Condition and priorities of the transition of agro-industrial complex of the country to a new quality level of sustainable development

Thought is justified that the agrarian sector is the driver of our economy, because large state funds are invested in it and they must give an appropriate return. It is emphasized that at present time the import of food products in our country amounts to a significant proportion, although all this can be produced in Kazakhstan. It is noted that without deep modernization and diversification of the AIC taking into account the natural, climatic and geographical features of the country, as well as traditional skills of the indigenous population, especially in animal husbandry, with the creation of predominantly organic agriculture of the country, it is impossible to solve the urgent problems posed by the President of the Republic to the agro-industrial complex. It is argued that structural modernization and diversification of the AIC will create additional potential for increasing of the competitiveness of the domestic economy in conditions of the growing relevance of food security in the world community. It is concluded that the complex implementation of the system of proposed measures will allow during a short historical period to ensure food security and create a high export potential of the country's agro-industrial complex based on highly efficient industrial-innovative agricultural production; to ensure the phased replacement of the low-efficiency of state model of subsidizing of AIC and the transition to a market model of intensive development of the industry on the basis of large and medium-sized agro-production. It is proved that for the transition of the agro-industrial complex of Kazakhstan to a new qualitative level of sustainable development in the conditions of turbulence and cyclicality of unsustainable development of the world economy, it is necessary to implement a market-based organizational-economic matrix-integrated model of intensive development of the domestic AIC based on public-private partnership.

Necessity of scientific approach to studying management in AIC

The growing world population and the constantly increasing demand for food make the agro-industrial complex (AIC) one of the most perspective sectors of the economy. At the same time, the most important problem of the modern development of the agro-industrial complex is the enhancement of management efficiency, which contributes to an increasing of the volume and rising of effectiveness of agricultural production.

The problem of management in the AIC is to ensure the possibility realization of the objectives of an enterprise with optimal using of its internal variables (enterprise's potential), taking into account environmental factors and bringing the enterprise's potential in line with a dynamically changing environment to ensure the competitiveness of agricultural products and the effective functioning of the enterprise in the future. This should be taken into account of the influence of factors of direct and indirect impact — the effect of positive factors should be increased, the effect of negative factors should be minimized [1; 208].

Today, Kazakhstan has a huge national wealth, about 85 % of which falls on the natural resource potential. The area of farmland is 215 million hectares, which is more than 4 % of world resources. AIC produces products worth more than 11 billion dollars, or 7,8 % of the country's GDP [2; 7]. Therefore, the formation of new management systems in the agro-industrial complex requires fresh intellectual decisions made by professional managers who own modern intuition and are able to take into account the specifics of Kazakhstan's reality and the traditional forms of labor relations for this reality.

By the way, American researchers M. Woodcock and D. Francis formulated the abilities and skills that are required from a skilled manager in present time and in the future [3; 320].

The skills and abilities are required to the manager, scientists justify by the action of relevant factors, which influence and, obviously, will influence to management activities in the near future:

  1. Stress, pressure and uncertainty are increasingly present in most life forms of organizations. Therefore, from skillful managers are required the ability to effectively manage themselves and their time.
  2. The erosion of traditional values has led to a serious breakdown of personal convictions and values. Therefore, from modern managers are required the ability to clarify their personal values.
  3. There is a wide of choice. Therefore, from managers are required to clearly define both the goals of the being done work and their own goals.
  4. Organizational systems are not able to provide all the learning opportunities required to a modern leader. Therefore, every manager must himself maintain constant growth and development.
  5. There are more and more problems, and they are becoming more complex, while the means of solving them are often more limited. Therefore, the ability to solve problems quickly and effectively becomes an increasingly important feature of management skills.
  6. The constant struggle for markets, energy resources and profitability make it necessary to put forward new ideas and constant adaptation. Therefore, managers must be resourceful and able to respond flexibly to changing situations.
  7. Traditional hierarchical relationships are difficult. Therefore, effective management calls for the using of skills to influence on others, without resorting to direct orders.
  8. Many traditional schools and methods of management have exhausted their capabilities and do not meet the challenges of the present and future. Therefore, more modern management techniques are required, and many managers need to master different approaches with regard to their subordinates.
  9. The high costs and difficulties associated with the using of employees. Therefore, from every manager is needed more skillful using of human resources.
  10. Increasing scales of changes is required of development of new skills, of development of new approaches and fight against possibility of their own «obsolescence». Therefore, from managers is needed the ability to help others in the rapid studying of new methods and development of practical skills.
  11. Difficult problems increasingly require of combining efforts of several people to work together to solve them. Therefore, manager should be able to create and improve groups that can quickly become inventive and productive in their work.

