Kulimkhan HASENOVA
ALMATY, April 8
(THE GLOBE)
The representatives of several the biggest parties and public movements of Kazakhstan will gather in the House of Democracy in Almaty on April 9 to issue a joint Appeal to the President and the people. The initiator of this action is �Pokolenye�. It is expected, that the leaders of the Republican party, �Azamat�, �Orleu�, �Azat�, Communist Party of Kazakhstan, �Lad�, the Workers� movement and others will take part in the extraordinary meeting. As stated by Irina Savostina, leader of �Pokolenye� movement, �Otan�, the authorities� party is also invited to join the Appeal. The Appeal contains a suggestion to dismiss the existing government and to create a coalition government from �the most worthy representatives of all Kazakhstan�s political parties and movements�. �It should consist of people who in this difficult time can undertake responsibility for the economic situation in Kazakhstan. It is time to involve real reformers in settling the urgent problems.�
Which party leaders will sign the Appeal, as well as the government�s response should be known today. Meanwhile, the leaders of the �Azamat� public movement expressed their opinion about both the latest actions of the government and their analysis of the economic situation of the country.
Only a lazy person has not expressed his attitude to the decision of Kazakhstan government concerning further policy on the tenge�s exchange rate. Following the Prime Minister and the Chairman of the National Bank, the heads of the biggest banks, enterprises-exporters, businessmen and politicians formed a harmonious queue. The representatives asked for calm and only for calm. Many of them expressed their confidence in the next day and the government�s correctness. Each of them guaranteed the protection of Kazakhstan citizens. Again it was promised, that due to the latest measures of the authorities, the economy of our country will get �a serious positive impulse and we will soon feel its results�.
The declaration of the public movement �Azamat� (which aspires to become party), stood out against this background. On behalf of �the three Hercules� � Galym Abilsyitov, Murat Auezov and Pyotr Svoik, the appeal to the President and to the Parliament called for an immediate cease to �actions of the government which are destructive for Kazakhstan.� �Azamat�, having recently called our parliament �an island of complacent penguins�, today considers it to be a real force. According to Pyotr Svoik, only the deputies can further influence events in the country. However, the parliamentarians� silent agreement with the government once again affirms their blessings to the coming economic collapse. The leaders of �Azamat� believe that the only appropriate course of action today is to dismiss the government and to form the new one. �The country requires both a professional anti-crisis program understandable to the population, and people able to realize it,� stated the appeal.
�Azamat� considers our government unable to take anti-inflationary measures. To work out a real anti-crisis program, we need (apart from professionalism) the trust of the people. As far as �Azamat� is concerned, it has its own anti-crisis program. Pyotr Svoik elucidated some of its points to the journalists. It is obvious that its economic part depends greatly on its political one. Today we need mutual understanding and trust between the authorities and society even more than before. According to �the three Hercules�, today�s government is not worthy of trust because it works like the fire brigade, which can take from the burning building only its own chairs. It is not able to plan or predict its own actions, and has no ideals.
�The President, the parliament and political public organizations respected in Kazakhstan should determine as soon as possible, the entire problem. This includes the principles of real anti-crisis stabilization. And when these principles are obvious and announced (we on our own behalf are always ready to help), the practical issues must be settled at once. These practical issues are: what government we need, what laws we need, and what urgent measures are to be taken. People should be informed about everything, because if we cannot lean against the people, we will succeed in nothing. In the opinion of �Azamat�, all these reforms failed because they were done by a group of �technocrats�, �oligarchs�, or by �partocrats�, not by people.�
Michail SERGEEV
ALMATY, April 6
(THE GLOBE)
�The decision of the government and the National Bank regarding free tenge exchange rate is only one of the measures required to support the Kazakhstan economy, as we actually need a whole range of steps,� the representatives of small and average business declared in Almaty.
In their opinion, the devaluation of the tenge will only help big industrial complexes. For the small and average business devaluation means a reduction of the purchasing capacity of the population, proportional to tenge�s fall.
�We expect the reduction of manufacturing volumes and turnover and the necessity to fire our personnel�, they said.
To raise the entire economy, thee representatives suggested a range of measures encouraging the development of the import-substitutive enterprises in Kazakhstan.
First, the businessmen believe it necessary to collect the VAT in a proper way. At the present moment the VAT has become a tax on turnover as far as the calculation and the collection of it are concerned.
�If 10 years ago the VAT was calculated only for the newly formed value (that is salary, deductions, and profit), today depreciation and taxes are taxed as well�, the representatives of the small and average business explained.
Second, it is necessary to reconsider the rate of the customs duties on raw materials.
