State pension fund of Kazakhstan wants partial privatization

/IRBIS, Dec.09, 99/ - REUTERS informs, with the reference to vice director of SAPF Sergei Seleznev, that State accumulative pension fund (SAPF) of Kazakhstan considers partial privatization the most effective for its future. "The best case is when the government retains controlling block, assigns managers, monitors investment activities, and part of the shares are sold, because SAPF itself is a profitable fund", said vice director. Earlier, the fund was to be either liquidated or privatized by 2001 by decreasing its share of pensions assets collected down to 30 percents. Director of the fund Eric Sultankulov informed the assets of the fund was a little more than 30 bln tenge, which is 53 percent of all pension accumulations. Net profit of the fund after taxes equaled 1 bln tenge in 1999. Vice director said the yield of instruments, held by the fund, were 68 percent in tenge and about 11 percent in currency. Most of fund's portfolio consists of state securities denominated in currency, into which State treasury bills were converted after devaluation of tenge in April of 1999. Privatization of the fund is only possible after decreasing its share of pensions assets down to 30 percent of all pension accumulations. However, it is possible that another monopolist may appear as a private pension fund. Seleznev said it would be less harmful if the monopolist is the fund with state owned block in it rather than a private fund. SAPF was created in early 1998 with beginning of pension reforms in Kazakhstan. The National Bank is the custodian bank for SAPF, and the fund began to manage its own assets from August, 1999. There are 15 private pension funds in Kazakhstan now.