The Impact Of Foreign Direct Investment On The Growth Of Kazakhstan's Economy

The study aims to investigate the impact Foreign Direct Investment on the growth of Kazakhstan's economy. Investments play a very important role in the economy. They are objectively necessary for the stable development of economy, sustainable economic growth. Active investment process determines the economic potential of the country as a whole, contributes to the improvement of living standards of the population. Economic activity of individual economic entities depends to large extent on the amounts and forms of investments.On an economy-wide level of investment required to expanded reproduction,structural reforms in the country, increasing the competitiveness of domestic products,address socio-economic problems, particularly the problems of unemployment,environment, health, development of education system, etc.At the micro-level investments contribute to the development and sustainability of the company, updating of fixed assets, increases the technical level of the company, stabilize the financial condition, to enhance the competitiveness of enterprises, to improve the skills of the workforce, improvement of management practices.In connection with the continuing instability of the economic situation in the Republic of Kazakhstan and many leading economists linked the future of our country with the involvement on a large scale in the Kazakhstan economy foreign investment that pursues long-term goals for the establishment in Kazakhstan of a civilized society, characterized by high living standards. It is hard to believe that some foreign investment will help to raise the economy of oor great country. But on the other hand, they can serve as a stimulus, a catalyst for the development and growth of domestic investment. The inflow of foreign investment is vital to the achievement of such goals as the solution to the current crisis,initial recovery work. Kazakh public interests do not coincide with the interests of foreign investors, therefore, it is important to attract capital, not to deprive their owners of their own motivations, simultaneously directing the actions of the latter for the benefit of public purposes. This problem can be solved, but first you need to learn the specific state in attracting foreign investment in the real conditions of Kazakhstan, to consider the economic and legal framework that promotes investment climate in the country. Thus,great attention should be paid to the last as today is the uncertainty in this area limits the investment process, therefore, there is a peculiar paradox: the strongest tool to attract foreign capital at the same time is the main reason that keeps investors from major investment. Given the serious technological backwardness of Kazakhstan's economy for most positions, Kazakhstan needed foreign capital, which could bring new technologies and modern management techniques, but also to promote the development of domestic investment. The experience of many developing countries shows that the investment boom in the economy begins with the arrival of foreign capital.In this study main goal is to analyze the relationship between Foreign Direct Investment and economic growth in Kazakhstan since its independence in 1991. For the empirical analyses I will use simple regression analyses on secondary data of Kazakhstan's economy from 1993 to 2016. The growth rate of GDP and money supply are analyzed in relation with FDI as well as export volumes.Before running the regression analysis, we need to test for the stationarity of the data.After I will use Linear Regression Model. Data on GDP, FDI, money supply and export volume will collect the period from 1993 to 2016.For time series forecasting I will use statistical method ARIMA. ARIMA is an acronym that stands for Autoregressive Integrated Moving Average. It is a class of model that captures a suite of different standard temporal structures in time series data. For this method I will collect data from 1993 to 2016, and forecasting for 2017 year.