TAM/BAS COUNTRY BRIEF FOR KAZAKHSTAN 2010-2012

This document provides recommendations for TAM/BAS intervention in Kazakhstan over the period 2010-2012. It is a product of the staff of the European Bank for Reconstruction and Development undertaken by the TAM/BAS Programme team and the Office of the Chief Economist. The findings, interpretations, and conclusions expressed do not necessarily reflect the views of the Board of Directors of the EBRD or the governments they represent. The EBRD does not guarantee the accuracy of the data included in this work. This Report has been prepared by a core team led by Francesca Pissarrides (Office of the Chief Economist), Valeria Della Rosa (BAS Programme) and Craig Otter (TAM Programme). The team was assisted by Simone Zeh (Office of the Chief Economist), Eugen Gossen (TAM Programme) and Caroline Van Coppenolle (BAS Programme). The team also acknowledges the support from: The Chamber of Commerce and Industry of the Republic of Kazakhstan, “Damu” Entrepreneurship Development Fund, Business Women Association of Kazakhstan, Kazakhstan Small Business Development (KSBD) Project, Kazakhstan Association of Management Consultants, Forum of Entrepreneurs of Kazakhstan, Roundtable of Kazakhstan Association of Management Consultants, Department of Entrepreneurship and Industry, “Kaznex” Corporation for Export Promotion, National Business, Association of Microfinance organizations of Kazakhstan (AMFOK), Asian Development Bank, EBRD Resident Office in Almaty, Regional BAS Offices, European Union, WorldBank Group – International Finance Corporation, JICA/Japan-Kazakhstan Center, USAID, VIProMotion, Timujin, BISAM Central Asia, Zhuldyz-Kenan.

ABBREVIATIONS

BAS Business Advisory Services Programme BEEPS Business Environment and Enterprises Performance Survey GGM Grant Guideline Matrix IFI International Financial Institutions LEF Local Enterprise Facility MSME Micro, Small and Medium sized Enterprises OCE EBRD Office of the Chief Economist TAM TurnAround Management Programme OECD Organisation for Economic Co-operation and Development USAID United States Agency for International Development

2

Previous TAM/BAS experience in Kazakhstan

The TAM/BAS Programme supports economic transition by achieving enterprise change in potentially viable micro, small and medium enterprises and contributing to the development of sustainable infrastructures of local business advisory services in the EBRD countries of operation.

TAM TAM supports the introduction of international best practice in small and medium-sized enterprises with the potential of becoming future leaders in their market through the introduction of international advisors from developed countries with 15 to 20 years of professional experience in the specific business sector. TAM projects typically last around 18 months. The Programme also carries out seminar and training activities promoting international best practices by disseminating successful case-studies to entrepreneurs. Since inception in 1998, TAM has received a total of €3.2 million in donor funding. The largest donors of TAM projects have been Japan with €1.9 million, and the EU with €800,000 under TACIS. Additional funding for projects came from Switzerland, Belgium, the EBRD Special Shareholders Fund and Austria. The Programme has carried out 51 projects throughout Kazakhstan of which 12 are still in progress. Projects have been mainly focussed on the Food/Beverages, Manufacturing and Energy sectors and mostly located in Almaty, East Kazakhstan, Kustanay and South Kazakhstan. Currently, projects are being carried out in all of these provinces.

BAS BAS acts as a facilitator for the use of local, private-sector consultants by MSMEs to obtain a diverse array of services. BAS works on both the demand and the supply side. By assisting individual enterprises to engage with local consultants on narrowly-based, specific projects with a rapid payback, it stimulates demand and the understanding of the potential benefits of using external consultants. It also directly increases the supply and quality of local advisory services, through targeted market development activities. BAS supported projects typically last around four months. Since October 2001, BAS Kazakhstan has received a total of €9.3 million in donor funding. The first and largest donor has been Japan with €7.6 million, additional funding came later from Switzerland and the EBRD Special Shareholders Fund. The Programme has undertaken a total of 684 projects with MSMEs, engaging 240 consultants– 94% of which were local. Projects have been carried out from the 5 BAS Kazakhstan offices: Almaty, Ust Kamenogorsk, Kostanai, Shymkent, and Aktobe and more than 56 % of the projects were located in rural areas; this tendency has been rapidly growing over time. The industry spread of projects has been wide, but there has been a focus on Food/Beverages, Wholesale/Retail Distribution and Construction/Engineering. Most projects were targeted at improving Computerized Financial and Management Information Systems as well as Quality Management & Certification. In terms of cross-cutting issues, BAS Kazakhstan has been mainly focused on facilitating rural development through its regional presence and active work in rural areas. The BAS Programme in Kazakhstan has also undertaken a number of market development activities geared to the development of the local consultancy industry. It has carried out workshops on "Business development through usage of consulting services." to promote the benefits of advisory services to MSMEs and, in cooperation with the Kazakhstan Association of Management Consultants, it has introduced “Core Consultancy Skills” and “Consulting Ethics” courses from the UK and Canada via trainings-of-trainers. Course deliveries are now taking place on a commercial basis. The objectives of this work have been to increase the professional competence of business advisors in Kazakhstan and ensure the long term sustainability of the local advisory services sector.

Linkages with banking

To date, three TAM/BAS-assisted companies in Kazakhstan have attracted four investments from the EBRD or EBRD related financial intermediaries, mobilising a total EBRD Financing of over €68 million. In addition to investments, TAM/BAS has referred over 20 companies to other banking teams.

TAM in Kazakhstan in charts

Out of the 51 TAM projects 39 have been completed and 12 are still in progress

The vast majority of TAM projects have been evaluated as successful

Status of TAM projects in Kazakhstan

0

5

10

15

20

25

30

35

40

Closed Work in progress

Evaluation of completed TAM projects

TAM projects have had a wide industry spread, with

food manufacturing the most common sector Projects have been dispersed throughout Russia with a

broad representation in all federal districts

TAM projects by industry

Closed Early

24%

Highly Satisfactory31%

Satisfactory

38%

Unsatisfactory

7%

4

0 5 10 15 20

Computer and ElectronicEnergy Efficiency

Printing and Related SupportProfessional Services

Solid Waste ManagementWarehousing and Storage

Building Material and GardenElectrical Equipment

Chemical ManufacturingPharmaceutical and Medicine

Textile MillsEnergy

Miscellaneous ManufacturingFood & Beverage

TAM projects by province

0 5 10 15 20 25 30 35

AkmolaAktobeAlmatyAtyrau

East KazakhstanJambyl

KaragandyKostanay

KyzylordaMangystau

North KazakhstanPavlodar

South KazakhstanWest Kazakhstan

TAM projects started up over time

0

2

4

6

8

10

12

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

TAM Donors in Kazakhstan since inception €

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

Japan EU Switzerland Multi-Donor

Belgium Austria

Source: TAM/BAS Programme

BAS in Kazakhstan in charts

BAS Kazakhstan has received a total of €9.3 million in donor funding.

