LETTER FROM THE CHAIRMAN
OF THE BOARD OF DIRECTORS
DAMU ENTREPRENEURSHIP
DEVELOPMENT FUND JSC
Ladies and gentlemen!
support of entrepreneurship in Kazakh-
stan is the State Program for Support and
In 2018, the Damu Entrepreneurship Devel-
Business Development “Business Road Map
opment Fund JSC (hereinafter referred to as
2020”, which provides opportunities for en-
“Fund”) successfully continued the process
trepreneurs to receive support in the form
of implementing business support programs
of subsidizing interest rates on loans/leas-
and demonstrated a high level of business
ing transactions, partial credit guarantees,
process management.
and business support services.
First President of Kazakhstan, Elbasy
Within the framework of improving the
N.A. Nazarbayev set a strategic task - to
qualifications of labor forces, development
ensure the contribution of small and me-
of mass entrepreneurship and involvement
dium-sized businesses in a GDP of 50 % by
of the self-employed and the unemployed
2050. In his turn, the President of the Repub-
in full and productive employment,the State
lic of Kazakhstan K.K. Tokayev pronounced
Program for the Development of Productive
a medium-term outlook - 35-40 % by 2025.
Employment and Mass Entrepreneurship for
2017-2021 “Enbek”, which provides entre-
We are confident that our potential will al-
preneurs with concessional financing, is be-
low us to accomplish these tasks. Suffice to
ing successfully implemented.
THE END OF 2018,
say that by the end of 2018, according to
preliminary information the contribution of
Work is continuing in connection with the
THE CONTRIBUTION
small and medium-sized businesses in the
implementation of the Housing Construc-
country’s GDP was over 28 % and the total
tion Program
“Nurly Jer”, which envisag-
OF SMALL AND MEDIUM-
output of companies amounted to KZT26.5
es the introduction of new approaches to
trillion.
stimulating housing construction in order
SIZED BUSINESSES IN THE
to increase the affordability of housing for
In addition, actual small and medium-sized
the public as well as close coordination with
COUNTRY’S GDP WAS OVER
businesses (1.2 million) employ more than
existing programs in the field of housing.
3.2 million people, which makes up 37 % of
In the framework of a Joint Project of Unit-
the employed population of the country.
ed Nations Development Program, Global
28%
One of the effective tools for integrated
Environment Facility and the Government
ANNUAL REPORT 2018
IN THE WORLD BANK’S DOING BUSINESS RATING,
KAZAKHSTAN IS RANKED 28th AMONG 190 COUNTRIES
ON THE EASE OF DOING BUSINESS
of the Republic of Kazakhstan “Sustainable
Cities for Low-Carbon Development in Ka-
ACTUAL SMALL
zakhstan”, the financing tool for investment
projects in the field of energy conservation
AND MEDIUM-SIZED BUSINESSES
has been developed.
EMPLOY MORE THAN
In accordance with the state program “Digi-
tal Kazakhstan”, specific work has been car-
ried out on the digitization of systemically
important enterprises, automation of the
Fund’s business processes and digitalization
of state support measures for small and me-
dium-sized businesses.
The ongoing reforms to improve the busi-
3,2
ness climate in the country are positively as-
sessed by international experts. In the World
Bank’s Doing Business rating, Kazakhstan
MILLION PEOPLE
is ranked 28th among 190 countries on the
ease of doing business. In comparison with
2017, Kazakhstan rose by 8 positions (from
the 36th place) and outranked such coun-
to maintain a high level of professionalism.
development of the strong business sector
tries as Switzerland, the Russian Federation,
In this regard, the Fund has reached agree-
in Kazakhstan.
France, China, Japan, and others.
ments with the Korean KOSME, Polish PARP,
Turkish KOSGEB and other leading foreign
First Deputy Prime Minister
The Fund focuses in particular on study-
organizations supporting the business.
of the Republic of Kazakhstan
ing international experience in the field of
Minister of Finance
support and development of small and me-
I am confident that the objectives set for
of the Republic of Kazakhstan
dium-sized businesses with a view to apply-
the Fund to expand the financial and infor-
Chairman of the Board of Directors Damu
ing best international practices. Employees’
mation support for small and medium-sized
Entrepreneurship Development Fund JSC
training abroad allows the stuff of the Fund
businesses will contribute to the further
Smailov A.A.
ANNUAL REPORT 2018
LETTER FROM THE CHAIRMAN
OF THE MANAGEMENT BOARD
DAMU ENTREPRENEURSHIP
DEVELOPMENT FUND JSC
Ladies and gentlemen!
