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November 26, 2022

Kazakhstan: From oil revenues to investments

In a recent speech, the President of Kazakhstan, Mr. Nursultan Nazarbayev outlined the political and economic goals and tasks facing the country.

One of the distinctive features of the Kazakh leader’s speech is the absence of excessive optimism and realistic view of things.

-Now the world is rapidly changing, – Nursultan Nazarbayev noted. The new reality with different opportunities and risks appears right before our very eyes.

The President of Kazakhstan classed as such the global economic crisis, which has become a source of instability on the global financial markets – a hydrocarbon, metal, and food markets, etc., and as a consequence – a decrease of Kazakhstan’s exports and the economic growth slowing.

– Today there are no oil super-revenues, – the leader of Kazakhstan hardly summed up. According to him, the global economy is under pressure of political factors. The world has become unstable. Major Powers have imposed sanctions against each other. The confidence plummeted between them. The uncertainty and conflicts in the Middle East, North and Central Africa led to massive flows of refugees. The international terrorism is a serious threat to the world today. This is the result of destruction of statehood by the interference of external forces in the internal affairs of sovereign states. The bandits, extremists and terrorists are at ease where there is no state, no power, and that’s the way the mop flops.

As Nazarbayev said now the development of the world occurs against the background of fierce competition of global and regional centers of power. That is, the country needs to be economically strong and politically stable in order to survive.


Kazakhstan has the experience of survival since the days of independence. The collapse of the USSR, the life “without oil”, crises of the late ’90s forced the authorities to develop a tough, but the effective strategy of existence. It has allowed the republic to hold out thereafter, in the late 2000s.

– The large-scale privatization and the arrival of majority of multinational companies to our economy, – reminded the Kazakh leader. At that time, Kazakhstan took over the construction of a new capital – Astana, the Caspian Pipeline Consortium began working, the Strategy “Kazakhstan – 2030” launched. The importance of the decision to establish the National Fund has become absolutely clear when the global financial crisis of 2007-2009 erupted. Almost $ 20 billion – 14 percent of Kazakhstan’s GDP has been allocated for the maintenance of employment, repair and construction of roads, improvement of cities and villages. The banking sector, farm enterprises, small and medium businesses received help.

The Government of Kazakhstan has developed and consistently implemented the two anti-crisis plans. From the oil production the country reoriented to the industrial and innovative development, the legislation has undergone significant changes, the tactics in the fall of “oil” prices to 20-30 dollars per barrel was thought out. But the negative factors, in particular the forced transition to a floating exchange rate of tenge, also existed.

– Now, and in any other time our main anti-crisis stratagem is identical with three simple but important concepts: growth, reform, development, – said the President of Kazakhstan.

First of all, for that Kazakhstan needs to stabilize its own financial system, and to strengthen the tenge exchange rate, as its support by the National Bank cannot be eternal.
Nazarbayev proposed to the National Bank to conduct stress testing of all banking sector subjects concerning the non-performing loans. The measures on the adoption and cancellation thereof will be assumed according to its results. Organizations that fail to solve the problem of capitalization will leave the financial system. Kazakh banks have to comply with all international standards, including those of the Basel Committee and the International Monetary Fund.

The very population of the country has to become the main allies of the national currency position strengthening.

– Kazakhstanis have to get used to that we live for the tenge, Nursultan Nazarbayev emphasized. – We buy bread and clothes for tenge, we save money in tenge as it is more profitable, because dollar deposits bring low interest. Our speech has tenge and we will live using tenge. Then the calm will come in the country.


Kazakh leader sees the growth and development of the economy in investments. He plans to lift restrictions on the privatization of a number of public sector facilities and to create optimal conditions for local and foreign investors. In particular, he plans to cancel the pre-emptive rights of all shareholders on acquisition of the disposed assets, to develop concrete proposals for strengthening the anti-monopoly activities, to eliminate the distortions of the market incentives in the form of artificial price control.

-The market economy -is a competition of strongs, Nazarbayev asserts. – The losers should be able to withdraw from the market or to start over. Let the new owners come in place of ineffective managers.

Kazakh leader highlighted: the country needs private investments with a focus on transnational corporations. The first steps towards this have already been made. For example, recently the decision was made to establish the International Financial Center “Astana”. It will become a regional hub in the field of Islamic financing, private banking and reinsurance.

– Kazakhstan has to become a leading country in the region with strong institutions, competent, efficient and predictable Government, Nazarbayev said. He authorized to create a Government Council focused on attracting investors and improving the investment climate.

Kazakhstan also intends to diversify its sources of funding. So, an agreement with “Eximbank” on the raising debt capital in the amount of $ 2.6 billion has been reached during the visit of Kazakh leader to China.

