Kazakhstan president supported privatization of National companies

/IRBIS, Jan.4, 01/ - REUTERS informed that Kazakhstan president supported idea to start privatization of some national companies through stock exchange market. According to Mr. Dzholdasbekov, head of National Securities Commission (NSC), this would attract money expected from capital amnesty into economy. The Kazakhstan president, Mr. Nazarbayev had a meeting on Wednesday with Mr. Dzholdasbekov, they discussed issues of securities market and privatization. The head of NSC appealed to the president asking him to support selling of one third of shares in companies through stock exchange market. In particularly he named two national companies, KazTransOil and KazAtomProm. Besides these two, Kazakhstan has several other state companies: Kazakhoil, KEGOC (power grid), KazTransGas, Kazakhstan Temir Zholy (rail road), Atyrau sea port. The government does not exclude that all of them will be privatized. The law on capital amnesty will most likely pass approval in the parliament. The head of NSC also appealed to the president to support "blue chips" privatization program. The government has many times delayed realization of the program. In last year, Aktobemunaigas OJSC and Mangistaumunaigas OJSC long awaited by the stock market were sold to strategic investors. Mr. Dzholdasbekov commented that he asked to support realization of the blue chips program through stock market. The meeting also covered an issue of securities market taxation. Mr. Dzholdasbekov noted that present 15% tax on bonds, which pension funds and pension assets companies exempted from should be canceled. This would make corporate bonds attractive to other potential investors, firstly insurance companies. At present, bonds' profitability is 11% APR, after taxation it falls to 9.35%. This level makes bonds less competitive against bank deposits. For instance, last year issue of corporate and municipal bonds for a total of $170 mln made up one tenth of total credits to the economy. Mr. Dzholdasbekov claimed that next 3-5 years of the same pace of development could result in equaling of both markets.