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Russian companies playing dominating role in Kazakhstan’s IT sector, consulting

The total number of registered firms from Russia in the republic exceeded 23,000, having doubled since 2021

ALMATY, January 22. /TASS/. Russian companies currently play a dominating role in Kazakhstan’s consulting and IT industry, while overall the inflow of companies from Russia to the republic keeps "increased dynamics" compared with other countries, according to research by the Kazakh investment bank Halyk Finance, a subsidiary of Halyk Bank.

"In 2023, the inflow of companies from Russia to Kazakhstan slowed down substantially, though it kept its increased dynamics compared with other countries. It is worth noting that the enhanced growth of Russian companies is first of all registered in non-commodities sectors of the ‘new economy’ - consulting and IT industry where those companies had dominating positions in terms of quantity," the research released on the bank’s website said.

"A strong inflow of Russian business" was noted in the consulting sector, with "a 3.4-fold rise since 2021," analysts said.

"However, the highest growth of [Russian] companies - by seven times - was registered in the telecommunications area (IT), while their share overall has become predominant reaching 75%," according to the research. Almost half of companies from Russia (9,800) are focused in the republic in trade, while their share in the total number of trade companies in Kazakhstan amounted to 47%. Analysts also explain that "the positive side of the relocation of business from Russia" is their moderate inflow to commodities sectors and extractive industry, but outstripping - to manufacturing with growth reaching 60% in two years.

Overall "the pressure of the Western sanctions continues encouraging Russian businesses to relocate to Kazakhstan," Halyk Finance noted. The growth of the number of Russian companies in Kazakhstan in 2023 (+21.7%) surpassed the total increase of 16.1%, and amid such dynamics the total number of registered firms from Russia in the republic exceeded 23,000, having doubled since 2021, according to the research.

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