CORRECTED-UPDATE 1-Kazakhs to merge pension assets into state-run fund by July

Wed Feb 6, 2013 2:34am EST

Related Topics

(Corrects dollar number in third paragraph to billion from trillion)

By Raushan Nurshayeva

ASTANA Feb 6 (Reuters) - Kazakhstan, keen to deploy billions of dollars to sustain rapid growth rates, will merge its private pension fund assets into one state-run fund by July 1, Deputy Prime Minister Kairat Kelimbetov said in a statement.

Kazakh President Nursultan Nazarbayev had last month ordered the government to create a single pension fund to support the economy without raiding the $58 billion National Fund, replenished by windfall oil export revenues.

The combined pension assets accumulated by 10 private, and one state-run, Kazakh pension funds totaled 3.177 trillion tenge ($20.7 billion) as of Dec. 1, 2012, central bank data show. The state-run pension fund, GNPF, made up 19.3 percent of that sum.

The single state-run pension fund, to be created under the umbrella of GNPF, would be owned by the government and managed by the central bank, Kelimbetov said. The central bank will act as a custodian, keeping the assets of the new fund.

"Investments of assets of the single pension fund will be carried out based on the principle of diversification, safety of investment and moderate yields," Kelimbetov's statement said. It gave no further detail of future investment strategy.

Central Bank head Grigory Marchenko said on Jan. 25 that the new fund could eventually invest half its assets abroad.

Marchenko said at the time that the merger of Kazakh private pension fund assets into a single state-run fun could take just three months, if there was strong support from all government bodies and parliament. He said in a worse-case scenario the process could drag on for up to a year and a half. (Writing by Dmitry Solovyov; Editing by Hans-Juergen Peters and David Holmes)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

A tourist takes a plunge as she swims at Ngapali Beach, a popular tourist site, in the Thandwe township of the Rakhine state, October 6, 2013. Picture taken October 6, 2013. REUTERS/Soe Zeya Tun (MYANMAR - Tags: SOCIETY) - RTR3FOI0

Where do you want to go?

We look at when to take trips, budget considerations and the popularity of multigenerational family travel.   Video