Kazakhstan is offering a number of lucrative investment opportunities under its plan to privatize 106 companies under the Sovereign Wealth Fund of Kazakhstan. Samruk Kazyna invited investors both local and foreign to buy shares in the 106 companies that are part of the second phase of the privatization scheme. This is a continuation of what was started in the 1990s when the country was trying to introduce a free market economy.
The government had tried to run these companies on its own as it created an open market economy but it has since run into hurdles like lack of enough funding to fully capitalize the enterprises as well as the technical know-how. This has prompted Samruk Kazyna to invite investors to buy shares and help in the management and capitalization of the enterprises.
The estimated total value of the companies it put at slightly over 100 billion dollars, up from 93 billion which was the estimate in July. Right now there are 600 companies under the Sovereign wealth Fund of Kazakhstan. And of these, some of the opportunities are in the following areas.
KazMunayGas oil and Gas company is one of the companies that is up for sale. It has 2 oil refineries and manages a number of subsidiary companies which include helicopter services, shipping, and tankers as well as catering service. The oil industry in Kazakhstan has a lot of potential which is why companies like Chevron are already investing in it.
Also on sale is the operator of the railway company. The government has been funding Kazakhstan Temir Zholy but is now ready to sell it off along with close to 100 percent f its assets to an investor who is ready to operate it in accordance to the agreements with Samruk Kazyna. There are about 15 thousand kilometers of rail to be managed. With a current revenue at close to 4 billion dollars. Some expansion work has already been carried out along with production of coaches and engines. Even more, revenue can be collected if the high-speed line receives funding from an investor.
Kazatomprom is the leading producer of uranium in the world and it is also up for privatization. More than 40 percent of the World’s peaceful uranium is got from Kazatomprom with over KZT 250 billion in revenue being collected in 2015. This is one of the most lucrative investment opportunities in Kazakhstan.
There are number of other companies that will offer investment opportunity including the telecom industry which was also under the government.
The impact of the privatization of a number of government run enterprises means that a lot more investment opportunities will be opened up as investors bring in more technology into the country which will mean there will be a need for services like maintenance and installation of different machinery and equipment.
The service industry will have much more demands and so will housing as foreigners will need to find suitable housing and certain services that they may have been used to in their countries.
At the moment te government of Kazakhstan is trying to position itself to be able to handle a growing economy with more input from foreigners as well as locals.
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