State to subsidize only interest rates of enterprises' problem loans - PM

17:31, 26 February 2010

ASTANA. February 26. KAZINFORM /Serik Sabekov/ Participation of the state in recovery of the enterprises will be limited to subsidizing the interest rates on the problem loans provided earlier. Prime Minister Karim Massimov has said it at a plenary session of the Council of Entrepreneurs under the Kazakh President today.

According to him, Road Map 2020 program provides for subsidizing only the interest rates of the problem loans given to the enterprises. The ventures in turn must conform to the criteria of the country's industrial-innovative development. Secondly, they must disclose voluntarily the information on all its credits and have transparent ownership structure.

"Last year we required such information from the banks. To my mind, today their activity is quite transparent", Massimov noted.

As the Head of the Government highlighted, the same thing must be done regarding the ownership structure of the enterprises in order to let the banks see who the businessmen are and what they do.

The enterprises must also develop a special recovery program together with the creditors for 2-3 years. This program is voluntary one and the risks are taken by the banks, the PM added.

The businessmen can apply for recovery within 2010 only.

"As soon as the projects are selected the banks will cut their rates up to 12%. The effective rates for the entrepreneurs will be at 7% while 5% will subsidies", K. Massimov concluded.

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