Kazakhstan Opinions - The Times Of Central Asia

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Kazakh News Publisher Says New Media Law Does Little for National Press

Kazakhstan's new law "On Mass Media," recently passed by its lower house of parliament (the Majilis), has agitated the country's reporters. In an interview with The Times of Central Asia, Dzhanibek Suleyev, the publisher of several news sites, remonstrates that the law should have been more supportive of the national press. An aspect of the law that has caused heated discussions is the Ministry of Foreign Affairs' new right to deny accreditation to foreign journalists "in case of a threat to the national security of the Republic of Kazakhstan." A few months ago the Ministry of Foreign Affairs didn't renew or refused to issue accreditation to 36 correspondents of the news website Azattyq, the Kazakh affiliate of the U.S. Government's Radio Free Europe/Radio Liberty (RFE/RL). No explanation was given for this rejection, and Azattyq has filed a lawsuit in court. Suleyev explained: "It is clear that the state wants to protect itself and society as much as possible from extremist publications and the spread of deviant morality, but what is proposed for those who simply do their work honestly, every day? We like to impose restrictions, but what about support? I think that if the state were to expand the field of cooperation, the press would be less critical." "Apparently, the state authorities have such an ambiguous opinion of Azattyq. In addition, the lack of accreditation clearly does not prevent 'going on the air,' the audience has access to the materials. I do not think that denial of accreditation to foreign media will become a mass phenomenon. The New York Times or leading sports publications and channels will hardly be denied accreditation. You have to understand that from the point of view of the state, there are ordinary media, and there are structures engaged in propaganda and counter-propaganda, and this should be taken into account," Suleyev explained. Suleyev said that the establishment of a one-year statute of limitations for media materials is a positive development, as it protects journalists' rights. It was initially proposed to set the term at three years from the date of publication. "It is good that it was reduced to a year, three years of limitation is the death of the publication. Of course, I would have liked to reduce the statute of limitations even further, but thanks for that. If journalists are always afraid of the court, how can they work? Because of the long statute of limitations, editorial offices need to keep archives, video, audio and documents, not everyone can do this. Besides, with a long statute of limitations, it is easier to settle scores with the press, to get unwanted people closed down," he said. Suleyev was happy to see more television programs in Kazakh. The new law aims to increase the amount of Kazakh-language and domestic content on television and radio. From 2025 at least 55% of TV and radio programs should be broadcast in Kazakh, rising to 60% from 2027. Retransmission of foreign TV and radio channels will be reduced to 10% from...

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No Lessons Being Learned From Kazakh Floods, Says Political Analyst

Kazakhstan has been prone to flooding before, but the 2024 Kazakh floods have added a catastrophic page to the chronicles. Political analyst Marat Shibutov tells The Times of Central Asia that only extremely tough measures can motivate ministers and akims (local government executive) to actually work on flood prevention. The Floods Have Not Yet Peaked Areas and homes in many regions of Kazakhstan -- Atyrau, West Kazakhstan, Aktobe, Akmola, Kostanay, East Kazakhstan, North Kazakhstan and Pavlodar -- remain flooded. According to the Ministry of Emergency Situations, more than 113,000 people have been evacuated from the various disaster zones. The threat of another destructive wave of surface water still remains for major cities, even high-rise buildings are battling high in water in Atyrau, Petropavlovsk and Kostanay. Kazakh president Kasym-Jomart Tokayev has already visited the affected regions several times. According to local reports, people are now concerned not with punishing those responsible, but with paying fair compensation for lost housing, farms and livestock, and, most importantly, with creating an effective flood control system. In particular, residents of dacha (detached suburban) houses in Uralsk blocked the highway, demanding that the akim of the city include them in the list of those to be paid. If more floods occur it will be impossible to live in flood-prone areas. The only alternative is a radical revision of the requirements for residential zoning protective measures. Tokayev spoke about the responsibility for breached and unfinished dams and dikes, as well as the overlooked forecasts made by meteorologists about increased snowmelt and the threat of flooding not only from rivers, but also from the steppes in late March. For the lack of timely flood control measures, he announced a harsh reprimand to First Deputy Prime Minister Roman Sklyar and Minister of Water Resources and Irrigation Nurzhan Nurzhigitov. Local administrators weren't spared either, with harsh reprimands and warnings for incomplete official compliance to the akims of Aktobe, Kostanay and West Kazakhstan regions -- and a harsh reprimand to the akims of Atyrau, Akmola, Almaty, Pavlodar and Abay regions. According to official data from the Ministry of Emergency Situations, in 2024 to date seven billion tenge ($15.5 million) have been allocated just to local executive bodies for flood mitigation activities. In March 2024, 66 billion tenge ($147 million) was allocated to carry out work relating to combating emergency situations. From 2019 to 2023, the Emergency Situations Ministry's expenditures increased almost fourfold, to 264 billion tenge ($588 million). Over the past five years, over 762 billion tenge ($1.7 billion) has been allocated from the national budget. What exactly those funds were towards remains an open question -- possibly as part of ongoing criminal cases. Disasters of the Past It's not the first time that high water has caused irreparable damage in Kazakhstan. In Uralsk they still talk about a serious flood in 1942. In early May, the water level in the Urals reached 943 centimeters, and a 9-point storm raged on the river. Over 500 families were evacuated from...

