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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: 308 - (29/08/06)

Phenomenal growth figures are still the order of the day 
Economic success is the background to understanding Kazak politics. GDP has been growing at an incredible 10 per cent per annum in this decade, even if this phenomenal progress is dipping a bit recently. Kazakstan's GDP is projected to have grown by 7.7 per cent in the first half of this year, the first deputy chief of the country's national statistics agency, Yury Shokamanov, told Interfax News Agnecy. Shokamanov believed that the Kazak government will hopefully be able to keep average annual inflation at 7 percent; but consumer prices might end the year up rising by 8 percent.
The Washington-based International Republican Institute has commissioned a poll that found, to no one's surprise, that despite gripes about corruption, the citizens of this booming former Soviet republic were optimistic about the future and supported President Nursultan Nazarbayev. He was re-elected by a whopping majority last year, whose exact extent is not to be taken too seriously in a 'fledgling democracy.'
By inviting Western oil companies to invest billions in huge but hard-to-reach oil deposits that the Soviets had ignored, Nazarbayev, a former steel engineer who has ruled Kazakstan for 15 years, has created one of the most vibrant economies in the former Soviet Union. Given that the population is only 16 million and that the country, the size of Western Europe, enjoys 60% of the FSU's mineral resources, the prospects could hardly be better.
Like Putin's Russia, Kazakstan is reaping vast revenues from the world's highest as yet oil prices, over US$75 per barrel in early August, 2006, which can be used to renovate the decrepit infrastructure and despoiled environment inherited from communist days. 
Both countries are embarking on a massive programme of public works, which open up huge opportunities for enterprising private firms abroad. 

Transport strategy until 2015 unfolded
As part of this, Nazarbayev has approved a Transport Strategy of his republic until 2015.
The government has been ordered to work out and approve a plan of events on the strategy's implementation. The government has to inform the President of Kazakstan on the strategy implementation each year by January 30th. 
The strategy was worked out by the Ministry of Transport and Communications on orders from the head of state. The strategy includes construction of 50 thousand km of roads, around 2 thousand km of railways, to develop Aktau and Kuryk ports, and to build up a fleet of air vessels.

New opposition party consolidates in Kazakstan 
Kazakstan's opposition Alga! (Forward!) party held its second congress on July 23rd. It is still in existence this year, the great thing in Central Asia for any oppositionist cause.
Alga! will have the same objectives as the Democratic Choice of Kazakstan, an opposition party banned by court order in 2004 for an allegedly anti-constitutional statement, Asylbek Kozhakhmetov, head of the Alga! organising committee and one of the former leaders of the Democratic Choice of Kazakstan, told the congress, held in Almaty. 
Kozhakhmetov said Alga! planned to become an active participant in the Kazak opposition and "struggle for the democratisation of Kazakstan." That is they want the next elections to be genuine ones, a tall order in Central Asia.

Experts say Kazakstan has all the resources for tourism 
Kazakstan's Chairman of the Committee on Regulation of Commerce and Tourism under the Ministry of Industry and Trade Kairbek Uskenbayev spoke at a recent meeting about the plans of the committee on the creation and development of the tourism sector. According to him, Kazakstan possesses everything, all the necessary resources to set up and promote tourism.
The committee has worked out a plan of the profitable promotion of tourism, which suggests removal of administrative barriers in the sphere of visa and registration procedures for foreign citizens. The expert council, set up under the ministry of industry and trade, will be regularly evaluating the problems of tourism in Kazakstan. In this connection there has been concerted a joint decree of the ministry of internal affairs, national security committee and the ministry of foreign affairs of Kazakstan.

Belarus could assist Kazakstan in the development of petro-chemistry through know-how
Kazakstan has an unlikely new courtier in Belarus, which claims that it could assist Kazakstan in the development of petro-chemistry through know-how in this sphere, says the Trend special correspondent in Astana, citing the Extraordinary and Plenipotentiary Ambassador of Belarus to Kazakstan, Larisa Pakush. 

This may be nonsense; or it might just not be:-
"There is a well-developed petro-chemical industry in Belarus. The country's income from crude refinery amounts to over US$1bn. 30% of the GDP is gained from the petro-chemistry. Belarus which has unique designs could sell its know-how," the diplomat claimed. 

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Moody's may upgrade insurer Kecic 

Moody's Investors Service has placed the insurance financial strength rating of the State Insurance Corporation for the Insurance of Export Credit and Investment of Kazakstan (Kecic), currently Ba1, on review for possible upgrade, Moody's said in a press release, New Europe reported.
Headquartered in Almaty, Kazakstan, Kecic was founded in August 2003 and started operations in February 2004. It is 100 percent owned by the Republic of Kazakstan and is mandated to be the primary provider of export credit insurance in the country, both commercial and political. In addition, Kecic is writing inward reinsurance business in the Kazak market. A number of recent developments have put upward pressure on Kecic's rating, in Moody's view. On June 9, 2006, the foreign currency bond rating of the government of Kazakstan was upgraded by Moody's from Baa3 to Baa2, thus improving the quality of both Kecic's asset base and support by the owner.

