Dear Kazakhstanis!

Today the whole world is going through hard times of a scaled economic crisis, the global financial tsunami that shook even the soundest world economies. No wonder it echoed on our country too.

But we have ample experience of weathering shocks of this kind on our Independence record – a vivid illustration of our fortitude. Suffice it to recall all our painstaking efforts in recovering our economy derailed after the soviet empire break-up. Figuratively speaking, we have put up a mountain on the lowland.

Pooling our efforts together we overcame all the challenges of those times. In the end of last century, during the crisis that broke out in Eastern Asia our Independence was put to another serious test, but we have drawn the right lessons and experience from it to emerge stronger out of it and make a headway.

The current world crisis is certainly transient, and our people have always shown a remarkable patience in the times of trial, going through thick and thin together.

On its part the state does everything to counter the crisis. The National Fund’s means are already working for our national economy’s stabilization, and the entire package of social guarantees will be fully provided. There is no doubt we will brave these challenges out.

Crises come and go, but our independence, national idea, welfare of the generations to come remain unshakeable in centuries. We are in for another stage in our young history – twenty years of Kazakhstan’s independence. It is a historically short term, but to us it is commensurable to a whole epoch, as Independence is fulfillment of centuries-old aspirations of our nation, our predecessors.

That is why every year of Independence is of special significance to us, and we will continue to strengthen our statehood in the face of any challenges.

Dear compatriots!

Practically every day together we are building a new country, open and prospering, the country where the nationals’ welfare is yearly growing, where political stability and security is guaranteed to all the citizens, the country no external threat will ever come from.

Kazakhstan’s development strategy adopted for a decade ahead, its implementation experience inspire confidence in our own strength and in the rightly chosen course. Amid the world financial crisis we have developed and are consistently putting into practice complex anti-crisis measures.

We are keeping a close track of the internal and external conjunction, taking measures without a delay, which is why the global food crisis did not become a national disaster to us.

The crisis, testing us for endurance came from outside, spawned by misbalances in the world economy. There was no way to forestall and evade it. To overcome it the leading world economies have funneled over 10 trillion US dollars, i.e. practically 15% of the world GDP, but of no avail so far.

It looks like this crisis will be lasting – analysts say the world economy has not reached its bottom yet.

I am convinced that after it is over the world financial system will change and maybe political management of the states too. Many are increasingly inclined to a “finger control” of economy relying on it as a tool for extricating from the crisis.

That is why the radical measures offered in my article “Keys to the crisis” will be discussed in the world community.

The reality we are facing to-date is: shrinking of business activity in the world entailed drop in demand for oil and metals, and these are Kazakhstan’s main export items.

In a year the price on oil dropped nearly 4 times less, and on metals –almost twice less. Our main trade partners and close neighbors – Russia and Ukraine – have depreciated their national currencies by 40-50% and we had to do the same to meet our home producers’ interests and retain competitive power of our produce and not to waste our gold currency reserves.

Dear Kazakhstanis!

Unfortunately the train of difficulties and pressing of the crisis are not abating, you have to know that, but we must be sure that not only are we ready for these trials, but will emerge out of them a stronger and a thriving state and keep our positions in the world.

When in good times we formed the National welfare Fund, mindful of the future. That gave a safety margin to our economy against possible shocks of this kind.

To build up a viable and flexible economy we have been consistently carrying out reforms, augmenting export potential and gave a start to diversification.

That is why today we have a solid reserve and are able to carry out an efficient anti-crisis policy.

Most of the states responded to the crisis by a package of economic stimulation measures.

Kazakhstan was among the first states to react duly to the mounting turbulence of the world economy and to undertake forestalling measures.

To sustain financial system we gave additional liquidity to the banks in bid to support economic activity of small and average business and major enterprises.

The sum was increased on insured compensation on individual deposits from KZT 700 thousand to KZT 5 billion. The state helped decrease the risks of the banking sector on external loans and sufficiency of own capital.

To support housing construction and bail out shared construction holders KZT 545 bln was allocated.

To sustain business activity in the country we went as far as unprecedented financial support to the subjects of small and average business the size of KZT 275 bln, work continued on cutting down the administrative hurdles.

Against the last year corporate income tax was cut by a third already making 20%, and in 2011 – to be 15%. VAT was downed to 12%. In place of descending scale in social tax a single rate was introduced the size of 11%, and for the investing businesses tax concessions are provided.

All that stimulated non-primary sector and small and average business development. The law on state procurements gives an advantage to domestic producers too.

To develop AIC KZT 280 bln was allocated, and for major infrastructure projects – KZT 120 bln.

In all additional over 2 trln 700 bln was channeled for the anti-crisis measures in economy, a tangible backing to overcome the crisis indeed.

We act resolutely and swiftly to mitigate the blow of the world crisis on our economy and our society. In it pooled efforts of the Government and the Parliament was helpful. And I want to bring it home to you, my dear compatriots that together we need to hold back the pressing of this time

The Government has to guarantee that all the state’s social liabilities – wages, pensions, benefits will be paid.

