President of the Republic of Kazakhstan Kassym-Jomart Tokayev delivers a speech at the Kazakhstan-Korea Business Forum on June 12, 2024 in Astana. (Office of President of the Republic of Kazakhstan)
By Nurgali Arystanov
Ambassador of the Republic of Kazakhstan to the Republic of Korea
Kazakhstan is emerging as a key investment destination in its region, consistently attracting substantial foreign direct investment (FDI) since its independence in 1991. With over $431 billion in FDI to date, driven by investors such as the Netherlands, the US and Switzerland, Kazakhstan is emerging as a promising landscape for foreign companies, including those from South Korea.
This robust economic relationship is underscored by 55 investment projects valued at $5 billion. Furthermore, over 700 joint ventures with Korean capital are operating in Kazakhstan, showcasing strong bilateral collaboration.
Kazakhstan offers a favorable investment climate. The government is continuously improving investment legislation. Investors are provided with a package of incentives, such as land allocation, exemption from customs duties and taxes.
South Korea ranks fifth among the largest investor countries in Kazakhstan’s economy (following the Netherlands, Russia, Belgium and China). Over the past 19 years, the volume of direct investments from South Korea in Kazakhstan has reached $10.2 billion.
South Korea is also Kazakhstan’s fourth-largest trading partner (after China, Russia and Italy). The trade turnover between our countries reached $6 billion in 2023.
In June, direct flights between Astana and Seoul were launched. Together with Almaty-Seoul route, there are 15 flights a week between our two countries.
Kazakhstan has created modern infrastructure for developing innovative technologies, including the Astana Hub International IT Startup Park and the Park of Innovative Technologies.
Our cooperation in the mining sector holds great potential. Kazakhstan is one of the world’s leaders in mineral resource wealth.
Agriculture is another promising area for cooperation. Kazakhstan is interested in joint investment projects in the deep processing agricultural products and building smart greenhouses.
There are other promising areas for joint work, such as e-commerce and fintech.
To this end, the Working Group on Strengthening Investment Cooperation with South Korea was established in 2021, led by First Deputy Prime Minister Roman Sklyar.
The main task of this group is to work exclusively with Korean companies and promptly resolve any issues arising during project implementation.
We have created modern infrastructure for developing innovative technologies.
The Astana Hub International IT-Startup Technopark and the Park of Innovative Technologies are operational.
We are ready to implement research projects in artificial intelligence, big data, cybersecurity and other areas.
There is significant potential for cooperation in the field of subsoil use. Kazakhstan is one of the world's leaders in mineral resources.
We also see prospects for cooperation in implementing infrastructure projects.
A landmark infrastructure project for the two countries could be the construction of the new city, Alatau City. We need investors and development companies to help us build this new city.
Kazakhstan is actively developing a new multimodal transport and logistics route, the Middle Corridor, which passes through the Caspian Sea. Kazakhstan is interested in developing the port industry on the Caspian coast. In this regard, I invite Korean logistics and engineering, including shipbuilding companies, to participate in developing the Middle Corridor.
There are other promising areas where our companies could work together, including e-commerce, fintech, the creative industries, opening branches of Korean universities in Kazakhstan and internships for Kazakh specialists in Korea under the Bolashak education program.
Thriving business ecosystem
Kazakhstan’s business-friendly environment attracts foreign investors, with over 45,000 foreign-affiliated companies successfully operating in the country.
Here are a few success stories. In Almaty, Hyundai cars are assembled (project cost: $60 million). In Kostanay, a new KIA automobile plant is under construction (project cost: $200 million).
Lotte produces chocolate in Kazakhstan under the brand name, “Kazakhstan,” which has become globally recognized.
Doosan Enerbility is implementing a project to build a 1,000 MW power plant in the Turkestan region (project cost: $1 billion).
Korea Expressway and SK Ecoplant participated in the construction of the Big Almaty Ring Road.
Korean financial institutions such as Shinhan Bank and BNK also operate in Kazakhstan.
This year, the CU convenience store chain opened in Almaty (10 stores).
The Seegene Medical Foundation launched a laboratory in Almaty and plans to open a checkup center soon.
Thanks to the joint efforts of the two governments, this year, the implementation of a project to establish an elevator R&D center for testing locally produced elevators will begin.
KNOC (Korea National Oil Company) invests in Kazakhstan's oil and gas sector. In turn, Kazakhstan supplies crude oil and uranium to South Korea.
Kazakhstan offers strategic market access to a billion-strong regional population through its prime location and transit corridors. Its abundant natural resources, growing renewable energy sector and opportunities in industries like petrochemicals and advanced grain processing make it an attractive investment destination.
Support for investors
Kazakhstan offers robust support mechanisms for investors, including tax exemptions, land grants and infrastructure support. The establishment of 14 special economic zones (SEZs) and 35 industrial zones provides tailored incentives and legal stability for up to 25 years.
The Astana International Financial Center (AIFC) enhances Kazakhstan’s appeal as a regional financial hub. Operating under English Common Law, the AIFC provides a secure legal environment for international investors.
For large investment projects, the government can sign a special Investment Agreement to accommodate companies’ requests, including tax exemptions and infrastructure solutions.
Kazakhstan’s national investment company, Kazakh Invest, serves as a “one-stop shop” for investors. It offers end-to-end support, from initial inquiries to postinvestment assistance. The opening of a Kazakh Invest branch in Seoul highlights the focus on strengthening ties with South Korea, providing local support to Korean investors seeking opportunities in Kazakhstan.
Overall, Kazakhstan’s stable economy, favorable business environment, abundant resources and strategic market access make it an ideal destination for foreign investors. The growing partnership between Kazakhstan and South Korea — through joint ventures, investment projects and government-backed initiatives — demonstrates significant potential for further collaboration. As global economic dynamics evolve, Kazakhstan remains a key destination for South Korean companies aiming to expand overseas.
The views expressed in this article are the writer's own. -- Ed.
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