Since 2001, there has been a fairly even distribution of projects between the main cities and other areas

5

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000

8000000

9000000

EBRD JAPAN SECO

BAS funding in Euros

BAS projects by location

Other56%

Main cities44%

BAS has assisted enterprises of all sizes, but especially micro enterprises

The overwhelming majority of BAS consultants is under local ownership

Local82%

Local owned by

foreign14%

Other4%

The distribution of projects between the main cities and more rural areas has been changing over time in favor of

enterprises outside of the main cities in Kazakhstan where BAS operates : Ust Kamenogorsk, Kostanai, Shymkent, and Aktobe

BAS projects by location, 2001-05

BAS projects by enterprise size BAS consultants by ownership

<5050%

50<10017%

100<20014%

>20019%

Other65%

Main cities35%

BAS projects by location, 2005-09

Other 42%

Main cities 58%

Food/Beverages, Wholesale/Retail Distribution and Construction/Engineering remain three industries where enterprises have accounted for a significantly large share of the total of BAS projects.

6

0.0 5.0 10.0 15.0 20.0Transport

PaperHealth

Textiles/Apparel/FootwearEnergy

Glass/Rubber/PlasticPrinting/Publishing

Wood Processing/FurnitureChemical/Pharmaceutical

Metals/Machinery/EquipmentMedia/Communication

Electrical/Electronics/ITOther

Construction/EngineeringWholesale/Retail Distribution

Travel/TourismFood & Beverages

0.0 5.0 10.0 15.0 20.0 25.0Paper

EnergyWood Processing/Furniture

TransportPrinting/Publishing

HealthMedia/Communication

Glass/Rubber/PlasticChemical/Pharmaceutical

Textiles/Apparel/FootwearMetals/Machinery/Equipment

Electrical/Electronics/ITTravel/Tourism

Construction/EngineeringFood & Beverages

Wholesale/Retail DistributionOther

Computerized Financial and Management Information Systems, Market Analysis and Planning as well as Quality Management & Certification remain the most popular project type.

BAS projects by industry, 2001-05 BAS projects by industry, 2005-09

0 5 10 15 20 25 30Energy Efficiency

Computerised Manufacturing SystemsEngineering Studies

Development PlanningReorganisation/ Restructuring

Feasibility StudyOther

Quality Management & CertificationMarket Analysis & Planning

Computerised Financial/ MIS

0 5 10 15 20 25 30 35 40Energy Efficiency

Engineering StudiesComputerised Manufacturing Systems

Reorganisation/ RestructuringDevelopment Planning

Feasibility StudyMarket Analysis & Planning

Quality Management & CertificationOther

Computerised Financial/ MIS

Source: TAM/BAS Programme

BAS projects by type of advice 2001-05 BAS projects by type of advice, 2005-09

7

The SME sector Kazakhstan’s MSME sector accounts for 99% of registered businesses as of mid-2009 (94%

small and 5% medium-sized businesses). According to Global Entrepreneurship Monitor, Kazakhstan ranks well on entrepreneurship (16th out of 42 countries) and the participation of women entrepreneurs is relatively high. Entrepreneurs have on average less formal education than the overall population. The highest rate of entrepreneurship is in Southern Kazakhstan, which includes Almaty, while the lowest is in Western Kazakhstan, characterized by large natural resource industry. Tax systems, lack of innovation despite the government’s efforts to promote it and imported counterfeit goods constitute primary constraints on entrepreneurship in Kazakhstan. In spite of the relatively large number of entrepreneurs, the economy’s diversification is limited and the MSME sector in Kazakhstan is not very competitive. Mining and Fuels, which are usually produced by large companies, make up more than 80% of Kazakh merchandise exports, and their share has been growing in the recent years. For comparison, in other transition countries Mining and Fuels make up around 20% of exports1. One of the weakest contributions to the Kazakh economy comes from medium-sized companies with 50-250 employees, which contributed only 4% of the GDP in 2008, while in CEE countries these figures fluctuated around 20% in 2007. Small firms accounted for 28% of GDP in 2008. Although this figure has been declining, it still close to a developed economy, in which small firms typically account for 30-40% of GDP2. Firms are not able to grow organically and ‘graduate’ into the medium-sized category.3 The crisis hit the MSME sector especially hard, because most of them operated in the construction and real estate sector. In 2009, the MSME contribution to the GDP almost halved from 32% to 17% (16% from companies <50 employees and 1% from companies with 50-250 employees)4.

Business environment The four main obstacles to business cited by entrepreneurs in the latest BEEPS study (2008) were 1) high taxes, 2) access to finance, 3) an inadequately educated work force and 4) corruption. Medium-sized companies complain more about access to finance and work force qualifications than small-sized companies: access to financial and human capital are most important when firms grow. The sources of finance are concentrated in Almaty and Astana, and most banks and their branch networks remain focused on catering to MSMEs in the two main cities. The implementation of bankruptcy laws remains an important challenge, but the law does authorise parties to agree on out-of-court settlements. A geographically unified registry is in place and credit information services are provided by a private credit bureau (the bureau’s coverage rate is 29% of the adult population)5. In Transparency International’s Corruption Perception Index, Kazakhstan scores significantly below the transition country average and ranks 145th out of 181 countries. Although an intention to join the Extractive Industries Transparency Initiative has been declared by the authorities, this initiative has yet to materialise.

