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Kazakhstan: Blocked Bloggers Discuss Economics

Although LiveJournal, the major blog platform on the post-Soviet space, including Kazakhstan, is still not accessible through the national telecom monopolist Kazakhtelecom, Internet enthusiasts find their way to express their opinions online. The main topic – as, probably, elsewhere these days – is economics.

Alim-atenbek comments on the new global competitiveness report released by the World Economic Forum (WEF). Country competitiveness has become a very popular issue in Kazakhstan, when three years ago the leadership of Kazakhstan declared an ambitious goal of entering the top fifty most competitive states of the world. However, since 2006 – when Kazakhstan was safely on 51st place – the country’s rating fell down to 66th! Alim-atenbek opines [ru]:

This is the indicator of how our government works. I wonder how this fact would be covered in our media… As one of my acquaintances, a respected economist from Berkeley University, says: “Your economy grows, but it does not develop!” I think early 2007 was peak period of our competitiveness. Now we are an oil-abused state, and this dependency is not likely to be over soon.

Many observers tend to consider Kazakhstani market too small for sizeable new business projects because of weak return on investment. Megakhuimyak gives his reasons why it is not [ru]:

This assumption is disputable and wrong. 1. This is applicable not for all sectors. 2. In Kazakhstan, there are a lot of business opportunities; moreover, there are spheres that can be monopolized in 5-10 years. 3. There are few operating manufacturing facilities that can be bought for a giveaway price. In this sense – yes, the market is small. 4. The main reason why business does not want to develop totally new projects is political risk that some people may come and take your business away. 5. Unfortunately, as our president gets older, the probability of property redistribution grows – and new businesses get more and more cautious.

Not only businesses get more cautious – they are also actively engaged in capital runaway to the most notorious tax havens, dass says [ru]:

Only during the first half of 2008, the Kazakhstani investments abroad amounted to $1,5 billion. The most attractive destinations are Netherlands (15,3%), Switzerland (10,6%), British Virgin Islands (8,3%), USA (7,3%). Such information should not be published openly – the unprepared citizens will be upset and start swearing at the government. But if you just take a look at these Virgin Islands, you would agree that half a billion is not worth of begrudge.

Also posted on neweurasia.net

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