Central Asia's Green Finance Leader: OECD Highlights Kazakhstan's Achievements

Central Asia's Green Finance Leader: OECD Highlights Kazakhstan's Achievements

In a significant move towards a greener future, Kazakhstan is making comprehensive reforms and investments to transform its infrastructure and economy, as highlighted in the OECD's report on Responsible Business Conduct for Sustainable Infrastructure.

The Central Asian nation is focusing on sustainable finance and economic growth, aiming to decarbonize due to its status as a top greenhouse gas emitter per capita and energy-intensive economy. Policy reforms include the implementation of emission trading schemes, tariff reforms to remove fossil-fuel subsidies, and improving financial sustainability in electricity by moving to full cost recovery through incentive-based tariffs.

Renewable energy is another key area of focus. Kazakhstan is scaling up the development of both large-scale and distributed renewable energy projects, with small-scale distributed renewable energy being promoted as part of the cleaner energy transition. This aligns with Kazakhstan's Low Emissions Development Strategy and updated Nationally Determined Contributions (NDCs) aimed at reducing GHG emissions by 15% by 2030 and achieving carbon neutrality by 2060.

Environmental modernization is also a critical sector undergoing transformation. Kazakhstan is modernizing energy, transport, and industry to transition to a green economy. This includes stringent energy efficiency norms for energy-intensive industries and strengthening emissions monitoring, reporting, and verification systems to help meet environmental targets laid out in national strategies.

Occupational safety and responsible business conduct are also essential components of Kazakhstan's sustainable infrastructure development. The OECD report emphasizes the importance of responsible business conduct, which encompasses occupational safety as part of broader corporate governance and environmental practices. Kazakhstan is implementing these recommendations, fostering an enabling environment for responsible business operations in infrastructure.

Human capital development is another crucial aspect of Kazakhstan's sustainable development agenda. Although specific initiatives on human capital are less detailed in the available sources, Kazakhstan's sustainable development agenda involves improving social indicators as part of its broader SDG commitment, supported by UN cooperation. This indirectly supports human capital development by targeting urban infrastructure, health (including maternal mortality reduction), and closing gender and social gaps.

The Kazakhstani government offers various incentives to support these initiatives. Investors in renewable energy can receive grants of up to 30% of project costs to make the sector more competitive. Kazakhstan exempts enterprises adopting Best Available Technologies (BAT) from environmental emission taxes as an incentive for environmentally friendly production. Since 2016, Kazakhstan has provided tax incentives for renewable energy investments, and since 2020, imported renewable energy equipment is fully exempted from VAT and customs duties.

Kazakhstan has made significant efforts in reducing industrial injuries and improving workplace safety. In 2024, a digital map was introduced to monitor working conditions, enhancing transparency and compliance with safety standards. The nation's economy prioritizes labor safety, environmental modernization, decarbonization, human capital development, and business involvement in the ESG agenda.

In 2025, Kazakhstan declared the Year of Working Professions, focusing on vocational training and upskilling in priority sectors such as energy, construction, water supply, and transport. These measures aim to strengthen institutional and workforce capacity in critical infrastructure areas.

Experts attribute Kazakhstan's progress to systemic government measures that support domestic producers, develop small and medium-sized enterprises, and strengthen mechanisms for sustainable economic growth. The Tariff in Exchange for Investment program reimburses infrastructure and energy investors through regulated tariffs, ensuring predictable returns and facilitating private capital inflows.

In conclusion, Kazakhstan's multi-faceted approach to sustainable infrastructure development through responsible business conduct, advancing sustainable finance, renewable energy, environmental modernization, occupational safety, and human capital development is commendable. The nation is indeed leading the way in Central Asia's transition to a greener and more sustainable future.

1. To further boost its renewable energy sector, Kazakhstan offers grants of up to 30% to investors in this field, aiming to make it more competitive and contribute to the nation's decarbonization efforts.
2. The Central Asian nation is focusing on sustainable finance as part of its transformative reforms, which include reforms to emission trading schemes, removing fossil-fuel subsidies, and moving towards full cost recovery through incentive-based tariffs in electricity generation.
3. In the environmental modernization sector, Kazakhstan is implementing stringent energy efficiency norms for energy-intensive industries and improving emissions monitoring, reporting, and verification systems to meet its greenhouse gas emission reduction targets.

Read also: