Selling to the Government
State procurement in Kazakhstan is regulated by the 2015 Law on State Procurement and subsequent amendments, applying to ministries, state agencies, and entities in which the government holds more than 50 percent ownership. A 2014 amendment to the law allows vendors from Eurasian Economic Union (EAEU) member countries to participate in public procurement tenders on equal terms with domestic suppliers. Although Kazakhstan has yet to accede to the WTO’s Agreement on Government Procurement, in November 2019, the Government of Kazakhstan formally notified the WTO of its intent to begin accession negotiations.
Recent amendments to the law include a clear definition of “dumping price” to prevent underpricing, the introduction of a complaints register, exclusions for non-financially sound suppliers and companies registered in offshore zones, measures to prevent unfair advantages through competitor information access, and revised principles for single-source procurements.
The procurement system in Kazakhstan is decentralized, with various government agencies and entities managing specific procurement projects. The Ministry of Finance develops procurement policies, and the Committee for Public Procurement oversees enforcement. State procurement processes are implemented through mandatory tenders announced by government agencies, with opportunities published in designated newspapers by the Committee for Public Procurement.
To streamline the procurement process, the government established an e-procurement portal. The state procurement website, available in Kazakh and Russian, was launched in 2008, with the e-finance Center serving as the sole operator for electronic state procurement in Kazakh, Russian, and English. Although regulations aim to provide transparency and accountability, challenges persist, including short tender deadlines (suggesting potential pre-selection of suppliers), lack of transparency, and payment issues. Regulations frequently favor domestic suppliers, but lucrative opportunities exist, and American companies have succeeded in winning projects in Kazakhstan. U.S. companies are advised to approach government tenders with caution, seek payment guarantees, and be wary of payment-after-service arrangements.
U.S. companies bidding on government tenders may qualify for U.S. government advocacy. The Advocacy Center, part of the U.S. Department of Commerce’s International Trade Administration, coordinates interagency advocacy efforts to support U.S. exporters bidding on public sector contracts with international governments. The Advocacy Center collaborates with the U.S. Commercial Service and other partners to ensure U.S. companies have the best possible chance of winning government contracts. Advocacy assistance can take various forms, often involving U.S. Embassy or government agency support for U.S. bidders directly to foreign governments. For additional information, consult Advocacy for Foreign Government Contracts.
Project Finance
Large infrastructure projects in Kazakhstan are often financed through multilateral development banks such as the Asian Development Bank (ADB), European Bank for Reconstruction and Development (EBRD), and the World Bank, as well as through the Development Bank of Kazakhstan. Commercial financing, such as bank loans and private equity, is also used.
Multilateral Development Banks and Financing Government Sales: Price, payment terms, and financing can be a significant factor in winning a government contract. Many governments finance public works projects through borrowing from the Multilateral Development Banks (MDB). The Guide to Doing Business with Multilateral Development Banks overviews how to work with MDBs. The International Trade Administration has a Foreign Commercial Service Officer stationed at each of the five different Multilateral Development Banks: the African Development Bank; the Asian Development Bank; the European Bank for Reconstruction and Development; the Inter-American Development Bank; and the World Bank.
Learn more by contacting the following offices: