Invest in AlmatyInvest in Almaty

Almaty Development Center 2

Almaty City

The President of the Republic of Kazakhstan in his 2014 the State of the Nation Address sets a clear task to improve the investment climate and scale up attraction of investments for –industrial-innovative development.

In pursuance of the President’s order, the Government of the Republic of Kazakhstan has developed a package of legislative initiatives to create incentives for investment in Kazakhstan.

Implementation of development investment programs gains particular importance in the regions at the local level.

Almaty is the southern capital of Kazakhstan and plays an important role for attracting investments to Kazakhstan as a major financial, logistics, commercial and cultural centre.

Population: More than 1.6 million people Currency: Kazakh Tenge (KZT)Territory: 683,5 sq.km. Height above sea level: 500-1700 m. Climate: sharp - continental Time zone: GMT+06:00 Postal code: 050000-050063 Area code: 727 website: www.almaty.gov.kzwww.investinalmaty.com

Almaty Development Centre 3

Social-economic figures of Almaty City

Almaty Development Center 4

Legal framework for investors

(1) Law on Investments Cover up to 30% of «Investment subsidy» Exemption from corporate tax and property tax Natural Grants Exemption from customs duties

(2) Law on Concessions Payment for accessibility of the object of concession Partial compensation of the investment costs Partial compensation of operation and maintenance costs

(3) Law on Special economic zones in the Republic of Kazakhstan Visa support of foreign nationals

(4) State support program of industrial and innovative activities Reimbursement of auditing expenses Subsidizing of bank interest rate State guarantees for commercial loans

(5) Law on Project financing. Securitization support on Stock Exchange

5

Why invest in Almaty

Almaty Development Centre

According to GFCI (Global Financial Centers Index) rankings for 2014 Almaty city held 43th place. GFCI rating includes assessment of business environment, development of financial sector, infrastructure, human capital and the city reputation.Introduction of simplified entry to Almaty in visa-free regime for the citizens of 10 countries: Great Britain, Germany, Italy, Malaysia, the Netherlands, UAE, Republic of Korea, USA, France and Japan. Almaty City will host the International Universiade in 2017. Gross Regional Product and positive budget fiscal position suggests growing conditions for future capital investment in Almaty.

6Almaty Development Centre

According to GFCI (Global Financial Centers Index) rankings Almaty city Ranking rose from 58th to 49th place. GFCI rating includes assessment of business environment, development of financial sector, infrastructure, human capital and the city reputation.

GLOBAL FINANCIAL CENTER INDEX

7

Points of Growth

Almaty Development Centre

Industrial zone in Alatau district – industrial territory designated for development of production capacities for: food processing, light industries, engineering, construction and pharmaceutical industries.

Free economic zone «Park of innovative technologies» was created for technological development in the following spheres: information technologies and telecommunications; electronics and renewable sources of energy.

Development of international alpine tourism in the suburbs of Almaty Estimated revenue from the tourists of alpine cluster may be $3 billion per year. Within the range of 40 km from Almaty there are several winter sport resorts, such as: Shymbulak, Kokzhailau, Akbulak, Turgen, Almatau, Kaskelen , Almarasan, Ushkonyr.

Transport infrastructure development Local authorities have ambitious plans for the development of the city infrastructure including: new airport, subway, the light rail transport, paid highway BAKAD, Almaty-Kapchagai highway.

Official mandate of Almaty Development Centre

8Almaty Development Center

JSC «Almaty Development Centre» (ADC) was established in 2008 by Almaty Municipal Authorities as a Regional Development Institution.

«ADC» mission: Assistance to Municipal Authorities in strategic development of social, economic and cultural infrastructure of Almaty city.

According to its Charter and Local Authorities Mandate «ADC» was authorized to implement following functions:

ORIGINATION AND STRUCTURING :ORIGINATION AND STRUCTURING :OF MUNICIPAL INVESTMENT OF MUNICIPAL INVESTMENT

PROJECTS:PROJECTS:Public financial support to private investment

projects on risk sharing basis

ORIGINATION AND STRUCTURING :ORIGINATION AND STRUCTURING :OF MUNICIPAL INVESTMENT OF MUNICIPAL INVESTMENT

PROJECTS:PROJECTS:Public financial support to private investment

projects on risk sharing basis

REGIONAL PRIVATE PUBLIC REGIONAL PRIVATE PUBLIC PARTNERSHIP DEVELOPMENTPARTNERSHIP DEVELOPMENT

Financial advisory services and acting as PIU for Municipal PPP projects.

REGIONAL PRIVATE PUBLIC REGIONAL PRIVATE PUBLIC PARTNERSHIP DEVELOPMENTPARTNERSHIP DEVELOPMENT

Financial advisory services and acting as PIU for Municipal PPP projects.

