Akezhan Kazhegeldin analyses the reasons behind the economic crisis in Kazakhstan and proposes some decisive reforms.
Over the course of many years the ruling class in Kazakhstan has reconciled itself to the idea that everything in the country has to be imported from abroad – be it goods, capital, ideas or advisors. As a result, when the crisis hit no-one was in any doubt to begin with that it, too, had its origins overseas. The price of oil went down abroad, so the dollar became more expensive at home. Growth slowed down abroad, so the downturn sped up at home. But let us not deceive ourselves. In the first place Kazakhstan experienced a very local crisis of a specific nature, different to what happens in other countries when faced with similar problems. In the second place Kazakhstan's crisis is long-term, and not cyclical as the government has been trying to convince us all. We need to understand that before we begin taking decisions about what to do next.
President Nazarbayev is right when he says that no crisis lasts for ever. But we must not wait for the crisis to resolve itself. Experience in other countries shows that crises can be very drawn out, as in the case of Greece or Argentina. Fortunately for Greece it is a member of the Eurozone, so the country is receiving help through European solidarity. We, on the other hand, only have ourselves to rely on.
On the wrong track
The current crisis is the result of 15 years during which Kazakhstan's economy has been moving in a different direction from that of the global economy. Speaking figuratively, our economy is not just trailing behind the global economy, it is going in the opposite direction. The global trend during the 2000s was to speed up modernisation, carry out key structural reforms and prioritise industries that use high tech and hence have a large share of added value.
The trend in Kazakhstan over the last decade and a half was a rejection of structural reforms, an increasingly disproportionate relationship between extractive and manufacturing industries, and reliance on the export of raw materials. Prices for raw materials were high and it looked like the money flowing in from the world's markets would enable us to painlessly alter the structure of our economy. But this was not what was done. As a result, Kazakhstan did not develop in an economic sense in recent years.
The current crisis is more dangerous than the one we saw in the 1990s. Back then, many people lost their jobs. However, the free market made it possible for most of the working population not only to survive but to restructure their lives. People accepted the new rules of the game and were optimistic about the future of an independent Kazakhstan. The mid-1990s were a time of high expectations and major changes. There were still many poor people in the country, but the number of affluent, independent, free citizens was also on the up.
Today the psychological climate has changed significantly. A fixed group of very rich people, both functionaries and businesspeople, has developed in the country. Many of them are also in government. At the same time the number of poor and very poor people is growing. This creates a risk of instability, a surge in crime rates and the spread of extremist ideas.
The economic situation has also markedly deteriorated, and that includes for qualified specialists. Real wages and incomes have fallen by nearly half and unemployment has grown in all sectors. Unlike in the 1990s, those affected cannot simply set up their own businesses, as the openings in the economy are blocked and its channels clogged. It is impossible to get the necessary permits to do business, loans are not available, the laws and the courts protect the rich, and the free competition is hindered by officials and law enforcement agencies.
All this takes the crisis out of the economic realm and into the political. It is stupid to think that the government enjoys popular support, whatever the figures say. Social media, while by no means representing all groups in society, paint a much clearer picture of discontent. There are thousands of times more people who are highly dissatisfied with current conditions than who participated in last congress of the ruling party – the twenty-seventh, apparently.
Social stupor has paralysed society at precisely the time when the country is confronted with a sharp disruption of geopolitical stability, not just in our region but globally. Whether Kazakhstan will be able to achieve a breakthrough and rejoin the global trend of development depends on the preservation of the country's independence and integrity. Today this is the fundamental task of the state – the "national idea", if one is determined to formulate it as such.
I have spoken about this to President Nursultan Nazarbayev on many occasions. His position in this process is very important. The price Kazakhstan pays to overcome the crisis depends on the steps President Nazarbayev decides to take in the near future. If those steps are half-hearted or inconsistent, the price paid by the country will be high. In this case, the issues of modernisation and accelerated development will be resolved the next generation of national leaders.
