education. This document should ensure the active introduction of alternative options for non-formal education, recognition of the results of independent learning and the certification of professional skills.
We must also reorient the entire vocational education system towards the formation of competencies that are in demand in the labour market.
The main thrust here will be on preparing a new wave of entrepreneurs. The subject "Fundamentals of Entrepreneurship" should therefore be studied at all levels of education - from schools to universities.
It is essential that we pay the most serious attention to sports and the creative potential of the younger generation.
In times when there is a shortage of funds, it makes no sense to support professional sports clubs entirely at the expense of the state. Billions of tenge from the state budget and quasi-state companies are being spent inefficiently.
Priority should be given to mass sports, physical education and, of course, to children. In each region, sports facilities should be opened in large district centres.
We also need to resume the activity of "children's circles", where representatives of the young generation can learn the basics of creativity and handicraft.
Modern realities can be so dangerous for children: their energy and curiosity need therefore to be guided in the right direction. After all, children are the future of our state. This will be a criterion by which we will evaluate the work of governors.
I should like to say a few words about the quality of education. Last year, I ordered the closure of educational institutions involved in the "printing" of diplomas.
The implementation of this is challenging because of the resistance of influential people involved in this lucrative educational business. But the problem needs to be solved. This issue should be taken under special control by the Prime Minister.
I would also like to touch upon the issue of the development of science.
Here we need a fresh look, new approaches, reliance on international experience.
I instruct the Government to provide internships in leading research centres of the world for 500 scientists annually, as well as provide 1000 grants for young scientists for research under the Zhas Galym project.
An important source of funding and support for science is through the largest enterprises, especially in the raw materials sector.
The current norm on the deduction of 1% of capital investments for the development of science and technology is not transparent. Often these funds are simply redistributed within companies. I instruct the Government to ensure the centralisation of collection and distribution of these funds through the budget, based on national scientific priorities.
A good move on the part of big business would be to take over the "patronage" of regional universities in terms of their scientific activities.
We need a separate programme document on the scientific and technological development of the country. Its primary task will be to attract science to solving problems at national level.
DEVELOPMENT OF THE HEALTHCARE SYSTEM
The pandemic crisis has taught us a lot. For example, to appreciate the work of a doctor. But health workers were once on the periphery of state attention.
It goes without saying that given the importance of the medical profession, it must be supported financially. I instruct the allocation of 150 billion tenge ($357 million) for the payment of incentive bonuses to medical workers for the second half of the year under the soon-to-be revised budget.
We are doing this now during the crisis, and we must continue to do so on a systematic basis. By 2023, wages for medics and health care workers will be twice the national average wage.
The issues of the supply of medicines has been resolved, but the domestic pharmaceutical industry needs to be set on a secure footing. All basic medicines and medical devices must be manufactured in Kazakhstan. This is a national security issue. From next year I expect concrete results in this area.
Another issue is the development of medical infrastructure.
By the end of the year, 13 new hospitals focusing on infectious diseases will be built in various regions of the country. And by 2025, 20 modern multi-functional healthcare facilities will be commissioned. This means an inflow of about one and a half trillion tenge of investments in health care.
On the initiative of the Leader of the Nation, two multi-disciplinary medical centres will appear in Nur-Sultan and Almaty. They will become the flagships of our medicine, growth points for innovation and the development of applied medical science.
The government will have to radically reconsider approaches to the organisation of primary health care. It should become more mobile and accessible to a wide range of the population, including those living in the countryside.
Measures should be taken to revive the transportation of medicine to remote regions. To create effective rural health care within three years, we will need to provide all rural villages with feldsher-obstetric stations and medical outpatient clinics.
The pandemic has acutely pointed to the issue of training doctors in rare specialties: epidemiologists, infectious disease specialists, intensive care staff, pulmonologists, and cardiologists. I instruct the Government to draw up a long-term forecast (10 years) of staffing medical institutions.
Measures for the further development of national health care will make it possible to fully equip all medical organisations with the necessary equipment, to update the hospital beds fund by 50%, replace outdated infrastructure, and increase life expectancy to 75 years.
ECOLOGY AND PROTECTION OF BIODIVERSITY
Environmental protection and ecological development are at the forefront of Kazakhstan’s agenda. The whole civilised world is dealing with this issue, and we should not lag behind this main trend.
A draft for a new Environmental Code has been developed to solve a number of systemic problems. I ask Parliament to consider and adopt this important document by the end of the year.
I instruct the government to start implementing practical measures to improve the environmental situation. Long-term plans for the conservation and sustainable use of biological diversity should be approved.
Over the next five years, more than two billion trees will be planted in the countryside and 15 million in cities and towns. This initiative will lead to a large-scale greening of our country.
There is the now acute issue of building up a green belt around the capital.
Legislatively and normatively, it is essential to protect the national parks and other natural resources of Kazakhstan, as well as to toughen up the criminal and administrative prosecution of citizens who commit offences in this area.
We must equally pay due attention to the ecological education of the younger generation in schools and universities. The "Together for a Cleaner Kazakhstan” environmental campaign, designed to strengthen environmental values ​​in society, should be carried out on a systematic basis.
An important task is the active development of a culture of ecological tourism within the country.
In the medium term, economic growth should become increasingly green. The foundations for deep de-carbonisation should therefore be laid now. I instruct the Government, in cooperation with the scientific community and the private sector, to develop a package of proposals for "green growth".
The government, together with the civil sector, will also have to develop a draft law on the protection of animals. The attitude to animals is a measure of the civilisation of any state, and we are far from perfect in this regard.
A FAIR STATE THAT PROTECTS THE INTERESTS OF CITIZENS
No aspect of socio-economic development can be successfully implemented without the rule of law and guaranteeing the safety of our citizens.
A "Listening State" is, in fact, essential to the concept of building a "Fair State". It is not enough just to hear and see the problems of citizens, the main thing is to respond to them both correctly and objectively.
There is a lot of work ahead to develop new standards for serving the interests of citizens. The law enforcement and judicial systems play a key role in this respect. Reforms are absolutely necessary here.
Reality is changing rapidly. The more security forces rely on best practices, the more likely they are to fit into the context of international practice.
The current situation in the country imposes new requirements on law enforcement agencies, which must meet the demands of citizens.
However, due to the inertia of the past, an accusatory bias still prevails in the work of the law enforcement system. There are frequent cases where citizens are unfairly drawn into the orbit of criminal prosecution.
Operational officers, who detect crimes, and investigators, who make procedural decisions, both report to the same superiors, for whom the main task is to solve the crime and send the case to court. But the rights and freedoms of citizens should not suffer for the sake of indicators.
As for the prosecutor's supervision, this comes too late. Prosecutors become acquainted with the circumstances of a case only before being sent to court.
The criminal sphere should be modernised, following the example of the developed OECD countries. We need a model that ensures timely protection of citizens' rights and meets high international standards. I consider it necessary to introduce to Kazakhstan a three-tier model with a clear division of powers.
The police must identify crimes and those involved, collect and consolidate evidence.
The prosecutor is obliged to give an independent assessment of the evidence collected, stop any violations of the rights of citizens, prevent the involvement of conscientious citizens in the criminal process and to support the prosecution in court.
The court will consider complaints against the actions of the authorities and issue a final verdict on cases.
This approach will strengthen the system of checks and balances, and create effective filters at every stage.
I emphasise again: legality and fairness must be ensured by default. It must be remembered that the fate of people depends on mistakes in criminal cases.
From 2021, it should be legally imposed on the prosecutor in criminal cases to agree on key procedural decisions affecting human rights and freedoms.
It is important to ensure the stability of criminal procedure legislation. Frequent adjustments have a negative effect on law enforcement and do not allow for the development of uniform investigative and judicial practice.