Automation and optimization of public ser-
vices provided by the Fund made the deci-
The year 2018 distinguished itself through
sion-making process on applications more
sound events that were aimed at providing
transparent for entrepreneurs, increased
comprehensive support for domestic entre-
the availability of services, reduced the time
preneurship, as well as at the creation of a
needed to provide services and the costs of
climate favorable to business and foreign in-
collecting documents. In 2018, more than 22
vestment.
thousand entrepreneurs received support
under the Fund’s programs in the amount of
Improving support tools that provide simpli-
KZT536.8 billion. The Fund issued about two
fied access to government support programs
thousand guarantees for loans extended to
through second-tier banks and financial in-
entrepreneurs, for the total amount of KZT 65
stitutions and help promote the process of
billion, twice as many as in the previous year.
issuing loans for the development of micro
and small businesses is one of the strategic
In 2018, the works for the automation of ser-
objectives of the Fund.
vices were carried out with the further place-
ment of other Fund’s services on the E-Gov-
In this regard, we have improved the conditions
ernment Portal, which allows you to apply
of support programs that allow introducing a
for guarantees in the framework of the State
IN 2018 MORE THAN
floating loan rate, shortening the time frame
Program for the Development of Productive
for reviewing projects and providing the right
Employment and Mass Entrepreneurship for
22 THOUSAND
to consider small projects without the partici-
2017-2021 “Enbek”. Following the results of
pation of regional coordination councils.
2018, since the beginning of the program,
ENTREPRENEURS RECEIVED
1,764 borrowers were funded in the amount
In addition, uniform standards for the con-
of KZT 19.3 billion.
SUPPORT UNDER THE
sideration of loan applications have been
introduced, and lending procedures and a
1,470 loan projects for a total value of KZT
FUND’S PROGRAMS
package of required documents have been
198.4 billion received subsidies for loan
optimized. Work was carried out on the in-
commission under the State Business Sup-
IN THE AMOUNT OF
troduction of new successful tools to sup-
port and Development Program “Business
port small and medium-sized businesses
Road Map 2020”.
KZT536.8
across borders, which contribute to the
opening of additional opportunities for Ka-
During the implementation of the Nurly Jer
BILLION
zakhstan’s business in foreign markets.
housing construction program, the Fund has
ANNUAL REPORT 2018
provided the incentives for the private con-
the Grant Manager providing loan guaran-
cro, small and medium businesses. Possible
struction activity through subsidies on loan
tees and interest rate subsidies for projects.
non-state sources of financing include loans
interest to entrepreneurs who are engaged in
During 2018, 68 grant projects totaling KZT
from international financial institutions, rais-
housing construction, thus reducing the cost
4.8 billion were approved.
ing funds through issuing bonds, as well as
of square meters of floor area for end-users.
corporate business funds. Sustainable insti-
In 2018, Regional Coordination Councils ap-
The Fund has launched a new line of ac-
tutional development of the Fund will be
proved 41 loan projects for a total value of
tivities directed towards the introduction
achieved through the automation of busi-
KZT 28.4 billion.
to Islamic Banking and Finance. In the past
ness processes, improving corporate gover-
year, in partnership with the Islamic Corpo-
nance and reaching the target of financial
Along with the state programs, through col-
ration for the Development of the Private
performance.
laboration and the synergy of the Akimat of
Sector (ICD), prerequisites for raising funds
the Mangystau region, the Fund and corporate
in the amount of up to USD 40 million
business, entrepreneurs of the Mangystau
were negotiated. The attracted funds are
ENBEK
region were able to receive loans for the im-
planned to be forwarded to the small and
PROGRAM
plementation of their projects and, thanks to
medium-sized businesses through Islamic
subsidies, the preferential annual interest rate
financial instruments.
FUNDED
of 1 % was provided. This project was the only
one of its kind and provided the most favor-
For 2019, the Fund has identified several key
able conditions for small and medium busi-
strategic goals: to promote growth in vibrant
nesses. 42 loan projects for a total amount of
small and medium-sized businesses; to op-
KZT 818.87 million have been approved. It is
timize programs to ensure greater access
expected that 410 new jobs will be created
for microenterprises, including the gradu-
1764
following the approved projects.
al introduction of credit technologies and
BORROWERS
their digitization. So, for example, in order to
In 2018, the Fund continued to attract pref-
support micro-enterprises within the frame-
erential funds from international financial
work of direct financing of Microfinance
organizations. In 2018, KZT 67.1 billion of
Organizations, the organizational structure
Summarizing the above, I would like to note
investments was attracted. In 2018, our long-
of the Fund was modified and the Apex De-
that the cohesive team of the Damu Entre-
time business partners - the Asian Devel-
partment was created. The main tasks of the
preneurship Development Fund JSC will
opment Bank and the European Bank for
Apex Department are: the effective chan-
continue professional work in providing sup-
Reconstruction and Development allocated
neling of funds to micro and small business-
port to the business with maximum effect in
KZT 34.1 billion to finance female entrepre-
es through Microfinance Organizations and
order to increase the entrepreneurial poten-
neurship, micro, small and medium-sized
the expansion of funding instruments range
tial and the share of small and medium-sized
businesses in Kazakhstan.
for Microfinance Organizations.
businesses in the economy of Kazakhstan.
