The investment forum in Kostanay was held not in a conventional conference hall, but on the shop floor of Allur’s new automotive components plant. Participants were surrounded by machinery from different eras: from cars of the 1940s and 1950s to modern combines and vehicles now assembled in the region. The venue itself became part of the message: the region was showcasing not only the results of recent years, but also how the structure of its economy is changing.
The plenary session was moderated by Rakhim Oshakbayev, economist and Director of the TALAP Center for Applied Research. Financial analyst Rasul Rysmambetov delivered the closing remarks.
Among those who came to Kostanay that day were Timur Turlov (Freedom Holding Corp.), Andrey Lavrentyev (Allur, Qarmet) and Kudrat Shamiev (Eurasian Group); Shakhmurat Mutalip (ERG) was also in attendance. Several former heads of the region sat in the front row.
For a regional forum, such a concentration of major business figures is highly indicative. Their time is an expensive resource and therefore a signal of strong economic interest. Why did people with billion-dollar fortunes come to an investment forum in Kostanay? What has changed in the region in recent years?
The economy is becoming more complex
The region has undergone a noticeable structural shift in recent years. Over a decade, industry’s share of gross regional product rose from 20.4% to 34.9%, construction from 5.8% to 7.9%, and the real sector’s overall share from 38.8% to 52.5%. The regional economy grew by 8.3% in 2024 and by about 8.2% in 2025. Around KZT 2 trillion was invested in fixed capital in 2023–2025, with private capital accounting for roughly 80% of that amount. Foreign direct investment inflows over the same period totalled about USD 1.4 billion.
But the story is not simply about industrial growth. Kostanay Region is strengthening both of its core specialisations at the same time.
According to the regional administration, Kostanay Region now produces about a quarter of Kazakhstan’s mechanical-engineering output while remaining one of the country’s leading agricultural regions. In agriculture, the region ranks first in exports of processed agricultural products and second in food production.
Opening the forum, Regional Akim Kumar Aksakalov recalled that historically the region’s economy was focused primarily on agriculture, extraction and the initial processing of raw materials, while much of the subsequent value-added processing took place outside the region.
What is changing most today is the depth of the economy. Industrial localisation is increasing and new production chains are emerging. In agriculture, the focus is shifting from raw-material volumes to deeper processing. In both cases, the underlying process is the same: a larger share of value added is to be created within the region.
The automotive industry is moving from assembly to a production chain
The automotive industry is the most visible example of this growing complexity.
Until recently, the region’s automotive development could be described mainly in terms of new assembly capacity and rising vehicle output. The focus is now gradually shifting towards localisation and the creation of a longer production chain within Kazakhstan.
Allur Board Chairman Andrey Lavrentyev said at the forum that Kazakhstan had become Li Auto’s first overseas industrial partner. The relevant agreement was signed in Shanghai on 16 July 2026. At the same time, the Allur–Qarmet–Kia Qazaqstan industrial linkage is expanding: domestic production of automotive steel and stamped body parts is expected to raise the share of Kazakhstani steel in vehicle bodies to 75%.
Another project is a Lovol full-cycle combine harvester plant in the Kostanay industrial zone. Announced investment exceeds USD 160 million. According to Allur, the group’s combined production capacity in Kostanay now exceeds 200,000 vehicles a year, total investment amounts to KZT 350 billion, and employment exceeds 5,500 people.
But the economic effect of the automotive industry is becoming broader than the vehicle plant itself. The region is already developing foundry production and manufacturing gearboxes, cable systems, plastic parts and other components. The next stage is domestic automotive steel and body parts.
The skills dimension also matters. Thousands of employees and students have received training through Allur University, while engineering training and workplace-based practical learning are being developed directly at industrial enterprises.
This is where the potential multiplier effect becomes visible: large-scale production creates demand for materials, components, engineering expertise, logistics and skilled labour, and one enterprise can create the conditions for the emergence of others.
Agriculture is betting on deeper processing
A similar logic is taking shape in Kostanay’s traditional agricultural economy.
The region is not abandoning its agricultural specialisation. On the contrary, the aim is to make it more technology-intensive and economically productive: maintain the scale of raw-material output while generating substantially more value through processing.
According to data presented at the forum, the region ranks first in Kazakhstan for exports of processed agricultural products and second for food production. Dairy complexes, powdered mare’s milk production and pulse processing are expanding. Among the next projects announced were the Konditerskaya Stolitsa confectionery factory and deep grain processing to produce bioethanol and sustainable aviation fuel (SAF).
A closer look shows the scale of the transition. Modern dairy farms are being built with automated milking, cooling systems and feed-control technologies. Plants producing cheese and powdered mare’s milk are already operating—products with significantly more processing and value added than the original raw material.
The logic is even clearer in grain processing. One proposed deep-processing project envisages the production of starch, gluten, syrups, amino acids and bioethanol. Regional background materials give an illustrative comparison: with grain valued at around KZT 85,000 per tonne, the value of products after deep processing can reach KZT 500,000 per tonne.