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Turanalem bank raises 800m syndicated loan 

Kazakstan's TuranAlem Bank (BTA) has appointed Bank of Tokyo-Mitsubishi UFJ, Commerzbank and Standard Chartered Bank as the organisers of an 800 million Euro syndicated loan, BTA said in a release, New Europe reported.
TuranAlem Finance BV, an SPV company for BTA, will serve as the borrower. The loan will be divided into two tranches of 18 and 36 months with an interest rate of Libor + 0.35 per cent and Libor + 0.65 per cent, respectively. The funds are being acquired for general corporate purposes, including the refinancing of a 777 million Euro syndicated loan the bank received in September 2005. TuranAlem Bank, the third largest bank in Kazakstan, ranked eighth by assets among CIS banks in 2005, according to the Interfax-1000 ranking of CIS banks. BTA shareholders are Raiffeisen Zentralbank Oesterreich AG of Austria, the European Bank for Reconstruction and Development, the International Financial Corporation and FMO of the Netherlands, as well as a number of entities and individuals and BTA executives.

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Kazaks strengthen ties with European Union 

Never before has Kazakstan seen such a vast range of international opportunities as this year in Europe and worldwide. Astana is bidding to take the 2009-OSCE rotating presidency, hosting its second success forum - dialogue of civilisations, President Nursultan Nazarbayev participating, as a single CIS invitee, in the G8 meeting in St. Petersburg, and above all these launching its first telecommunication satellite into orbit, as well as esculating relations with its trading partner number one - the European Union. 
Recently the European Union was holding its Eight Cooperation Council meeting with Kazakstan, New Europe reported. 
The meeting was chaired by Akhmetzhan Essimov, Minister of Agriculture of the Republic of Kazakstan, former Ambassador to the EU, the only participant of all previous EU-Kazakstan Co-operation Council meetings. The Kazak heavy artillery delegation was represented by 10 profile vice ministers. The delegation of the European Union was led by Pertti Torstila, Secretary of State at the Ministry of Foreign Affairs of Finland, Benita Ferrero-Waldner, Commissioner for Foreign Affairs, Hugues Mingarelli, Director of the European Commission for East Europe, Caucasus, and Central Asia. The incoming German Presidency was represented by Ulrich Brandenburg, Deputy Political Director. 
The Cooperation Council reaffirmed the desire to see EU-Kazakstan relations continue to strengthen politically, economically and commercially, especially in the context of the Partnership and Cooperation Agreement between the EU and Kazakstan. Alongside, there is a strong desire to go beyond a standard cooperation and look ways for strategic partnership.
"We regard Kazakstan as an extremely important partner. The European Union is resolute in its wish to develop the relationship based on common values, such as respect for the rule of law, multilateral democracy, human rights, and freedom of media," Mingarelli said. The Cooperation Council discussed recent developments in political process in Kazakstan in light of its bid for the 2009-OSCE rotating chairmanship, as well as election legislation, activities of political parties, mass media and freedom of speech. The core issues for serious discussion became democracy and freedom. The Council took note of the EU's intention to reach a decision on supporting Kazakstan's candidacy by the end of this year. In this context, Mingarelli admitted: "We have been able to acknowledge the success of Kazakstan in all these areas." In particular, "there were improvements in the 2005 presidential election, the authorities have also made efforts to strengthen the court system." At the same time, Mingarelli noted that "as long as our relationship is constructed on the basis of sincerity, the sides managed to define areas for further improvement. We consider it necessary to carry out consolidated work on media, all opposition members have to have equal opportunities," he stressed. 
The Cooperation Council underlined the continued engagement of Kazakstan to enhance regional cooperation and integration initiatives, as well as increasing the volume of Kazak investment in the regional infrastructure projects, thus welcoming its crucial regional role, which benefits conflict prevention, sustainable economic development and cutting poverty.
The head of the EU delegation, Torstila of Finland, welcomed the forthcoming visits of Nazarbayev and Foreign Minister, Kassymzhomart Tokaev, to Brussels at the end this year. He expressed confidence that the forthcoming meetings in Brussels will serve as an impulse for the further deepening of the EU-Kazakstan relations. Torstila in particular reconfirmed that Kazakstan is the strategic partner of the European Union in Central Asia, and the existing Partnership Cooperation Agreement is the major tool of the EU-Kazak collaboration, which is based on the high dynamics of trade and economic ties, rapidly growing economic and geopolitic interests of the European countries, joint actions to address global modern challenges, namely to maintain energy security and effective dialogue of civilisations. 
Ferrero-Waldner underlined the presence of both sides with common political and economic interests, the progress Kazakstan had made in the field of firmly improving democracy, establishment of the State Commission on designing concrete definitions for the programme for democratic reforms, welcomed the planned elections of representatives of local authorities, in Kazakstan in the autumn of this year. The continued ban on the implementation of the death penalty, etc. Ferrero-Waldner confirmed her intention to visit Kazakstan in October-November this year.
The Cooperation Council discussed the growing problem of illegal immigration to Kazakstan, and recalled the EU's offer of assistance to Kazakstan in border management issues (BOMCA.) It welcomed the ratification by Kazakstan in November 2005 of the Convention on the fight against human trafficking and Prostitution Exploitation by Third Parties, and the establishment of a special department at the Ministry of Interior to deal with these issues. The Cooperation Council welcomed Kazakstan's efforts to improve its anti-money laundering legislation, with assistance coming from the EU expertise. 
The Kazak delegation noted the sharp rise of a mutual trade turnover up to US$15.3 billion in 2005, thus making the EU the number one Kazak foreign trade partner ahead of Russia and China, as well as emphasising the booming energy dialogue including those agreements reached during the visit in May of the Energy Commissioner to Astana, and the Kazak oil minister pay-back visit to Brussels last June. Further, Kazak Minister Essimov informed the EU side of steady economic growth for a sixth consecutive year, social and economic reforms undertaken in a resolute and effective manner, which has already positively affected the well-being of citizens and the competitiveness of the economy, and presented the brand new programme of modernisation of the country put forward by President Nazarbayev - the strategy to make Kazakstan among top-50 world's developed and competitive nations. 
The Cooperation Council welcomed the continuing strong economic performance of Kazakstan. It underlined that enhancing the transport of Kazakstan's energy resources to the EU is a common priority for both sides.
It noted progress in co-operation in a large range of areas, and discussed further evolution in these fields, which include oil pipeline projects that will enhance EU security of supply, the diversification of natural gas export routes, nuclear energy, civil aviation and water resource management. The Council discussed the possibility of concluding a new bilateral steel agreement, and Kazakstan's accession to the WTO. 
Kazak officials were open for discussion of the most sensitive topics, whether they concern human rights or economic problems. They said they were ready for and open to criticism provided it is constructive and well-based. "Our country is determined to develop new relations with the EU by looking into the future, in a pragmatic and a staged way based on common values and interests," noted a statement at the closing press conference following the Co-operation Council meeting made by the head of the Kazak delegation, Minister Essimov. The EU-Kazakstan Cooperation Council has held eight meetings since its foundation in 1999.

