Identifier
Created
Classification
Origin
09STATE42778
2009-04-28 17:52:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Secretary of State
Cable title:  

KAZAKHSTAN OFFICIALS MEET WITH EEB A/S DAVID

Tags:  EAID ECON EFIN EINV 
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VZCZCXYZ0017
OO RUEHWEB

DE RUEHC #2778 1181811
ZNR UUUUU ZZH
O 281752Z APR 09
FM SECSTATE WASHDC
TO RUEHTA/AMEMBASSY ASTANA IMMEDIATE 2318
INFO RUEHBUL/AMEMBASSY KABUL IMMEDIATE 0249
RUEATRS/TREASURY DEPT WASHINGTON DC IMMEDIATE 0330
RHEHNSC/NSC WASHINGTON DC IMMEDIATE 3165
RUEAIIA/CIA WASHINGTON DC IMMEDIATE 6467
UNCLAS STATE 042778 

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: EAID ECON EFIN EINV
SUBJECT: KAZAKHSTAN OFFICIALS MEET WITH EEB A/S DAVID
NELSON ON BANK-FUND MARGINS
UNCLAS STATE 042778

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: EAID ECON EFIN EINV
SUBJECT: KAZAKHSTAN OFFICIALS MEET WITH EEB A/S DAVID
NELSON ON BANK-FUND MARGINS

1.(SBU) Summary. On the margins of the World Bank/IMF
conference this past weekend, Acting EEB A/S David Nelson met
with visiting Kazakhstani officials on Sunday, April 26 to
discuss Kazakhstan's economy in the wake of the global
financial crisis and Kazakhstan's engagement in Afghanistan.
Participants included: Deputy Minister of Economy and Budget
Planning, Timur Suleimenov; Deputy Minister of Finance,
Alikhan Smailov; Ambassador Erlan Idrissov; Anuar
Kurzhikayev, 3rd Secretary, Embassy of Kazakhstan; State
EEB/IFD/OMA Briana Saunders. End summary.

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Kazakhstan Coping with Challenging Times
--------------


2. (SBU) Deputy Minister Smailov gave a mild assessment of
Kazakhstan's economic situation and how the country was
coping with the global economic crisis. He noted that GDP
growth had fallen from an annual average of 9 percent over
the past several years to 3.2 percent in 2008 with the onset
of the crisis. He expected growth to reach only one percent
this year, which is due in whole to the "anti-crisis" program
the government implemented last fall. Smailov noted the
hardest hit sectors have been banking, construction and
commodity exports. Ambassador Idrissov highlighted that,
while the economy is taking a hard hit, it was an affirmation
that Kazakhstan is indeed part of the global economy and that
the crisis presents an opportunity to improve the country's
vulnerable sectors.


3. (SBU) Smailov said the Government of Kazakhstan last fall
began an "anti-crisis" program to address the financial
sector, real estate, small- and medium-sized enterprises,
agriculture, and infrastructure and industrial projects. The
Government has allocated $15 billion, or 17 percent of GDP,
for the program, $10 billion of which comes from the National
Oil Fund (currently $24 billion). In addition, the
government devalued the tenge earlier this year. The
government is also basing the national budget on a price of
$40 per barrel (Brent price) and any revenues beyond that
price will go directly into the National Oil Fund. Total
reserves, including the oil fund, now stand at $42 billion
(for a population of 16 million people). Smailov said that
their healthy reserve position prevents Kazakhstan from
needing external assistance from the IMF.

--------------
Kazakhstan's Engagement with Afghanistan
--------------


4. (SBU) Acting A/S David Nelson asked officials about
Kazakhstan's economic engagement with Afghanistan, and what
their future plans are. The officials noted that Kazakhstan
is a major provider of grain for the Afghans, as it is among
the top five grain exporters in the world. Ambassador
Idrissov said Afghanistan was "high on the agenda" of
Kazakhstan, and that a new action plan until 2011 will focus
on water infrastructure. In addition, the Government of
Kazakhstan will support TIFA, private sector involvement in
Afghanistan, and training to address the long-term goal of
improving education. The Ambassador confirmed that
Kazakhstan is ready to partner, both in the public and
private sectors, with the United States and other donor
countries.
CLINTON