Characteristics of the current state of Kazakhstan agricultural sector

At the current stage of the society development, one of the significant factors of the growth of our country competitiveness is the creation of an effective economic management mechanism in the agrarian economy. The importance of agriculture to provide the country with food, employment growth and the economic development of the Republic is very high.

Kazakhstan’s agriculture has always been and remains one of the most important and significant sector of the economy of the Republic, and consequently, the development of this sector has always been one of the Government’s priorities. So, for example, the achieved positive trends in the development of the agro-industrial complex of the Republic were the result of reforming the state policy when various state programs were implemented in order to support the development of the agro-industrial sector.

It is also important to note that in recent years the share of Government supported en- terprises has significantly increased due to the implementation of the Kazakhstan 2050 Strategy. In the light of international trends and internal factors, as well as taking into account the proximity of the major markets of Russia and China, the food production sector of Kazakhstan has a high export potential [1].

The population in Kazakhstan continues to increase, which leads to an intensive growth in food consumption. The development of the food market and the increase in the range of agricultural products has impact on the change in the consumption structure towards the higher-quality products [2, p. 22].

It should be noted that more than 40% of the country's population live in rural areas, which means that the formation and development of the country's agricultural complex largely determines the level and quality of livelihood of the population and the well-being of the people as a whole.

Table 1. Population growth in the Republic of Kazakhstan as of June 1, 2019

	Population number as of the beginning of 2019	Total population growth	Population number as of June,1, 2019	For the accounted period
				Growth rate, %	Average number
Total population, including;	18 395 567	94 137	18 489 704	0,51	18 442 636
Urban population	10 698 210	69 392	10 767 602	0,65	10 732 906
Rural population	7 697 357	24 745	7 722 102	0,32	7 709 730

From the data given in table 1, it is clear that the current situation is featured by the increase of Kazakhstan population. Mainly it is caused by a natural growth, as well as due to migration.

Now we proceed to the consideration of the structure of agricultural producers

(Fig. 1). As can be seen from the Figure above, the largest share of the registered producers of agricultural products makes the households of the villages – 1,635,861 units, while the peasant or farm enterprises amount to 215,633 units.

86,4 %

11,4 %

1, 4%

households 86,3

country or farms 11,4

individual entrepreneurs 1,4% the foreign companies 0.9%

• Figure 1. Structure of producers of agricultural products in the Republic of Kazakhstan as of July 1, 2019 (%)

The individual entrepreneurs engaged in such type of economic activity as “Crop production, animal husbandry, hunting and the provision of services in these areas” account for 26,041 units. And finally, legal entities make 17,023 units.

The key indicators characterizing the state of the agricultural sector for the last 5 years is presented in table 2.

Table 2. Gross output of products (services) of agriculture, forestry and fisheries, (millions KZT)

Branches	June, 2015	June, 2016	June, 2017	June, 2018	June, 2019
Total agriculture sector, including	611 708,1	793998,1	887 509,4	1 001 033,8	1 112 280,6
Crop	21 863,3	31 208,7	35 403,2	37 768,5	47 591,3
Livestock	588 973,5	762 001,4	851 094,0	962 194,9	1 063 506,6

As seen from Table 6, the production of agricultural products has been steadily increasing throughout the entire period shown and since June 1, 2015 has grown almost 2 times. Moreover, the growth rate of crop production has been increasing at a somewhat higher rate, namely, 2.2 times, while livestock production grew only 1.8 times for the same period.

For illustration purposes, the data is presented in the form of a chart.

Figure 3. Dynamics of growth of agricultural products in Kazakhstan for the period from 2015 to

2019, million KZT

In the above Figure 3, a growing trend in the dynamics of production of agricultural sectors for the past five years is clearly visible. This became possible due to the increase in state support, improvement of the system of legislative and economic incentives for the formation of agricultural production using new agricultural technologies, etc. [4].

Let’s consider such an important aspect of the characteristics of the current state of the agricultural industry, as products exporting.

For example, during this period the Republic has exported more than 1.2 million tons of wheat for the amount of USD 213 million, 481 million of barley for the amount of USD 89 million, 254 million tons for oilseeds were exported for the amount of USD 81 million. Export of meat and meat products is also growing. During the first two months of the current year more than 5 thousand tons of meat and meat products were supplied abroad.

One of the fundamental conditions for the development of this industry today is the Kazakhstan 2050 Strategy, under which the key parameter is the formation of Kazakhstan as an exporter of meat and dairy products to the world markets [3].

Compliance of domestic agricultural products with the international quality standards requires great investments. However, it should be noted that today the agricultural sector is facing to the insufficient investment.

Investments in the agriculture, forestry and fisheries in January-May of this year increased compared with the corresponding period of the previous year by 52.2% and amounted to KZT 124.3 billion (Figure 4). Over 89.2% of investments in the agriculture, forestry and fisheries were directed to the cultivation of seasonal crops (60.2%) and livestock (29.1%) [3].

■ cultivation of seasonal cultures

110_, 6 ltivation of long-term cultures

■ livestock production год

Figure 4. Investment in agriculture, forestry and fisheries in

148,8

ay 2019 (% to the

corresponding period of the previous year)

In particular, great amounts of resources were allocated and used for the implementation of these programs, the largest agrarian holding KazAgro was created to manage all the issues for realization of the support programs, namely, lending, insurance, training and, on this basis, increasing the competitiveness of the industry as a whole.

Thus, conducted herein the analysis of the current state of the agricultural sector, revealed the following. First, in spite of the fact that new tendencies of the world agrarian economy are being formed in Kazakhstan, there are a number of problems in the sphere of agriculture. Namely, the situation can be described as an incomplete and ineffective management of human and natural resources. Also worth to note is the lack of investment in the industry. Another key issue that requires an immediate solution is the improvement of product quality, the increase in the share of exports, and the poor infrastructure of the agricultural complex [5].