�We are ready to produce the goods inside the country, but 80% of processing materials are imported. The customs duties to be paid on the processing materials contradict to the state�s mission to develop the import-substituting production,� the businessmen said.
Third, VAT should not be paid at the moment when raw materials cross the customs border of Kazakhstan.
�Rather VAT should be paid by the customer. In the present case they make us pay this tax instead of the customer. At present we face a double taxation: and are forced to give away our working capital. Neither the raw materials have been utilized, nor have the goods been produced, but the taxes are to be paid and only in the monetary form�, one of the representatives said.
The business representatives also believe the government should legalize capital investment to production, reconsider the administrative part of the Tax Code, abandon the calculation method (replacing it by the cashier method), and stop the reevaluation of the fixed assets of the enterprises according to the inflation level.
In their opinion, the preliminary accumulation of the capital has been completed.
�The state requires an internal investor. We have such an investor, he has money and is ready to invest it. Let the state legalize him�, one of the participators of the round table stated.
As far as the tax legislation currently in force is concerned, the businessmen emphasized that we need �direct� laws, and the provisions of the Law should be interpreted not by the tax police, but by special tax courts.
�If the Tax Code consists of only 65 pages, the supplemental law statements regulating the tax relations are printed on 650 pages,� one of the representatives of the small business remarked.
According to the representatives of Almaty businessmen�s association, these measures do not break the frames of the normal environment and may be taken without significant expenses.
�If this range of measures are realized by the government, we will settle the problem of unemployment, namely in Almaty. And the contribution to the economy of the country due to development of the import-substitute enterprises will be essential�, the businessmen said.
ALMATY, April 5(IRBIS)
According to the documents, available for the IRBIS agency received by the unofficial channels, the decree of the government of Kazakhstan �On approval of the rules of emission, circulation and reimbursement of the special currency state liabilities of the Republic of Kazakhstan with 5 years circulation period� was issued today.
In accordance with the decree, the Finance Ministry of Kazakhstan along with the National Bank being its financial agent, should organize the emission of the special five-years currency state notes, exchanging the portfolio of the Pension Funds as on April 9, 1999. To execute the exchange on the voluntary lines, the Accumulative Pension Funds (APF) should submit the written applications to the National Bank by April, 9, 1999.
According to the Rules, the special currency state notes (SCSN � the abbreviation of IRBIS agency) are emitted by the Kazakhstan Finance Ministry on behalf of the government to protect the APF assets against devaluation of the national currency. The emission of the SCSN with five years circulation period is to be executed by the APF, exchanging the portfolio of the state securities nominated in tenge. Only those state securities (SS) are to be exchanged, which conform to these conditions, were emitted by the Finance Ministry, and belong to the Accumulative Pension Funds as on 09.04.1999.
The exchange is executed by means of re-registration of the SS portfolio in the amount including the nominal price of MEKKAM, the nominal price and the unpaid interest amount of MEOKAM, the nominal price and the unpaid interest amount at the interest rate as on April, 9, 1999 of NSO.
The nominal price of SCSN is 1000 tenge. They give their owners the right to receive their nominal price while they are reimbursed, and to get the interest in per cents of their nominal price. SCSN are emitted in the non-documentary form, placed and circulating by entering the corresponding note in the �depo� accounts of their holders in the Central depositary and in the �depo� accounts opened at the Primary Dealers for their investors.
The circulation of SCSN will begin from April, 9, 1999.
It is planned for the time being, that a fixed interest will be determined for SCSN, equal to the current interest of the US five-years Treasury notes + 100 basic points. Calculation of the interests will begin from April, 9, 1999, and will be executed within the whole circulation period, including the day of reimbursement. The calculated interest amount will be converted to the dollar at the rate of 88.3 tenge per US dollar and will be paid in tenge at the exchange rate valid on the day of payment. Payment of the interest on SCSN is to be executed every 6 months (182 calendar days) from the beginning of circulation of these securities on the corresponding day. The reimbursement date is April, 8, 2004.
Reimbursement of SCSN will be executed by conversion of their nominal price to the dollar at the rate of 88.3 tenge per US dollar and is to be paid in tenge at the rate valid on the day of reimbursement.
Reimbursement and payment of interest on SCSN will be executed from the republican budget.
IRBIS agency emphasizes, that it has not a copy of the documents with a signature of the Prime-Minister of Kazakhstan. That is why the agency does not undertake any responsibility for usage of this information by somebody for any purposes.
According to the information received from the REUTERS terminals, the profitability of the five-years notes of US Treasury is at present about 5.049 annually. 100 basic points will add approximately 1 per cent to this figure. Hence today the fixed interest rate on SCSN is about 6 per cent annually.
All Over the Globe is published by IPA House.
© 1998 IPA House. All Rights Reserved.