Decisions regarding the application of legislation are often made without proper analysis and forecasting, based on the convenience of law enforcement officers. It is therefore necessary to develop new concepts of "administrative" and "criminal" offenses. Society and the legal community will understand the logic of establishing punishment for offences.
Throughout the progressive world, the institution of the police is developing on the basis of a service model. We also announced the transition to such a model, but so far the work has led to only fragmentary results.
The time has come for a more holistic reform of the local police service on the principle of "police at a walking distance”, where the key role is assigned to the district inspector.
It is necessary to  raise the status of the district inspector legislatively, provide him with all the opportunities for productive work. He must be recognizable, accessible, authoritative for citizens, and actively defend citizens' rights.
It is important to teach law enforcement officers to conduct an open dialogue with people. This should become a priority in the system of training and selection of personnel.
Much is said about the development of video surveillance systems, but at the same time, the premises of the law enforcement agencies often remain "blind" zones. I instruct the introduction of continuous video surveillance in penitentiary institutions and police offices.
The structure of the Ministry of Internal Affairs needs to be revised, freeing it from non-core functions, which will increase the efficiency of this important department.
Considering that we have entered the era of natural and man-made disasters, I believe it is necessary to recreate the Ministry for Emergency Situations.
There are also problems in crime prevention work. It is necessary to reorient the supervision of the prosecutor's office to effectively address the problems faced by citizens and businesses.
It so happens that as soon as a respectable investor appears on the horizon, law enforcement and regulatory authorities immediately rush to check him. The government and Parliament will have to protect business legislatively from excessive interference by law enforcement agencies.
The current thresholds for bringing businesses to criminal liability for tax violations require revision. Any investigative actions against registered entrepreneurs can only be carried out with the approval of a court or a prosecutor. This option should also be considered.
An important criterion for the rule of law is impartial and fair justice. The court must be adversarial and the judge free from prosecution. For this, it is necessary to ensure equality between lawyer and prosecutor.
Building public confidence in the courts should be a priority. Its achievement is possible only through the joint efforts of the state and the judiciary itself.
The judiciary should not be a closed corporation. The Supreme Judicial Council and the Supreme Court should intensify efforts to recruit new professionals to administer justice. The judicial system needs specialists in the field of taxation, use of the subsoil, intellectual property and corporate law.
The selection of judges should be accompanied by media coverage so that the public knows on what merits individual candidates are hired.
It is also necessary to develop alternative ways of resolving disputes, which will make it possible to find compromises without the participation of the State. Such institutions have worked well in developed countries.
Almost ten years ago we adopted the Law on Mediation. But until now, not a single State body has been involved in its development, there is no intelligible state policy. This state of affairs should be corrected.
A representative Commission for the reform of law enforcement and the judicial system is being created under the Presidential Administration.
The fight against corruption is becoming more systemic. More attention has been paid to the causes of corruption, and preventive work is being conducted.
It has become necessary of now to conduct an anti-corruption analysis of regulations and work processes in government agencies and the quasi-public sector to identify corruption-creating factors. 
At the same time, the fight against corruption should not cause officials to lose independence, initiative and efficiency due to the fear of being held accountable.
Supporting the institution of public control as an alternative to state control, we must create an appropriate legal framework. I instruct there to be developed and adopted a Law "On Public Control", designed to ensure openness and accountability to society of state bodies and the quasi-public sector.
It is essential to further enhance the role of public councils by involving them in the work of procurement commissions. The creation of public councils in the quasi-public sector should also be envisaged. The relevant legislation is before Parliament and should be adopted by the end of the year.
At the same time, representatives of different social groups should be widely involved in the composition of Public Councils. For example, it is necessary to create the necessary conditions for the participation of people with disabilities in the work of such structures, which should always be at the forefront of ​​special attention by the state.
It is extremely important to create a single information resource, where information on the financial and economic activities of quasi-state structures, the use of budgetary funds and other relevant data will be available to society.
Openness of information on decisions of state bodies will facilitate constructive dialogue with civil society. It is desirable that the legislation on access to information be passed before the end of the current session.
I also consider it advisable to introduce new anti-corruption tools. From 2021, a new anti-corruption restriction should be introduced for civil servants, deputies and judges regarding their ownership of accounts and holdings of cash and valuables in foreign banks.
If civil servants or heads of quasi-state organisations have dual citizenship, they are liable to dismissal from their positions.
The Criminal Code needs to be amended in terms of toughening penalties for corruption of law enforcement officials, judges, bribe givers and intermediaries in bribery.
Parole will not be applied to persons who committed corruption offences. It is essential to adhere strictly to the rule of prohibiting persons convicted of corruption from working in the civil service or in the quasi-public sector for life. We must also form at legislative level a system for the protection of persons who report cases of corruption.
It is critical to take new measures to protect human rights. For me, this issue is a priority.
Like the rest of the world, Kazakhstan is also faced with the vulnerability of citizens from bullying on the Internet. First and foremost, children suffer from this. They are especially sensitive to cyberbullying, which, unfortunately, has dire consequences. It is time to take legislative action to protect citizens, especially children, from cyberbullying.
Other measures to protect children's rights need to be strengthened, in particular to accede to the Optional Protocol to the Convention on the Rights of the Child, regarding the procedure for communication.
The issue of improving national legislation to combat torture also remains relevant. This document, which criminalises torture, needs to be brought in line with the provisions of the International Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment.
The fight against human trafficking is also on our agenda. In this regard, Kazakhstan does not look good in the eyes of the international community. Law enforcement agencies will have to improve the procedure for investigating such crimes. They must be severely punished by the courts. This important task requires coordinated action by government agencies.
I hope for the speedy adoption of the relevant laws in Parliament.
DIGITALISATION IS A BASIC ELEMENT OF ALL REFORMS
Digitalisation is not a fashion trend, but a key instrument for achieving national competitiveness.
First of all, it is necessary to eliminate the digital divide, ensure maximum access to the Internet and high-quality communication for all citizens. Today it is as basic a need as roads and electricity.
Children from socially vulnerable families should be provided with computers and high-quality internet. By the end of this year, each village with a population of over 250 people will have access to the Internet.
We see the problems people face when assigning pensions and benefits. A heap of papers, running in despair from place to place. It is necessary to fully digitalise these processes. "Data” should "run”, not people.
We must strive to abandon the use of paper in interagency cooperation and when communicating with citizens. I instruct you to cancel the most demanded certificates and paper confirmations (30 out of 47) by the end of the year, to provide digital confirmation of information.
There is already a good practice established for addresses, property and other similar certificates. Identity cards, diplomas, licenses must be accepted by government agencies in electronic form.
To simplify the public’s interaction with electronic services, biometrics should be widely used at public service level and in private business.
Working with "data" must reach a new level. Provision of a unified database system and its further development is one of the main challenges of the Government.
Thus far, this work has not been properly developed, including due to the dominance in the IT industry of a number of state-owned and affiliated companies.
Ministries and governors’ offices also have information and analytical or IT structures that protect only narrow departmental interests at the expense of overall strategy.
The development of the IT market, engineering and other high-tech services is not only the creation of added value and jobs within the country; more and more opportunities appear for the export of such services abroad. It is important to unleash this potential.
Interaction between the IT industry and national business is seen as a promising area.
Large state and private companies spend tens of billions of tenge on the design and applications of foreign players. The government should establish mutually beneficial cooperation between industry and the IT sector. This will create digital technology platforms that can drive the digital ecosystem of every industry.
We have passed laws allowing Kazakhstan to become one of the international hubs for the processing and storage of "data". Over the past year alone, more than 80 billion tenge ($190 million) of investments were attracted to digital mining. But we cannot stop here, we should attract the world's digital giants to the country. Otherwise, other states will do so.