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How India is Becoming a Robust Soft Power in Central Asia

The middle-income trap, a pressing issue that has led to the stagnation of many successful developing economies, demands immediate attention. This trap, which occurs when a middle-income country can no longer compete internationally in standardized, labor-intensive goods due to relatively high wages, is a result of various factors, including countries most successful demographic characteristics. For instance, access to education has reduced birth rates due to an almost 100% literacy rate defined by 12 years of education. In the process, importing cheap manufacturing products has made local products uncompetitive. In such a situation, the country should have planned to upgrade current skill-based education to high-tech skills such as ICT, pharmaceuticals, etc. This shift to high-tech education holds immense potential for developing countries, offering a pathway out of the middle-income trap. Unfortunately, poor investment in developing high-tech education has led to an inadequate supply of a high-skilled workforce. Developed economies, such as the U.S. and a few European countries, are in an advantageous position to overcome such a trap due to their highly effective immigration policy. Developing countries, such as Brazil, Mexico, Argentina, the Philippines, and almost all Central Asian Republics, meanwhile, suffer. This will be further aggravated if the issue is not addressed urgently. Due to its geographic location and natural resource endowments, Central Asia, a diverse region with a mix of upper-middle and low-income countries, holds significant importance in the global economic landscape. Let's look at a specific case, such as Uzbekistan, a country whose population is growing at 1.3% per annum. Regarding age structure, the 0-14 age group makes up 30.1% of the population, the 15-64 age group 64.6%, and the 65-plus group constitutes just 5.3%. The country has achieved a high literacy rate, with 100% of the population completing 12 years of primary and higher secondary education. However, the country’s GDP per capita is relatively low, at US$ 3,209 (nominal term) and US$ 11,316 (PPP). The country's economy is dominated by the services sector, which contributes 48.4% to the GDP, followed by industry at 33.7%, and agriculture at 17.9%. The poverty line is set at less than US$ 3.2 per day, affecting 10% of the population. The country's labor force is distributed across sectors, with 25.9% in agriculture, 13.2% in industry, and 60.9% in services. The unemployment rate is 5.3%, and underemployment is a significant issue, affecting 20% of the population. The low supply of highly skilled workers challenges further increasing per capita income. The country will likely fall into this middle-income trap because it reaches a certain average income and cannot progress beyond that level. It seems helpful to mention some insights from this perspective. During Soviet times, the growth model of states was determined by their available resources, and Central Asia is rich in abundant resources. However, in most cases, primary resources were taken to other non-resource wealthy states for further value addition. So, the workforce was created in the respective states based on the concerned state's requirements. Workforce migration from one state to another was...

