EBRD recommends Kazakhstan scale down state involvement in economy
ASTANA. March 13 (Interfax) - The European Bank for Reconstruction and Development has recommended that Kazakhstan should reduce the level of bad debt and state participation in the economy, said the EBRD's Managing Director for Turkey, Eastern Europe, the Caucasus and Central Asia Olivier Descamps.
"The health of the banking sector should be improved. The patient is still very weak and needs medication," Descamps said delivering an EBRD report on Central Asian economies in Astana on Tuesday.
According to the report, Kazakhstan's banking sector needs to reduce the level of bad debt and improve risk management mechanisms.
"The excessive state involvement in the economy should be scaled down. This can be achieved through several methods. The first symbolic step, which has already been announced, is the People's IPO. The second step is to try and preserve the equity value of the banks subject to restructuring," Descamps noted.
"The EBRD views Kazakhstan as a success story. The country has excellent potential, but also a few crossroads ahead where it will have to choose the way its business will develop. Maybe even a revolution will be needed to accelerate this country's development," he emphasized.