The art of the impossible
The assertion that politics is the art of the possible seized to be true long ago. In today's world, the art of politics is achieving the impossible by the boldest means possible. The most important thing, as Deng Xiaoping used to say, is not to be prisoners of our habits, not to be afraid of change or of changing ourselves.
Thanks to its willingness to change, China has achieved outstanding results as far as the modernisation of its economy is concerned. Of course, this has happened due to the inflow of foreign direct investment. But this investment happened after decisive changes took place in the economy. Now the Chinese are selling products on the world's markets that it never used to make in the past, successfully competing with traditional industrial nations.
But we don't have to look as far away as China. Even our neighbours Kyrgyzstan and Uzbekistan are changing the structure of their economies with the help of foreign investment. Both these countries produce and sell goods and services – including to Kazakhstan – that they did not produce in the Soviet era. And yet the leaders of those countries do not conduct economic forums, you don't see them at Davos...
The Chinese leadership is sovereign and dignified. But it still follows the recommendations of the International Monetary Fund and does not employ a random group of experts to come up with a special programme for the distant future. A programme such as "Kazakhstan 2030", for example, which has fortunately already been forgotten about.
The first part of "Kazakhstan 2030" was written by American experts on the energy market – professional people but only concerned with their own special area of oil, gas, pipelines and so on. Taking a mechanical approach, they drew up a "white paper" projecting the position of the energy market in the distant future. The second part of the programme was the fruit of the imagination of thinkers from the Administration of the President of Kazakhstan. They fleshed it out with a selection of good wishes and propaganda about future achievements.
The government has long felt that the President prefers reading about what things will be like in the future to reading about what they are like at the moment. As a result, lengthy pseudo-economic texts have rained down on the country. They are now piled up on ministerial tables so that the President can quote them in his speeches like holy writ.
President Nazarbayev is aware of my critical attitude to these types of texts. But that does not mean that we don't need a programme at all. On the contrary, I continue to argue that Kazakhstan should immediately adopt two programmes, to be implemented simultaneously: the Stability Programme and the Development Programme.
Stepping on the gas... and applying the brakes
Both of these goals are equally important. During a crisis it is vital to stabilise the budget of the country and its territories, safeguarding the financing of its social obligations. At the same time it is important to set into motion the mechanism of development on the basis of modernising the economy, developing infrastructure and rejecting outdated social practices.
Achieving these two inherently opposing goals – stabilisation and development – cannot be entrusted to a single official body. The two goals will compete for attention in the minds of officials, who will end up making decisions that benefit either development or stabilisation depending on their own interests. In some cases those interests will be selfish, in others idealistic. Giving those charged with implementation a choice of this nature is dangerous. They should act instead in line with a clearly stated task.
For the period of dealing with the crisis, and for the sake of modernisation, Kazakhstan thus needs two bodies to manage the economy. One of these bodies is the traditional one: the government. Not in its present form, but filled with professionals, experienced managers, people of principle who have their own opinion and are ready to defend it. The other body is a specially created one: a Commission for the Modernisation of the Economy under the President of Kazakhstan, based on his constitutional powers.
The first task of the government should be formulated as clearly as possible: to restore order to the money supply and establish fiscal discipline. The second task is to reduce government spending as far as possible, completely eliminating excess costs. It is always easier for governments to borrow than to earn money. But there is much truth to the popular saying that you borrow what belongs to others, for a while, but you return what is your own, forever.
In a normal family, if there is no money the children do not ask for a new bike. The family goes on holiday to the countryside, not to Turkey. According to normal logic, the state should cancel any further financing of EXPO 2017. The project should be sold to the private sector, for example to Bulat Utemuratov's business group, for an notional minimum price on condition that he finishes the buildings and guarantees that the exhibition programme is implemented. The state will not claim any revenue from the exhibition and it will even exempt the project from tax. I am confident that Mr Utemuratov will be able to sell the EXPO 2017 buildings later at a profit and will not end up losing money.