The Fund also expresses its gratitude to
In addition, during the implementation of
Along with this, within the framework of
partners and all interested parties for effec-
the Joint Project of the Government, UNDP
the so-called “simple things economy” and
tive joint work. I am confident that in 2019
and the GEF “Sustainable Cities for Low-Car-
the program for allocation of the long-term
we will make further important progress on
bon Development in Kazakhstan’, a mech-
tenge liquidity, initiated by Elbasy Nursul-
the development of domestic business.
anism is being implemented to encourage
tan Nazarbayev, the Fund will act as a finan-
investment in the energy efficiency of urban
cial agency.
Chairman of the Management Board
infrastructure by attracting funds from the
DAMU Entrepreneurship
GEF Grant of USD 3.0 million, under which
The Fund also aims to attract additional
Development Fund JSC
the Fund undertakes the responsibilities of
non-state funds for the financing of mi-
Buribayeva G.A.
ANNUAL REPORT 2018
SIGNIFICANT CORPORATE EVENTS IN 2018
Guarantee of Fund to the amount of USD 45 mln was provided to
European Bank for Reconstruction and Development to perform
obligations of the “Bank CenterCredit” JSC on the financing of small
and medium enterprises and female entrepreneurs.
45
USD MLN
On May 5-7, 2018, an annual exhibition of Kazakhstani manufacturers,
which received government support “ULTTYQ ÓNIM” (hereinafter - the
Exhibition), was held at “Korme” exhibition center, Astana c. The number
of participants at the Exhibition was
347 companies that received
347
government support, the number of visitors exceeded 8 000 people.
COMPANIES
Pursuant to paragraph 117 of Assigning control over
On November 7, 2018, the Department for
implemenetation of Activity Plan of the Republic of
Administration of Financial Support Tools,
Kazakhstan for 2018 approved by order of the Prime
which aims at conduct of administration
Minister of the Republic of Kazakhstan as amended
(maintenance) activities of financial support
in accordance with order of the Prime Minister of the
tools (subsidies /guarantees / grant funding
Republic of Kazakhstan dated March 30, 2018 No 35-р,
/ program tools of conditional allocation of
as well as pursuant to paragraph 18 of the Action Plan
funds in second-tier banks, leasing companies,
for 2017-2019 for implementation of the Development
microfinance companies and institutions car-
Strategy of DAMU Entrepreneurship Development
rying out certain types of bank transactions).
Fund JSC for 2014-2023, the Apex Department was
This activity was previously carried out by the
established on November
2,
2018. The activities
Department of Program Tools and Subsidies
of the Apex Department are aimed at institutional
Department. Thus, in order to avoid the con-
development and financing of microfinance companies
flict of interest, supervisory control over the
out of own funds and through raising credit lines of
Department for Administration of Financial
international financial institutions, which are currently
Support Tools, Department of Program Tools
an important funding source for business initiatives of
and Subsidies Department is imposed on vari-
micro and small enterprises.
ous members of the Management Board.
ANNUAL REPORT 2018
On December
21,
2018,
Fund made a complete early
repayment of loan funds to
the Asian Development Bank,
as part 2 and 3 tranches in the
amount of USD 132.5 mln.
16
KZT BLN
In December 2018, Fund raised a bond
loan by issue and allocation of bonds to
the amount of KZT 16 bln at the market of
“Kazakhstan Stock Exchange” JSC.
In order to implement the Development Strategy of DAMU Entrepreneurship Development
Fund JSC for 2014-2023 “Microfinance Organization KMF” JSC was included as participant
of the Project for promoting sustainability of financing micro, small and medium-sized
businesses: “Financing of micro, small and medium-sized businesses through second-
8,4
tier banks and microfinance companies at the expense of the Asian Development Bank”,
implemented by Fund jointly with the Asian Development Bank. As part of the cooperation,
KZT 5.87 bln was allocated to “Microfinance Organization KMF’ LLP for lending to projects
KZT BLN
of micro and small businesses. During 2018, taking into account revolving disbursements, a
total of KZT 8.4 bln of microcredits was provided to 13,205 borrowers.
In 2018, active programs of conditional allocation of funds were
At the end of 2018, two new programs of
reoriented as part of work of Fund on optimization of the terms
conditional allocation of funds were launched:
of programs of conditional allocation of funds to ensure greater
access of micro/small businesses to the Fund’s programs and
financing of second-tier banks for subsequent
diversification of the Fund’s loan risks (such as Damu-Regions
lending to small and middle-sized businesses
3, Damu-Micro, Damu-Leasing programs, the State Program
carrying out entrepreneurial activity in the field
for the Development of Productive Employment and Mass
of e-commerce, digital platforms, and their
Entrepreneurship for 2017-2021 “Enbek”.
ecosystems;
financing of credit associations for subsequent
lending to micro and small businesses.
In 2018, as part of the “Agency Network” project,
Agreements for Cooperation were signed with
“Eurasian Bank’ JSC, “Capital Bank’ JSC,
“Alfa Bank” JSC and “RBK Bank” JSC.
ANNUAL REPORT 2018