Kazkahstan: Surviving or Prospering?

Kazakhstan is a country of contrasts, with no exaggeration: desperate poverty neighbors with arrogant wealth, economic growth is accompanied by decline of social sphere and expansion of state control, and tolerance abuts discrimination. Such is the set of topics in focus of Kazakhstani blogosphere this week.

Eilide, a blogger living in Armenia but closely watching the developments in Kazakhstan, wonders if everything is really as good in Kazakhstan as some of her country's experts describe:

“They praise institutional development, stock market and financial sphere on the whole. A nice picture of rich and prosperous country. But there is crisis in banking sector, stock market is still very weak and most pension funds show low profitability. Or am I missing something?”, she asks [ru].

Although financial and banking sector do indeed demonstrate vesible sustainability in comparison with other CIS countries, expansion of the state raises serious concerns of the observers, especially after amendments in the subsoil legislation that had been introduced last year, giving the government an exceptional right to unilaterally cancel contracts with the foreign investors that work in the sphere of extraction of natural resources.

Tuganbaev, a Kazakh living in Moscow, updates on the outcome of scandalous Kashagan affair. To remind, Kazakh government was dissatisfied with the performance of consortium of oil companies that are to develop a supergiant Kashgan field on the Caspian shelf and threatened to use the new legislation if its conditions were not met by the alliance.

“The half-year-long talks have eventually ended up in Kazakhstan's favor. The state-run KMG will become the largest participant in the project as its share ups two times. The government will now have 16,81 per cent, while all other members of consortium have agreed to give up their shares from 18,5 to 16,6 per cent [ru]”.

Strannik-kz says that after this deal was settled the state's influence have raised significantly. Mobil Oil, another big participant of the Kashagan alliance, was very opposed to giving up its shares in favor of Kazakhstan. Chevron, another American company is currently taking part in the development of two other huge oil and gas deposits called Tengiz and Karachaganak, shared Mobil's concerns at the most recent meeting with the governmental officials and… were made leave the room due to “lack of respect to the top management of KMG” [ru].

However, the state is not so tough towards another big investor in coal industry — notorious Arcelor Mittal. Last week nearly 30 pitmen were buried in the coal mine. It is far not the first incident, says dansanat, bitterly noting that “when one man dies, it's a tragedy. When dozens perish, it's mere statistics” [ru]. But the government fails to take adequate steps in investigation of the cases. This time an explosion had again killed people, but the journalists and civil activists were not allowed to access the site. Mantrov-kz opines that an information blockade is inadmissible:

“Journalists must cover the issue themselves, not by rebroadcasting of the words of officials. Billionaire Mittal is interested in scarcity of information, because his company's image can be damaged. The state also is not so keen in objectivity, because it bears responsibility for its citizens’ safety. Mass media are the only source of vital information for the families of miners, but it is thoroughly filtered again” [ru].

Besides, while Astana (the capital city), Almaty (a commercial capital) and Atyrau (an informal oil capital) are shining with petromoney-driven gloss and glamour, the rural areas are suffocating in desperate poverty. Scaliger tells a couple of stories how people survive in boundless Kazakh steppes with no hope for better life:

“Speaking incidentally, stories of this kind are nothing new for Kazakhstan, but the first one that met eyes of public. There is the only rule that works in distant and isolated villages, where people were left to themselves – the rule of “Dog eats dog”.

1 comment

  • Oldschool Boy

    What is the point of the article?
    As far as I know, nobody ever said that Kazakhstan is a rich country. It is developing, which means transition from being underdeveloped and poor to being developed and wealthy. Who is arguing against this?
    There are contrasts in Kazakhstan, but show me a wealthy country without poor people, or without bigotry.
    Yes, Kazakhstan is far from being rich, with GDP per capita of about $10,000 (compared with wealthy countries with GDP per capita of above $30,000). Yes, it is wealthier than neighbouring countries. Yes, there are – as in any other counry in the world – luckier people with good education, carier and wealth living in big cities, and there are not that lucky – again, as anywhere in the world – who live in remote deserted villages and who strugle to survive.
    Same old story as everywhere…

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