Of course, this is a situation that has been forced onto the government. But it gives the richest member of President Nazarbayev's team the opportunity to demonstrate his patriotism, and it will be a real test of his entrepreneurial talent. It will also serve as a sort of vaccine for those in power who in the future might be tempted to propose costly projects rather than engaging in continuously developing the country's economy.
Not so long ago, President Nazarbayev essentially supported our proposal to create a Commission for the Modernisation of the Economy. On the eve of the Presidential elections he announced that he would propose a programme of modernisation and create a commission charged with its implementation. But as has happened in the past, the President delegated the task to the same Cabinet that got the economy into the mess it is in now. As a result, nothing was done and valuable time has been lost.
The role of personality and history
Since the beginning of the new century there has been much talk about development, modernisation and a new industrialisation. But nothing has been done – things have been put off until later. Now there is nowhere to retreat to. We are talking about a historical legacy here: will President Nazarbayev transform the economy in accordance with the requirements of the twenty-first century, or will he leave it in the doldrums in the hope that the next generation of leaders will sort it out?
I would prefer to see the first scenario, in which President Nazarbayev uses his unlimited power to carry out fundamental changes to the economy and to political life. To do this, he must personally lead the Commission for the Modernisation of the Economy, making it an organ of direct presidential control. It is not important how that sits with the legislation: the laws were written by people and they can rewrite them. The main thing is that energy and willpower are focused on achieving historic goals, ensuring the country's security and the wellbeing of its citizens.
It is high time to use the forthcoming parliamentary elections for the sake of the cause, to show that there is a need for new members of parliament who will carry out the reforms. The Commission for the Modernisation of the Economy should submit a programme of action and a package of laws for consideration by the new Majilis. The members of parliament should repeal the many laws that serve as obstacles to the freedom of entrepreneurship and create the conditions for corruption. They should legislate to protect businesses from the police and from public prosecutors, and to ensure the legal protection of property. Can you imagine what this will be like for those who recently voted those very same laws in?
We need President Nazarbayev to use his ability to get what he wants. Back in the 1990s he was not afraid of change, supporting it with his power and authority. He took risks himself and allowed others to take decisive action, two factors which ensured the success of Kazakhstan's reforms and led to our recognition as the leading economy of the entire CIS.
It was not easy for President Nazarbayev, twenty-five years ago, to get rid of the inert planned economy under which he had lived all his life. But he chose a free market, and he was right to do so. Now he needs to reject the dull commodity economy and the growing technological gap, replacing them with the manifold possibilities presented by the next technological revolution.
Against emergency privatisation
A fundamental condition for this Kazakh "modernisation from above" should be the rejection of the previously announced programme of privatising state shares in national companies. This may sound surprising coming from me, but I consider privatisation under the current circumstances to be unacceptable. Although the privatisation programme has already been announced by the government and the President, and potential investors have been notified, it is necessary to withdraw this announcement and explain the reasons for doing so.
In the first place, privatisation under the current circumstances will not bear the expected fruit: serious foreign investors will not enter our murky business world. Under the current legal system in Kazakhstan there are no guarantees for foreign capital, nor are any foreseen for the future. Instead we have tax racketeering, extortion by the regulatory and supervisory authorities, and attacks by competitors who have some "protection" within the government or Presidential Administration.
Instead of solid foreign investors, crooks from around the world will descend on the privatisation programme and promise the government "rivers of gold". In reality they will try to quickly plunder our businesses and then leave. Many such pseudo-investors appeared in Kazakhstan after independence was declared. Our government drove them away. We must not now give new "adventure seekers" the chance to become quick dollar billionaires at the expense of the country's natural wealth.
The main argument against "emergency privatisation" is a simple financial calculation. State-owned companies will still be able work for the common good in the near future. The country needs the revenues that they can earn through effective and honest governance. In an oligarchic, corrupt pseudo-market economy, further distorted by previous "development programmes", one cannot simply rely on the "invisible hand of the market". Compared with the dirty hands of corrupt officials, the invisible hand of the market falls all too short.