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Kazakstan sets sights on London to stage floatations

A new wave of companies in Kazakstan are poised to choose London for listing shares. It is thought that they will raise about £3 billion at the same time, The Times reported recently. 
KazMunaiGaz, the state oil and gas company, is likely to float a subsidiary in the fourth quarter, giving investors exposure to Kazakstan's huge oil and gas reserves. 
That deal, lead-managed by CSFB and ABN Amro, could raise up to £1 billion. "It's a benchmark deal, Kazakstan's version of Rosneft," Jurgen Rigterink, head of ABN Amro's Kazakstan office, said. 
Eurasian Industrial Association, one of Kazakstan's largest holding groups, is also planning to list in London. Its assets, including Aluminium of Kazakstan and Kazchrome, account for 5 per cent of national GDP. 
Margarita Rudakova, a director of Eurasian Bank, said: "A London listing will be good for the company, but also good for Kazakstan. It's a reputation thing." 
Kazak banks are also lining up to list on the London Stock Exchange (LSE). The Kazak banking sector is the envy of the region, thanks to liberal reforms pushed through by Grigori Marchenko, the former governor of the national bank. 
Mr Marchenko - now chief executive of Halyk Bank, the country's most profitable bank, which is preparing to float a minority stake - said: "Some Westerners might have the wrong idea of Kazakstan - from characters such as Borat, the comedian, for example - but the image of Kazakstan that Borat portrays has nothing to do with the real Kazakstan. We've got the most progressive financial sector in the CIS [Commonwealth of Independent States, the former Soviet Union]." 
The upcoming IPOs hope to follow the success of Kazak-mys, the Kazak copper company, which raised £661 million in October in the first full listing from a post-Soviet Union company, lead-managed by JPMorgan Cazenove. The company's shares have more than doubled since listing, making the company the 49th biggest on the FTSE 100. 
Oleg Novachuk, Kazakmys's chief financial officer, said: "The market perception of Kazakstan is better now, thanks to our deal. Future IPOs will be easier because of it." Mr Novachuk, a British resident, owns 12 per cent of the company, making him one of the richest people in the UK. 
Bond investors are already quite familiar with the country, because Kazak firms, particularly banks, have raised more than £10 billion on the Eurobond market over the past three years. Yet local analysts say that investors should tread carefully. Dosym Satpaev, head of the Risk Assessment Group in Almaty, said: "Practically all big companies are controlled by the President's family. It's safe for foreign investors, but only as long as this particular elite stays in charge." 
Mr Satpaev also noted that "transparency is not Kazakstan's strong point." Indeed, Kazakmys has already been finding the LSE reporting requirements difficult. It walked away from KPMG, its previous auditor, when the accounting firm said that it would take too long to do proper due diligence on the firm. Ernst & Young said that it could do it more quickly and employed a team of 156 people to go through the company's books. 
Mr Novachuk denied that the company is controlled by the family of President Nazarbayev, although he admits that the President's brother is on the board. 

