Kazakhstan’s IT sector is experiencing a boom, becoming a leader in e-government and fintech. Domestic IT service exports have already surpassed $546.7 million in 2024, signifying a thriving industry. Nearly 28% (394 out of 1,400) of registered IT companies are exporters, reaching an impressive 86 countries. Key export markets include the USA ($118.7 million), Russia ($34.5 million), and Ireland ($30.3 million).
Software development, game development (GameDev), SaaS, enterprise software, platform solutions, and artificial intelligence are the cornerstones of Kazakhstan’s IT exports. President Kassym-Jomart Tokayev has set an ambitious goal of reaching $1 billion in IT service exports by 2026. The Export Credit Agency of Kazakhstan, a key driver of non-primary exports, plays a crucial role in achieving this target.
Empowering Kazakh IT Companies in the Global Marketplace
Globalization and rapid technological advancements present both challenges and opportunities for Kazakh IT companies. The Export Credit Agency of Kazakhstan offers a comprehensive “safe entry” strategy to support expansion into new markets. This strategy encompasses:
- Exporting on deferred payment terms: Facilitating sales to customers who prefer delayed payments.
- Financing for working capital and investments: Addressing collateral limitations by securing financing from banks.
- Financing foreign buyers: Enabling foreign buyers to purchase Kazakh services and goods with easier financial terms.
Beyond Financial Support: A Holistic Approach
The Export Credit Agency of Kazakhstan offers a broader range of services to enhance export success:
- Financial Support: Provides flexible financing options tailored to specific needs.
- Investment Protection: Safeguards Kazakh investments abroad from political risks.
- Improved Credit Conditions: Negotiates favorable credit terms for both exporters and importers.
- Non-payment Risk Mitigation: Assumes the risk of non-payment by foreign buyers.
- Foreign Buyer Verification: Ensures the reliability of potential foreign partners.
These measures significantly expand the potential customer base for Kazakh companies. Traditionally, manufacturers are limited to customers willing to pre-pay. The Export Credit Agency of Kazakhstan’s tools allow companies to transact with a wider range of buyers, fostering growth.
Popular ECA Products and Services:
- Export Credit Insurance: Protects exporters from non-payment by foreign buyers for deferred payment transactions.
- Loan Insurance: Enables exporters to obtain financing with limited collateral by mitigating default risks for lenders.
- Export Letter of Credit Insurance: Secures favorable financing options for foreign buyers of Kazakh products and services.
Adding to its existing offerings, the ECA recently introduced:
- Pre-export and Export Trade Finance: Provides guarantees for export operations and subsidizes interest rates on export loans.
Guarantee instruments empower Kazakh producers to participate in international tenders, expanding their reach in targeted export markets. Additionally, these tools stimulate attracting foreign investment by providing ECA guarantees as collateral for advance payments in export deals.
A Real-World Success Story
A prime example of the The Export Credit Agency of Kazakhstan’s impact is the export and implementation of the “Sergek” intelligent public and road safety system in Namangan, Uzbekistan. This system, developed by Kazakh company Sergek Group, was successfully deployed with the support of export credit insurance and state export program subsidies.
Sergek’s work in Namangan is aimed at reducing traffic accidents and improving driving culture. The intelligent system has been certified according to the legislation of Uzbekistan. 25 hardware and software complexes record violations of traffic rules in 13 sections of the city and districts of the region. The system records exceeding the speed limit, passing through a traffic light forbidding signal, violation of road marking lines.
The program is unique. Over the years, thanks to the Sergek system, it has been possible to reduce deaths in road accidents by 50% and reduce crimes in public places by 40%.
Disclaimer: The views, suggestions, and opinions expressed here are the sole responsibility of the experts. No Economy Prime journalist was involved in the writing and production of this article.