- Could you tell us about DBK's role in implementing the Business Road Map - 2025 program?
- The Development Bank of Kazakhstan is a key state development institution and is actively involved in the implementation of state programs, from supporting domestic car manufacturers to financing major investment projects and export operations.
On 31 December 2019, Resolution No. 1060 of RK Government approved the Rules for subsidizing a portion of the interest rate under the State Business Support and Development Program “Business Road Map – 2025” (hereinafter - BRM-2025). Since October 2020, DBK has been a participant in the “BRM-2025” program, like the second-tier banks, and provides a set of interrelated measures necessary to achieve the key objectives - to ensure sustainable and balanced growth of entrepreneurship, to maintain existing and create new permanent jobs. The program is being successfully implemented, as evidenced by the projects financed by the bank under the program.
- How to become a participant in the program?
- To participate in the program, it is necessary to meet the requirements of DBK and undergo appropriate bank appraisal of the project. The client then needs to upload an application to eGov.kz in order for the operator to approve the possibility of subsidizing the rate
- What projects are being implemented by DBK in this program?
- Currently, under the BRM-2025 program, the 50 MW Kaskelen solar power plant project can be highlighted with the participation of DBK. The construction of an industrial facility in Karaganda is under financing. It is worth noting the high social and economic impact of the implemented projects. For example, by the end of 2020, about KZT 1 trln. of tax and obligatory payments were paid to the budget of the country by the clients of DBK, participants of the BRM-2025 program. In addition, 640 permanent jobs were created as part of the new project facilities put into operation. The Bank is now considering about 10 projects in AIC processing, construction materials and renewable energy that meet the criteria of the state program.
- What are the basic conditions for participating in the program?
- All the necessary information about participation in the program can be found on the website of the financial operator Damu Fund, as well as on DBK's website. At the same time, DBK provides financial support to private entrepreneurs under the second pillar of the BRM-2025 program, which provides for subsidised interest rates on new loans for the implementation of investment projects, as well as projects aimed at modernization, expansion of production.
The following key parameters for participation in the program should be highlighted.
The interest rate subsidy on DBK loans is implemented with a nominal interest rate not exceeding 15%, of which 6% is paid by the private entrepreneur and the difference is subsidized by the state.
The interest rate subsidy is granted without limitation on the duration of the subsidy, while projects with a subsidy period longer than 5 years are allowed to be subsidized by decision of the state commission for modernization of the economy.
For DBK-financed projects, the maximum amount of the subsidized loan is not limited. However, a limit on the maximum loan amount subject to interest rate subsidies is currently under consideration in order to reach as many entrepreneurs as possible with state support.
- How many projects in total and for which amount have been financed as part of the bank's activities in 2020? How has this figure changed compared to 2019?
- Despite the difficult economic situation around the world and in Kazakhstan caused by the coronavirus pandemic, DBK increased its loan portfolio to KZT 1974 bln. at year-end 2020, an increase of 14.2% compared to 2019. In 2020, DBK invested KZT 506,2 bln. in manufacturing and infrastructure, financing 34 projects. The figure for 2019 was 28 projects worth KZT 452,8 bln. Importantly, in 2020, 9 major enterprises were modernized and commissioned with a significant socio-economic impact on regional development, creating 1 942 new high-paying jobs.
- How many projects were financed in 1Q 2021?
- In 1Q of the current year 12 projects worth KZT 45,58 bln. are at the stage of financing, including two investment projects worth KZT 12.2 bln. and 10 pre-export operations worth KZT 33.3 bln. The Development Bank of Kazakhstan was established in 2001; it finances medium- and long-term investment projects in the sphere of production infrastructure and non-resource sectors of the economy; it promotes attraction of external and internal investments into the country's economy. It is part of the Baiterek National Holding.