As Nursultan Nazarbayev noted today we shall more actively develop the export niches in the global and regional markets. “We need to effectively use the economic potential of neighboring countries. Firstly they include China, Russia, Iran, Mongolia, India, Pakistan, Central Asia and the Caucasian countries. These countries annually import goods and services to more than 3.5 trillion dollars. It is necessary to conclude Free Trade Agreements of the Eurasian Economic Union with key regional markets. The government should work out these issues with our partners and to solve them for the benefit of all concerned. MFA has to involve all in the task the resources of Kazakhstan diplomatic missions”, – the leader of the country said.
For competitive ability of the workforce Kazakhstan proposes to establish centers for training in cooperation with other countries – Germany, Canada, Australia and Singapore.


According to Nazarbayev to increase the innovative potential of Kazakhstan’s economy it is necessary to develop competence in the field of smart technologies, artificial intelligence, and cyber-physical systems integration, energy of future, design and engineering. This can be done only through the construction of an efficient research and innovation system. The strong research universities and innovation clusters formed on the basis of high-tech park “Astana Business Campus” Nazarbayev University and Technopark “Alatau” in Almaty will be its foundation.

– Holding of International specialized exhibition EXPO – 2017 in Astana gives us a good opportunity to vigorously develop new energy based on “green technologies”, – said the leader of Kazakhstan.

The first results of the innovation strategy are already visible – we reached an agreement with China on cooperation in the non-primary sector for 23 billion dollars (and this amount means the construction of more than 40 new businesses). The President’s visits to London and Paris have returned in the guise of the concluded contracts for 11.5 billion dollars. The visit of the Japanese delegation to Kazakhstan has turned in the arrival of concern “Toyota” on the Kazakhstan market and in a new round of development of Kazakhstan’s car industry.

– One of the main results is the high level of trust of the international financial institutions in us, – Nursultan Nazarbayev emphasized. – At this difficult time, supporting our reforms, they discovered for us the access to financial resources in the amount of $ 9 billion. We signed with the European Union an agreement on the in-depth partnership and cooperation.
It should be clarified that the economic cooperation is largely the result of a reasonable and balanced foreign policy of Kazakhstan. Republic strongly advocates for nuclear-free world, for the elimination of terrorism and extremism, and for the solution of any conflict in a peaceful way. The leader of Kazakhstan outlined the peacekeeping position of his country in the current disagreements between Russia and Turkey.

– We are very upset with the event occurred – he said. – Though it is very hard, I believe it is appropriate to create a commission, to identify those responsible, to punish, to acknowledge the error and restore the relationship. I make a call for this to our friends from Russia and Turkey.


The message announced on November 30 – a landmark day for Kazakhstan also because starting from this day the Republic de jure became a full member of the World Trade Organization. Kazakhstan’s accession to the WTO opens up new economic opportunities for foreign investors, and for Kazakhstan producers.

As noted the Director General of the WTO, Roberto Azevedo, in his report for 2015, the main lesson learned from the Kazakhstan’s accession to the WTO, it is the invaluable role of the strong political will which has been demonstrated by the Head of State, and his direct participation in the completion of the negotiation process.

According to the report, these negotiations were the most difficult in the history of the organization. The Secretariat and the WTO member countries noted the high quality of arrangements intended to make a major contribution to the development of the international trading system. As a result the practical solutions have been adopted to ensure the balance between the compliance with the conditions arising from the Kazakhstan’s membership in the EAEC, and the implementation of the commitments undertaken within the framework of country’s accession to WTO.

The Prime Minister of the Netherlands Mark Rutte who recently made an official visit to Kazakhstan also said in an interview that due to the development of the country not only the energy sector, but also opportunities for trade and investment become attractive for Dutch companies. Dutch companies actively work in the food industry, infrastructure and dredging and maritime operations, as well as in the provision of professional consulting services. There has been a significant increase in the number of agricultural projects, especially in the field of milk production and poultry farming, and horticulture in the protected and open field. Modern greenhouses and dairy farms using the Dutch technologies are regularly built.

– Kazakhstan has a huge potential to become a gateway to the East, that is, for the countries of the East Asian region (China, South Korea and Japan), providing access to a large region of Eurasia – said Rutte. – Kazakhstan can play an important role as a major transport hub between East Asia (China) and Western Europe. As the Netherlands themselves act as the same “gateway”, we are ready to share our experience in transport hub logistics.

The latest report “Doing Business” published by the World Bank shows that in recent years Kazakhstan has risen by 12 points and took 41th place in the ranking of countries that create the most favorable conditions for business. Furthermore, in terms of the Global Competitiveness Index of the Davos Economic Forum, Kazakhstan ranked 42 in the world. These indicators of post-Soviet country, achieved just in two and a half decades speak for themselves about the benefits of the strategy chosen by Kazakhstan, focused on the development and stability. And, as judged by the statements of the Kazakh leader, the country intends to continue to pursue this path.

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