We need to bring the volume of investments in this industry up to 500 billion tenge ($1.2 billion) within five years.

President of Kazakhstan Kassym-Jomart Tokayev’s State of the Nation Address, September 1, 2020. Part 4

CIVIL PARTICIPATION IN GOVERNANCE OF THE STATE

We have set a course for the establishment of the "Listening State". As I said, the essence of this approach is not simply the situational response of government agencies to the daily problems of the population. This is first of all a constant dialogue between the authorities and society.

The National Council of Public Confidence has given a new impetus to the development of public dialogue. It justified its mission by institutionalising the nationwide dialogue process in our country, which resulted in a package of political reforms.

In particular, the Law "On Peaceful Assemblies”, new in its democratic essence, was adopted, amendments were made to the Laws "On Political Parties”, "On Elections”, "On Parliament and the Status of its Deputies”, as well as to the Criminal Code regarding decriminalising Article 130 and humanising Article 174. I am grateful to Parliament for the high-quality and efficient work involved.

This is only the beginning of our reforms in the political sphere and its modernisation will continue. It is necessary to reform practically all the institutions of state power. The main goal of the reforms is to increase the efficiency of the functioning of the entire State.

If we really want to improve the lives of our citizens, then we should involve them in the reform process. Our subsequent political reforms should be aimed at the wider involvement of the public in the government of the country.

For example, opinion polls show an increased demand for the election of rural governors. This important step should be approached carefully and consistently. We need to clearly understand how this system will work in practice. However, the solution of this issue cannot be postponed indefinitely.

The term of office of a number of heads of rural districts will end next year. I believe it is possible to conduct direct elections of rural governors.

In addition to the electivity of local authorities, it will be necessary to decide on the division of powers between levels of government, as well as with local self-government.

An extremely important point is the development of a model for budgetary financing of the regions. This is not only about the "centre-region” relationship, but also about the distribution of funds within the region.

It is essential to strengthen control over the process of approving local budgets, since funds are often not directed to the real needs of the public. Annual renovation of the same streets, senseless spending on image events - all this causes the just indignation of citizens.

With regard to socially significant expenditures on infrastructure and social initiatives, the budgets of districts and villages should go through public expertise, including using online surveys.

We also need to strengthen the financial capabilities of local government. To do this, it is necessary to expand property rights and increase the revenues of the budgets of rural districts. This should be the next stage in the development of "public participation budgets”. By December 1 of this year, the Government will develop a regulatory framework and mechanisms for solving this important problem.

Representative bodies - maslikhats are called upon to monitor the optimal use of local resources. But their opinions are often ignored. This is already a political anachronism.

I also believe it is possible to assign maslikhats with the function of collecting signatures and drawing up petitions on the development of the region or local problems that have not been resolved sometimes for decades.

It will also be necessary to strengthen the audit commissions of maslihats. I instruct the Government and the Accounts Committee to prepare a package of relevant amendments to the legislation.

We need to introduce mandatory online broadcasts of the meetings of maslikhats. Discussions between people's representatives, their socio-political appearance should not be a secret kept from the public.

It is proposed to gradually differentiate the powers of local government bodies and local self-government bodies.

We need to raise the status of local self-government bodies - gatherings and assemblies. Their opinion on topical problems on the ground should be taken into account by regional maslikhats for making specific decisions.

Separately, we should consider the issue of self-government in cities.

A reform was launched to introduce the institution of associations of property owners (APO). A corresponding law has been adopted, all apartment complexes will gradually switch to this form of management.

This reform is designed to take into account the views of residents on property management, accountability in spending funds on maintenance and repairs.

The government and governors must ensure that this important reform is implemented. After all, APO is, in fact, a basic element of the institution of self-organisation and self-government.

The time has come to develop a new Concept for the development of local self-government. Parliament on that basis will adopt a package of corresponding laws.

It must be admitted that formalism and lack of efficiency are still widely present in the work of government agencies. Citizens are forced to demand the solution of their local problems from the central government, to file complaints with the Head of State. It is time therefore to delegate more authority and responsibility to local leaders.

Through social media, problems that cannot be solved locally are made known throughout the country.

We need to create a single legitimate institution of online petitions for citizens to initiate reforms and proposals. Such a mechanism must be completely protected from any manipulation.

The government, in cooperation with civil society, will have to develop a regulatory framework and resolve all technical issues related to this important project.

The most important mission of protecting the interests of the country's citizens will continue to be carried out by political parties.

Through its actions the Nur Otan Party is confirmed in its status as the leading political force in our society. The party's potential will be used in the implementation of all planned reforms.

At the same time, I, as the Head of State, must work on the development of a real multi-party system.

We are not standing still, we are progressively improving our political system, adapting it to the new reality. Our society needs political reforms, so they will definitely continue.

It should be remembered that the main enemies of democracy are ignorance and populism. I hope that our citizens will support the reforms and, having received new political opportunities, will not allow society to slide into "hypocracy."

The success of all these reforms and transformations depends on our solidarity, patriotism, and civic responsibility.

NEW QUALITY OF THE NATION

Today we are faced with the task of forming a new paradigm for our people's lives, improving the quality of the entire nation.

Life itself dictates to us the need to adapt to the requirements of the time as individuals and as society as a whole.

Only a nation striving forward can demonstrate the achievements of a progressive country on a global scale.

I want our people to have more qualities that are good and exemplary for the whole world.

For the new development of our nation, our daily life attitudes must change.

And new principles should reign in society and new guidelines should be consolidated.

"To have knowledge, you need to learn. To be rich, you have to do business. Unity and cohesion are necessary for power. For these needs it is necessary to work tirelessly”, - these words of the teacher of the nation, Akhmet Baitursynuly, are still relevant today. 

First, the generation of the twenty-first century must be highly educated.

Second, young people must be accustomed to hard work.

Third, this is correct when professionalism is the basis of any business.

Fourth, iron discipline and high responsibility must become characteristic features of us all.

Fifth, one must not deviate from the path of justice. Justice is an important condition for the development of society. This quality is of particular importance for the fate of the country and our people.

Sixth, we need to cultivate qualities such as honesty, frugality and solidity. We all want to see Kazakhs this way. Only through following this path can we build a competitive state and create an intelligent nation.

The task of the country’s intelligentsia at this new stage is to embed new principles of national existence, as well as to contribute to improving the quality of the nation.

The renewed society must gradually rid itself of alien habits.

Extravagance and pomposity do no honour to either society or the individual. Irresponsibility, indifference, carelessness can lead to the tragedy of the entire country. And idle talk and bragging slows down the development of society. The great Abai wrote about this, saying "... lies, slander and pride hide the face of truth”. This problem is still relevant to this day.

We must instil in every citizen the great value and high ideals of labour.

A strong system "Responsible State - Responsible Society - Responsible Person” must be rooted in our country.

Dear compatriots!

The country faces great and complex tasks. Their successful solution requires extraordinary approaches, new thinking, universal solidarity and mutual support.

Our strategic course is clear. We are well aware of our problems and shortcomings.

Today I presented to the whole society a plan of action for the state in a situation of crisis. The ultimate success of the reforms depends on each and every one of us.

All of us should work on self-development. The challenges of the times force us to constantly adapt, become stronger and work relentlessly. Therefore, a happy and bright future will depend on a valorous labour of each citizen.

Each generation faces a different challenge. In our history, we have always overcome different challenges. Our people are capable and ready to tackle the most arduous tasks. We are ready for this.

We are a generation that has embodied the long-term dreams and aspirations of our people about Independence. Next year will mark the 30th anniversary of our Independence. This date is an important milestone for sovereign Kazakhstan. This is the beginning of a new historical period.

We bear a huge responsibility for the future of the state.

In unity and concord, we will overcome all challenges and achieve all our goals.

We can do it.

I am firmly convinced of that.

May our country be always safe.

Thank you all.

President of Kazakhstan Kassym-Jomart Tokayev’s State of the Nation Address, September 2, 2019

President Kassym-Jomart Tokayev’s State of the Nation Address

CONSTRUCTIVE PUBLIC DIALOGUE - THE BASIS OF STABILITY AND PROSPERITY OF KAZAKHSTAN

Dear compatriots!