Existing business support services

According to the recent EBRD Management, Organization and Innovation Survey, management quality is very poor in MSME’s, when compared with other transition companies. The World Economic Forum’s annual Global Competitiveness Index indicates that Kazakhstan falls in the bottom third of the 125 countries included in the survey for indicators based on managerial skills and knowledge. Business service providers, individual consultants and trainers, government agencies (particularly at the local level) and corporations are in particular need of training and advice. In addition to BAS efforts, the jointly funded USAID-Government of Kazakhstan “Kazakhstan Small Business Development Programme” tries to fill this gap by offering training opportunities and encouraging private-public partnerships. Training comprises a “Business Essentials” MSME toolkit and a “Consulting Essentials” course targeted mostly at start-up entrepreneurs and NGOs offering business services. Education and training needs are further being addressed through continuing education programmes (Kazakhstan Institute of Management, Economics and Strategic Research) and mini-MBA programmes (International Business Academy, Forum of Entrepreneurs of Kazakhstan).

1 WTO, EBRD Transition Report 2009 2 Statistical Agency of the Republic of Kazakhstan, European Commission, Directorate Enterprise and Industry. 3 De Haas, R (2009): http://www.ebrdblog.com/2009/11/27/kazakhstan%e2%80%99s-missing-middle/ 4 Preliminary data, first half of 2009 only. Source: Statistical agency of the Republic of Kazakhstan. 5 Doing Business 2010 data-The World Bank Group

8

Government support The government is co-funding the USAID Kazakhstan Small Business Development Programme and actively takes part in public-private partnerships. Study tours and visits from international experts targeted at the government as well as private and non-governmental MSME stakeholders provide exposure to international best practice. DAMU (Entrepreneurship Development Fund), which has been providing financial support to small and medium businesses through several programmes, is now changing its strategy to include a training component. DAMU is planning a one time 2 day training at the national level for MSMEs on core business skills carried out by university professors. The Government’s assistance has focused mainly on MSME financing rather than advisory services.

International donor programmes

Several international donors are providing assistance to MSME development. Besides the above described USAID Kazakhstan Small Business Development Programme, the World Bank and the Ministry of Agriculture help improve access to finance by providing micro-credit programmes. Japan provides some consulting services by Japanese consultants through JICA. However donor presence in Kazakhstan is shrinking and USAID for example is phasing out after the end of its MSME programme.

The MSME sector in charts

MSMEs growth in number, output and employees has been above previous year levels until the fall of 2008.

After a sharp decline, growth levels recovered in May/June 2009 towards previous year levels.

Individual entrepreneurs and farmers make out a large proportion of the MSME sphere. While the number of individual entrepreneurs has doubled between 2002 and 2007, the number of small and medium-sized

enterprises remains at a low level.

85

90

95

100

105

110

115

120

Jan-08

Feb-08

Mar-08

Apr-08

May-08

Jun-08

Jul-08

Aug-08

Sep-08

Oct-08

Nov-08

Dec-08

Jan-09

Feb-09

Mar-09

Apr-09

May-09

Jun-09

Number of active MSMEs Employees Output

MSMEs number, employees and output year on year change (in %) Number of MSMEs 2002-2007

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

2002 2003 2004 2005 2006 2007

MSMEs Individual entrepreneurs Farmers

The number of employees is increasing – in relation to size, MSMEs account for most of employment, followed

by farmers.

MSMEs output is significantly higher than for individual entrepreneurs or farmers. Across time, however, individual entrepreneurs have improved

their performance. Number of employees 2002-2007

0

200

400

600

800

1000

1200

1400

1600

1800

2000

2002 2003 2004 2005 2006 2007

MSMEs Individual entrepreneurs Farmers

Output in mln tenge, 2002-2007

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

2002 2003 2004 2005 2006 2007

MSMEs Individual entrepreneurs Farmers

Contribution to output and employment is highest in the capital Astana, followed by Almaty city and region. The

Mangistauskaya, Atyrauskaya and East Kazakhstan regions also perform above average.

The productivity of enterprises increases substantially with size. Farmers and micro enterprises are lagging behind in terms of output, while small and medium-

sized enterprises perform better. MSMEs across size (Jan 2009)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Micro Small Medium Farmers

Number of active enterprises Contribution to employment Contribution to output

Employees and output across regions (Jan 2009)

05

1015202530354045

Akmoli

nska

ya

Aktubin

skay

a

Almati

nska

ya

Atyrau

skay

a

Vostoc

hno-K

azak

hstan

skay

a

Zhamby

lskay

a

Zapad

no-K

azak

hstan

skay

a

Karaga

ndins

kaya

Kostan

aiska

ya

Kyzylo

rdins

kaya

Mangis

tausk

aya

Pavlod

arska

ya

Severo

-Kaz

akhs

tansk

aya

Yuzhn

o-Kaz

akhs

tansk

aya

Astana

city

Almaty

city

MSME output per capita in mln tengeMSME employees in % of economically active populationOutput KazakhstanEmployment Kazakhstan

Source: Statistical Agency of the Republic of Kazakhstan, www.stat.kz, unfortunately no information on MSMEs repartition across sectors was available.

Business environment in charts

The business environment is improving gradually and compares relatively well to Russia and Central Asia.

Dealing with construction permits, trading across borders and closing a business are major impediments

to business.

Doing Business Ranking

0

20

40

60

80

100

120

140

160

180

2008 2009

Kazakhstan Kyrgyz Republic Russian Federation Turkey

Doing Business Ranking

0306090

120150180

Starting a Business

Dealing witrh ConstructionPermits

Employing Workers

Registering Property

Getting Credit

Protecting Investors

Paying Taxes

Trading Across Borders

Enforcing Contracts

Closing a Business

Overall infrastructure reform and financial institutions

has slightly lagged behind other areas. Transition performance in Kazakhstan is well within EBRD

average.

Low energy tariffs and weak institutional capacity do not provide incentives to use energy efficiently.

Energy Efficiency

0

1

2

3

4

5

6

7

8

9

10

2000 2001 2002 2003 2004 2005GD

P pe

r un

it of

ene

rgy

use

(PPP

in $

US

per

kgoe

)

EBRD average Kazakstan The Knowledge Economy is developing well in

Kazakhstan. Education is a particular strength, while major challenges remain in the areas of political

incentives for the knowledge economy and innovation.

Perceived corruption is significantly worse than transition country average. More than three-quarters of Kazakh firms report corruption as an obstacle in

the latest BEEPS.

Knowledge Economy

0123456789

10

Kazakhstan Transitionaverage

Non-transitionOECD average

Corruption Perceptions

1

2

3

4

5

6

7

8

9

10

Kazakhstan Transitionaverage

Non-transitionOECD average

Source: EBRD, World Bank, Transparency International.

