Overview

In USD Millions; Note: the above statistics are unoffial estimate based on kazakhstan customs data and industry sources.

Best Prospects and Services 

Less than half of the construction materials used in Kazakhstan are available domestically.  Locally produced materials include cement, bricks, wooden doors, windows, steel doors, and soft and iron roofs.  A fairly high portion of locally produced materials and products are not considered to be up to international standards.  Most other materials are imported, mainly from Turkey, China, and Germany.

Currently, this sector of the market is for high quality imported products and materials used in the finishing and renovation process, including: wall & floor coverings, ceiling products, doors and windows, kitchen and bath equipment, plumbing and electrical equipment, hardware, and DIY products.  Within recent years output of building products grew between 3 and 30%, depending on the product category.   Domestic production of a number of new quality and cost competitive basic building products was established.  Among these products are fiberglass insulation materials, new types of roofing and waterproofing products, energy efficient glass, aluminum extrusion, engineering equipment, cement, bricks, and wall panels.  Imported technologies and equipment significantly contributed to the overall improvement in the industry. Due to government emphasis on import substitution and diversification of industry, many opportunities exist for suppliers of manufacturing machinery and systems and for new technologies.

Opportunities

As mentioned before, the autumn 2007 decrease in global liquidity has negatively impacted the construction sector, and financing for new housing and office construction projects has all by dried up.  Though construction may suffer the most from slowing domestic lending, it enjoys generous state backing, as the government is committed to inject sizable funds ($4 billion) into this sector.  Additionally, much of the construction related to infrastructure and industrial projects is supported by federal funds, so the impact will be minimal in these areas.  Though the sector will see slower growth this year (vs. 30% in the first nine months of 2007), firms taking a medium-term approach will find this the right time to enter the market.

While the oil and gas sector will be the major purchaser of architecture, construction, and engineering services for years to come, there is demand for these services in many other sectors, notably construction, renovation, and conservation of industrial and public utilities and residential buildings, and design and assembly services.  There is a need for the full range of civil engineering, construction, and engineering activities including research and development, all aspects of design, design and build, management contracting, construction management, tunneling and tunnel lining, foundation engineering, mining, and facilities management.

The city of Almaty, the commercial and financial center of Kazakhstan, has been at the center of Kazakhstan's booming economy.  It is estimated that nearly 146,000 m² of luxury apartment floor space were built in Almaty in 2005.  In business construction, an average of three new Class A and B facilities were opening monthly until the recent economic slowdown.  Intensive construction in the country’s new capital, Astana, has been going on since 1997 and the demand for machinery, construction equipment and materials is constantly increasing.  A large part of investment has gone to developing construction and transportation infrastructure, including airports, sports facilities, supermarkets, apartment houses, and construction of highways.  Although most official buildings are in place by now, there is still demand for modern offices and housing in this once very small town. The new capital is also awaiting construction of sport and entertainment centers, shopping malls and hotels, as well as of a highway system connecting Astana to other parts of the country.