The editorial team at FBRK continues to analyse the largest public procurements of Kazakhstani ministries in 2024. Today our focus is on the Ministry of Transport.
As a reminder, we previously reported on the spending of the Ministry of Culture and Information, where significant sums were allocated to maintaining the national television and radio broadcasting network, the state educational order in the arts, and support for the film industry.
Rising in the heart of the Kazakh capital is the "Transport Tower" — an impressive 155-metre building that locals have long nicknamed the lighter because of its distinctive silhouette. This architectural structure not only adorns the left bank of Astana but also serves as home to the Ministry of Transport. However, behind the external splendour lies some quite substantial spending on maintaining this administrative giant.
Just for the renovation of the complex's heating consumption systems, the ministry plans to spend 195 million tenge. Of this, 55.2 million tenge went on work in 2024, and the remaining 140 million is to be spent in 2025.
Even more substantial sums appear in the history of the building's capital repairs. A recently terminated contract provided for costs of 3.77 billion tenge, with the bulk of these funds to have been spent in 2024. Interestingly, alongside this contract there is an agreement for the provision of technical supervision of the capital repairs valued at 88.06 million tenge, running until 2025 (8.64 million tenge in 2024 and 79.42 million tenge in 2025). This circumstance suggests that despite the termination of the main contract, the ministry is probably planning to renegotiate a capital repair contract in the near future.
The day-to-day upkeep of the "Transport Tower" also requires no small investment. Cleaning, landscaping, and waste removal between 2021 and 2024 have already cost 369.48 million tenge, of which 18.87 million tenge falls in 2024.
Next on the list of the largest contracts are electricity supply services, costing the ministry 218.68 million tenge. It is worth noting that the contract is with Astanaenergosbyt LLP, a company specialising in supplying electrical and thermal energy to consumers in the capital.
A separate item of expenditure is the ministry's transport provision. A new contract for the provision of executive-class cars in 2024-2026 will cost the exchequer 192.37 million tenge. The breakdown of this sum by year is as follows: 65.88 million tenge in 2024, 61.4 million tenge in 2025, and 65.09 million tenge in 2026. The ministry requested six black saloons with leather interiors and automatic transmission — five cars no older than 2020 and one no older than 2023.
It is worth noting that another transport service contract, entered into back in 2021 when the transport sector fell under the remit of the Ministry of Industry and Infrastructural Development (MIID), is also still running. The total value of this contract is 258.36 million tenge, of which 19.41 million tenge falls in 2024.
As a reminder, the separate Ministry of Transport appeared in Kazakhstan relatively recently — in September 2023, when, as part of an administrative reform, the MIID was split into two separate departments: the Ministry of Transport and the Ministry of Industry and Infrastructural Development.
Having analysed the largest public procurements of the Ministry of Transport, we come to a clear conclusion: a large share of the department's budget funds is planned for the maintenance and servicing of the "Transport Tower" building, as well as for providing the ministry's leadership with executive cars. The total sum of these expenditures runs into millions of tenge. Of particular interest is the situation with the building's capital repairs — despite the termination of the main contract worth over 3.7 billion tenge, the existing contract for technical supervision clearly points to the likelihood of major repair work resuming in the foreseeable future.
As a reminder, the FBRK editorial team has repeatedly covered problems in Kazakhstan's transport sector. For example, in May 2023 our editorial team reported on popular manipulations with foreign permit forms (FPFs), for which whole groups of shell companies are created to obtain as many FPFs as possible for subsequent resale to carriers.
In January 2024, the Committee for Road Transport and Transport Control presented a project proposing to reform the distribution system for permit forms. In particular, this concerned eliminating the artificial shortage of forms and their illegal resale on the black market. However, in February, the owner of a transport company, Bolatbek Aliyev, stated that the problems with FPFs still remain unresolved.
Furthermore, in October, our editorial team raised the issue concerning the influx of transport companies from Russia and Belarus into Kazakhstan, which are actively developing the Kazakhstani freight transport market. At that time, we sent an official request to the Ministry of Transport to find out whether Kazakhstan is witnessing a process of displacement of domestic carriers from the international transport market. You can read the department's detailed response via the link.
In January 2025, the FBRK editorial team received materials from a December 2024 inspection, confirming systemic problems in the industry that market participants had previously highlighted. According to information from our sources, the violations identified affect all key aspects of the industry's operation: from problems with the integration of information systems to an artificial shortage of foreign permit forms (FPFs), from malfunctions of automated measurement stations to shortcomings in the regulatory framework.
To be continued...