Astana International Financial Centre (AIFC) presented the results of its activities for 2023. The AIFC maintained its prominent position in the Central Asia and Eastern Europe region (according to the Global Financial Centres Index rating), confirming the existence of a favourable legal and regulatory environment, along with well-established infrastructure for doing business, investment attraction and human capital development.
Renat Bekturov, the Governor of the Astana International Financial Centre, highlighted the centre's success in exceeding its investment attraction targets and outlined new objectives. He stated, "As of today, we have attracted over USD 10,9 billion to the country's economy through AIFC, comprising USD 4,6 billion on AIX and USD 6,3 billion in investments from participants. This accomplishment aligns with the development strategy set for the centre until 2025. In the medium term, our focus will be on further developing infrastructure and introducing market-demanded instruments such as the carbon market, sustainable finance and others."
Over the past year, more than 600 new participants have registered within AIFC, bringing the total to more than 2 300 companies from 78 countries. Throughout the entire duration of the financial centre's operation, AIFC participants have contributed 68,5 billion tenge in taxes to the country's budget (as of 1.09.2023).
In 2023, significant progress was observed in the development of key sectors such as transportation, logistics, agro-industrial and mining complexes, renewable energy sources (RES) and the IT sphere. As part of the Middle Corridor project, a joint venture named Caspian Integrated Maritime Solutions was registered in AIFC by subsidiary of KazMunayGas in collaboration with Abu Dhabi Ports Group. This venture was marked by the arrival of two large tankers at the port of Aktau. Additionally, national railway company Kazakhstan Temir Zholy in partnership with national companies from Georgia and Azerbaijan established a joint venture to invest in overland projects along the Middle Corridor. Furthermore, the Samruk-Kazyna Fund is actively involved in the construction of wind power generation projects in collaboration with Chinese participants within AIFC.
The debt instruments market on AIX experienced unprecedented growth in 2023, marked by the listing of 56 debt instruments. The total raised capital during this period exceeded USD 1,95 billion. Furthermore, AIX added seven equity instruments to its official list, which included the shares of KEGOC (Kazakhstan Electricity Grid Operating Company).
In 2023, AIX welcomed 14 new members, comprising both Kazakhstani and European brokers and custodians. Notably, the trading volume on AIX reached a historic high totaling USD 510 million (as of 21.12.2023), a substantial increase from the USD 173 million recorded in 2022. The AIX Central Securities Depository surpassed 1,5 million individual accounts, and in November foreign investors accounted for 61% of the total exchange trading.
A pivotal development was the redomiciliation of Polymetal International from Jersey to the AIFC jurisdiction. This move marked a significant milestone as the company became the first to shift the primary listing of its shares from the London Stock Exchange to AIX. As a consequence of this redomiciliation, major global custodian banks gained access to the AIX depository.
The increasing interest in the asset and fund management sector is evident in significant indicators, including a notable 82% growth in assets under management (AUM) within AIFC, increasing from USD 585 million at the start of 2023 to a record high of USD 1 billion. Furthermore, the number of registered funds expanded from 20 to 37 during the same year, with the volume of investment funds' assets under management reaching USD 616 million.
To enhance investment attraction, AIFC continues to develop new products and services previously unavailable in Kazakhstan's financial market. From 2022 to November 2023, the volume of transactions under the pilot project on the interaction of AIFC crypto exchanges with Kazakhstani banks amounted to about USD 220 million. In 2023 alone, the trading volume increased by 104 times compared to 2022, amounting to 217 million US dollars, and the number of clients by 6,7 times – 41 384.
AIFC's crowdfunding platforms have funded more than 300 projects, totaling over USD 35 million in all years. In 2023 alone, nearly 150 projects worth USD 14,3 million have been funded. Projects span industries such as IT, construction, commerce, agriculture, services, manufacturing, and engineering. This broad interest emphasises the role of crowdfunding in financing SMEs.
In 2023, Astana Financial Services Authority (AFSA) granted authorisation to 20 companies offering financial services in AIFC. Additionally, 7 ASP-consultants (ancillary service providers) were registered, bringing the overall count of such companies to 116.
In 2023, collaborative agreements were established with nine regulators including the Cayman Islands, Kyrgyzstan, Luxembourg, Mongolia, Oman, Russia, UAE, Hungary and Uzbekistan. This development elevated the total number of cooperation agreements to 53.
This year marked the completion of the project involving the passage of Kazakhstan through the FATF/EAG mutual evaluation procedure. AIFC as a special jurisdiction with participants subject to financial monitoring, played a crucial role in achieving a significantly positive outcome. As per the report, the AIFC jurisdiction was assessed as complying with international standards regarding anti-money laundering and terrorist financing (AML/CFT). The independent regulator of AIFC, AFSA, was recognised as an effective body with a well-developed regulatory regime in the field of AML/CFT. Kazakhstan will be subject to standardised monitoring until the next assessment period in 2026.
The AIFC Court and the International Arbitration Centre (IAC) are widely acknowledged as reputable and effective forums for dispute resolution. In 2023 both entities achieved significant milestones by successfully resolving and enforcing a record number of cases totaling 736, which included 38 judgments, 191 arbitral awards and 507 mediated settlements. Lord Burnett of Maldon was appointed Chief Justice of the AIFC Court and Thomas Krummel was appointed Chairman of the IAC. Notably, AIFC courtrooms are accessible in eight countries: Armenia, Azerbaijan, Georgia, Kyrgyzstan, Tajikistan, Turkey, Turkmenistan and Uzbekistan. Over the years, 566 lawyers from 30 countries have registered with the AIFC Court to represent parties in cases.
One of the priority areas of AIFC development is green finance. Thanks to the efforts of the AIFC Green Finance Centre (GFC), Astana ranked 1st in the Eastern Europe and Central Asia region in the Global Green Finance Index (GGFI).
By the end of the year, more than 60% of green bonds and loans in the country were issued with the support of the GFC.
Since the launch of the sustainability market in 2020 until the end of 2023, bonds and loans totaling 236,5 billion tenge have been issued. In 2023 sustainable bonds amounting to 64,7 billion tenge were placed. MFO OnlineKazFinance JSC (Solva) made history as the first microfinance organisation in Kazakhstan to issue debut gender bonds.
Moreover, the first placement of subsidised green bonds totaling 3 billion tenge by KazWindEnergy LLP, took place with the support of the GFC. This placement occurred under the Damu Fund program as part of the National SME Support Project.
The first green bonds certified according to the Climate Bonds standard, totaling 7 billion tenge, were successfully placed with the Development Bank of Kazakhstan acting as the issuer. Additionally, an agreement was signed between Almaty Electric Stations JSC and Eurasian Development Bank for the reconstruction project of the Almaty CHP-3 (thermal power plant). The implementation of this project will involve the issuance of the first Sustainable Development Bonds (SLB) in Central Asia, amounting to up to 236,8 billion tenge.
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The Astana International Financial Centre (AIFC) is an independent jurisdiction with a favourable legal and regulatory environment and a developed infrastructure for starting and doing business, attracting investment, creating jobs and developing Kazakhstan's economy.
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