10

Recommendations for future TAM/BAS

interventions

TAM/BAS will focus on addressing these gaps by continuing its operations in Kazakhstan. However, the extent of the Programme’s activities is very much dependent on funding availability.

Continuation of TAM In light of the low level of development of the local consultancy market, business advice from international experts is highly relevant in Kazakhstan. The main impediments faced by Kazakhstan MSMEs, which will be addressed by the TAM Programme assistance, relate to: • low quality of products and manufacturing • lack of transfer of technologies to reach international standards • poor management skills (operational, marketing, export , M&A) • deficiencies in long term business planning, and restructuring TAM will continue delivering assistance responding to the above as well as focusing on energy efficiency and environmental issues. In terms of sectors, agribusiness, energy, textiles, manufacturing and pharmaceuticals would benefit from international industrial expertise, especially when it comes to technological know-how. With regard to Kazakhstan’s land-locked position, transportation will be will be given a higher priority, as it impedes the competitiveness of the Kazakh MSME sector. TAM will continue its regional scope beyond the main cities where management advisory services are not available.

and BAS Stakeholders in the enterprise sector unanimously believe that Kazakhstan entrepreneurs could benefit strongly from the help of business advisory services. The main advantage of BAS is that it contributes to the creation of a viable infrastructure of business support by operating on both the demand and the supply side of the market. Evidence shows that the local advisory market is still at a very low level of maturity so while the BAS grant will remain the key component, targeted market development activities will also play a significant role in BAS assistance to Kazakhstan. A Grant Guideline Matrix is proposed in Kazakhstan in order to prioritize intervention, avoid duplication of efforts from international donors and focus on the areas where Kazakhstan businesses have needs and no access to such services. Depending on funding availability, higher grants will be allocated according to: • Location: higher grants will be given to enterprises outside of the main cities, particularly

in the Western and Eastern regions • Type of advisory service: higher grants will be given to support projects aiming to improve

market performance and to improve environmental management and energy efficiency.

in addition to targeted market development

activities

TAM/BAS assistance at the enterprise level will be complemented with the following market development activities in order to maximise the Programme’s transition impact in Kazakhstan: • Visibility and dissemination: The BAS Programme will take steps to promote the use of

business advisory services (for example by disseminating successful case-studies to entrepreneurs) especially in more rural regions where consultancy is not considered as an option. TAM/BAS will organise more seminars related to international best practices to demonstrate the potential benefits for local entrepreneurs.

• MSME and consultancy training: Capacity building for consultants will be organised to help broaden the country’s supply and quality of local advisory services. The BAS team will continue to address existing gaps in the supply of advisory services by offering trainings covering industry-specific skills, HR policies, international best practices and QMS/certification. For example, BAS will continue sponsoring training-of-trainers to teach consultants how to deliver a “Core Consultancy Skills" (CCS) course that meets international standards which have already been delivered in 7 cities for a total of 185 participants.

• Support to and development of existing local institutions: BAS Market Development Activities will continue supporting local institutions that contribute to the development of SMEs and markets for business advisory services. These can include the Forum of Entrepreneurs, which partners with the BAS Programme in policy dialogue,

the Kazakhstan Association of Management Consultants, the Independent Association of Entrepreneurs and the National Business Forum, which BAS sponsors in its semi-annual platform for public-private sector policy dialogue.

• Contribution to policy dialogue: The TAM/BAS Programme will continue to engage in dialogue within Kazakhstan to encourage further economic diversification in particular by addressing MSME access to finance issues, especially prevalent outside the main economic hubs, and encouraging further linkages with EBRD banking in industries such as agribusiness.

TAM/BAS focus on

addressing cross-cutting issues

In order to address cross-cutting issues that are pertinent to Kazakhstan’s MSME sector development, the TAM/BAS Programme will focus its effort on projects targeted at areas outside of the main cities. In Kazakhstan, where distances and market accessibility are a handicap, TAM/BAS will continue targeting rural development initiatives in industries related to manufacturing and agribusiness especially in the north and the eastern part of the country where there is potential for firms to develop because of the presence of heavy natural resources industries. Moreover, TAM/BAS will also devote efforts to supporting measures that increase energy efficiency and environmental management especially in those areas. Finally, TAM/BAS will also devote efforts to supporting women entrepreneurs and encouraging women’s access to middle management and executive positions primarily by the continuation of targeted initiatives. Trainings that specifically target needs and skills shortages of women in business, young entrepreneurs and rural businesses will be organised.

TAM/BAS contribution to EBRD policy dialogue

By thoroughly analysing the business environment and clearly identifying the challenges faced by the MSME sector, TAM/BAS further strengthens the EBRD’s policy dialogue toolkit. Future challenges for the government (among others) are identified as improving law enforcement, administrative corruption, improving tax administration and improving the educational system.

12

ANNEXES ANNEXES

1. Kazakhstan MSME Fact sheet 1. Kazakhstan MSME Fact sheet

Kazakhstan MSME Country BriefKey MSME Sector Challenges

Source: EBRD

Source: BEEPS (2005)

Country DataSeries Name 2002 2003 2004 2005 2006 2007 2008GDP per capita, PPP (constant 2005 international $)* 6748 7351 8001 8699 9529 10259 10458Unemployment, total (% of total labor force)* 9 9 8 .. .. .. .. Unemployment, female (% of female labor force)* 11 10 10 .. .. .. .. Rural population (% of total population)* 43 43 43 43 43 42 ..Micro, small and medium enterprises (number) .. .. .. .. .. ..Enterprise Restructuring (EBRD transition indicator)** 2 2 2 2 2 2 2Competition Policy (EBRD transition indicator)** 2 2 2 2 2 2 2Source: *WDI (2007) and **EBRD

BEEPS (2005)Change in Performance in Last 36 Months

Small Companies

Medium Companies Initiatives Undertaken in Last 36 Months

Small Companies

Medium Companies

Sales % change 21.2 38.624.5 37.5

Exports % change 0.7 2.540.5 50.0

Fixed assets % change 10.5 13.59.1 14.6

Material inputs % change 18.7 29.91.8 2.1

Employment % change 30.2 33.810.9 22.9

% of companies adopted new technology 24.5 39.5

6.4 10.4

% of companies changed organisational structure 26.6 25.0

1.4 4.2

% change in capacity utilisation 11.1 10.09.5 8.3

Source: BEEPS (2005) Source: BEEPS (2005)

