IMPROVING THE COMPETITIVENESS OF THE ECONOMY

In his message, President Kassym-Zhomart Tokayev not only pointed out the main problems in the country's economy, but, most importantly, outlined ways to solve them. Systemic problems of the country's economy are commodity dependence, low labor productivity, insufficient level of innovation, uneven distribution of income. The raw materials orientation of Kazakhstan's economy is a legacy of the Soviet period. As you know, in 2014 the State Program of Industrial and Innovative Development for 2015-2019 was adopted. Its goal was to diversify the economy, increase labor productivity and the share of manufacturing exports, and develop small and medium-sized businesses. However there is still no tangible progress in these issues. According to statistical reports, the share of industry in GDP is less than 30%.

The President stressed the need to improve tax policy. A new Tax Code of the Republic of Kazakhstan should be developed already in 2023, providing for the differentiation of tax rates in various sectors of the economy, with the introduction of a "luxury tax" when purchasing expensive real estate, vehicles and will not affect the middle class. It is also necessary to widely introduce digitalization to eradicate corruption in this area. Differentiation of tax rates will prevent further stratification of society and contribute to the redistribution of national wealth. The introduction of mechanisms to reduce or exempt from corporate income tax on profits aimed at technological modernization and scientific research will contribute to improving the effectiveness of tax incentives.

Special attention was paid to the development and support of entrepreneurship, attracting talented young people to this sector of the economy. This will create new jobs, increase tax revenues, and improve the quality and competitiveness of domestic goods. The developed "Business Roadmap 2020" is aimed at stimulating national entrepreneurship and business activity in the post-crisis development phase. Entrepreneurship provides dynamism of the economic system, contributes to the rapid commercialization of research , as well as has a significant impact on the accelerated pace of industrial development. From the experience of foreign countries, small innovative firms become technological leaders not only in industries with rapidly changing production technology, but also in emerging industries. In this regard, the President's message notes that when providing financial support, the state will give priority to competitive small and medium-sized enterprises. The President noted the underfunding of small and medium-sized businesses in the amount of about $42 billion, so a serious problem is the lack of credit resources. At the same time, banks have accumulated multi trillion liquidity, which actually does not beneficially work for the country's economy. In this regard, the President instructed the National Bank of the Republic of Kazakhstan, the Agency for Regulation and Development of the Financial Market of the Republic of Kazakhstan, the Government to find concrete solutions to ensure stable and affordable lending to the real sector of the country's economy.

Thus, the new economic policy should be aimed at macroeconomic stability, innovation, digitalization in order to achieve the high-quality and inclusive economic growth and fair distribution of the country's national income.

Press Service of Al-Farabi Kazakh National University