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Key Economic Data 
  2003 2002 2001 Ranking(2003)
Millions of US $ 29,749 24,205 22,400 60
GNI per capita
 US $ 1,780 1,510 1,350 119
Ranking is given out of 208 nations - (data from the World Bank)

Books on Kazakstan


Area ( 


ethnic groups 
Kazaks 44.3%
Russians 35.8%
Ukrainians 5.1%
Germans 3.6%
and many others

(formerly Akmola)


Nursultan Nazarbayev


Update No: 289 - (27/01/05)

The authoritarian regime buoyed by economic boom
After Kazakhstan gained independence from the Soviet Union in 1991, many hoped this Central Asian country would pursue democracy. President Nursultan Nazarbayev, elected in 1991 and 1999, promised as much, before shifting towards authoritarian rule.
He consolidated his power by employing his family, stifling the media and silencing critics (including journalists) who oppose his excessive control. The government has made it harder for opposition parties to jockey for position, and Mr Nazarbayev seemed to be laying the groundwork for his daughter to succeed him. But elections in September 2004 probably foiled this attempt at a political dynasty. Democratic Choice, an opposition party that once seemed formidable, has lost much of its momentum. 
In Kazakhstan, the long-term political perspective is murky. President Nazarbayev and his ruling Otan party retained a strong majority in the Mazhilis (lower chamber of parliament) after 19 September elections, that elicited howls of protest from opposition parties and a politely negative assessment from the OSCE. Some members of the president's own team, such as former Mazhilis speaker Zharmakhan Tuyakbai, joined the opposition, which found itself at year's end contemplating the wisdom of a move toward greater confrontation with the authorities.
Meanwhile, speculation centered on the date of future presidential elections -- likely to take place in 2006, but theoretically possible in 2005 -- and the thorny issue of succession, especially after presidential daughter Darigha Nazarbayeva lost some of her lustre as a potential successor when her Asar party put in an uninspired showing in parliamentary elections. The perpetually fractured opposition does not seem capable of mobilizing mass support, and the president and his team have the deck stacked very much in their favour, but the gradual hollowing out of the political process under President Nazarbayev makes any real forecasting problematic at best. 
As Kazakhstan becomes important to American interests (it was an ally in the Afghan war, and its oil is part of plans for a pipeline bypassing Russia and Iran), it has grown harder for Western governments to ignore its dictatorial politics, especially as Mr Nazarbayev becomes more oppressive. Some say it is in America's interest to pressure Kazakhstan to reform, even if the country's 15m people are a politically passive lot. Plans to diversify the economy, by developing agriculture and privatising land (a controversial move for a nomadic culture), ran into political trouble in June 2003. But reform in Kazakhstan's financial sector has been very successful. 

Uncertain future
Nazarbayev has undoubtedly overseen a petroleum-fuelled economic upturn and shepherded a comfortably pro-presidential majority into parliament, yet his very domination of the political arena and the looming uncertainty of succession conspires to cast a pall over the future. 
Kazakhstan stood out as the economic leader, with plentiful oil to sell amid high world prices and a rapidly developing financial system to move the money around, but the hydrocarbon-heavy mix promises the country an uphill battle if it is to avoid the fate of an oil-dependent rentier state and arrive at a more diversified economy. 

Canny foreign policy
Nazarbayev, who pioneered the "multivector" approach to foreign policy in the region, no doubt relished the sight of his broadening legacy, as Kyrgyzstan, Tajikistan, and Uzbekistan attempted to replicate Kazakhstan's feat of maintaining cordial relations with such regional and global heavyweights as Russia, the United States, and China while getting something for themselves in the bargain. 
The basic rules of the "multivector" game, as played in the southeastern arc of Central Asia, have now emerged: cooperation with Russia and China premised on a common acceptance of authoritarian political practice and driven by economic interests, often in the energy sector; cooperation with the West, primarily the United States, premised on the primacy of security concerns and driven by common opposition to Islamic extremism; and just enough tension between the big outside players to let the smaller Central Asian players extract concessions with the occasional move to and fro. To protect its oil-wealth, which lies in and around the Caspian sea, Kazakhstan is creating a full-fledged navy. 