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Turanalem bank acquires 75m loan from ADB 

Kazakstan's TuranAlem Bank has acquired a five-year 75 million Euro loan from the Asian Development Bank (ADB), the Kazak bank's press service said in a release, New Europe reported.
The funds will be spent on financing small and medium-sized businesses in all branches of the economy, the release said. Support will primarily be provided to enterprises working in industry, construction, services and innovative activities. The money will also be used to finance projects aimed at providing bank clients with retail products. More specifically, the bank plans to acquire a leading position in the car loan market, the release says. The loan represents ADB's second private sector financing without central government guarantee in Kazakstan. On June 15, ADB signed its first private sector loan to Kazakstan for a 50 million Euro five-year senior loan to JSC Alliance Bank, which is also meant to boost financing for SMEs.

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Gold production down 6.3%

Kazakstan produced 4,406 kg of refined gold in January-June, 6.3 per cent less than in the same period of last year. Silver production fell 1.3 per cent to 399,317 kg, the State Statistics Agency said, Interfax News Agency reported.
Kazakstan increased alumina production 2.9 per cent year-on-year to 768,026 tonnes, the agency said. Unprocessed zinc production rose 3.2 per cent to 185,678 tonnes but unprocessed lead output fell 16.1 per cent to 59,436 tonnes and refined copper production fell 7 per cent to 196,264 tonnes. 

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Company to restructure telecom in August 

In August Kazakstan will hold a competition to choose a foreign consulting company for the restructuring of national telecom provider Kazaktelecom, Askar Zhumagaliyev, chairman of the Kazak State Information Technology and Communications Agency, said in Astana, Interfax News Agency reported.
"We will hold an appropriate competition that will determine a consulting company, to which we will give the initial figures and the initial points for restructuring Kazaktelecom," he said. Following an analysis, the consulting company will say "whether we actually need to restructure Kazaktelecom and whether this will lead to the creation of a competitive market," he said. n May Kazak Prime Minister, Daniyal Akhmetov, instructed a number of agencies to prepare measures in a three-year period to demonopolise the country's telecommunications market. In particular, he raised the issue of holding a competition to choose a foreign company for restructuring Kazaktelecom. Kazaktelecom is the leading telecom operator in Kazakstan.

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Kempinski Hotels plans 2 projects 

Kempinski Hotels, a founding member of the Global Hotel Alliance, has signed a cooperation agreement with Okan Holding, one of Kazakstan's leading real estate development companies, covering Kazakstan, Uzbekistan, Kyrgyzstan and Turkmenistan, Interfax News Agency reported.
Within Kazakstan, Okan Holding has invested in a number of prestigious developments, including a national museum, first class bank, concrete production, food production and trading, business and office complexes as well as residences and hotels. The aim of Okan Holding is to attract foreign investment in Kazakstan with the highest standards of construction and promote the country's infrastructure and environment. According to the cooperation agreement, Kempinski Hotels and Okan Holding have already signed a management agreement for a new five star luxury hotel in Almaty, Kazakstan's largest city with 2.8 million inhabitants scheduled to open in 2008. The Kempinski hotel will be part of a luxury complex in the exclusive Bostand district.
Kempinski is assigned to manage the modern 230-room hotel and serviced apartments, which will feature a conference centre with ballroom, business centre, several restaurants as well as a Spa and fitness centre. The complex will also house Almaty's largest shopping mall, covering 486,530 square feet, with space for some 140 upmarket boutiques.
The futuristic complex in the Mikrorayon district features a base podium with Astana's largest shopping mall as well as a business and convention centre.
An office tower on 16 floors will offer 172,223 square feet of office space. A further two towers will be managed by Kempinski. Astana International Airport is served by Lufthansa, Ukrainian Airlines, Turkish Airlines, Pulkovo Airlines and Air Arabia, with several flights daily to Almaty on Air Astana. Kazakstan is considered to be the largest state in Central Asia and the world's ninth largest in terms of land surface. Economic reform and government led privatization have created a positive growth momentum for the country, which has increased foreign investment and exports since 2000.

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