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Will Europe Learn Lessons From Central Asian Gas Failures to Secure Oil Imports Bypassing Russia?

Despite loud statements and reports, alternative routes for transporting oil from Kazakhstan and Central Asia to Europe remain only intentions. The desire of the EU to diversify its hydrocarbon suppliers is running into internal bureaucracy and a lack of understanding of how things work in Central Asia, which is in fact seeking to ship its energy in different directions. Lost gas To start, it is worth recalling the Turkmenistan-Russia gas dispute of 2009. Before that, Gazprom bought gas from Central Asian countries at the border, swapping some volumes of domestic supplies with Kazakhstan, Turkmenistan and Uzbekistan, and buying gas at prices lower than EU export rates. Gazprom explained this practice rather simply: there is no economic sense in transporting the gas through Russian territory, so at the border the price cannot be European (minus transportation) – this gas was consumed in Russia or supplied at preferential prices to Ukraine, while Russian gas was sent to Europe. In 2008, Turkmenistan produced 70.5 billion cubic meters (bcm) of gas, exporting 47 bcm, with an increase in production and exports planned for 2009. According to the Energy Institute, gas consumption by European countries in 2022 amounted to 498.8 bcm, meaning Turkmenistan alone, assuming export volumes stabilized at 50 bcm per year, could cover 10% of Europe’s needs. That amount, 50 bcm of gas, is the annual consumption of Switzerland, Sweden, the Czech Republic, Greece, Portugal, Slovakia, Slovenia, Bulgaria, Croatia, Denmark, Estonia, Finland, Ireland, Latvia, Lithuania, Luxembourg, Norway and North Macedonia combined. However, Turkmen gas would never reach Europe. When an agreement on the volumes and prices of gas purchases by Gazprom failed to be reached, 15 years ago, on April 9, 2009, there was an explosion and fire on the eastern branch of the Central Asia-Center (CAC) gas pipeline, at CAC-4. Subsequent negotiations to resume the transport of Turkmen gas between Russian President Dmitri Medvedev and Turkmen leader Gurbanguly Berdimuhamedov, which took place in September 2009 in Moscow, could not resolve the dispute. All these years, the media and European leaders have been talking about building the so-called Nabucco gas pipeline, which was to go from Central Asia, along the bottom of the Caspian Sea, through Azerbaijan and on to Germany and Austria. Its design began back in 2002. Note that by 2009, had the project been energetically implemented, Nabucco could have been built and the first deliveries would have begun. In 2022, gas consumption in Germany and Austria amounted to 77.3 bcm and 7.9 bcm, respectively, meaning supplies from Central Asia could cover at least half of their needs. This seemed like the perfect opportunity for a large-scale gas pipeline. The Central Asian countries wanted to supply gas to Europe via alternative routes, receiving European prices for their commodities, and Europe could have significantly diversified its gas imports. Another player, however, was closely watching Europe’s red tape and indecision – China. Hidden dragon China understands how to work with Central Asia, and in 2007 construction of the first line of...

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The Middle Corridor: How Kazakhstan is Carving its Niche in Europe-Asia Transport

