OLEG YU NAM Chairman of the Board of Directors Kuat Corporation INTERVIEW

uat Corporation has been around for some time. Established in 1992, its turnover last year was in excess of $500 million. Oleg Yu Nam (INTERVIEW), Chairman of the Board of Directors, thinks of his construction firm as part of a new breed.

Since independence in 1991, Kazakhstan has successfully embarked on political and economic reforms. What makes it so different from other CIS countries?

At a very early stage, right after the dissolution of the socialist system and at the beginning of the transition, no one thought Kazakhstan would become a leader in Central Asia. But our president turned those expectations around. Czar Peter I made similar strides by opening a window to Europe, and allowing Russia to develop in leaps and bounds.

The government is making great efforts to diversify the economic base away from petroleum. Some sectors already perform well, with construction growing at an average annual rate of 20 percent. What are the key drivers in your field?

The first driver is the regulatory framework. We have effective laws on urban development that create tremendous opportunities. Land has been parceled out and architects have been given free rein to exercise their creativity. Another driver is bank investment and capital inflows. Everyone is interested in developing the sector, from financial institutions to city mayors and regional governors.

Kuat has received many awards and doubled its turnover to more than $500 million last year. How did you become a market leader?

The word “kuat” in Kazakh means “power”. I started from scratch in 1992. Our office back then was tiny. Nonetheless, we decided to focus on construction of residential buildings. I had experience as a foreman and as a site engineer. We introduced our own crews to carry out the construction work, and starting in 2000 we embarked on a rigorous development program. Every three months we push through optimization drives. In the last six years we’ve increased output 300 times.

You expect to double turnover to $1 billion this year and bring the number of employees up to 25,000. Where do you find the contractors and the engineers?

A company needs to create safety nets for its employees as well as topnotch working conditions. It should also be guided by fully transparent policies. Last year we were certified with ISO 9001:2001 quality standards. Our employees are paid high salaries and they receive generous social benefits. When people feel they are protected they give back more in return. Another contributing factor is that our company has its own ethos. We want employees to feel they are living in a wonderful place.

You mention social responsibility, transparency and ISO 9001 certification. Is this all in preparation for a stock market listing?

Yes, we are aiming for a listing at the London Stock Exchange. Currently the company has enough funds in the domestic market, but we know that we need to invest more and penetrate into new markets. First we need to get listed in capital markets here in Kazakhstan. This will enable us to invest $1.5-2 billion in projects such as the Manhattan complex, which will be completed in seven years.

Image is a very important indicator of success. How are you branding your company and how do you want to be perceived abroad?

In 2002 we were awarded the Arch of Europe golden prize in Frankfurt. The following year we received the platinum Star for Quality in Geneva. In 2004, also in Geneva, Kuat was awarded the Century International Diamond Quality ERA award. Finally, we were granted another Diamond award in New York last year honoring our corporate spirit. All these events have a ripple effect.