Inside the Astana International Financial Center
A little more than a month ago, the international financial center Astana was launched in the capital of Kazakhstan. So far, 55 companies have registered at the Astana International Financial Center (AIFC), however, by 2020 Kazakhstan announced a prospect of more than 500 companies.
The AIFC building is familiar, without exaggeration, to every Kazakhstani. The center is located at the international exhibition EXPO 2017 and seems to have adopted progressive ideas from its predecessors.
Once at the site, one doesn’t immediately realize that he or she is even in the capital of the former Soviet Union. And that was the plan, according to Kazakh President Nursultan Nazarbayev’s intentions AIFC should become an international financial hub in Eurasia.
The idea to create the stock exchange was conceived in Kazakhstan three years ago. And it demanded, first of all, the political will of the leadership: in Kazakhstan the government even made amendments in the constitution.
The new paragraph 3.1. allows Astana to have a special legal regime in accordance with the constitutional law.
Prior to establishing the AIFC, Kazakhstan had studied the experience of other countries where such a stock exchange operates: the UAE, China, the United States and Singapore. Many experts doubted the idea of establishing such a center based on English law in a country that is only 27 years old.
And the status of AIFC judges, people who guarantee protection of the rights and interests of foreign investors, only emphasizes the country’s desire to get a perfect image, which would be guided by large, transnational companies.
The mission of the court is written on the AIFC official site: to create and develop a completely independent common law judicial system for the prompt resolution of civil and commercial disputes, characterized by reliability, fairness and accessibility, unconditional application of the rule of law and flexibility, which meets the needs of international business.
One of the most important goals is the promotion of the growth of regional trade by increasing confidence in the administration and access to justice at the AIFC, Kazakhstan, the Eurasian region and in the world. The name Lord Wolfe appears under the text. His persona, in the world of jurisprudence, is significant, just like the whole list of the court. Lord Harry Kenneth Woolf is one of the most influential figures in the British legal history. He is the first lord of the Supreme Court of England and Wales, the first President of the Court of the Qatar International Financial Center, the ex-judge of the Court of Appeal of the Hong Kong Court and the former Chairman of the Legal Committee for the Financial Market of the Bank of England.
Journalists of The Times, reacted to the appointment of Mr. Wulff in Kazakhstan with a purely English humor: “A world-class lawyer will work in a country, people mostly associate with comedian Sasha Baron Cohen, which means that the association with Borat will soon disappear.”
In Kazakhstan, Lord Wolfe will work with eight other British lawyers and judges, all of them are well-known in international law, for example, the AIFC advisory council was headed by the royal lawyer Michael Blair, and among the judges, in addition to Mr. Wolfe, there are ex-minister of Justice of the UK Edward Folks, Sir Jack Beatson and Sir Rupert Matthew Jackson - the authors of textbooks in the field of law. And English law, as a fundamental in the AIFC, was chosen deliberately. The system of English justice is known far beyond England -- London is not only a financial but also an international legal center.
Many experts agree that even the authority of the chairman of the court of the financial center is a guarantee of a qualitative and truly fair judicial system. And the authorities of Kazakhstan support it in every possible way: the decision of the lawyers of the AIFC is a priority, and in its work the court of the center is absolutely autonomous.
As strategic partners of AIFC, Kazakhs managed to attract the Shanghai Stock Exchange and the American NASDAQ. At the same time, Chinese experts, as the main shareholders, will assist in strategic and business planning, technology consulting, developing a strategy for expanding the market. And NASDAQ will help in the development of technologies for easy access of investors to financial instruments using its Nasdaq Matching Engine system.
According to AIFC Governor Kairat Kelimbetov, a well-known Kazakhstan economist, the former head of the national bank of the country, the AIFC already cooperates with major financial institutions such as the World Bank, the IMF, the EBRD, ADB, the Asian Bank for Infrastructure Investments and the new Development Bank of the SCO countries.
The country's leadership sets ambitious goals for AIFC: assistance in attracting investments to Kazakhstan’s economy, creating a special environment for investing in financial services, developing the securities market, insurance, banking services, and the Islamic finance market. By the way, AIFC intends to provide a full line of products. And preferences the Kazakh government provides are unprecedented, for example, exemption from taxes for 50 years.
It is already known that Kazakhstan intends to place shares of national companies on the exchange: Air Astana, Kazatomprom, Kazakhtelecom, Kazmunaigaz, Samruk-Energo, Kazpost, Tau-Ken Samruk, Qazaq Air.
In one of the interviews devoted to the opening of the AIFC in Kazakhstan, a representative of the international consulting company Control Risks, specializing in strategic studies of global risks, Timothy Stanley, voiced his predictions. In his opinion, the work of the financial center will positively affect not only the economy of the country, but also the political image of this Central Asian state. Today, Kazakhstan, compared to other central Asian states, boasts somewhat a more stable political situation.
The country has a relatively low sovereign debt with the possibility of servicing it. Of course, the raw material dependence of the economy is still relevant, but at the same time, the state creates conditions both for its diversification and for the development of large business.
American economist and Pulitzer Prize winner Daniel Yergin has very accurately described the mission of the AIFC during the presentation of the Center to investors - a place where the money and its owners feel comfortable. Perhaps, the best description. The world has a new financial bridge between Europe and Asia.
According to preliminary forecasts of the Kazakh authorities, the AIFC will be able to attract about $2 billion to the economy of Kazakhstan. The plans of the Kazakh authorities are big and quite feasible, so now, when the competition for investors is getting tougher and only the product that meets the requirements of modern realities will get investments.