Now, internationally there is a convergence in the field of management. However, development of knowledge and models from other countries has certain limits. The limiting factor is the socio-economic and cultural-historical conditions of each country. Therefore, the experience of other countries must be creatively adapted to domestic conditions.

Acquaintance with foreign management experience and its implementation in Kazakhstan requires taking into account national peculiarities, customs, habits, territory, historical experience of entrepreneurship and management, average labor intensity, standard of living and much others, which affects to choice of management forms and methods of manage in the country.

Efficiency of solving managerial problems and implementation of state programs in the domestic agro-industrial complex

Numerous managerial problems and government programs aimed at supporting of domestic agricultural producers help to saturate the domestic market with fresh agricultural products of their own, reduce dependence on their imports and, conversely, create conditions for the export of livestock product and plant products.

Thus, according to the results of the harvesting campaign of 2018, 22.7 million tons of grain were milled in the republic, which exceeded the figure of the previous year by half a million tons. In 2018, the number of cattle in the country increased by 5,5 % (to 7,1 million heads), sheep — by 2,2 % (to 16.4 million heads), horses — by 8.6 % (up to 2,6 million heads). In turn, the livestock of birds increased by 11,4 % (to 44,4 million heads) [4; 3].

Program of animal husbandry is gaining momentum. In 2018, 19,9 thousand tons of beef were exported. Gradually carried out diversification of acreage, changing the situation in domestic seed production, updating the fleet of agricultural equipment contribute to the achievement of the goals in the AIC. During the years of independence, Kazakhstan achieved the largest volume of grain exports — 11,7 million tons. And the price for it was 40 % higher than in the previous period. Today, for 100 % have digitized arable land, for 50 % — pasture. 74 out of 106 services provided by the Ministry of Agriculture of the Republic of Kazakhstan were automated. There are 54 types of subsidies [5; 3].

Despite the marked positive trends, now the agro-industrial complex is in dire need of government support, because it solves the most important problem — ensuring the country's food security. The industry still has a lot of problems.

Analysis of problems constraining development AIC of the Republic

According to scientists and practitioners [6; 8], the main causes of problems in the AIC are:

Currently, personal subsidiary farms (PSF) and private farms/peasant farms (PFF), of which 90 % are small entities, produce 77–85 % volumes of marketable products: their share in crop production is 69 %, and in livestock production — 87 %. Only about a third of agricultural producers (ACP) is engaged by the processing of meat, milk, fruits and vegetables.

Due to the fact that investing in peasant farms and individual farms is not economically justified, 403 processing enterprises were established, which are currently loaded to 20–40 %. The reason for this is both the lack of raw materials and its low quality.

