According to the statements of certain governmental structures and officials, the Kazakh state has provided small and medium-size businesses with some serious support. But do these statements have anything to do with reality and do the entrepreneurs feel this support?

Unfortunately, due to the governmentalization of entrepreneurs associations, the absence of the opposition in the country, a small quantity of independent media resources as well as the lack of possibility to conduct a trustworthy sociological research, we have to believe (or not) what they publish on social networks where we usually encounter only complaints and despair.

In view of this, we have decided to analyse the official statements of governmental agencies related to the subject of supporting local businesses. Since there are quite a few of them, we have limited ourselves to analysing only one report titled «The MNE RK Extended Panel: Overall Results of 2020 and Plans for 2021».

Since we are interested not in the words (which the Kazakh governmental agencies and official speakers have learned to say and write quite skilfully) but in the figures, let us concentrate on the latter.

For instance, here is what Minister of National Economy Aset Irgaliyev has reported –

«To revive the business activity and to support the population and businessmen, we have introduced large-scale measures in the amount of 6.3 trillion tenge or 9% of the GDP». 

«As a result, 700 thousand entrepreneurs have received tax remissions in the amount of 1 trillion tenge. As part of the governmental programs, about 40 business-projects have been funded at lowered interest rates. 80% of the borrowers from the afflicted sectors have received stay of debts».

All of this sounds and looks goods. However, when we estimate the amount of the state support in the individual terms (in other words, when we estimate how much an individual entrepreneur gets), the situation starts looking less optimistic.

Here are our estimations.

Done: «3665 projects credited in the amount of 400 bln tenge; the amount of subsidies paid constituted 35 bln tenge».

In other words, on average, the subsidies per one project constituted 9.5 mln tenge.

Done: «State guarantees provided for 6782 projects in the amount of 215 bln tenge. The amount of guarantees paid constituted 81 bln tenge».

In other words, on average, the guarantee per one project constituted 31.8 mln tenge; with that, the state had to increase expenses — it paid 37,7% of the amounts guaranteed.

Done: «976 grants received in the amount of 3.5 bln tenge».

In other words, on average, one grant constituted 3.6 mln tenge.

Done: «8454 credit applications granted in the amount of 427 bln tenge».

In other words, the average amount of the application granted constituted 50.5 mln tenge.

All of this shows that, in total, 19877 business-units received state support in 2020 (3665 + 6782 + 976 + 8454). Whereas, according to the Bureau of National Statistics, as of January 1, 2020, 1603839 small and medium-size businesses were registered in the country.

In other words, approximately one of every 80 business-unites has been granted state support. Apart from that, we strongly suspect that, first and foremost, the state support has been provided to the business-structures affiliated with the officials providing it.

Let us move on. Here is another quote from the report of the Minister of National Economy –

«In general, the measures introduced had led to increasing the GDP share of small and medium-size business up to 30,5% in 2020».

On one hand, this is a good thing, on the other — we are curious to what extent was it the consequence of providing state support and to what degree was it the result of reducing production in the resource-based sectors of economy?

However, this is but a trifle against the backdrop of Aset Irgaliyev’s honest confession of how the state has «raped» the housing and utilities providers. Here is a related quote from the governmental press-release –

«The Minister of National Economy said that, as of the start of the current year, the growth of tariffs for the population was contained at the average rate of -0.4% (comparing January 2020 against January 2021) including water supply (0.34%), heating supply (3.75%), wastewater disposal (1.37%), electricity supply (3.92%).

«As a result, on average, the tariffs have been reduced by 7,4% (reduction for water supply services by 8%, for wastewater disposal — by 9,3%, for heating supply — by 7,6%, for electricity supply — by 5%). The general savings of the population constitute about 1 bln tenge per month. The measures aimed to ensure the transparency of the tariff formation and tighten control of the price-forming for goods and services on the part of natural monopolists have been implemented«, said A. Irgaliyev».

One must agree that what this sector is experiencing should not be called state support but state rape.

Generally speaking, it seems like, as per usual, there are many more talks related to this important and sensitive subject than real deeds. To confirm it, let us recall the news from Almaty where entrepreneurs affected by the the COVID-19 pandemic and the related restrictions have demanded to be paid 2 bln tenge a day to enable then to pay rent and salaries.

Let us quote the words of Chairman of the Regional Council of the Almaty Entrepreneurs Chamber Maxim Baryshev (Radio Azattyk version) –

«Employees’ salaries, rent and a part of debt must be funded directly by the country’s budget during the period of restrictions and limitations. These funds must be paid for each day of the involuntary idle time. As of today, about 50 thousand companies and individual entrepreneurs have been affected by the restrictions. We are talking about 250 thousand employees which is quite a large number. We need two bln tenge for each day of the idle time. It is only to pay salaries and rent. Entrepreneurs want to keep their staff and leased properties and go on to work when allowed to. At this point, however, the state does not offer any budget funding».  

Alas, the Almaty entrepreneurs are not going to get any funding — not today, at least. And not only because the country’s budget is suffering from the COVID-19 pandemic just as much as the business but also due to the fact that they have no resources to exert political pressure on Akorda and the Library. Therefore, they will have to continue complaining and begging in order to gain attention and receive some real money in addition to the numerous promises.