WASHINGTON, March 2, 2015 —The World Bank Group’s Board of Executive Directors today approved a US$40 million loan to help enhance the competitiveness and management capacity of small and medium sized enterprises (SMEs) in Kazakhstan.
“Small and medium sized enterprises are widely identified as important sources of economic growth and employment and, therefore, an essential foundation for shared prosperity,” said Ludmilla Butenko, World Bank Country Manager for Kazakhstan. “The project is expected to increase the competitiveness of Kazakhstani SMEs to contribute to diversification of the economy by reducing its reliance on extractive industries.”
Lack of professional and management skills as well as limited market linkages are among key obstacles the Kazakhstan’s private sector is facing today. The SME Competitiveness Project is aimed at strengthening the management capacity of SMEs to grow and create more and better jobs. For this, the existing SME advisory programs will be enhanced in terms of quality and methodology in line with international standards. Several hundred business consultants will be trained and certified to deliver in turn professional consulting to several thousand entrepreneurs and SMEs.
The project will also focus on increasing market linkages for SMEs in non-extractive sectors with a market-based growth potential. The new linkages between SMEs and large buyers will provide entrepreneurs with an increased access to markets. To facilitate the process, the project aims at piloting a supplier development program and enhancing the capacity of policy making authorities in developing competitive sectors in emerging areas of the economy. The evidence-based policy making will be strengthened through improved existing monitoring and evaluation frameworks and public-private dialogue.
All these activities will result in increased firm productivity and revenues as well as overall contribution of SMEs to the country economy.
The implementation of the five-year project (2015-2020) will start after the country approval process is completed.
The SME Competitiveness Project will be financed through a US$40 million IBRD loan, with a 15-year maturity period and a 5-year grace period, with US$6 million in co-financing from the Government of Kazakhstan.