  1. Of the total investments in Kazakhstan, only about 0,8 % are invested in the agro-industrial complex due to its small-scale production and low efficiency. At the same time, the level of efficiency of the using of labor resources in the countryside remains low: out of 4 million villagers, about 500000 (12,5 %) are employed by hired labor, and the number of self-employed is about 3,5 million. They are actually unemployed, not contributing to the budget of the republic.
  2. The dominance of small-scale agricultural production and numerous economically non-productive superstructures, which are not only the structures of JSC «KazAGRO», but also the national and regional structures of the Ministry of Agriculture, causing significant non-productive costs, caused insolvency of about 80 % of agricultural producers.
  3. According to the Ministry of Agriculture, the annual volume of subsidies to the agro-industrial complex in Kazakhstan is 4–5 % of the gross output of the industry. Whereas the level of such state support of the gross agricultural product in Switzerland is 79 %, Japan — 74 %, Norway, Iceland — 72 %, in the EU countries — 46 %, Turkey — 31 %, Poland — 25 %, Canada — 23 %, the United States — 15 %, Hungary — 14 %, Mexico — 13 %, Czech Republic — 12 %, Austria — 9 %, in average for the OECD — 38 %.

Experts believe that the main cause of problems in the agro-industrial complex is the current state mechanism of extensive development, which acts not only as a brake, but more and more reduces the competitiveness of the country's agro-industrial complex. This is beneficial to foreign agricultural producers (ACP) and damages to the national interests of Kazakhstan.

Solutions of actual problems of the country's agro-industrial complex

For the transition of agro-industrial complex of Kazakhstan to a new qualitative level of sustainable development in the conditions of turbulence and cyclical unsustainable development of the world economy, it is necessary to take the following priority measures.

Firstly, for the republic super-relevant is the formation of multi-product agriculture in the country with the predominant development of medium and large-scale agricultural production on the basis of the market model of intensive development of the agro-industrial complex, developed by Kazakhstani and world-class experts.

Secondly, in the future, the way of solution of many problems of the agro-industrial complex lies through the implementation of a market model of intensive development of regional agro-clusters and district agro-complexes. For this, in parallel with the approved State program of the Development of the AIC for 2017–2021, it is necessary to start for implementing of public-private market model of intensive development of the AIC consisting of 14 regional production-infrastructure agro-clusters, technologically connected with 160 agro complexes — district cooperative associations and modern agro-towns under regional centers of the country. According to the author of the article [6; 8], regional agro-clusters and district agrocomplexes will ensure: high efficiency of the using of attracted capital, primarily from Islamic countries; high employment of the rural population; high labor productivity based on the using of modern agricultural technologies and innovative technical means; high wages are the basis for a significant increase in the level and quality of life of villagers, who constitute more than 40 % of the country's population.

Thirdly, among the tasks for the coming years is the development of sustainable agriculture systems for competitive agricultural production, resource-saving technologies of cultivation, the breeding of grain, leguminous, oilseed, annual and perennial herbs, adapted to steppe conditions, the improvement of the precision farming system. According to the general director of the Research and Production Center of the grain farm named after A.I. Barayev [7; 2], especially precision agriculture, which implies the optimal management by crop production in each square meter for receiving of maximum profit while saving economic and natural resources should be the driving force of innovative development of the republic.

Fourthly, in the long term to the solution of the tasks assigned to the industry can contribute introduction of new production capacity with the attraction of foreign investors and transnational companies (TNC). Together with a foreign capital, new, modern, highly productive technologies will come to our country, which will make it possible to get more added values with less labor costs. In addition, the arrival of TNCs, experts believe that it will provide an opportunity to freely export manufactured products to many countries where these companies are represented.

Fifthly, in order to further expand export horizons, it is necessary to solve the problem of the development of the network of wholesale distribution centers (WDC) in industry. It is a multi-functional infrastructure complex, consist of storage and retail space with special equipment for calibration, packing, packaging, also of distribution of food products for its wholesale realization both on the domestic and foreign markets [8; 4].

The main function of the WDC will be to provide of opportunities for domestic agricultural producers to enter to the market of wholesale buyers, which will contribute to the sale of food products at market «fair» prices, to reduce of the costs for storing them and increase of turnover of agricultural crops.