Dear members of parliament and government!

Congratulations on the beginning of the new parliamentary season!

We are approaching the important part in the newest history of our country.

Approximately thirty years ago, we proclaimed our independence thus fulfilling the dream that our ancestors had for centuries.

Since that time, under the leadership of the First President of Kazakhstan – the Leader of the Nation Nursultan Nazarbayev, our country has become a stable and reputable state in the world.

Thanks to the solid unity of our nation, we have strengthened our independence and created opportunities for improving the wellbeing of our people.

It was a time of creation and progress, peace and harmony.

The whole world recognized the way of development of the country and called it the Kazakhstan model or the Nazarbayev model.

Today, we are able to double the achievements of our independence and to bring our country to a qualitatively new stage of development.

We can achieve this by maintaining the continuity of the policy of the Leader of the Nation and through systemic reforms.

As you know, this was the basis of my pre-election programme.

At the moment state bodies are doing the necessary work to implement it.

I will definitely fulfil my promises to the people.

Our work should proceed from the need for the full implementation of the Five Institutional Reforms and the Plan of the Nation developed by Elbasy. The work of the National Modernisation Commission that he created should be resumed.

Furthermore, I would like to express my thoughts on the implementation of our common tasks, in particular, my pre-election platform.

І. MODERN EFFECTIVE STATE.

The political transformation I promised will be gradually and steadily carried out taking into account the interests of our state and people.

World experience shows that explosive, unsystematic political liberalisation leads to the destabilisation of the domestic political situation and even to the loss of statehood.

Therefore, we will carry out political reforms without "running ahead of ourselves”, but consistently, persistently and thoughtfully. Our fundamental principle: successful economic reforms are no longer possible without the modernisation of the country’s socio-political life.

"A strong President – an influential Parliament – an accountable Government.” This is not a fait accompli, but a goal towards which we must move at an accelerated pace.

This formula of the political system is the basis of state stability.

Our common task is to implement the concept of the "Listening State”, which quickly and efficiently responds to all constructive citizen requests. Only through a constant dialogue between the Government and society can a harmonious state be built in the context of modern geopolitics.

Therefore, it is necessary to maintain and strengthen civil society, to involve it in the discussion of the most urgent national tasks in order to solve them.

It is for this purpose that the National Council of Public Trust, representative in composition, was created, which will work on a rotational principle.

In the near future, we all have to implement the following measures.

First. Continue the process of party building.

The Nur Otan party, thanks to our Leader and its Chairman, Nursultan Abishevich Nazarbayev, is consistently carrying out the difficult and responsible mission of the country’s leading political force.

We must cooperate with other political parties and movements that pursue a constructive policy for the benefit of society.

The main problems that concern our society should be discussed and their solutions should be found in Parliament and in the framework of civil dialogue, but not on the streets.

Deputies can and should use their legal rights, including by sending inquiries to the Government on pressing issues and requiring it to take specific measures.

At the same time, relations between the legislative and executive powers should be mutually respectful, business-like, without artificial confrontation.

As Head of State, I see my task as contributing to the development of a multi-party system, political competition and pluralism of opinions in the country.

This is important for the stability of the political system in the long run.

The upcoming elections to the Mazhilis of Parliament and maslikhats should contribute to the further development of the multi-party system in the country.

Second. Effective citizen feedback.

Public dialogue, openness, quick response to the needs of people are the main priorities for the activities of state bodies.

A department has been created in the Presidential Administration that will monitor the quality of reviewing citizens’ requests by state bodies and take prompt measures on them.

Often people are forced to turn to the President because of the "deafness” and closed-off national and local officials.

Repeated complaints about the unfairness of decisions in a particular area mean systemic problems in a particular Government agency or region. Now this should be viewed in this way, and appropriate actions should be taken.

In order to increase the efficiency of the work of civil servants, it is necessary to attract trained young personnel into their ranks.

At the same time, starting in 2020, we will begin to gradually reduce the number of civil servants, and we will use the released funds to provide material incentives for the most useful staff.

By 2024, the number of civil servants and employees of national companies should be reduced by 25 percent.

Third. Improving the legislation on rallies.

According to the Constitution, our citizens have the right to freedom of expression.

If peaceful protests do not pursue the goal of violating the law and the peace of citizens, then they should be embraced and given approval for them to be carried out in the manner prescribed by law, to allocate special places for this. And not in the outskirts of cities.

But any calls for unconstitutional and hooligan actions will be dealt with within the framework of the law.

Fourth. Strengthening the public consensus.

The harmony between social and ethnic groups is the result of the joint work of the whole society.

In this regard, it is necessary to analyse political tendencies and take concrete measures to strengthen our unity.

We need, taking into account the role of the Kazakh people as a nation-building people, to continue building inter-ethnic concord and inter-religious understanding

Our position: the unity of the nation is in its diversity!

We will continue to provide conditions for the development of languages and cultures of all ethnic groups in our country.

I believe that the role of the Kazakh language as a state language will grow and the time will come when it becomes a language of interethnic communication.

But, to reach this level, what is needed is not loud statements, but our common work.

In addition, it must be remembered that language is an instrument of big politics.

I believe it is necessary to enhance the image of non-governmental organisations in the creation of an active civil society.

Therefore, in the near future, we need to elaborate and adopt the Concept of Civil Society Development until 2025.

Preparations for important jubilees and significant events that will be celebrated next year have begun.

Next year, all of us will celebrate Al-Farabi’s 1150th anniversary and the 175th anniversary of Abai Kunanbayuly.

During the anniversary celebrations, we should glorify the works of these genial personalities for our people, without allowing squandering of resources.

We also need to implement the most important celebration – the 30th anniversary of our Independence.

I am convinced that such significant events will contribute to the education of the young generation in the spirit of genuine patriotism.

II. ENSURING RIGHTS AND SECURITY OF CITIZENS.

A key factor in enhancing the protection of citizens’ rights and their security is the substantial reform of the judicial and law enforcement systems.

A number of serious measures must be taken to improve the quality of court decisions.

The right of a judge to make a decision based on law and internal convictions remains unshakable. However, a thorough analysis of court decisions should be carried out and the uniformity of judicial practice should be ensured.

In public law disputes, when appealing against decisions and actions of authorities, citizens are not on equal footing. Their capabilities are incommensurable with the resources of the state apparatus.

Therefore, it is necessary to introduce administrative justice, as a special dispute resolution mechanism, levelling this difference.

Henceforth, when resolving disputes, the court will have the right to initiate the collection of additional evidence, the responsibility for the collection of which lies with the state body, and not with the citizen or business.

All contradictions and ambiguities of the legislation should be interpreted in favour of citizens.

I would also like to dwell on the following important issue.

We have moved away from excessive repressive measures and harsh punitive justice practices. However, numerous serious crimes still occur in the country.

We got carried away with the humanisation of legislation, while losing sight of the fundamental rights of citizens.

We urgently need to tighten the penalties for sexual violence, paedophilia, drug trafficking, human trafficking, domestic violence against women and other grave crimes against the individual, especially against children. This is my task to Parliament and the Government.

Recent tragic events have also revealed the problem of poaching, as a most dangerous form of organised crime.

Poachers are equipped, armed and feel their impunity. This year alone, two wildlife inspectors died at their hands.

Recently, the criminal activity of a gang of poachers on Lake Markakol in the East Kazakhstan region was stopped.

These are only isolated cases, but poaching has taken deep roots, including with the connivance of law enforcement agencies. Poachers ruthlessly destroy nature – our national wealth.

I instruct the Government to take urgent measures to tighten the relevant legislation within two months.

The issue of a systemic fight against corruption is also on the agenda.

It is necessary to restore anti-corruption expertise of draft regulatory legal acts of national and local authorities with the participation of experts and the public.