Global Competitiveness Report (2009-2010)

Rank (out of 134) Score(out of 7)

Global Competitiveness 67 4.08 Ease of… 2009 2010 2009 2010

Higher Education and training 59 4.13 64 63 13 16 -3Extent of staff training 83 3.67 79 82 16 18 -2Goods Market Efficiency 84 4.0 177 143 25 18 7Brain Drain 61 3.3 33 38 3 5 -2Technological readiness 69 3.53 26 31 9 11 -2FDI and technology transfer 113 4.02 41 43 12 13 -1Firm-level technology absorption 85 4.46 53 57 11 12 -1Personal computers n/a n/a 61 52 6 6 0Business sophistication 88 3.7 182 182 27 28 -1Strength of auditing and accounting 98 4.1 37 34 11 8 3Burden of government regulation 85 3 54 54 6 6 0Source: WEF The Global Competitiveness Report (2009-2010) Source: World Bank Doing Business Survey (2009, 2010) and EBRD

Change in Transition

country rank

Global Rank (out of 181 in '08 and out of 183 in

Developed successfully a major new product line/service Upgraded an existing product line/service

Discontinued at least one product (not production) line/service Agreed to a new joint venture with foreign partner

Obtained a new product licensing agreement

Outsourced a major production activity/service that was previously conducted in-houseBrought in-house of a major production activity/service that was previously outsourcedObtained a new quality accreditation (ISO 9000, 9002 or 14,000, AGCCP, etc)

Dealing with licencesEmploying workers

Doing Business (2009-2010)Transition Country Rank

(out of 28)

MSMEs have difficulty in securing bank credit. Tax and statistical reporting requirements for MSMEs remain time-consuming and cumbersome. Other administrative barriers remain high as well and include licensing, accreditation and certification and a multitude of regulations. Many documents need to be notarised, further adding to the red-tape burden. Audits and inspections by regulation agencies provide ample opportunity for corruption and corrupt Kazakh governmental officials are especially operating in the areas of licensing, customs duties and loans.

Trading across bordersEnforcing contractsClosing a business

Registering propertyGetting creditProtecting investorsPaying taxes

Doing business Starting a business

In urban areas (cheap) SME financing is sufficiently available and expanding fast, but in rural and remote areas especially non-trade Business Obstacles for SMEs in Kazakhstan, 2005

Financing

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Infrastructure

Taxes

Macroeconomicinstability

Licensing and regulation

Functioning of judiciary

Corruption

Street crime

Organised crime

Anti-competitivebehaviour

Kazakhstan MSME Country BriefKey MSME Sector Challenges

Source: EBRD

Source: BEEPS (2005)

Country DataSeries Name 2002 2003 2004 2005 2006 2007 2008GDP per capita, PPP (constant 2005 international $)* 6748 7351 8001 8699 9529 10259 10458Unemployment, total (% of total labor force)* 9 9 8 .. .. .. .. Unemployment, female (% of female labor force)* 11 10 10 .. .. .. .. Rural population (% of total population)* 43 43 43 43 43 42 ..Micro, small and medium enterprises (number) .. .. .. .. .. ..Enterprise Restructuring (EBRD transition indicator)** 2 2 2 2 2 2 2Competition Policy (EBRD transition indicator)** 2 2 2 2 2 2 2Source: *WDI (2007) and **EBRD

BEEPS (2005)Change in Performance in Last 36 Months

Small Companies

Medium Companies Initiatives Undertaken in Last 36 Months

Small Companies

Medium Companies

Sales % change 21.2 38.624.5 37.5

Exports % change 0.7 2.540.5 50.0

Fixed assets % change 10.5 13.59.1 14.6

Material inputs % change 18.7 29.91.8 2.1

Employment % change 30.2 33.810.9 22.9

% of companies adopted new technology 24.5 39.5

6.4 10.4

% of companies changed organisational structure 26.6 25.0

1.4 4.2

% change in capacity utilisation 11.1 10.09.5 8.3

Source: BEEPS (2005) Source: BEEPS (2005)

Global Competitiveness Report (2009-2010)

Rank (out of 134

13

) Score(out of 7)

Global Competitiveness 67 4.08 Ease of… 2009 2010 2009 2010

Higher Education and training 59 4.13 64 63 13 16 -3Extent of staff training 83 3.67 79 82 16 18 -2Goods Market Efficiency 84 4.0 177 143 25 18 7Brain Drain 61 3.3 33 38 3 5 -2Technological readiness 69 3.53 26 31 9 11 -2FDI and technology transfer 113 4.02 41 43 12 13 -1Firm-level technology absorption 85 4.46 53 57 11 12 -1Personal computers n/a n/a 61 52 6 6 0Business sophistication 88 3.7 182 182 27 28 -1Strength of auditing and accounting 98 4.1 37 34 11 8 3Burden of government regulation 85 3 54 54 6 6 0Source: WEF The Global Competitiveness Report (2009-2010) Source: World Bank Doing Business Survey (2009, 2010) and EBRD

Change in Transition

country rank

Global Rank (out of 181 in '08 and out of 183 in

Developed successfully a major new product line/service Upgraded an existing product line/service

Discontinued at least one product (not production) line/service Agreed to a new joint venture with foreign partner

Obtained a new product licensing agreement

Outsourced a major production activity/service that was previously conducted in-houseBrought in-house of a major production activity/service that was previously outsourcedObtained a new quality accreditation (ISO 9000, 9002 or 14,000, AGCCP, etc)

Dealing with licencesEmploying workers

Doing Business (2009-2010)Transition Country Rank

(out of 28)

In urban areas (cheap) SME financing is sufficiently available and expanding fast, but in rural and remote areas especially non-trade MSMEs have difficulty in securing bank credit. Tax and statistical reporting requirements for MSMEs remain time-consuming and cumbersome. Other administrative barriers remain high as well and include licensing, accreditation and certification and a multitude of regulations. Many documents need to be notarised, further adding to the red-tape burden. Audits and inspections by regulation agencies provide ample opportunity for corruption and corrupt Kazakh governmental officials are especially operating in the areas of licensing, customs duties and loans.