A similar process is under way in metallurgy. ERG is building a new pellet plant in Rudny with annual capacity of 5 million tonnes and a project cost of USD 305.4 million. The project both increases processing depth and provides for a major technological upgrade of production.
The same economic logic is emerging across different sectors: not simply to produce more raw materials, but to move them through more processing stages within the region and obtain a higher-value product at the end.
Industrial growth is changing infrastructure requirements
The more complex production becomes, the more it depends on infrastructure beyond the factory gate.
New enterprises need energy, transport and logistics. Businesses need access to external markets. This is why the region’s infrastructure projects are becoming increasingly closely linked to its industrial strategy.
In energy, the largest announced project is the installation of 165 wind turbines with combined capacity of 1.2 GW. The region’s own generation currently falls well short of consumption: according to background data, it covers about 29.4% of annual electricity demand.
New power capacity is therefore no longer a separate “green” agenda, but one of the prerequisites for the next stage of industrial growth.
The same applies to logistics. The Tobyl transport and logistics complex—a dry port with design capacity of 400,000 containers a year—is being built in the region. The project is intended to connect the region to international transport corridors and increase container traffic through Kostanay. Road links to the north, south and west of the country are also being modernised.
Air connectivity is changing as well. Following modernisation, the terminal area at Kostanay Airport has expanded, the number of aircraft stands has increased, and the route network is growing. A separate project is restoring Arkalyk Airport.
Together, these developments point to an important transition. Energy, roads, airports and logistics are becoming not merely a backdrop to economic development, but factors of production in their own right.
Major capital is paying attention to the region
Against this backdrop, the composition of the forum’s participants takes on additional significance.
The simultaneous presence in Kostanay of top executives from Allur, Freedom Holding Corp. and ERG is difficult to explain solely by the status of an anniversary event. All of these groups are already linked to the regional economy or are developing new areas of activity here. The symbolic signal is therefore backed by tangible business interests.
It is particularly telling that around 80% of the region’s fixed-capital investment over the past three years came from the private sector.
Allur is expanding automotive production and localisation. ERG is implementing a major metallurgy-modernisation project. Freedom is developing banking, brokerage and insurance businesses, including satellite-based index insurance for agriculture.
Freedom Holding Corp. CEO Timur Turlov linked the situation in the region to a broader trend: strong investor interest in Kazakhstan. He also described a domestic agricultural insurance product developed by the company using satellite data. Kostanay Region is among the regions with the strongest demand for this product.
This example is notable because it shows another layer of economic complexity. Financial and technology services are emerging around agriculture, while suppliers of components and materials are forming around mechanical engineering.
The concentration of major business figures at the forum therefore matters not as a status symbol. It is a costly signal of capital’s interest in the region, reinforced by existing investment and the expansion of production chains.
The next scarce resource is people
At the same time, a more complex economy changes the nature of its main constraints.
At the first stage, a region needs investment, enterprises, and energy and transport capacity. As production expands, people become an increasingly important resource.
Financial analyst Rasul Rysmambetov, who closed the forum’s plenary session, highlighted this issue. He described the outflow of young people to Almaty and Astana as a real challenge for Kostanay Region and linked its further development to the creation of new jobs and the quality of the urban environment.
For a modern economy, this is no longer a secondary issue. Automotive plants, metallurgy, energy, deep processing and the services connected to them require engineers, technologists, IT specialists, managers and skilled workers.
This creates another linkage: industrial growth requires not only factories, but also housing, education, transport and a high-quality urban environment.
This logic is already embedded in the revision of Kostanay’s master plan: industrial growth raises demand for energy and new production, capital supports expansion, and the urban environment has to retain people and thereby close the economic loop.
That is why new neighbourhoods, urban modernisation, international education programmes and the arrival of hotel brands matter here not in isolation. They are becoming part of the region’s competition for human capital.
From individual projects to an economic system
The investment forum showed that the main process under way in Kostanay Region can no longer be described through a single new factory or one rapidly growing industry.
In mechanical engineering, a chain of local materials and components production is forming around vehicle assembly. In agriculture, processing depth and technological intensity are increasing. New industry creates demand for energy and logistics. A more complex economy, in turn, raises requirements for skills and the quality of the urban environment.
The main potential of the next stage lies in the connections between these elements.
If a new car plant generates orders for component and metal producers, grain processing creates demand for logistics, energy and technology, and new jobs support construction, services and urban demand, the initial investment begins to work several times over.
This is the economic effect that matters far more than the simple sum of projects launched.
Holding the forum on a factory floor made it possible to see the first outlines of such a model. The key question now is whether individual changes in production, infrastructure and the urban environment can reinforce one another on a sustained basis.
If they can, the next stage of Kostanay Region’s development will be determined not only by growth rates or the volume of investment attracted, but by the region’s ability to activate its own economic multiplier.
Forum video at the link
More videos about the forum and Kostanay are available here (playlist link)