BUSINESS

Kazakh State Helps Construction Industry

Bloomberg

ALMATY — The Kazakh government is spending 242.5 billion tenge ($2 billion) to prop up the construction industry, which is suffering from a shortage of financing amid the global credit crunch.

The credit situation in the country’s two biggest cities, Almaty and Astana, is the “most complicated,” Economy Minister Bakhyt Sultanov said Monday in an e-mailed report on the status of the government’s investment plan.

Kazakhstan’s economy grew more than 10 percent annually from 2000 through 2006 as the country exploited the biggest oil and gas reserves in Central Asia. Growth slowed to 8.5 percent last year after tight credit curtailed a national building boom.

Half of the money, 122 billion tenge, went to Kazyna, a state-run development holding based in the capital Astana. Of that total, Kazyna is to deposit 48.8 billion tenge in commercial banks for loans to finance residential construction and 24.4 billion tenge to finance “large projects,” Sultanov said.

Of this amount, 23.3 billion tenge will be spent to complete 112 building projects in Astana.

The remaining 48.8 billion tenge will be deposited in commercial banks on the condition that it’s loaned to small and medium-sized companies.

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