It is necessary to use legislative and normative means to regulate the responsibility of the first head of the department where the corruption related crime takes place.

It is also necessary to ensure strict liability of employees of the anti-corruption bodies for any illegal methods of work and provocative actions. They should not have a place in investigative practice.

The principle of the presumption of innocence must be fully respected.

One of the most pressing tasks remains a full-fledged reform of the law enforcement system.

The image of the police, as a power tool of the state, will gradually become a thing of the past; it will become a body providing services to citizens to ensure their safety.

At the first stage, it is necessary to reorganise the work of the Committee of Administrative Police by the end of 2020. This must be done qualitatively and without a gung-ho approach.

The effectiveness of the work of the police depends on the reputation of the police service itself.

Over the next three years, 173 billion tenge will be allocated to reform the Ministry of Internal Affairs.

These funds will be used to increase wages, provide accommodation, and the creation of modern front-line police offices on the principle of public service centres.

Particular attention will be paid to issues of protecting citizens from natural disasters and technological accidents, which, unfortunately, have become a frequent occurrence not only in our country, but throughout the world.

Professional staff should work in this area.

I instruct the Government to increase the salaries of civil protection employees within the framework of the funds allocated to reform the Ministry of Internal Affairs, and to allocate around 40 billion tenge for these purposes.

We are also faced with the task of establishing a combat-ready army based on a new concept.

The events in Arys showed that serious problems have accumulated in the armed forces.

Finally, it is necessary to streamline all military expenditures and strengthen financial and general discipline in the army. At the same time, it is necessary to increase the prestige of the military service and the material support of the armed forces.

Equipped by professionally trained, loyal officers and military personnel, our army should be prepared to repel threats to the country’s security in new geopolitical realities.

President of Kazakhstan Kassym-Jomart Tokayev’s State of the Nation Address, September 2, 2019. Part 2

III. DEVELOPED AND INCLUSIVE ECONOMY.

Kazakhstan’s economy is moving forward despite the global challenges.

From the start of the year its growth has been higher than the world average.

If necessary structural adjustments can be implemented, by 2025, annual sustainable growth of gross domestic product can reach 5% or higher.

In order to give a new impetus to the development of the economy, the Presidential Administration and the Government should carefully analyse the work of domestic and foreign experts.

We need to implement a number of structural tasks in line with the Long-term Development Strategy 2050 and the Plan of the Nation proposed by Elbasy.

First. Abandonment of the raw material-based mentality and diversification of the economy.

The "knowledge economy”, increased labour productivity, innovation development and the introduction of artificial intelligence have become major factors in global progress.

In the course of the third five-year plan of industrialisation, we should take into account the mistakes and shortcomings that have been made earlier.

The Government should take into account all my comments and fully implement the relevant instructions in these matters.

We need to increase real labour productivity by at least 1.7 times.

Raising our reputation in Central Asia as a leader in the region is a strategic task.

This is our political course determined by Elbasy.

Second. Increased returns from the quasi-public sector.

Our state-owned companies have become bulky conglomerates whose international competitiveness is in doubt.

In order to reduce the unjustified presence of the state in the economy, I decided to introduce a moratorium on the creation of quasi-state-owned companies.

We need to understand the genuine contribution of the Sovereign Wealth Fund to the growth of the welfare of the people over the past 14 years since its creation.

The Government, together with the Accounts Committee, must conduct an analysis of the effectiveness of state holdings and national companies within three months.

Quasi-state companies often compete with each other on the same field. In the field of housing policy, for example, seven state operators are operating simultaneously, and this is only at the national level!

The number of state-owned companies can and should be reduced.

At the same time, one should carefully approach the activities of state-owned companies operating in strategic sectors.

State control over them should be maintained. Otherwise, instead of state monopolists, we will get private monopolists with all the ensuing consequences.

The Government needs to systematically and substantively deal with pricing and tariff issues. This also applies to the goods and services of natural monopolists. It is no secret that prices in our country are high – from food and clothing to the cost of various services.

For example, there are questions as to why the flights of the main air carrier on the most popular routes are much more expensive, sometimes by up to 30%, than in Europe?! What is the reason for the relatively high cost of services at our airports?

Why is the cost of jet fuel for foreign carriers at Kazakhstan airports higher than for domestic?

As a result, the aviation industry of Kazakhstan is losing its international competitiveness, and the country’s transit potential is decreasing.

With the connivance of the relevant ministry and departments, an artificial shortage of rail tickets has been created.

Order should be restored in these areas urgently.

Our goal is to ensure the full development of market institutions and mechanisms with the stabilising role of the state.

At the same time, one should not forget about the "economy of simple things”. This is a priority area of ​​our work.

Third. Effective small and medium sized businesses are a solid foundation for the development of cities and villages.

Small enterprises, especially micro-businesses, play an important role in the socio-economic and political life of the country.

Particularly, first of all, they provide rural residents with stable jobs, thus reducing unemployment. In addition, the tax base is created while the local budget is strengthened.

Furthermore, the development of mass entrepreneurship helps overcome paternalistic attitudes and dependence.

Therefore, the state will continue to support businesses.

Around 100 billion tenge has been allocated from the National Fund for this purpose.

However, according to experts, financial support is only received by the businesses affiliated with local authorities.

In fact, new companies and jobs should have been created within the new projects.

This is directly related to "the economy of simple things.”

However, local akims have not fulfilled the organisational work.

As a consequence, conditions were not created to increase the tax base, pension contributions, and strengthen the local budget.

In this regard, I instruct the Accounts Committee and the Ministry of Finance to take strict control over the expenditure of funds.

There are plenty of examples of entrepreneurship development in our country. Our whole society needs to support small businesses.

I instruct the Government to develop a legislative framework to exempt micro and small business companies from paying income tax for a period of three years.

Corresponding amendments to the legislation should enter into force from 2020.

My decision for a three-year ban on inspections of micro and small business entities will come into force from January 2020.

We believe in the integrity and law-abiding nature of our businesses, which should have responsibility towards consumers and citizens. During the moratorium, it is necessary to activate the tools of self-regulation and public control.

In cases of violation by business entities of the prescribed norms and rules, especially in the sanitation and contagious diseases sphere, such companies will be closed, their owners will be held accountable.

We are thus reducing the burden on businesses.

At the same time, there are still numerous problems associated with the actions of law enforcement and regulatory authorities.

Cases of raiding against SMEs have become more frequent.

My position on this issue is well known: any attempts to hinder the development of business, especially small and medium-sized ones, should be considered crimes against the state.

In this regard, additional legislative measures are needed. Parliament and the Government should propose a solution to this problem.

At the same time, it is necessary to strengthen opposition to the shadow economy, to tighten the fight against the capital flight and tax evasion.

Furthermore, the system of state financial support for SMEs needs to be "rebooted”, giving priority to new projects.

I instruct the Government to allocate an additional 250 billion tenge for the next three years under the new "Business Roadmap”.

It is necessary to actively introduce new forms of business support with an emphasis on social aspects – the creation of family businesses, primarily for large and low-income families.

Particular attention should be paid to the development of tourism, especially eco- and ethno-tourism, as an important area of ​​the economy.

The 750th anniversary of the Golden Horde should be commemorated in terms of attracting the attention of tourists to our history, culture and nature.

For the development of tourism, it is important to ensure the construction of the necessary infrastructure, primarily roads, as well as the training of qualified specialists.

Fourth. Support for national businesses in international markets.

It is necessary to drastically increase the effectiveness of state support for exporting companies.

I speak, first of all, about medium-sized business.

Meanwhile, we do not have effective state support measures for this particular segment of entrepreneurs, especially regarding the sale of products. We need to support our SMEs.

I instruct the Government, within the framework of the State Programme for Industrial and Innovative Development, to develop a set of measures to support high-performance medium-sized businesses, including through tax, financial, and administrative incentives.