Sixthly, the most important condition of the further development of the domestic agricultural sector is the innovative way, i.e. intensification of production based on the latest achievements of science and technical progress. The rector of the Kazakh Agrotechnical University named after S. Seyifullin, A. Kurishbaev, to the question why our agricultural sector of the economy lags far behind developed countries answers: «In the grain-sowing regions of Australia, where rainfall is less than in northern Kazakhstan, the yield of grain crops is twice higher than ours. In Canada with similar climatic conditions with our country, labor productivity in crop production is 14 times higher than our indicators. In the Netherlands, which occupies 1/5 part of the Almaty region, the annual export of agricultural products amounts to almost 100 billion US dollars. In our country as a whole in republic, agricultural exports do not exceed 2,1 billion US dollars, which is almost 50 times less. The secret of their success lies in the widespread introduction of innovations into production through a clear system of personnel training and dissemination of knowledge. That is the way we must fol- low» [9; 7].

If we consider that we have already missed a lot in matters of intensification of agriculture, then we will need to go by the shortest way, that is, to engage by the transfer of already well-known scientific knowledges and successful agricultural technologies, which the Head of State constantly says. So, in the Message of the President N.A. Nazarbayev to the people of Kazakhstan «New development opportunities in the conditions of the fourth industrial revolution» it is noted: «The development of agrarian science requires priority atten- tion».

It should deal primarily with the transfer of new technologies and their adaptation to domestic conditions.

At the same time, it is necessary to reconsider the role of agrarian universities.

They should not just issue diplomas, but prepare specialists who will actually work in the agroindustrial complex or engage by scientific activities.

These universities need to update their curricula and become centers of dissemination of the most advanced knowledge and the best practices in the agro-industrial complex.

For example, multiple increases in productivity can be achieved, thanks to technology predicting of the optimal time for sowing and harvesting, «smart irrigation», intelligent fertilizer application systems and control of pests and weeds.

Unmanned equipment can significantly reduce the cost of farming, minimizing the human factor [10; 5].

Before proceeding to technology transfer, it is necessary to prepare personnel with appropriate knowledge and skills. Therefore, in the republic, in order to improve the quality of agricultural education, the concentration of three agricultural universities on providing the agricultural sector with specialists with modern knowledge and practical skills is expected. This task includes the implantation of standards in universities of leading world universities.

Conclusion

Today, the agriculture of the Republic of Kazakhstan is one of the key sectors in terms of its contribution to the country's GDP. So that in the future it will become a solid basis of economic stability, we must use full of the existing «trumps», including the diversity of climatic conditions, extensive farmland, water resources, science, personnel, and various state support tools.

During of the next few years task set significantly increase labor productivity and export of product. In his Message to the People of Kazakhstan «Growth of Welfare of Kazakhstan: increasing incomes and quality of life», President emphasized: «We need to fully realize the potential of the agro-industrial complex. The main task is to increase labor productivity and export of processed agricultural products by 2,5 times by 2022.

All measures of state support should be directed to the large-scale attraction of modern agricultural technologies in the country.

We must use the best experience of managing by the industry introducing flexible, convenient standards and attracting «gray heads» — authoritative foreign experts in the field of agriculture.

It is necessary to build a system of mass training of rural entrepreneurs with new farming skills [11; 5].

For a speedy solution of this large-scale task as soon as possible, the new version of the State program for the Development of the Agro-Industrial Complex has already been reviewed and approved.

In accordance with the standards of project management, long-term sectoral programs have been developed for the main areas of the agro-industrial sector — beef and dairy cattle breeding, poultry farming, irrigated land. There are solutions to the main conceptual issues of the industry and related areas, including digitalization. So, by 2021, at least two thousand digital farms are to be created [12; 2]. Already a list of more than 500 farms is identified.

 

References

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  7. Mukanova, A. (2019). Khochesh khoroshii urozhai — sobliudai tekhnolohii [If you want a good harvest — follow the technology]. Kazakhstanskaia pravda – Kazakhstan truth, 23 January, 2 [in Russian].
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  9. Omarkhanov, G. (2018). Stavka na transfert tekhnolohii [Bet on transfer of technology]. Mysl – Truth, 5, 6–11 [in Russian].
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Year: 2019
City: Karaganda
Category: Economy