The world is facing new challenges and threats today. The world economy has still not recovered from consequences of the global financial and economic crisis. The recovery continues at a very slow and uncertain pace, and some countries remain in decline. The geopolitical crisis and the sanctions policy of the leading powers create an additional obstacle for the recovery of the world economy.
From my experience, I feel that the years to come will become the time of global trials. The entire architecture of the world will be changing. Not all countries will be able to get through these complications in a decent manner. Only strong states, with their people united, will manage to do that. Kazakhstan, as a part of the world economy and a country located very close to the epicentre of geopolitical tensions, is experiencing negative pressure from all these challenges. We see the results: prices in global markets are dropping, and general economic growth is slowing down.
As is known, the forecasts of the development of the global economy for 2014 and the next two years were revised downward by the International Monetary Fund and the World Bank. That means we need to revise our own plans, and make adjustments for the coming period. There is no time for hesitation. The measures I will talk about today will be implemented from January 1, 2015. We must promptly take all the possible measures to prevent negative trends.
Today the Government is already working quickly at my order. We have revised the parameters of the republic’s budget for 2015. And this is right, as the drop in prices of our export raw materials has led to the reduction of the flow of money to our income. At the same time, the Government have a tough yet specific task: it must fulfil all social liabilities in full.
In a crisis, as we’re seeing the world over, economic policies must be re-evaluated. The sectors that need support are those which create the highest multiplier effect on economic growth and employment. We have already had such an experience. Suffice it to recall our successful anti-crisis measures in 2007-2009. As you see, life makes adjustments to the best laid plans. And we should add new content to the platform of our party based on today’s reality.
On my orders, the Government has completed the development of a new large-scale development programme. Today, as we respond to the challenges we face, I proclaim Kazakhstan’s New Economic Policy “Nyrly Zhol” (The Bright Road). This is what I devote my state-of-the-nation address for 2015. The policy will have a counter-cyclical character and will be aimed at continuing structural reforms in our economy. What does this mean?
Over the years, when the situation in external markets was favourable, and the price of oil and our export products were at sufficiently high level, we diverted revenues from those exports to the National Fund. One of the main tasks of the National Fund is to increase resistance of our economy to external shocks, including when prices of natural resources drop.
We were putting income from extraction and sales of raw materials into this Fund during all these years. We used 10 billion US dollars out of the National Fund to fight the crisis of 2007-2009. As for the rest of the money, we have not spent it. We saved and multiplied it. Now we are in the period when we must use these reserves. They will help overcome uneasy times and stimulate the growth of our economy. These resources are not intended for short-term measures. We will spend them on the transformation of our economy, namely – the development of transport, energy, industrial and social infrastructure, and small and medium businesses.