To use a medical metaphor, the Kazakh economy needs emergency surgery and intensive care. That would at least put it back on its feet. After than it will need to relearn certain skills so it can not just walk but run at a global level.
During the modernisation programme, all state assets and shares in national companies generating profits should be transferred (without the right to dispose of them) to the National Pension Fund. The huge amount of assets that were passed from one department to another over the course of many years and have now literally been dumped into Samruk-Kazyna should serve the people rather than go towards the upkeep of civil servants and the financing of wasteful international projects.
It is quite possible that Kazakhstan will even have to reconsider the conditions under which foreign investors have operated in past years if they have failed to meet their investment commitments.
Restoring justice
By rights, the mineral resources produced in Kazakhstan belong to the people. They should be a means of funding the universal pension and social security system. That was what was envisaged in the pension reform of the late 1990s. The money flowing in was expected to accumulate in the accounts of the National Pension Fund, which became the main savings institution for the citizens of the Republic and a tool for stabilising the country's financial system.
If this plan has not been secretly abandoned in the heat of the oil boom of the early 2000s, the tenge would never have collapsed so disastrously. Hundreds of billions of dollars would have been invested in the economy of Kazakhstan and would be generating profits that could now be used to pay decent pensions and benefits.
The Accumulative Pension Fund (Nakopitel'nyj pensionnyj fond) should become the largest national investor, funding a programme of modernisation for industry and agriculture. Increasing revenues from economic activity by new enterprises should become a source for paying old-age pensions and benefits – not for some future generation but for today's pensioners and people with disabilities.
That is how pension funds work in the United States and Europe, in the oil monarchies of the Arab world, and in the industrial democracies of Asia. And that is how it should be in Kazakhstan. The Commission for the Modernisation of the Economy will be entrusted with putting this plan into practice. Without a stable internal source of funding we cannot rely on the new industrialisation being successful. The logical step would be to integrate the current National Fund and the Accumulative Pension Fund. In that way, the citizens of Kazakhstan would truly become co-owners of the natural resources of the country in which they live and work.
Compulsory agreement
Another powerful source of funds for the modernisation of Kazakhstan's economy will be the return of capital previously taken out of the country. Here, we are talking about amounts far in excess of the USD 9 billion recently irresponsibly mentioned by the Minister of Finance. I don't know who the Minister is protecting, but according to calculations by reliable international organisations USD 137.9 billion was taken out of Kazakhstan in the period 2004-2013. That is on average USD 13.7 billion a year. I am confident that, including the money taken out of the country prior to 2004, we are talking about a total figure of at least USD 200 billion.
Together with colleagues in Kazakhstan and abroad, I have carefully studied the history of capital exported from Kazakhstan. We know what the amounts are and we know where to look for them. The owners of the capital are well aware that we know about them and that we can use international legal instruments to search for and confiscate the funds. However, no-one is interested in expensive litigation, in a "financial war" that could last years. To avoid this, President Nazarbayev should initiate an agreement between the owners of the money taken out of the country, the state and the people.
Under this agreement, the owners of the money illegally taken out of the country will bring it back to Kazakhstan, paying it into special accounts belonging to the Commission for the Modernisation of the Economy. They will pay a significant fixed percentage of the amount as a fine, and the remaining money will still belong to them but it will be invested for a set period of time in projects for the modernisation of the Kazakh economy. We have developed a special procedure that gives these investments the same type of guarantees of profitability and security as the state gives foreign investors.
In exchange, the owners of the capital will be exempt from punishment and their heirs will receive national assurance that no future government will ever question the legality of their ownership of the money. This is very important, not only for those who secretly transferred money to Western banks but also for those officially rich people from the President's entourage. At the moment, these people enjoy total security within Kazakhstan at least. But none of them can be sure that following a change of government in Astana their money will not be viewed as having been acquired by criminal means. Their heirs can be even less sure of this.
