FOREIGN INVESTMENT IN KAZAKSTAN KEEPS GROWING.

A surge in foreign investment experienced by Kazakstan in recent years seems to be accelerating this year. The Icelandic company Ivedon International has rescued the large and ailing Sokolovsk-Sarbaysk iron ore mining and enrichment complex, and is set to increase output to 24 million tons in 1997 from 20 million in 1996. Ivedon invested $134 million in Sokolovsk-Sarbaysk after having taken it over in trust management. Its main customers are Russia’s Magnitogorsk and Kazakstan’s Karagandy metallurgical combines.

Karagandy, one of the ex-USSR’s largest steel and rolled goods producers, was rescued last year by the London-based Ispat International, which runs it in trust management. The Almaty government has announced a plan to turn Karagandy over to Ispat in full ownership.

British Gas and Italy’s Agip, with 32.5 percent each, Texaco of the U.S., with 20 percent, and Russia’s LUKoil, with 15 percent, have formed a consortium to develop the Karachaganak gas field in northwestern Kazakstan. Considered the largest gas field in the former USSR, Karachaganak contains an estimated 1.3 trillion cubic meters of gas, 1.2 billion tons of gas condensate, and 340 million tons of oil. Moscow had tried in vain during the 1980s to develop Karachaganak with additional investment inputs from CMEA countries.

Argentina’s Bridas company has won the international tender for a project to modernize and expand Kazakstan’s natural gas pipeline network. The project entails turning over the system to the company on a concession basis for 15 years.

Under an intergovernmental agreement signed last week, Japan is lending 21.5 billion yen, or approximately $188 million, on preferential terms to Kazakstan for construction of a major bridge over the upper Irtysh river in northeastern Kazakstan’s Semipalatinsk region.

Turkey holds one of the leading positions among countries investing in Kazakstan on the strength of Turkish companies’ involvement in light industry and construction. Yesterday in Ankara, Kazakstani prime minister Akezhan Kazhegeldyn and his Turkish counterpart, Necmettin Erbakan, completed talks during which Turkish investments in Kazakstan since 1992 were estimated at almost $2 billion.

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