““ONE STOP” INVESTOR SERVICES ONE STOP” INVESTOR SERVICES CENTERCENTER

Informational support to potential investors and implementation of Government Support

instruments

““ONE STOP” INVESTOR SERVICES ONE STOP” INVESTOR SERVICES CENTERCENTER

Informational support to potential investors and implementation of Government Support

instruments

ECONOMIC EXPERTISE AND ECONOMIC EXPERTISE AND CONSULTING SERVICES CONSULTING SERVICES

Expertise of Municipal investments in form of budget lending and direct equity investment

ECONOMIC EXPERTISE AND ECONOMIC EXPERTISE AND CONSULTING SERVICES CONSULTING SERVICES

Expertise of Municipal investments in form of budget lending and direct equity investment

Investor Services Centre

9Almaty Development Center

JSC «Almaty Development Center» is authorized as Investor Services Center by Almaty Municipal decree №4/1133 in December 2013.  Investor Services Centre includes follow official functions:  Informational support for potential investors Risk sharing project structuring based on Public-private partnership legislation Promotion and implementation of Government Support Consulting services (development of feasibility studies and business plans for investors) Database management of perspective and existing investment projects in Almaty Event management for investors in Almatywww.investinalmaty.com

City Projects

10

Video fixation system of traffic violations. Project volume: 1bln. KZT

Almaty Development Centre

Private bus fleet modernization, loan facilities for 400 new buses

Municipal sport playground management. Project volume: $600.000

Ski Resort Kokzhailau

Light Rail Tramway building, Concession volume: $500 mln

Electronic ticketing in public transport

New Municipal waste mechanical and biological treatment plant construction

Toll roads of Almaty, incl. BAKAD

Construction and Operation of Almaty LRT (Light Rail Transit)

9Almaty Development Centre

Project construction of LRT (Light Rail Transit) on concessional terms. EBRD is ready to provide a loan to a potential concessionaire, Akimat will participate in co- financing of the project.

The main characteristics of the project:            Operational length of LRT line is 22,9 km, number of rolling stock 31 vehicles, new depot in Alatausky DistrictForecasted passenger load, 1st year of operation – 23 mln people.

Total Project cost (estimated) – about 525 mln. US Dollars, Akimat expenses – 108 mln. US Dollars.

Period of implementation (preliminary estimate): 2015-2017 – preparatory phase2018-2019 – construction phase.

Current status:The development of tender documentation for tender for the selection of the concessionaire.

Waste Management in Almaty

10Almaty Development Centre

• The project envisages construction of a plant mechanical-biological waste management, as well as sanitary landfill in Ili district of Almaty region.

• The main characteristics of the project:• Recycling of urban more: 300K tons per year;• Recycling of sludge sewage treatment facilities: 360K tons per year;• Planned electricity generation - 5 MW per hour;• Forecasted revenues from implementation of "green" electricity: 4.7

million. US dollars per year;• The total cost of the project (estimated) - 170 million US dollars

• Terms of project implementation (preliminary estimate):• 2015-2016 - the preparatory phase;• 2017-2020 – the construction phase;

• Current status:The feasibility study has been completed to select the option of the project implementation

Development of public transportation of Almaty

11Almaty Development Centre

Since 2010 Almaty city Administration actively works on upgrading city’s passenger transportation by implementation of the environmentally friendly transport:600 buses which are working on compressed natural gas (CNG);195 modern trolleybuses

40 % of the 1500 buses of Almaty are CNG working buses.

Plans for 2015:Creating possibilities for private operators purchasing from 200 to 400 low-floors, 12 meters length buses which are works on CNG.

Estimated cost for 1 bus: 140 – 160 thousand US dollars.Total cost (estimated): 32-64 mln.US dollars.

14Almaty Development Center 14Almaty Development Centre

Ski Resort «Kokzhailau»

Construction of the year-round ski resort including the passenger cableways and chairlifts, as well as connection of utility networks to the main facilities of the resort.

The total amount of the state investments is estimated at $450.000.000 and private investments around $900.000.000.

•Place of implementation : Almaty, Kokzhailau mountain area

•Period of implementation: 2012 - 2020

•Created jobs: Up to 5,000 people

Almaty Development Centre 15

Islamic finance

Kazakhstan was the first country in CIS that introduced Islamic finance legislationAlmaty city positioning as a regional financial center for Islamic Finance «Almaty Development Center» in cooperation with «Islamic Development Bank» and «Islamic Corporation for Development of the Private Sector» are searching for perspective projects in Almaty like:

Building of Islamic Finance TowerHalal meat production hub

Almaty Development Centre 16

Big Almaty Ring Road - «BAKAD»

BAKAD is high priority project under personal control of the President.

BAKAD is part of Big Transport Route «West China – West Europe».

Length of road – 65.4 km (4/6 road lines) Estimated capital expenses of the project

amount $740 mln. Project Time Duration – 30 years Building period - 3 – 4,5 years Contract structure – BTO concession «Build

– Transfer – Operate»

Almaty Development Centre 17

EXPO 2017

Kazakhstan is hosting «Expo 2017» exhibition of innovative, information and industrial technologies.

Almaty city, as Part of Expo 2017, is preparing to implement a project portfolio to focus on green energy solutions.

Local Authorities with the support of EBRD have created subsidiary as an operator for green energy projects with estimated value of $35 mln.

18Almaty Development Center 18Almaty Development Centre

Thank you!

Almaty Akimat official web-sitewww.almaty.gov.kz

Almaty Development Center contacts:

Office 432, 85 Dostyk Ave., Almaty Tel. +7 727 3341378, -79, -80

Email: cda@cda.kzwww.investinalmaty.com

Thank you!

Almaty Akimat official web-sitewww.almaty.gov.kz

Almaty Development Center contacts:

Office 432, 85 Dostyk Ave., Almaty Tel. +7 727 3341378, -79, -80

Email: cda@cda.kzwww.investinalmaty.com