As planned in 2010 budget employees’ wages will be raised by 25%, and in 2011 – by another 30%, as well as average pension size.

By 2011 the size of basic pension payments will go up to 50% of the minimal subsistence level.

The state supported students that couldn’t afford tuition fees, we allocating additional 11 thousand grants and 40 thousand credits to students.

Dear Kazakhstanis!

We are facing formidable tasks in coping with the crisis aftermath and getting ready for subsequent economic growth.

We have to go on and ahead in our action plan on economic modernization and in our strategies in employment to ensure post-crisis development.

In difficult time we started construction of our new capital - Astana. Nobody believed in reality of our plans then. But we did it. Let’s follow this good experience.

Yes, we need new means. It is expedient to re-channel incomes of primary sector from the National fund to our plans. In total it will make up about KZT 600 bln additionally to the approved transfers from this Fund.

It is a temporary, but a necessary measure: thereby we will keep the volume of the country’s foreign reserves we have by present - $ 47 bln.

Another source is a stiff saving on all budget items and strict financial discipline. In this context the Government is tasked to examine all the expenditures of the republican budget and control their disbursement in regime of a weekly monitoring.

All non-priority expenditures - administrative, investment and others must be nullified.

The freed means will help to cope with financial shocks providing effective economic development in post crisis term.

Working places are to become the main indicator for determination of the Government and administrations’ efficiency and ability to provide sustainability of Kazakhstan economy. Each minister, mayor and governor must know the number of reduced jobs weekly.

The Government was tasked to allocate KZT 140 bln for regional employment and retraining. Local budgets are also to earmark means for co-funding of the population’s employment.

New vacancies are to be opened for those losing jobs -350 thousand at least will be involved in economic activity, not counting present public works.

We do not have to “invent a bike”: we have all opportunities for development of labor market and the allotted means will be channeled there.

First of all it is reconstruction and modernization of communal nets, water and heating supply objects, sewage and energetic branch.

The Government jointly with administrations is tasked to estimate required expenditures and provide funding and stiff control over the means’ disbursement.

Second is construction and reconstruction of local motor roads and renewal of social infrastructure, schools and hospitals mainly.

Third come local objects in each settlement. i.e. their development, green planting, repair of roads, clubs and other objects at the discretion of local authorities.

Regional maslikhats and self-administration bodies will be given means: they are to decide on their application and use themselves.

To implement the above goals we must use potential of local producers. If we have no such productions, they must be opened.

Fourth is expansion of social working places and organization of youth practice. The acting Law on employment allows using of budget means for these purposes. In 2008 over 13 thousand people were employed on these programs. And our goal to -date is to expand their frames. KZT 8, 6 bln will be additionally earmarked to provide 96 thousand with jobs.

Concurrently we are to increase maximum term of unemployment benefit’s payment from the State fund of social insurance - from 4 to 6 months.

The Government and administrations are tasked to organize retraining of specialists on the base of working educational institutions.

But despite the world crisis we cannot afford concentration on them alone: our future depends on further economic modernization. First of all it is modernization of oil-processing businesses for saturation of internal market with domestic fuel and lubricants.

Oil -chemical complex in Atyrau will be constructed and Moinak HPS -commissioned this year. Besides, after reconstruction Ekibastuz HPS capacity will increase.

Construction of Beineu-Bozoi-Akbulak gas pipeline, reconstruction of motor transit corridor “West Europe- West China” are also among our plans - 5-50 thousand will be involved in its construction in 2010-2012.

Apart from that we intend to launch production of engines, passenger and freight railway cars, road bitumen, and chemical industry.

Agro-industrial complex is of special importance- due to it we achieve two goals - diversify export and provide food safety.

That’s why we took a decision to finance investment projects developing export productions, such as organization of dairy and poultry farms, feed yards, greenhouses, drop irrigation, meat-processing businesses and infrastructure for the grain’s export and its deep processing.

But other projects are no less important for construction, for instance Koksarai water reservoir and other big irrigation objects.

According to our estimations, export specialization will create in future over 500 thousand new jobs and 8% of additional GDP growth in near five years.

Present difficulties are not our first “test”: we overcame a deep crisis in early 90s. Economic collapse then reached 60% and inflation was estimated by thousands percent annually.

We got out of second economic crisis caused by Asian financial markets in late 90s. Prices for oil dropped to $ 9 per barrel then and we could not pay salaries and pensions. But we withstood it.

When the time comes we will talk about overcoming of these difficulties too. But… crises will recur and our goal is to manage them. We have coped with it by date.

Re-grouping our forces and resources, we will not change the main course, nevertheless - it is determined by Strategy -2030.

We have anti-crisis program, sufficient means have been allotted from the state reserves, the Cabinet, Prime -minister and other officials are personally responsible for its implementation.

To-date problems are a test on maturity and sustainability of our state and community. And I believe we will do it well.