Another effect of the agreement will be to create openness and transparency in the Kazakh economy. No-one will have to hide behind the "Russian doll"-like structure of offshore companies, secretly assigning the funds to front men. Such tricks no longer guarantee the anonymity of the true owners. In addition, it costs them a lot of time and money, making them dependent on middlemen and lawyers. If the real owners of the funds enter the Kazakh market, the capitalisation of the market will increase immediately.
Laundering money abroad doesn't work, even for such "giants of corruption" as Third World dictators. The children of Gaddafi and Marcos were left without an inheritance. Money from Swiss bank accounts is being returned to the budgets of Nigeria and Peru. No country in the world would refuse to disclose information about the accounts of high-ranking officials if the request comes through the correct channels and is properly formulated.
We have been able to confirm the truth of all the above statements in practice in the course of the search for Rakhat Aliyev's fortune. The message for oligarchs and corrupt people in Kazakhstan is loud and clear: there is only one country in the world where you can be guaranteed the preservation of your capital – Kazakhstan. Negotiate with the government, pay the fines and participate in the economic revival of your country.
The nationwide agreement that we propose takes into account the interests of our wealthy citizens. The terms of the agreement cannot be changed in the future, even if populist politicians call for this to be done. To an even greater degree, the agreement is aimed at restoring justice and returning to the Kazakh people their due share of the income that was earned in the past. The terms of the agreement must be clear to the people, and it must be agreed with them.
This unprecedented process of redemption and forgiveness cannot be achieved by the executive or by parliament alone. President Nazarbayev must draw on all his experience of governance, his authority and his international contacts to give the nationwide agreement a similar scope to that of the Moncloa Pact in Spain, which was agreed between all the political forces in Spain for the sake of a peaceful transition from dictatorship to democracy. Thanks to that agreement, Spain avoided a new civil war. We in Kazakhstan need to avoid a financial civil war.
Foreign investments
The Commission for the Modernisation of the Economy, working under the President of Kazakhstan, will be able to attract much more investment into Kazakhstan than has been raised to date. The natural resources sector is no longer attractive for investors, and high-tech projects able to generate profits over a long period in the future have not been developed in the country. The projects that have been offered to foreign investors at various conferences recently under the guise of new technologies have been met with polite smiles, nothing more.
New technologies exist in the West, waiting for industrial implementation. Where that implementation takes place – whether in South Korea, say, or southern Kazakhstan – depends on what conditions are offered to investors. Kazakhstan has certain natural advantages but they are not enough in themselves. We can make ourselves more attractive by modernising our infrastructure, improving the quality of our public administration and ensuring a high level of education among the Kazakh labour force. Whether or not Kazakhstan is a beneficiary of the new industrial revolution depends on these decisions.
The global market is currently experiencing an excess – not just of raw materials, but also of investment capital. Take the companies on the American S&P 500 index, for example. These five hundred companies have USD 2.4 trillion in their bank accounts waiting for promising projects. My discussions with Western economists and businessmen suggest that every year USD 10-12 billion in investments would go into new industrial projects, thus becoming the third source of funding for Kazakhstan's industrial breakthrough.
Modernising the civil service
President Nazarbayev understands the difficulty of leading the Commission for the Modernisation of the Economy. He will be resisted not by a group of intellectual members of the opposition, but by the entire administrative class. The President cannot fail to see that during the years of raw material revenue windfalls, our civil servants have turned from bureaucrats and technocrats into kleptocrats, who either themselves steal or enable others to steal. Their collective portrait is a repellent one: they are immoral, corrupt, only care about their own careers, they seek to circumvent the law, they always lie...