In the aftermath of the pandemic and amid rising geopolitical tensions and sanctions – leading to the breakdown of traditional shipping and logistics chains – the need to develop new, alternative routes for trade has gained particular importance. One such route is the Middle Corridor, or Trans-Caspian International Transport Route, which has become a priority project for Kazakhstan and its neighbors. In this overview we look at the prospects for this multi-modal transnational route. The Trans-Caspian International Transport Route (TITR), or Middle Corridor, starts in China, passes through Kazakhstan, the Caspian Sea, Azerbaijan, Georgia and Turkey, before reaching Europe. Last year, more than 2.7 million tons of cargo was transported along the TITR, up 86% on 2022, whilst it is expected to carry 4 million tons this year. Drivers of growth This growth in volumes has been facilitated by the conflict in Ukraine and restrictions on the transport of goods through Russia, which previously represented the main land route connecting East and West. As a result, in 2022 the volume of container traffic via the TITR grew 33% year-on-year. In addition, amid the geopolitical tensions that have effected the safety of traversing the Suez Canal and the Red Sea – the central and shortest trade route between Asia and Europe – many shipping companies have been forced to go around the southern tip of Africa. This has led to an increase of 14-18 days in the delivery time of goods, as well as additional costs. Because of attacks by Houthi rebels, the number of container ships passing through the Suez Canal each week was down 67% year-on-year in 2023, according to the UN. Meanwhile, in the first two months of 2024, trade volumes along the route decreased 43%. According to data from the UN Conference on Trade and Development, last year the cost of transporting goods from Shanghai to European countries by sea roughly tripled. At the same time, shipping goods by rail from inland Chongqing to Europe was a third cheaper than by sea. Experts note that over the past decade, the total cost of transporting goods between China and Europe by rail has fallen 30%. All this opens wide opportunities for the further development of the TITR, which should be taken advantage of by countries along the route. Middle Corridor countries working together Today, to ensure safe and uninterrupted exports, as well as to attract more flows through Kazakhstan and other TITR countries, measures are being taken. Indeed, the route is considered a strategic initiative for the development of the entire region’s transport potential. During a recent visit to Azerbaijan, Kazakh President Kassym-Jomart Tokayev said that in the future the volume of cargo transported via the TITR should increase to 10 million tons, which is to be facilitated now by both existing demand and technology. At the end of 2022, a roadmap for 2022-27 was signed to eliminate bottlenecks along the route in Kazakhstan, Azerbaijan and Turkey, while to boost the volume of cargo transported by rail a...

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What Bank Loan Data Can Tell Us About Kazakh Business in 2023

After being severely tested by the pandemic in 2020-21, several thousand companies in Kazakhstan closed due to decreased demand and supply chain disruptions. Though the problems of local businesses began long before the pandemic, the two years of lockdown wiped out many good players and made those that survived more dependent on government orders and projects. Overall, Kazakhstan has a primarily commodity-driven economy (crude oil, metals and petrochemicals account for the majority of export earnings), and the country's economic fortunes have tracked the prices of a short list of major commodity exports. Thus, the government finds it hard to diversify the economy. Oil price volatility affects the national currency, and the ups and downs in the tenge exchange rate versus hard currencies make it difficult to be in a business with an investment cycle longer than one and a half to two years, as you have lower revenues amid dollar investments. This is one of the reasons why launching long-term projects in the country is difficult when there are no guarantees of sales, while currency risks can hit any project. The government has been active in attracting foreign investment, offering state support and protection, but only relatively recently did it begin to pay the same attention to the demands of domestic investors. However, this is only the beginning of a very long journey towards reducing dependence on imports and expanding the range of exports to stabilize the economy. A debt-driven economy The share of the private sector in Kazakhstan is difficult to measure. If we take SMEs (small to medium-sized enterprises) as the core of private business, in different years it fluctuates between a range of 20-30% of GDP. However, since state capitalism is entrenched in the country, even among SMEs there are contractors working for state and quasi-state structures, receiving funds from state companies and agencies. One-hundred-percent private companies that do not depend on government contracts finance their operations from their own or borrowed capital. This is why, in a transparent economy like Kazakhstan’s, looking at loan data can reveal the main trends in business and which niches have not yet been occupied and could be interesting for investment by both foreign and local players. It is best to look at the country's economy through the loan portfolio of banks that are subject to international banking regulation, whose indicators meet an easily understandable standard. There is a caveat: in Kazakhstan there is also the Development Bank of Kazakhstan, which is not included in the table below. It is technically not a bank, but rather a development institution financed from the quasi-public sector by Baiterek National Management Holding, which receives budgetary funds. In addition, most extractive-industry companies in Kazakhstan – due to their high capital expenditures and the shallowness of the country’s financial market – raise funds in the U.K., Switzerland, the U.S. and Russia. Chinese banks rarely lend to 100%-Kazakh companies, limiting themselves to trade credits (in the form of equipment) or loans to joint ventures with Chinese...

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