Trading across bordersEnforcing contractsClosing a business

Registering propertyGetting creditProtecting investorsPaying taxes

Doing business Starting a business

Business Obstacles for SMEs in Kazakhstan, 2005

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Financing

Infrastructure

Taxes

Macroeconomicinstability

Licensing and regulation

Functioning of judiciary

Corruption

Street crime

Organised crime

Anti-competitivebehaviour

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2. Overview of the key governmental and non-governmental MSME stakeholders

Governmental MSME Stakeholders Ministry of Industry and Trade

“Damu” Entrepreneurship Development Fund “Kaznex” Corporation for Export Promotion Departments of Entrepreneurship of

Local Governments Social-Entrepreneurship Corporations (SEC)

SME promotion fund Export promotion agency Business promotion department Regional development institution The “Damu” Entrepreneurship Development Fund is part of sovereign wealth fund “Samruk-Kazyna” and the main state institution for SME development in Kazakhstan. At the moment Damu provides financial support to small and medium businesses within several programmes: The first is the stabilization programme. It aims to partially mitigate the effect of the growing credit crunch on SMEs and does not target changing the SME structure for the better in a dramatic way. The second program has a goal to narrow regional disparities in SME lending. The third programme is directed to financing ongoing micro-credit organizations.

“Kaznex” Corporation for Export Promotion, part of sovereign wealth fund “Samruk-Kazyna”, was established in 2008 to enhance competitiveness of domestic enterprises through internationalization of the Kazakhstani business. Main activities of the Corporation include promotion of export capacity of Kazakhstani enterprises, development of institutional infrastructure for export promotion, promotion of export of products made in Kazakhstan; informational support, and branding of Kazakhstani products.

Departments of Entrepreneurship within local akimats (governments) are part of Ministry of Industry and Trade. Main objectives of the departments include creation of favorable environment for enterprise development, infrastructure support, monitoring and analysis of compliance with the law, proposing improvements to the laws related to development of entrepreneurship in different regions of Kazakhstan.

SEC is part of sovereign wealth fund “Samruk-Kazyna”, are for-profit business entities that were incorporated by the government in seven different regions of Kazakhstan by transferring to them municipal property, land, non-profitable but working enterprises which could be used to start new businesses. Each SEC operates as a holding company managing government assets in its region with a goal to bring in new projects, develop SMEs, and strengthen business cooperation.

Non-Governmental MSME Stakeholders Forum of Entrepreneurs of Kazakhstan The National Economic Chamber of Kazakhstan Souyz

Atameken Association of Microfinance organizations of Kazakhstan (AMFOK)

The Chamber of Commerce and Industry of the Republic of Kazakhstan

Interest Group/Lobbying Interest group/Lobbying Interest Group Business Promotion Organization Forum of Entrepreneurs of Kazakhstan was established in 1992 as association of industry associations. It currently has 14 regional chapters and represents 16 different business associations of Kazakhstan. Forum is a stage for policy dialogue between business community and the government.

The National Economic Chamber of Kazakhstan Souyz Atameken was established in 2005 by founders and members of industry associations in Kazakhstan. The chamber focuses its activities on designing and implementation of measures to support the activities of business entities, reducing administrative barriers, improving access of small and medium businesses to information and financial sources, establishing regional cooperation for small and medium-sized businesses to large national companies and participating in strengthening and developing the competitiveness of domestic business in connection with the forthcoming accession of Kazakhstan to the WTO.

Association of Microfinance Organizations of Kazakhstan (AMFOK) is a non-commercial association of microfinance organizations working throughout the country. Association was founded in February 2004, when six leading microfinance organizations of Kazakhstan performed as AMFOK founders for the purpose of solving development problems of microfinance and providing support to sustainable development of microfinance organizations in Kazakhstan. Currently, Association unifies 70 non-banking financial institutions.

The Chamber of Commerce and Industry of the Republic of Kazakhstan is a formerly government controlled body that exists in Kazakhstan since 1959. Currently it is a non-government and non-profit organization which represents interests of business community and provides a set of business services to SMEs including technical assistance, consultations on foreign trade activities, services for evaluation of customs value of goods, confirmation of documents on foreign trade transactions, consideration of disputes arising between the partners. The Chamber serves as social and economic partner of SMEs in a dialogue with public authorities, large businesses, as well as partners in international trade.

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3. Overview of international donor programmes

3.1. EU

The EU Technical Assistance to the Commonwealth of Independent States- TACIS programme 1991-2006 was replaced in 2007 by “European Neighbourhood and Partnership Instrument - ENPI”. The original TACIS objectives were “to support the process of transition to market economies and democratic societies in the countries of Eastern Europe, South Caucasus and Central Asia.”

The EU-Central Asia Strategy Paper 2007-2013 presents a regional approach to development assistance. It is supported by a multi-annual indicative programme, which has allocated €314 million for regional and national programmes over the first four years (2007-2010). Kazakhstan is supported by EU programmes at a national level worth €44 million.

The Development Co-operation Instrument is the legal basis for EU-Asia development and replaces TACIS regulations. The Central Asia Invest is one of 5 regional programmes which aims to promote the sustainable economic development of Central Asian Countries (Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan) by encouraging the development of Small and Medium Enterprises (SMEs). The programme will also support the relationships between European and Central Asian Business Intermediary Organisations, with a view to the integration of the Central Asian markets in the world economy. The programme supports capacity building projects for Business Intermediary Organisations in Central Asia. The activities must aim to upgrade the skills of staff members and to reinforce networking, making them better equipped to service the local businesses and to facilitate trade between Europe and Asia. 3.2. UK

The UK Department for International Development (DFID) does not provide bilateral support for Kazakhstan, however contributions to multilateral funding initiatives will continue. 3.3. USAID

During October 2006, the United States Agency for International Development (USAID) launched the Kazakhstan Small Business Development Project (KSBD) for the country of Kazakhstan. This four-year $8.9 million jointly-funded USAID and Government of Kazakhstan initiative aims to provide direct consultation and capacity development to design, and implement SME (Small and Medium-sized Enterprise) development programs through and with Kazakh counterpart institutions in order to promote sound economic development for the country of Kazakhstan. To increase youths’ capacity to successfully enter a market economy as employers or entrepreneurs, USAID supports development of practical skills in business and economics education at the high school level through the Junior Achievement Program.

