In Kazakhstan, financing of farmers is expanding through new lending programs. At the same time, the government is developing a mechanism for allocating funds to pay off past years' debt on subsidies. This was announced by the Prime Minister of the Republic of Kazakhstan Olzhas Bektenov, responding to a request from the Majilis deputies.
“In pursuance of the instructions of the head of state on a gradual transition from direct subsidies to affordable lending instruments, new forms of financing the agricultural sector are being introduced this year. The key instrument will be the provision of targeted investment loans at 12.6% per annum, which is significantly lower than the base rate of the National Bank. The measure is aimed at increasing the sustainability of the industry and reducing dependence on annual budget subsidies,” Olzhas Bektenov said.
He recalled that a mechanism for providing guarantees through the Damu Entrepreneurship Development Fund is being used to improve the collateral policy.
Regarding debts on subsidies to farmers, Olzhas Bektenov noted that, according to the law, approved applications are subject to mandatory payment.
"In order to prevent further accumulation of debt, authorized state bodies, together with local executive bodies, are working on the issue of its repayment at the expense of current budgetary allocations and the redistribution of the revenue side of local budgets," the Prime Minister informed.
He also reported that in order to increase the volume of financing for the agro-industrial complex as a whole, approaches to supporting field work, preferential leasing and replenishing the working capital of processing enterprises have been revised. In particular, financing channels have been expanded through the Agrarian Credit Corporation with the involvement of second-tier banks, regional investment centers, microfinance organizations, credit unions and social entrepreneurship corporations.
A mechanism for subsidizing interest rates has been introduced, which allows farmers to be financed at a rate no higher than 5% per annum.
The implementation of the program for replicating the experience of the North Kazakhstan region continues. In 2025, 200 billion tenge have been allocated for these purposes, within the framework of which it is planned to finance 141 investment projects.
"In order to expand the coverage of agricultural producers by the measures of this program, the list of investment areas was expanded from 4 to 13 last year. This approach will allow farmers to confidently plan long-term investments and develop their projects in stable financial conditions. In order to further expand access to financing for the agro-industrial complex, it is envisaged to introduce a mechanism for direct subsidizing of financial institutions for the acquisition of working capital," Olzhas Bektenov said.