It is necessary to seriously intensify efforts to attract foreign direct investment, without which the potential for further economic growth will be limited. This is one of the priority tasks of the executive branch.

Within the framework of the Strategic Plan for the Development of Kazakhstan until 2025, appropriate targets are set for each industry and region.

Their achievement is the direct responsibility of the heads of state bodies, especially regional akims.

Kazakhstan has embarked on developing a digital economy.

There is a lot of work to do. Our task is to strengthen our leadership in the region in terms of the development of info-communication infrastructure.

The Government will have to adapt the legislation to new technological innovations: 5G, Smart Cities, Big Data, blockchain, digital assets, and new digital financial instruments.

Kazakhstan should have the reputation as an open jurisdiction for technological partnership, construction and placement of data centres, development of data transit, participation in the global digital services market.

The Government should continue to support the activities of the Astana International Financial Centre (AIFC), which, in essence, has acquired constitutional status. The AIFC could become a platform for the development of the latest digital technologies together with the Nazarbayev University.

Fifth. Developed agricultural industry.

Agriculture is our main resource, but it is far from being fully utilised.

We have significant potential for the production of organic and environmentally friendly products that are in demand not only in the country, but also abroad.

We must gradually increase the amount of irrigated land to 3 million hectares by 2030.

This will ensure growth in agricultural production by 4.5 times.

The Ministry of Trade and Integration and the Ministry of Agriculture should strongly support farmers with the marketing of their products in foreign markets.

The Government has already been tasked in this regard. This is a priority.

Furthermore, we need to move away from only exporting raw materials, which reached 70%, while the load of processing enterprises is only 40%.

An urgent task is to attract foreign investors to the agricultural sector. Discussions are already underway; the Government needs to achieve concrete results.

I would like to specifically address an issue that is of public concern.

As Head of State I repeat: our land is not for sale to foreigners. This is not allowed.

All insinuations on this issue must end. At the same time, our task is to ensure the effective use of land.

The issue of inefficient use of land resources is becoming increasingly relevant.

The situation is compounded by the low level of direct taxes on land.

Many of those who received land leases for free from the state keep the land for future use without working on it. A whole layer of so-called "latifundistas” has developed in the country. They behave like a "dog in a manger.”

It is time to begin the seizure of unused agricultural land.

Land is our common wealth and must belong to those who work on it.

The Government and Parliament should propose appropriate mechanisms.

This is all the more important because without a solution to this issue, it is already impossible to have a qualitative development of domestic agribusiness.

Today, the increase in meat production rests not so much on the problem of breeding stock but on the problem of the lack of land for farmers to grow fodder crops. Feed availability is less than 60%.

Improving agricultural productivity is impossible without ensuring appropriate conditions for a quality rural life.

We will continue to implement Elbasy’s special project "Auyl – El Besіgі”.

We have to solve the extremely difficult problem of maintaining small villages. Regional standards have been developed, which should now be implemented in more than 3,000 rural settlements.

I instruct the Government to allocate 90 billion tenge in the next three years in addition to the 30 billion tenge allocated this year for the implementation of Auyl – El Besіgі.

These funds will be used both for solving infrastructure issues – transport, water supply, gasification, – and for the repair and construction of schools, hospitals and sports facilities.

The expenditure of these funds should be under the strict control of all Government agencies.

Sixth. Fair taxation and sound financial regulation.

Despite the growth of GDP and incomes of the population, inequality within Kazakhstan society still remains and is even increasing.

This is an alarming factor that requires special attention.

I believe it is necessary to modernize the tax system with a focus on a more equitable distribution of the national income.

The Government should also pay attention to the growing volume of social contributions.

On the one hand, they ensure the stability of social and pension systems.

However, there are risks that employers will lose incentives to creating jobs and increasing wages. Businesses will go into the shadow.

Therefore, I instruct the Government to postpone the introduction of additional pension contributions in the amount of 5% until 2023. We will then return to this question.

During this time, the Government, business representatives and experts should calculate the options and come to an agreed decision taking into account the interests of both future pensioners and employers.

The Government must impose a ban on all payments and fees that are not provided for by the Tax Code. These are, in fact, additional taxes.

A separate problem is improving the quality of the current tax system.

It should stimulate companies to invest in human capital, in raising labour productivity, technical re-equipment and exports.

Non-cash payments should be introduced everywhere, eliminating the constraining factor – a high banking commission. To achieve this, it is necessary to actively develop non-banking payment systems with relevant regulatory rules. With the obvious simplicity and attractiveness of this segment, it should not become a channel for money laundering and capital flight from the country. The National Bank should establish effective control in this area.

The next issue is the support for the export of non-oil products. The issue of applying simpler and faster VAT refund procedures needs to be considered.

One of the most problematic issues in our economy is the insufficient volume of lending. Over the past five years, the total volume of lending to legal entities, as well as small and medium-sized businesses, has decreased by more than 13%.

Second-tier banks cite a shortage of good borrowers and make provisions for excessive risks in the cost of credit.

The problem of quality borrowers, of course, exists. But you can’t just pass on your responsibility and take only the easy route.

I expect the well-coordinated and effective work of the Government and the National Bank on this issue.

Another problem – debt load, especially of socially vulnerable segments of the population, – has led to the need for emergency measures. You are aware of this.

This problem has gained social and political urgency.

Therefore, I entrust the Government and the National Bank to prepare within two months for the implementation of mechanisms that are guaranteed to prevent the repetition of this situation.

The lack of effectiveness of monetary policy is becoming one of the obstacles to the country’s economic development.

Lending to businesses should be ensured by second-tier banks on acceptable and long-term terms. By the end of the year, the National Bank needs to complete an independent assessment of the quality of assets of second-tier banks.

Seventh. Effective use of the National Fund.

It is necessary to reduce expenditures from the National Fund on solving current issues.

These are the resources of future generations.

The use of the National Fund should be allocated only for the implementation of programmes and projects aimed at the formation of a competitive economy.

The amount of guaranteed transfers used should gradually decrease to 2 trillion tenge from 2022.

It is necessary to significantly increase the effectiveness of the Fund’s investment.

I task the Government, together with the National Bank, to elaborate concrete proposals to improve the mechanism of the use of the National Fund by the end of the year.

Eighth. Increase of salaries.

As the success of large mining companies increases, we see that the wages of our citizens have not significantly grown.

As this concerns the social welfare of the population, the Government must remain persistent in this regard.

I instruct the Government to consider the issue of incentives for employers to increase wages.

President of Kazakhstan Kassym-Jomart Tokayev’s State of the Nation Address, September 2, 2019. Part 3

IV. NEW STAGE OF SOCIAL MODERNISATION

The country’s budget should be focused on two main objectives – the development of the economy and solving social problems.

The social sphere should focus on the following areas.

First. Improving the quality of education.

The effective methodology of accounting for the balance of labour resources has not yet been developed in our country.

In fact, the domestic training system is out of touch with the real labour market.

Around 21,000 school graduates annually do not have access to vocational and higher education.

This group of young people is the basis of the unemployed and marginalised. Many of them are exposed to criminal and extremist movements’ influence.

We need to identify the pupils’ abilities and move towards a career guidance policy.

This policy should be the basis of the national standard of secondary education.

Demand for technicians in our economy is very high, but capabilities of the national education system are low. Enterprises have to invite relevant professionals from abroad. We need to correct this situation quickly.

The difference in quality of secondary education is growing between urban and rural schools.

The main problem is the deficit of qualified teachers in rural areas.

Therefore, we need to expand the scope of the program "With diploma to the village” and continue the work on a new level. I task the Government to finance the programme with up to $20 billion tenge next year.

It is necessary to select talented rural youth and prepare them for domestic and foreign higher education institutions.

I task the Government to develop a roadmap to support gifted children from less well off and large families.

Governments and akims should have the opportunity to make such children attend youth clubs and centres and summer camps.