Naturally, the question arises of whether it is possible to solve complex public problems with such people. My answer is yes, it is possible. As Comrade Stalin once said to one of his aircraft designers, "I have no other ministers" – so we need to make the ones we do have work differently. Civil servants are so constituted that if you tell them to try to fit a round peg into a square hole, that's exactly what they will do; tell them to do the opposite and they will. The main thing is to tell them what the task is and then strictly monitor their compliance.
Remember that in West Germany after the War, it was civil servants who had served under Hitler who became civil servants in the democratic state. In China under Deng Xiaoping, it was Communist civil servants who built the new economy. However angry we may be, we cannot say that our civil servants are worse than both the former and the latter.
I believe that if we act quickly and consistently, the new conditions and rules will lead to the emergence of a new type of civil servant. Corruption, like obesity, is generally not the result of a genetic disease but rather an unhealthy lifestyle. For many years, Kazakhstan had a system that encouraged cunning, pliable individuals rather than intelligent, honest ones. Now, with the introduction of new criteria, civil servants will once again demonstrate their wonderfully adaptable nature. We will hear a lot more good propositions from them. My position here may not appear principled enough for some. But again, as Deng Xiaoping said: "It doesn't matter what colour the cat is as long as it catches mice."
Freedom for entrepreneurs
A new holiday recently started being celebrated in Kazakhstan: the Day of Gratitude. I don't know who exactly who the gratitude is directed towards, but for me those who particularly deserve our gratitude are the true entrepreneurs – small and medium-sized businesspeople, independent actors who do are not a drain on the budget, who do business at their own risk using their own money. They will have a particular load to bear in the modernisation process.
The opening of modern production facilities calls into life a host of related and supply businesses, which create new jobs, improve the social climate and fill districts with life. The old scare story that high tech leads to unemployment has long been forgotten. If that were the case, everyone in Japan would be unemployed today.
Besides investments in large production facilities, the modernisation programme foresees measures supporting business start-ups and creating conditions in which private initiatives can flourish. Laws protecting small and medium-sized enterprises, granting benefits and ensuring a rapid return on private investment will be presented to the Majilis for consideration.
Our businesspeople are entitled to expect that the risks they take when launching new production facilities will be compensated by the state. If not in money then in tax holidays during the ramp-up period to full production capacity, say, or in tax benefits in the initials years of operation before profitability is achieved.
All these legislative initiatives are secondary, however, while thousands of active entrepreneurs remain in prison, on trial or under investigation. The number one initiative of the Commission for the Modernisation of the Economy should be an immediate amnesty for entrepreneurs accused of so-called "economic crimes". All of them, regardless of their degree of guilt, are themselves victims of a perverse state-oligarchic system. We must not forget what courts convicted them, and on the grounds of what unconstitutional laws and amendments, adopted on whose initiative in recent years.
The public prosecutor's office and the police, especially the so-called "financial police", long ago became the cudgels used by government officials to beat each other with in the struggle for money and control over business. Henceforth, law enforcement agencies should be prohibited from initiating laws or amendments. Kazakhstan must not become a police state.
An amnesty for ordinary entrepreneurs would be all the more fair in light of the amnesty for "foreign" capital. Compared to the fabulous wealth of those who sit in the current government, any economic tricks or tax evasion by ordinary entrepreneurs seem like childish pranks. Is it fair that some people are in prison, while others are in the Cabinet?
Human dimension of the reforms
When my colleagues and I discuss the programme of modernisation of Kazakhstan's economy, the question always arises of whether the Kazakh people will accept it. After the previous "super-programmes" for the next twenty, thirty or fifty years, the clusters and the social entrepreneurial corporations (SECs), the inclusion in the world's top ten, twenty or thirty, the announcement that the country was a snow leopard, then a golden eagle, the attempt to announce a world currency... can the people really still believe in anything?
My answer is simple: citizens have the right to have their doubts, but the authorities are obliged to prove the reality of their plans. This is possible if the initial results are seen after half a year, not after decades. The Commission will publish reports once every six months. In this sense, the first phase of the modernisation programme could be called "Kazakhstan 2016", the work planned for the next year "Kazakhstan 2017", and so on. It will be easy for citizens to follow the activities of the Commission for the Modernisation of the Economy, literally in real time.