Under the USAID Enterprise Development Project (EDP) and its predecessor, the SME Development Project, Pragma provided tailored, one-on-one services to agribusiness clients in Central Asia, ranging from a dairy in the Ferghana Valley in Uzbekistan to a food packaging company in Almaty, Kazakhstan. During the fourth year of the EDP contract, concluding August 2006, EDP delivered Enterprise Improvement services to 696 SME client firms (559 new clients and 137 existing clients who received renewed EI services) throughout Central Asia. Cumulatively EDP provided EI services to 1,957 SME client firms (1,677 new clients and 280 existing clients who received renewed EI services).

The USAID Accounting/Certified International Professional Accountant Project was a follow-on to the accounting reform activities that the Pragma Corporation undertook under its USAID-funded Enterprise Development Project (EDP). The project covered five countries of Central Asia: Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan. The goal of the two-year ACIPA project was to strengthen local institutions in their capacity to advance the accounting profession and support the transition to a full market economy well-after USAID phases out its assistance in this sector.

In October 2006, the United States Agency for International Development (USAID) launched the Business Environment Improvement Project (BEI) for the countries of Kazakhstan , the Kyrgyz Republic , and Tajikistan . The 4-year BEI Project supports USAID’s strategic objectives in these countries by providing direct consultation and support to build capacity within government and private sector counterparts to promote effective dialogue, improve implementation of business-related legal reforms and streamline administrative processes for the benefit of small and medium enterprises (SMEs).

The Trade Facilitation & Investment Project (TFI) was funded by the United States Agency for International Development (USAID). The Project operated in Kazakhstan and the Kyrgyz Republic in 2001-2006 and in Tajikistan and Uzbekistan in 2002 - 2006. The goal of the Project was to improve the trade and investment environment for small and medium-sized enterprises. To accomplish this goal, the Project’s activities focused on the reduction of investment constraints, trade facilitation, accession to and active participation in the World Trade Organization and adopting international practices in the fields of Metrology, Accreditation, Standardization and Quality.

http://www.pragmacorp.com/ksbd.htmhttp://centralasia.usaid.gov/page.php?page=article-79&from_t=kztexthttp://www.smetradecenter.net/info/kz/ 3.4. Germany – KfW

Development cooperation between the Federal Republic of Germany and the Republic of Kazakhstan was started in the year 1993. The German federal government's total commitments under Financial Cooperation amount to EUR 79 million. So far the activities have focused on the financial sector and the health sector. Financial Cooperation was successful in the financial sector by extending a credit line under which medium to long-term loans were granted to small and medium-sized enterprises (SMEs). The credit line was extended to three private local banks whose loan officers were trained under a complementary measure. The funds of the credit line are now fully committed and have been largely disbursed. http://www.kfw-entwicklungsbank.de/EN_Home/Countries_and_Projects/Asia/South_and_Central_Asia/Kazakhstan78/Kasachstan_e.pdf 3.5. World Bank Group – International Finance Corporation (IFC)

Kazakhstan became a member of IFC in 1993. As IFC’s largest client in Central Asia, Kazakhstan has received commitments of more than $603 million of IFC’s own funds and over $282 million in syndications. IFC's investments in the country have been mainly in the financial, oil & gas and general manufacturing sectors. IFC is providing assistance to local small and medium enterprise suppliers operating in the oil and gas industry to achieve the internationally recognized ISO 9000 quality certification. 3.6. Islamic Development Bank (IDB)

The IDB provides financing for SMEs rather than direct technical assistance in the form of consultancy services. Since its inception the IDB has forged strategic partnerships with national development financial institutions (NDFIs) in its member countries to support the growth of the SME sector. The IDB Lines of Financing enable SMEs to access financing through Leasing, Installment Sale, and Istisna’a modes for scaling up their technological capabilities. IDB also extends global Line of Financing to several NDFIs in member countries to spur competition and efficiency in the SME sector. Currently, there are 31 Lines of Financing in 15 member countries amounting to ID 244.64 Million ($ 318.94 million).

http://www.isdb.org/irj/go/km/docs/documents/IDBDevelopments/Internet/English/IDB/CM/Cooperation/Islamic%20Financial%20Industry/NationalDevelopmentFinancingInstitutions.html

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3.7. UN Development Programme (UNDP)

UNDP works in three areas within Kazakhstan, on: poverty reduction, democratic governance and environment and sustainable development.

17

4. MSME STAKEHOLDER INTERVIEWS IN KAZAKHSTAN

In October 2009 interviews with major stakeholders in the MSME sector and the consultancy market were conducted. This annex provides a list of the interview partners and the questionnaire used.

Institution

Name and Position

EBRD Resident Office Mr. Tomas Bravenec, Senior Banker “Damu” Entrepreneurship Development Fund,

Mr. Bulat Mukushev, Chairman

WorldBank Group – International Finance Corporation

Mr. Umed Omarov, Associate Investment Officer

The Chamber of Commerce and Industry of the Republic of Kazakhstan

Mrs. Zulfiya Akhmetzhanova, Chairman,

Business Women Association of Kazakhstan

Ms. Svetlana Gonago, Head of Almaty Chapter Ms. Gulsum Akhtamberdieva, Board Member

Donor 4: JICA/Japan-Kazakhstan Center,

Mrs. Naomi Abe

Kazakhstan Small Business Development (KSBD) Project

Mr. Gregory Hemphill, Chief-of-Party

USAID Mrs. Svetlana Golovatskaya, Project Management Specialist Mrs. Erin Cole, Economic Program Development Specialist

Private Company: BISAM Central Asia

Mr. Leonid Y. Gurevich, President

Business Organization: National Business

Mr. Arman Idirissov, General Director

Association of Microfinance organizations of Kazakhstan

Mr. Anatolii Glukhov, Director

Asian Development Bank Mr. Steven Wermert, OIC European Union Kaznex” Corporation for Export Promotion

Mrs. Saule Orynbasarovna Akhmetova, Deputy Chairman of the Board

Kazakhstan Association of Management Consultants

Mr. Mukhtar Mussabetov, President Mrs. Valentina Grigorieva, Vice-President

Private Company: VIProMotion Mrs. Elnura Kasymova Private Company: “Timujin” restaurant,

Mr. Kanat, Asanbekov, Director

Forum of Entrepreneurs of Kazakhstan

Munavara Paltasheva, Executive Director

ICMCI Mrs. Heather Osler, Advisor Private Company: Zhuldyz-Kenan Mrs. Baglan Bakkulova Department of Entrepreneurship and Industry

Diyarov Dauren Mazhitovich, Head of the SME

5. MSME Stakeholders Survey

Questions on the MSME sector and the enterprise sector in general Q1 How do you evaluate the competitiveness of the Kazakhstan MSME sector (including state

owned and privatised enterprises)? Q2 Do you think that entrepreneurs wanting to start a business in Kazakhstan have the necessary

skills in terms of management and organisation to manage a successful business? Q3 Do you think that Kazakhstan’s micro, small and medium enterprises could improve their

performance considerably if they could more often draw on the support of business advisory services?

