Authorities are concerned about decline in small and medium business activity

According to statistics, the volumes of small and medium business crediting decreased by 32 percent over the last 5 months.

It resulted decrease in the volume of small and medium business production and subsequently resulted decrease of budget receipts.

Taking in consideration the fact, that 67 percent of Almaty budget is formed by tax payments coming from small and medium business, the crisis in the crediting branch became one of the most important problems for today.

According to Arman Dunayev, the chairfigure of "Kyzyna" fund, the share of credits presented to small and medium business by second level banks for the last 5 months were at the level of 34,2 billion tenge in January, 44,5 billion tenge in February, 50,4 billion tenge in March, 80,8 billion tenge in April. However, in the period from April to May there was observed a sharp decrease from 80,8 billion tenge to 51,4 billion tenge. At the same time, authorities state that such sharp decrease was observed not only in Almaty, but also in all the country, which caused decrease of business activity among the population.

Experts explain the growth of crediting in the period from March to April by intensification of credits delivery for the account of the money allocated through "Kyzyna" fund. Another reason of crediting decrease is high interest rates

At the same time, Arman Dunayev said that since this year, all the international auditors following International Standards of Financial Reporting introduced a norm, according to which, all the credits should be recalculated for fair price. "This norm concerns not only private companies, but all the financial companies of the state sector. "Kyzyna" fund, in its turn, is ready to unite the efforts with local executive bodies and increase the volumes of financing of small and medium enterprises," said Arman Dunayev.

Akhmetzhan Essimov, the head of Almaty city administration, expressed concern about decrease of small and medium business activity connected with high rates and asked the head of "Kyzyna" fund to propose the government to consider an opportunity to remove the limits of state crediting for some types of activities. "It is a strategic question defining our future. We risk losing an important factor of habitation construction,that is why mortgage crediting should become affordable. Small business depends on consumer crediting, and consumer ability of the population. I would like "Kyzyna" to think about how to stimulate this part of small business. We must give impulse and signal to the banks," said Akhmetzhan Essimov.

The head of Almaty city administration also marked the tendency of decrease of consumer ability at real estate market and increase of deposit investments. This situation is explained by expectation of Almaty inhabitants of further prices decrease at real estate market, however, experts state that pricing bottom is already reached.

Despite decline in small and medium business development, as for June of this year there were registered up to 68845 small enterprises in Almaty city. Up to 46742 enterprises work as Individual Entrepreneurs not forming legal entity, while totally 69214 people are registered as individual entrepreneurs in Almaty.

Small and medium business of Almaty is widely presented in such branches of economy as trade and public catering (49,4 percent), operations with real-estate and rent (19,4 percent) industry (11,1percent) and construction (11,6 percent).