Much can be done straight away. For example, tax rates and fees can be reviewed. The corporate income tax rate should be cut, and to compensate for this it is quite acceptable to charge a royalty from companies that continue to export raw materials and do not look for opportunities to develop processing within Kazakhstan. In the agricultural sector, income tax can vary depending on the climatic conditions in the region in question.
One section of the modernisation programme refers to the mass construction of one- and two-storey houses. This is a way not just to solve the problem of the housing shortage but also to create the right conditions for population mobility. President Nazarbayev recently publicly announced this part of the plan. But it cannot be realised on its own, without the overall modernisation of the country's economy. Kazakhstan has literally just a few years in which to ensure a housing supply (in accordance with the recommendations of the UN) of not less than thirty square metres per person. Naturally this means modern housing with sanitation, a stable water supply, electricity and gas.
There is no money for this in the budget. New income from modernisation is the only way to enable low-cost mortgages, particularly in areas where new industrial facilities are located. With the same end in mind, plans exist to specifically stimulate the creation of private enterprises for the production of building materials and service companies providing construction equipment for rent in the regions.
Public investment in infrastructure and transport, free land for new construction, the availability of loans – all of this will help to solve the accursed housing problem, including for young people who are just starting out on their professional and family lives. The houses may be modest but they will be full of life. Unlike the pompous residential areas of Astana, with their depressing dark windows and absurd prices. Enough of this building to impress visiting journalists. The people and the state as a whole should live within their means.
The main thing that distinguishes the modernisation programme from previous government programmes are the development goals. They are measured in human-scale units: life expectancy, food consumption, the level of education. We should no longer multiply millions of tons by thousands of dollars, then trumpet the resulting billions to the people as if they were some sort of great achievement. Kazakhstan is not a private oil, uranium and metal mining group; it is a country made up of people.
Our citizens need public education on the level of Scandinavian countries. Those countries guarantee a free place at university to anyone who wants it and is able to pursue higher education. In the area of medicine, the government should be held accountable not for how much money it has spent but for how it has raised life expectancy in Kazakhstan – to at least 75 years. The average life expectancy at the moment in Kazakhstan is 68 years, on a par with Syria and two years less than in Bangladesh.
Conclusion
I am convinced that there is no way around the modernisation of the Kazakh economy and Kazakh society. If President Nazarbayev does not resolve to do this immediately, the following leadership will. Simply because there is no other way to preserve the independence and territorial integrity of Kazakhstan. By virtue of our geography, turbulent history, multi-ethnic population and shared borders with great powers, we cannot quietly languish in poverty as is the case with some African countries.
We need a breakthrough in order to take up a new place in the global market. The sources of financing will be the money returned to Kazakhstan from abroad, the national funds, and foreign investment. No-one is going to come up with any other options.
Why would it be better for this process to begin immediately, with the active participation of Nursultan Nazarbayev? Because otherwise, our new leaders will deal with the past unceremoniously. They will enforce the repatriation of funds from abroad and deal with those who hid them there much more harshly. Tomorrow's leaders will have no other choice: if they delay or hesitate, the money will be confiscated by the governments of the countries where it is located, and directed towards solving their own social problems. The people of Kazakhstan will not forgive their government if it blows the chance to get this money back.
I do not want to leave the task of solving the problems of economic modernisation to the generation of our children. It may be that their historical situation will be more difficult than ours; the future will bring challenges of its own. They will have to face the challenges of being an advanced industrial nation, a strong modern state. We know how to do it, and we can do it. President Nazarbayev also knows how to do it and can do it. He, too, is thinking of his children and grandchildren. It only remains to get down to work – together, and in earnest.
DAT Newspaper, Almaty, March 11th, 2016