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WB offers 35m euro for Kazak agro development

The World Bank (WB) approved the allocation of a 35m euro credit for the realisation of the second stage of Post-Privatisation Agriculture Support project in Kazakstan, the bank's press service said recently, Kazinform reported.
The combined value of the project is 96.1m euro and it consists of several components. Kazakstan joined the World Bank in 1992. Since then the bank's investments in the country have amounted to nearly 2bn euro in 23 investment projects.
The aim of the project is the provision of assistance to farmers and agricultural SMR's in getting access to commercial financial services, thus stimulating general development of the farming sector in the country and raising the living standard of rural inhabitants.
A drop in agricultural production and a rise in investment requirements have conditioned a growing demand for financial services in the farming sector, especially in the field of long-term crediting.
The needs in innovative financial products and instruments have sharpened due to the continued privatisation of farming enterprises, bringing in a new clientele who do not always possess adequate mortgage.
"Kazakstan's banking sector is already playing an important role in agriculture, but its scale is mostly limited by large farms and enterprises," WB country manager for Kazakstan, Loup Brefort said.
The key task of this project is encouragement of deeper and more extensive financial intermediation in agriculture for the benefit of small farming businesses, thus increasing the range of available resources for their development, improving their competitiveness and finally increasing the incomes of small agricultural producers, he added.
These are financial consultancy services for agricultural risk management, price risk management, increase of the scales of financial services in rural areas and development of micro-financing.

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Moody's upgrades KEGOC issuer rating to Baa3

Moody's Investors Service upgraded to Baa3 from B1 the long-term issuer rating of Kazakstan Electricity Grid Operating Company (KEGOC), the state-owned electricity transmission grid owner and system operator of Kazakstan, Interfax reported recently. In a report, the agency said that the rating outlook is positive.
With over 23,606kms of electricity transmission networks, KEGOC had revenues of over 15.7bn tenges (€106m) in 2003. The company is 100% state-owned through the Kazak Ministry of Energy and Mineral Resources.
According to Moody's, the upgrade reflects KEGOC's low-risk, regulated monopoly business profile, its ownership and support from the government and its increasing strategic importance to Kazakstan's economic growth. KEGOC's revenues are regulated by the country's Agency on Regulation of Natural Monopolies, although there is no fixed tariff period.
Moody's noted that the regulatory framework is still developing, but has been generally favourable to KEGOC so far and the upgraded rating reflects Moody's expectation that this scenario will continue.
However, Moody's warned that Kazakstan's transmission grid infrastructure suffers from poor reliability in some areas and requires major capital expenditure in order to improve the quality of electricity supplies and manage the expected rapid growth in volumes. Although Moody's expects KEGOC's leverage to increase over the short to medium term as it carries out the investment necessary, government support for the successful completion of these infrastructure projects substantially mitigates the financial risk involved.
KEGOC is also responsible for implementing the government's plans for the liberalisation of the Kazak electricity market. Even as Moody's believes that this may expose the company to some greater operating risks over the short term, the rating agency anticipates that, in the medium term, the potential for increased electricity transmission volumes resulting from a liberalised market may benefit KEGOC.
There are no plans to privatise KEGOC and Moody's believes that the Kazak government will support the group in case of need.

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Tolkynneftegaz to build gas plant in Kazakstan

Kazak oil company Tolkynneftegaz plans to build a gas processing plant in Mangistau region at an estimated cost of €97m, Adilbek Kusherov, director of the regional economics, industry and trade committee told Interfax recently. He said the plant would be able to process 10m cubic metres of natural gas per day, produced at the Tolkyn field by Tolkynneftegaz and also at other nearby fields. The plant will produce liquid propane and butane and pentane mixes. Kusherov said the plant should be completed in 2006 and construction would be carried out using a credit from a commercial bank in the republic, Tolkynneftegaz is currently preparing a feasibility study for the project and is setting up a company to build the facility.

