Agroproducts up in overal exports with forced industrialization launched

Dear Mr. Kurishbayev, President Nursultan Nazarbayev pointed out the agri-industrial complex (AIC) and agricultural manufacture as the priority for innovative industrialization on the XII Nur Otan Party conference. The Ministry of agriculture has to execute a lot of work to implement the priority. What specific steps did you make to achieve these goals? In order to implement the industrialization of the AIC the state should orient its actions on the solution of two key tasks, which are vital today for Kazakhstan. Ensuring food supply security. An effective system of the AIC?s development support was created, which supports the present functioning of the sector including funding of spring sowing campaigns and harvesting, and generates investments into development of agriculture and manufacturing industry. Therefore we placed the main stake on diversification of the farming branch and its wide chemicalization using water-collection technologies. We changed the subsidy policy to stimulate the producers of agricultural goods transit to new technologies. Particular attention was paid to the increasing of production of such olive and horticultural crops, which would reduce the imports. The main priority in cattle breeding is enlargement of production by means of creation of middle and big cattle farms, rising of the genetic potential of all types of cattle as part of the large-scale selection program. To stimulate the process of intensification of cattle breeding we continue the program of feed stuff subsidy. In the field of agricultural manufacturing the main priority is technical and technological modernization of the branch, introduction of the international quality standards, maintenance consolidation of internal market stability, external market access. Development of export-oriented production and diversification of exports. To resolve this task we should pay close attention to the implementation of the investment projects. They are: the construction of grounds for cattle feeding with developed infrastructure, slaughter places, development of a fine-wool sheep breeding, production and manufacturing of soy and corn, deep manufacture of grain, development of fishery, manufacturing of fish and horticulture. Funds are invested into the agricultural sectors where production is still low. They are: organization of hothouse holdings, construction and reconstruction of vegetable stores, organization of a horticulture production by means of drip irrigation, construction of large milk farms, construction and modernization of poultry farms. To organize and implement these and other investment projects within the anti-crisis plan KZT 120 million was allocated. The President spoke about the agricultural sector that can make a big contribution to the economic diversification and export. Before 2015 the share of agroproducts in the overall export volume must be increased up to 8%, and the gross value added ? by 16 %. How are these marks going to be achieved? A targeted wide scale work is being conducted by the Ministry for the purpose of achievement of this plan. To enhance the gross output, domestic agricultural commodity producers are provided with support in order to raise competitiveness of the national agriculture and ensure food supply security of the country. There are three directions where efforts are invested in order to improve the quality of the raw materials base: ? Creation of new production capacities, dairy complexes and feeding facilities based on advanced technologies as a result of implemented investment projects through the KazAgro national holding. ? Build-up production due to existing capacities and cooperation of minor entities. ? Enhancement of the genetic potential of animals. Jointly with scientists the Ministry has launched the large selection program and introduced embryo transplantation in order to speed up high bred cattle reproduction and increase the heads of pedigree cattle which at present makes only 5% . The purpose of intensification and production expansion a part of cost of the feeding-stuff used for cattle feeding and genetic stimulation is subsidized by an ad hoc program. It is also envisaged to enhance competitiveness due to technical and technological reequipment. For this purpose processing enterprises are provided tax concessions, loan interest rate subsidizing, defrayal of costs of introduction of international quality standards. Beginning this year meat and dairy producers will receive subsidies provided that produced goods are supplied to the procession enterprises. The next year analogous subsidy mechanisms will be applied to the producers of fruit and vegetable crops. Alongside these measures, to support domestic manufacturers state protectionism measures are being developed to create conditions for product sale. According to the Strategic Plan of the Ministry, till 2011 the export sale of first grade meat will rise up to 2,200 tons per year, grain ? 5,5 million tons per year, fish product - up to 36,000 tons per year, wool ? up to 12,200 tons, and raw hides ? 1,073 square meters. To take firm positions in foreign markets special development programs are being elaborated in the perspective spheres of agroindustrial complex which can make Kazakhstan a leading exporter: - development of production and procession of export oriented livestock goods; - development of production and procession of export oriented crops; To oust imported items and fully supply domestic demands the following programs are being elaborated: - development of production and procession of oil crops; - development of fruit and vegetable farming in open and protected ground; - restoration of the Aport apple sort; - white sugar production from sugarbeat; - baby food production (baby food made of camel milk /fruit/vegetables); - development of paultry production; - development of fish rearing for sale; - development of agricultural engineering; - development of dairy production; - development of meat procession and meat products. To increase the share of agroproducts in the overall export volume and the agroindustrial complex added value and employment, the Ministry envisaged measures of forced industrial and innovative development in the state program. Such measures will ensure food supply security of the country, sustainability of the domestic food market, building-up of the export potential of the industry and wellbeing of the rural population. What kind of work will be done this year to provide food security of the country? What problems does this sector have? To provide food security and protect production of agricultural goods we introduce system measures. Budget programs are implemented to complete current assets of the manufacturing enterprises, subsidize interest rates of credit resources given by development institutes for technical and technological re-equipment. This year and on the subsidy mechanism will be simplified, therefore we have an opportunity to support all enterprises According to the Plan of cooperative actions of the Government, the National Bank and the Agency of financial market regulation and control for economy and financial sector stabilization during 2009-2010 agricultural entities obtain loans under 12,5 % year interest rate through SamrukKazyna Fund and banks to supply the crediting lack. KazAgro Holding conducts technical and technological modernization of manufacturing enterprises by leasing method. Moreover preferences are given to 9 manufacturing branches of agriculture raw materials ? the value added tax is reduced by 70 %. Big investment projects are held, which are directed to reduction of imports of deep manufacturing products made of agricultural raw materials. In 2009 the rules of subsidizing of cattle breeding products have been changed ? they should be forwarded to procession. From the next year these changes will be active for plant cultivation. The work of infrastructure creation of provisions, storage, primary manufacture and sales is continuing. Relevant international technical standards for the most needed products are introduced ? they are milk, meat, sugar drinks and fruits, vegetables, wheat, cornmeal, grits. Control of the overall security of food products is conducted. Expenses of the AIC subjects for elaboration, introduction and certification of quality management system under international standards are subsidized. The internal market is constantly monitored, customs payments for imports are regulated, protection of the internal market from cheap import goods is strengthened. According to the President?s orders amendments to the legislation are introduced, in order to increase the Kazakhstani share in the purchases made by public and national companies, and to form stable and guaranteed customer market for domestic producers. In other words public purchasing will give preference to domestic goods. I would like to notice that the government makes everything to ensure food security. Today all public and particularly local state bodies should actively work in this direction. Thank you for the interview.