Photo: iStock
Yerzhan Yelekeyev
29/01/2025 21:45
The country has a stable political environment and is actively improving its business climate, making it an attractive place to do business. Its strategic location at the crossroads of Europe and Asia enhances its role as a major transportation hub and provides a growing consumer market that offers further opportunities for businesses.
Kazakhstan is also developing its technology and innovation sectors, which open up additional investment possibilities. Alongside its political, social, and economic stability, Kazakhstan is well-regarded internationally and maintains good relations with its neighbors, the EU, and the US, playing an important role on the global stage.
The country is known for its abundant natural resources, including oil, natural gas, and minerals, which have traditionally attracted foreign investment. However, Kazakhstan is increasingly diversifying its economy and encouraging investment in other sectors, such as agriculture, transportation, renewable energy, and manufacturing.
In recent years, the Kazakhstani government has introduced various legal and regulatory reforms to make business operations easier. Special Economic Zones have been established, offering specific benefits and incentives for investors. These efforts have fostered a more business-friendly environment, resulting in a growing number of foreign investors capitalizing on opportunities in Kazakhstan.
To maintain its position as a key regional investment hub, Kazakhstan has embarked on a new investment cycle with a strategic goal of attracting $150 billion in foreign direct investment by 2029. The investment attraction process is a national priority, involving stakeholders from the Head of State, who chairs the Investment Council and meets with major investors, to the Prime Minister, sector ministers, the Ministry of Foreign Affairs, regional governors (akims), the Investment Committee, and Kazakh Invest.
Historically, about 75 per cent of foreign investment in Kazakhstan went to extractive industries, such as oil and gas. However, in the last year, foreign investment in these sectors decreased to 43 per cent as more investments shifted toward the processing industry.
Today, the green energy sector is one of the most promising areas for attracting investment. Kazakhstan is making significant strides toward its commitment to achieving carbon neutrality by 2060. By 2030, the country aims to increase the share of renewable energy in its energy mix from the current 4 per cent to 15 per cent. Presently, there are 148 renewable energy facilities in Kazakhstan with a combined capacity of 2,903.7 MW, with plans to add an additional 7 GW of renewable energy capacity by 2030.
Kazakhstan's geographic and climatic conditions provide a strategic advantage for expanding sustainable energy production. The country's average wind speed is 5-6 m/s, ideal for wind energy projects, with a wind potential of up to 920 billion kWh per year. In some regions, wind speeds reach 20-35 m/s in spring and autumn. The southern region also shows great potential for solar energy, with solar radiation levels ranging from 1,300 to 1,800 kWh per square meter.
In addition, Kazakhstan possesses a rich supply of various minerals. According to the World Bank, Kazakhstan has over 5,000 untapped deposits valued at more than $46 trillion and is a producer of many of the world’s 34 most essential raw materials. Mining and metallurgy account for around 20 per cent of national exports, and this share is anticipated to grow.
At the same time, global concerns about potential shortages of lithium, nickel, and other rare earth metals are rising. Currently, about 50 per cent of lithium demand is from the automotive industry, which could grow to 75 per cent by the end of the next decade. Kazakhstan aims to become part of the global supply chain for rare and critical metals essential for high-tech industries.
Kazakhstan’s geographic location also boosts its investment appeal in the transport and logistics sectors. The Middle Corridor, passing through Kazakhstan, has become a key alternative route for fast and uninterrupted cargo delivery between Asia and Europe. Furthermore, the Caspian Sea provides access to the Middle East and the Caucasus. Kazakhstan seeks to connect the Trans-Caspian International Transport Route with trans-European transport networks, aiming to reduce transit times to 10 days, which will significantly strengthen its transport and logistics capabilities. Over the past 15 years, more than $35 billion has been invested in transit infrastructure.
Overall, Kazakhstan and Hungary have the potential to create mutually beneficial partnerships across various sectors. By exploring new avenues of cooperation and strengthening existing ties, both countries can boost competitiveness, promote economic growth, and contribute to regional development.
For those interested in investing in Kazakhstan, Kazakh Invest, the national agency for attracting foreign investments, is a reliable partner. Kazakh Invest provides a range of services for potential investors, including information and support for conducting business in the country, assistance with finding partners and identifying investment opportunities, and guidance through the legal and regulatory environment.
Kazakh Invest is committed to positioning Kazakhstan as a premier destination for foreign investment. With its abundant resources, skilled workforce, and supportive business environment, Kazakhstan is well-positioned to continue attracting investment and fostering economic growth in the coming years.
The author is Chairman of the Management Board of Kazakh Invest