Now I want to focus on the quality of the higher education.

Only half of the country’s higher education institutions ensure a 60 per cent employment rate for their graduates.

Therefore, it is necessary to consider the reduction of their number.

It is no secret that there are universities that are engaged in selling diplomas instead of quality education.

By banning them, we should strive to improve the quality of the teaching in educational institutions.

Another problem with education is the uneven financing and the inefficiency of the modern regional governance system.

It is necessary to transfer the functions of managing the education departments and administration of budgetary funds from the district level to the regional level.

It is necessary to introduce a special financing order at all levels of education.

The poor quality of textbooks is another urgent problem.

Providing students with quality textbooks is a direct responsibility of the relevant ministry.

These measures are not going to have an effect if we do not improve the social standing of teachers.

That’s why I have instructed, at the August conference, the doubling of teachers’ salaries over the next four years. This means that next year salaries of teachers will grow by 25%.

The situation in science requires special attention. Without it, we cannot ensure the progress of the nation. Another question is to what extent is our science high quality and effective?

The Government should consider this problem from the point of view of increasing the level of scientific research and its practical application.

Second. Support for the institution of family and childhood, the creation of an inclusive society.

Protecting the rights of children and combating domestic violence should be our priority.

It is necessary to deliberately address the problem of high suicide rates among adolescents.

We have to create a holistic programme to protect children affected by violence, as well as their families.

Particular attention should be given to families with children with disabilities. According to official statistics, over 80,000 children are registered as having a disability.

The Government should develop measures to improve the medical and social support of children with cerebral palsy.

It is necessary to expand the network of small and medium-sized rehabilitation centres for children within walking distance.

We must create equal opportunities for people with special needs.

I talked about this during my election campaign. Now I instruct the Government to allocate at least 58 billion tenge for these purposes over three years.

Particular attention is required to strengthen the health of the nation. It is important to develop and promote sport among all age groups.

It is necessary to ensure the maximum availability of sports infrastructure for children.

The development of a mass sporting culture needs a pyramid structure. On top there will be new champions, and at its base a healthy and active youth and, ultimately, a strong nation.

Legislative support for this course is required, as well as the adoption of a Comprehensive Plan for the Development of Mass Sports.

2020 is declared the Year of the Volunteer. The urgent task is to expand the participation of citizens, especially youth and students in volunteer activities, to instil in them the skills for an active life. This is an important part of our work to strengthen civil society.

Third. Ensuring the quality and accessibility of medical services.

We are still seeing regional imbalances in the health of our population, especially in maternal and infant mortality.

Yes, these gaps are decreasing, but they remain large and significantly exceed those in developed countries.

The Government must create a list of health priorities for each region and introduce a budget based on such a list.

On January 1, 2020, Kazakhstan will launch a system of compulsory social health insurance.

I want to re-assure everyone: the state will maintain a guaranteed amount of free medical care. More than 2.8 trillion tenge will be allocated for its financing over the next three years.

The implementation of the compulsory social medical insurance is designed to improve the quality and accessibility of medical services.

Under the three-year budget, an additional $2.3 trillion tenge will be allocated for the development of our healthcare system.

The Government needs to be extremely responsive in implementing the social health insurance scheme to prevent its further discrediting.

We no longer have room for mistake.

Fourth. Support for those who work in culture and the arts.

We have not paid sufficient attention to those working in the field of culture including library, museum and theatre staff.

Their salaries have not increased in recent years.

As a consequence, workers in this field, especially young professionals, cannot participate in affordable housing programmes.

Such a situation is undermining the reputation of the profession, the lack of relevant staff has become obvious.

Next year, the Government should increase the salary of those working in the cultural sector.

Besides, social benefits that apply in the fields of education and health should also be provided to the workers of the cultural sector.

Fifth. Further development of the social support system.

The state is taking measures to support citizens in need.

But a number of decisions were not fully thought through.

As a result, we face a serious increase in dependency attitudes. Over the past 5 years, the number of recipients of targeted social assistance in Kazakhstan has grown from 77,000 to more than 1.4 million.

The amount of funds allocated from the budget for social support since 2017 has increased more than 17 times.

In other words, more and more people choose not to work or, even worse, hide their income to receive social assistance. Cases of wealthy families receiving social assistance have been covered in the media.

Once again, I note. As set out in our Constitution, the state is focused on social welfare and must fulfil its obligations to citizens.

The Government is obliged to proceed from this principle in its work, and additional funds must be found by eradicating wasteful expenditure and by increasing revenues.

Reserves for this, of course, are available. The Ministry of Finance is working to increase revenue. But more effort is needed including in areas such as customs.

Elbasy at a meeting of the Nur Otan political council drew special attention to streamlining the public procurement process. The Ministry of Finance has begun improving procurement, but legislative measures are also needed.

Public procurement is a field where money is wasted – according to some estimates, up to 400 billion tenge per year – which could go towards finding the solution of acute social issues.

In 2018, 4.4 trillion tenge was spent on public procurement, of which 3.3 trillion tenge or 75% took place in a non-competitive way with only one supplier.

It is time to end this "feeding trough” for officials and "clingers-on” of various kinds.

Returning to targeted social assistance, the Government should adjust the way it is allocated so that it becomes transparent, fair and encourages people to seek work rather than pursue an idle lifestyle.

Assistance should mainly be given to those who work.

At the same time, we need to take care of children from low-income families.

They require the introduction of a guaranteed social package. This should include help for preschool children, free hot meals for all schoolchildren, the provision of school supplies and uniforms, payment of medical, including dental care and reimbursement of public transport travel expenses.

All these measures should come into effect on January 1, 2020.

The Government, together with the Atameken National Chamber of Entrepreneurs, is required within a month to develop a special programme for the participation of mothers of large families in micro and small businesses, including through home working.

Sixth. I would also like to draw attention to the development of our domestic pension system where serious problems have accumulated.

At the moment, the funding of pensions is sufficient. But in 10 years, this situation may change.

The number of working citizens making pension savings will decrease significantly while the number of pensioners will increase.

At the same time, the amount of investment income received from pension assets remains low.

Therefore, the Government, together with the National Bank, should carry out substantial work to increase the effectiveness of the pension system.

Currently, a working person can only access his pension savings on retirement. But the desire of people to use these funds during their working lives is understandable.

I instruct the Government by the end of the year to consider how the targeted use by working citizens of part of their pension savings, for example, for buying a house or getting an education might be achieved.

In order to reduce costs and improve the quality of investment asset management, I instruct the Government to look at consolidating the extra-budgetary social security system by creating a unified social fund and introducing one social payment.

President of Kazakhstan Kassym-Jomart Tokayev’s State of the Nation Address, September 2, 2019. Part 4

V. STRONG REGIONS – STRONG COUNTRY.

In this area, we need to focus on the following tasks.

First. Improving the efficiency of local authorities.

People should always have access to local authorities. This is an axiom but not a reality.

I consider it possible to introduce, as a pilot project, a system for assessing the effectiveness of local authorities.

For example, if, as a result of a survey or online voting, more than 30% of residents believe that the akim of a city or a village is ineffective, this could be the basis for the creation of a special commission by the Presidential Administration to study the problem and make relevant recommendations.

Second. Reform of the system of interbudgetary relations.

The current system of interbudgetary relations clearly is not stimulating akimats of all levels to create their own development base of small and medium-sized businesses. The regions are poorly motivated to search for additional sources of income.

Starting next year, additional tax revenues from SMEs will be transferred to the regions.

But this is not enough. The time has come to review the organisation of the budget process at all levels. A major role should be played by the genuine involvement of the population in the formation of local budgets.

District, city and rural levels of Government should become economically more independent in solving problems of local importance. Their rights, duties and responsibilities should be clearly regulated in legislative acts.

Third. Managed urbanisation and a unified housing policy.