Q4 What are currently the business advisory services most needed by the MSME sector? 1) Market analysis and planning 2) Development planning 3) Feasibility study preparation 4) Partner search 5) Reorganisation/ restructuring 6) Computerised financial/ management information systems 7) Efficiency improvements 8) Computerised manufacturing systems 9) Engineering studies 10) Introduction of quality management and certification 11) Improvement of environmental management (energy efficiency or others) 12) Other Q5 MSMEs in what sector are most in need of business advisory services (and why)? Q6 MSMEs in which geographic location(s) are most in need of business advisory services (and why?) Questions on the consultancy market Q7 Do you think that a sufficiently broad network of business advisory services is currently

available to the MSME sector? How do you evaluate the competitiveness of the sector? Q8 What kind of services do they generally offer? Does their supply match the small enterprises’

demand or are there any kind of more sophisticated services that are usually not offered? Q9 Are there large regional disparities in the supply of business advisory services? And if yes,

which are the most disadvantaged areas? Q10 Are there business advisory programmes in Kazakhstan available which target already a specific

size/ location or sector? Q11 Do you think that MSMEs in Kazakhstan have the necessary financial funds to pay for

consultancy services themselves? Q12 How do you evaluate the quality of the business advisory services currently offered? Q13 Are there any kinds of minimum standards for consultants or some kind of accreditation system

that would ensure their quality? Q14 What kind of services/programmes is your institution offering to foster the development of the

MSME sector in general and to support the creation of a sound infrastructure of advisory services in particular?

Optional Q15 What are the key challenges MSMEs face today / will have face in the near future? Q16 What are the key challenges consultancies face today / will have face in the near future? Q17 Do female entrepreneurs have to cope with special obstacles if they want to get involved in

business activities? Q18 Are there any differences in the type of advice that small versus medium companies need? Q19 Would the MSME sector benefit from the international consultancy services and donor programmes

providing/facilitating this kind of services? Q20 What king of trainings/seminars would MSME benefit from?

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6. BAS Grant Guideline Matrix:

Kazakhstan GGM 2009

• Size of enterprise: Grant differentiation by enterprise size, industry or regional location is not necessary at this stage due to the low level of overall market development.

• Geographic location: Higher grants should be given to enterprises outside of Almaty. While companies in these regions tend to need the most help, they often find it difficult to access appropriate business advisory services and do not have the necessary financial resources to pay for them. No subsidies for the implementation of ISO 9000 and restaurant management systems will be granted in Almaty as the supply of these services in Almaty is well diversified. However, this change is restricted only to the companies located in Almaty and up to 50 % grants can be administered in Almaty suburbs in which suffers from the troubled economic environment.

• Type of advisory service: Higher grants should be given to support projects aiming to improve market performance and environmental management. Generally, many entrepreneurs manage their business without proper attention to long-term strategic planning. A significant potential exists for support in the areas of energy efficiency and environmental management. Many enterprises consider such an intervention to be more of a cost factor than an opportunity. Therefore financial help through programmes like BAS might be necessary to demonstrate the pay-off. Meanwhile, no grants should be given to projects with enterprises in Almaty city and its suburbs focussing on ISO 9001:2000 and computerized restaurant management systems due to the high proportion of such projects in the past. Grants for capacity building projects with consultants and for projects that may influence development of the market are up to 75%. Finally, subsidies for agricultural consulting and energy efficiency projects have been increased to 75% due to the need to stimulate these underdeveloped consulting segments in Kazakhstan and to work with the underserved rural enterprises.

to improve market

performance (Market

analysis & planning,

Development planning, Feasibility studies,

Partner Search )

to improve market

performance (Capacity

building for consultants,

MDAs)*

to improve management effectiveness

(Reorganization/restructuring, Computerized financial/mana

gement Information Systems)

to improve management effectiveness

(Computerized restaurant

management Systems)**

to improve management effectiveness (Agricultural management consulting)*

to reduce costs (Computerized Manufacturing

Systems, Engineering

Studies)

to introduce Quality

Management & Certification

(other than ISO 9000)

to introduce Quality

Management & Certification in

accordance with ISO 9000***

to improve environmental management (Energy efficiency, Environment)*

< 50 50% 75% 50% 0% 75% 50% 50% 0% 75%50 ≤ 99 50% 75% 50% 0% 75% 50% 50% 0% 75%100 ≤199 50% 75% 50% 0% 75% 50% 50% 0% 75%≥ 200 50% 75% 50% 0% 75% 50% 50% 0% 75%< 50 50% 75% 50% 50% 75% 50% 50% 50% 75%50 ≤ 99 50% 75% 50% 50% 75% 50% 50% 50% 75%100 ≤199 50% 75% 50% 50% 75% 50% 50% 50% 75%≥ 200 50% 75% 50% 50% 75% 50% 50% 50% 75%

Location/ Size

Almaty

Type of Advisory Service

Other regions

20

REFERENCES World Bank (2008), “Doing Business 2009 - Kazakhstan”, World Bank Group, Washington D.C., USA. World Bank/EBRD (2005), “Business Environment and Enterprise Performance Survey (BEEPS) 2005” World Economic Forum (2009), “The Global Competitiveness Report 2009-2010”, WEF, Geneva, Switzerland. EBRD (2009), “Transition Report 2009 – Transition in Crisis?”, EBRD, London, UK Statistical Agency of the Republic of Kazakhstan, www.stat.kz Transparency international (2009) , “Global Corruption Report 2009: Corruption and the Private Sector”, TI, Cambridge UK Bosma, Niels et al. (2009), “Global Entrepreneurship Monitor 2008”, Global Entrepreneurship Consortium, London, UK

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