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Kazakstan and Israel talk business development

Kazak businessmen of the State Export Credit and Investments Insurance Corporation organised a business seminar recently outlining that the mechanism of external risks insurance is one of the important factors stimulating the development of the country's exports of goods and investments, Kazinform reported.
The rich experience of other countries in reduction of risks in foreign economic activity appeared to be valuable material for the development of Kazakstan's business sector.
At the opening of the seminar Israeli ambassador at Astana Mikhael Lotem expressed expectations that Israeli experience will not only help Kazakstan in the development of exports, but it will also allow for ways to heighten mutually beneficial cooperation. Director of the department of insurance policies management of the Israeli Export Credit Agency IFTRIC Adi Gross spoke about the role of the agency in development of trade cooperation between the two countries. The largest banks of Israel and famous Israeli companies successfully apply this financial instrument in their business in Kazakstan.
Non-payments of foreign trade partners reached US$60m. The debtors are not only CIS countries, but also Great Britain, Turkey, China. "Having united efforts we should collect the debts and establish civilised trade exchange," said the President of the Kazak Insurance Corporation, Alikhan Smailov.

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China-Kazakstan trade to reach US$4bn

Trade between Kazkakstan and China may increase to US$4bn, up from US$3.2bn in 2003, Interfax News Agency reported.
"Early reports indicate that last year trade turnover would reach US$4bn. In 2003 we achieved trade turnover of US$3.2bn," Chinese Ambassador to Kazakstan, Zhou Xiaopei, said at a meeting with the parliamentary Agrarian Industrial Labour Union.
He said the target figure of US$5bn would be reached earlier than 2010 named by the leaders of the two countries.
The ambassador named three conditions which he found essential for boosting bilateral trade. Firstly, the completion of the oil pipeline from West Kazakstan to West China, secondly the construction of a gas pipeline from Kazakstan to China and finally the construction of a railway from the Dostyk-Alashankou terminal to the Caspian Sea and further to Turkmenistan, Iran and Turkey.

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Eureka Mining to speed up prospecting at Shorskoyev

Eureka Mining managing gold-mining projects in Kazakstan plan to accelerate the prospecting for the molybdenum deposit Shorskoyev in Kazakstan, Interfax News Agency reported.
The decision was made in connection with the rise in demand for stainless steel. Work will be completed in the first quarter of this year. The deposit Shorskoyev is expected to produce 3.8m pounds of molybdenum and 1.2m pounds of copper by the end of 2005. "At present, there is a deficit of this product," company chief, Kevin Fu, said, adding: "We are also studying other molybdenum projects in Kazakstan and the Russian Federation." Steel founders, including Thyssenkrupp AG, use more than 60 per cent of molybdenum. The world production of stainless steel has increased by 7.3 per cent over the first nine months of the current year. Fu said the new project will cost US$30m.

Kazakstan ups 11-month steel roll output by 6%

Kazakstan raised production of flat rolled steel products 6% year-on-year to 3.69m tonnes in January-November last year, Interfax News Agency reported.
The figure included 268,120 tonnes of tin-plate and tin-plated sheet, up 10%, and 704,770 tonnes of galvanised steel, up 9%. Kazakstan increased crude steel production 8% year-on-year to 4.97m tonnes in the 11-month period.
Production of carbon electric steel soared 90% year-on-year to 223,190 tonnes. Ferroalloy production went up by 3% to 1.32m tonnes, including 981,210 tonnes of ferrochrome, up 8%, and 95,700 tonnes of ferrosilicon chrome, up 7%.
However, ferrosilicon output decreased by 8% to 95,250 tonnes and ferrosilicon manganese production fell 2% to 144,010 tonnes. Kazakstan produced 3.94m tonnes of pig iron, up 4% year-on-year.
Production of large and small diameter tubes and hollow steel sections fell 8% to 49,990 tonnes, while production of cold-deformed carbon angles and sections rose 53% to 32,410 tonnes.

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