The previously adopted laws "On the status of the capital” and "On the special status of the city of Almaty” played a positive role, but today they need improvement.

It is necessary to expand the competencies of the akimats of the three largest cities, including in the field of urban development policy, transport infrastructure, and the formation of an architectural vision.

The large population of a number of cities is no longer a matter of pride, but a reason for concern in terms of meeting fully the socio-economic needs of residents.

We can see the pressures of overpopulation on our largest cities and at the same time a lack of human and labour resources in cities such as, for example, Pavlodar and Petropavlovsk, where proper conditions are created to welcome new residents.

The Government must take effective measures to manage migration processes.

In my election programme, I noted the need to develop a unified housing policy.

The basic principle is to increase housing affordability, especially for socially vulnerable segments of the population.

The Government needs to develop a unified model of housing development in the country to move away from the practice of adopting disparate programmes.

For example, within the framework of the "7-20-25” programme which was originally supposed to be based on social security, the average level of the borrower’s family income is expected to be around 320,000 tenge per month. People with low incomes could not afford to participate in it.

Therefore, this year, on the initiative of Elbasy, a new programme "Baqytty Otbasy” was launched with a preferential rate of 2% and an initial payment of 10%. These are very favourable conditions.

By the end of the year, at least 6,000 families will purchase housing under this programme, primarily large families and those raising children with disabilities. As of 2020, 10,000 such families will be provided with housing annually.

The Government should define clear criteria for participating in the programme and ensure its strict administration. Support should be provided exclusively to those who need it.

My instruction to the Government is to resolve within three years the backlog of low-income large families that are currently waiting for housing. Their number is around 30,000.

Citizens who do not have an income for the purchase of housing must be given the opportunity to live on a social benefit lease.

For these purposes, by 2022, the state will allocate more than 240 billion tenge.

New measures should be developed to involve the private sector in this work and to use the mechanisms of the public-private partnership.

People are dissatisfied with the opaque way akimats decide priority for social housing.

By the end of the year, the Government should create a unified national accounting system for waiting lists for rental housing, as well as for obtaining preferential housing loans under the "Baqytty Otbasy” programme.

Despite the reduced wear on utility mains from 65% to 57%, this indicator remains high.

In addition, out of 78,000 apartment buildings, more than 18,000 require repairs.

It is necessary to allocate at least 30 billion tenge to the regions over two years in the form of budget loans for the modernisation and repair of housing.

I instruct the Government to provide for this mechanism and tightly control the effectiveness of the development of these funds.

Regional development budgets by 2022 will exceed 800 billion tenge.

I instruct the akims, together with local maslikhats, to provide half of these funds for co-financing the modernisation of housing and communal services and solving urgent social problems of residents from the regions.

Fourth. Infrastructure development.

Obviously, residents of different regions of the country have different levels of access to clean drinking water, natural gas and transport infrastructure.

It is necessary to intensify the work on levelling this inequality.

At the instruction of Elbasy, the construction of the first phase of the Saryarka gas trunk pipeline network is nearing completion.

From next year, work will begin on the construction of distribution networks in the cities of Nur-Sultan and Karaganda, and later in the Akmola and North Kazakhstan, regions.

For these purposes, the state will allocate 56 billion tenge. As a result, more than 2.7 million people will have access to natural gas.

Over the next three years, around 250 billion tenge will be allocated to provide our citizens with clean drinking water and sanitation.

The full and high-quality implementation of the Nurly Zhol programme should be monitored closely by the executive branch.

This is a strategic project whose effective modernisation will improve the entire transport infrastructure.

For these purposes, until 2022, the state will invest more than 1.2 trillion tenge.

The Government had allocated huge amounts of money before. But these funds overwhelmingly disappeared into the air, or rather, into the pockets of officials, which is why there is still not enough clean water or modern roads and other infrastructure.

This time, the Government and Parliament, together with the Accounts Committee, must ensure the absolute efficient use of budget funds.

The Government needs to intensify efforts to improve the environment, expand the use of renewable energy sources, and cultivate a respect for nature. In this regard, the campaign "Birge – Taza Kazakhstan!” deserves approval and must be continued.

Parliament is to discuss and adopt a new version of the Environmental Code.

In general, the Government in the coming period should increase the efficiency of its activities. The people of Kazakhstan are waiting for concrete results.

Dear compatriots!

We have entered a new stage in reforming the country. We must fulfil these important tasks to a high standard.

Every citizen of the country should feel positive changes.

I demand Government agencies work rapidly and achieve real results.

It is unacceptable to carry out reforms for the sake of reforms.

Each minister and akim should have a list of key performance indicators.

It determines the level of their achievement.

Government ministers, heads of state bodies and regions, state-owned companies and institutions are personally responsible for the relevant reforms.

To ensure accountability for progress, I have recently signed a decree to gauge the situation in the country, including in each region through regular surveys.

Government agencies responsible for social and economic policy should work to meet the needs of society now and in the future. For this purpose, it is necessary to strengthen the system of monitoring, analysis and forecasting.

Therefore, I ask Parliament to establish the Institute of Legislative Research and Expertise at the request of our deputies.

This new institute should help improve the quality of our laws.

Dear people of Kazakhstan!

We know well the issues that worry our people.

We are developing an action plan to tackle each of these areas. 

We have a great responsibility.

I have great confidence in every citizen of the country and know they are concerned about the destiny of our country.

Kazakhstan is our common home!

I invite all of you to contribute to our national prosperity.

A constructive public dialogue is the basis of peace and stability.

In the words of the great Abai, "Unity must be in minds.”

Elbasy’s message "The unity of the people is our most valuable treasure” remains our guiding principle.

Harmony and unity, wisdom and mutual understanding help our nation move forward.

Our destination is clear, and our way is open.

I hope that together, the country will achieve even greater success!

I wish all of you wellbeing and success.

Address of the President of Kazakhstan Kassym-Jomart Tokayev to the nation


Dear compatriots!

I appeal to each of you.

In accordance with the Constitution, I have decided to hold early elections of the President of Kazakhstan on June 9, 2019.

I consulted with Elbasy Nursultan Nazarbayev, as well as with Speakers of both Houses of Parliament, and the Prime Minister.

The decision was agreed upon by the Constitutional Council.

I met with the leaders of the parliamentary parties.

The decision on early elections is important and necessary.

Thanks to Elbasy, we have built a successful and widely respected nation. Kazakhstan has gained a worthy place in the international community. Our country plays an increasing role in global affairs.

This is a fateful moment for all of us.

The power in Kazakhstan has been transferred in a calm atmosphere in full accordance with the Constitution. This caused respect for Kazakhstan from the world community.

Since taking office, I made a trip across regions, so I am aware of the mood of people. I meet with the intelligentsia, labour communities, business people, investors and representatives of international organizations.

My conclusion is that we are on the right track. Our wise nation is united. Our state, as the supreme value of our independence, is indispensable.

Therefore, I firmly believe that early elections of the Head of State are a vital necessity.

In order to ensure political and social consent, confidently move forward, solve the tasks of socio-economic development, it is of vital importance to remove any uncertainty.

Moreover, the situation in the world is changing rapidly and unfortunately, we are facing new challenges ahead. We must confirm the continuity, predictability and stability of our domestic and foreign policy. We shall continue working on the effective, successful implementation of social programs and strategic course of Elbasy.

This can be fulfilled only through direct expression of the will of the people in the elections.

Kazakhstan is a democratic state. And its President will be elected as per people’s will.

In the capacity of Acting Head of State, I guarantee that it will be free, transparent and fair elections!

This is my firm position!

We are facing great challenges. I believe in the wisdom of our people.

Dear compatriots!

The folk wisdom says, "Where there is unity, there is creation" (Birlik Bar Zherde, Tirlik Bar!).

I am calling you to be fully responsible about the future elections.

The future of our country and the destiny of each family depend on your decision!

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