1. Kazakhstan – Rising Star for Public-Private Partnerships (PPPs)
Shaimerden Chikanayev
London
International PPP Finance Summit 2018
4 July 2018

2. WHY KAZAKHSTAN?
Kazakhstan’s oil, gas, coal and uranium and others commodities reserves are among the ten biggest in the world
Strategic geographical location (e.g. China’s Belt and Road initiative, a door to the Eurasian Economic Union, a single market of 183 million people)
Good legal framework (special PPP Law and Concession Law)
Strong political will to support PPPs (KPIs for regions – 5 projects per year as a minimum)
Kazakhstan’s climbed the World Bank’s Ease of Doing Business index and is now ranked 36th
Strong support of Kazakhstan by MDBs (EBRD, ADB, IFC, IDB, EABR, AIIB) attracting private and international financial investment

3. WHAT IS LEGAL FRAMEWORK FOR PPPs?
Please refer to general overview of the legal framework of PPPs in Kazakhstan:
n.pdf
Please refer to unofficial translation of the PPP Law:
khstan.pdf

4. Concession Law v PPP Law
Bankability Requirement
Concession Law
PPP Law
Legislative certainty - limited service BTO  
Legislative certainty – full service BTO
Access to tax concessions
Clear right to terminate
International arbitration by Kazakh SPV
Protection against currency exchange risk
Direct negotiations (no tender required)
Ability to select foreign governing law

5. What to expect in 2018? Light Rail transit in Almaty - $ 300 mln
Almaty railway bypass - $ 297 mln
Asfendiyarov Medical university project in Almaty - $ 115 mln
Shymkent bypass toll road - $ 300 mln
Karaganda Medical University project - $ 100 mln

6. #1 - Light Rail transit in Almaty
Contractual structure – 22.9 km light rail transit to be implemented under the PPP Law as a DBFOT. 50%/50% cofinancing by public and private partners. Population served – 2 million.
Tentative timeline:
July 2018 – the first phase of the tender;
December 2018 – the second phase of the tender;
May 2019 – signing of the agreement;
2022 – commissioning of the LRT line;
23 years – operation of the LRT line.
Public partner – Akimat (mayor) of Almaty.
Technical Assistance - EBRD
Potential private partner - Itochu, Alstom, Siemens, Bombardier.
Potential lenders – IFC, ADB, AIIB, ECAs.

7. #2 - Almaty railway bypass
Contractual structure – 74.7 km railway to be implemented under the PPP Law as a BTO.
Current status of the project – correction of the feasibility study (ТЭО) has been completed and positive approval of the Gosexpertise has been procured for it.
Tentative timeline:
November – tender announcement;
Construction period – 2 years.
Operation period – 27 years.
Public partner – Ministry of Investments and Development (“MID”).
Potential private partners –Turkish and other construction companies.
Potential lenders – EBRD, IFC, ADB, AIIB, ECAs etc.

8. #3 - Asfendiyarov Medical university project in Almaty
Contractual structure – 300 bed hospital to be implemented under the Concession Law as a Build- Transfer- Maintain.
Tentative timeline:
2019 – tender;
2020 – start of construction;
2023 – commissioning of the hospital;
– operation.
Public partner– Ministry of Healthcare.
Potential private partners – construction companies.
Potential lenders – IFC, ADB, AIIB, ECAs etc.
Technical assistance – EBRD, KPPF.

9. #4 - Shymkent bypass toll road
Contractual structure – 48 km length two road bypasses around Saryagash and Shymkent to be implemented as BTMO.
Tentative timeline:
VI quarter 2018 – tender;
– construction period;
– operation period.
Public partner– Ministry of investments and development.
Technical Assistance – ADB.
Potential private partners – construction companies.
Potential lenders – EBRD, IFC, AIIB, ECAs etc.

10. #5 - Karaganda Medical University project
Subject of the project – construction, equipment and technical operation of the hospital under the Concession Law.
Tentative timeline:
2019 – tender;
25 years – operation period.
Sources of cost recovery and income generation – availability payment (compensation of operational costs, compensation of investment costs, remuneration for operation).
Public partner– Ministry of Healthcare.
Technical assistance – Asian Development Bank.

11. Shaimerden Chikanayev
Partner, GRATA Law Firm
Almaty, Kazakhstan
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