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Kazakhstan’s Nuclear Diplomacy – With China Set to Build Second, Who Will Construct Third Nuclear Power Plant?

Kazakhstan’s famed hospitality, long enshrined in its national proverbs, has also become a guiding principle in its foreign policy. One recent example is the Kazakh government’s diplomatic maneuvering in the selection of partners for its nuclear power program. Leader of the Race Initially, Kazakhstan planned to build a single nuclear power plant by 2035 to address potential electricity shortages. However, following the October 6, 2024, referendum, where 71.12% of voters approved a plant in the Almaty Region, President Kassym-Jomart Tokayev instructed the government to explore the construction of at least two additional facilities. This directive, as it turns out, was both timely and strategic. In March 2025, the newly formed Atomic Energy Agency, reporting directly to the president, was tasked with overseeing the selection of international consortium leaders. On June 14, the agency announced that Russia’s state-owned Rosatom would lead the consortium to build Kazakhstan’s first nuclear power plant. Rosatom CEO Alexey Likhachev welcomed the decision, stating that the VVER-1200 Generation 3+ reactors, already operating in Russia and Belarus and selected by partners in Hungary, Egypt, Turkey, Bangladesh, and China, would be used. These reactors, he emphasized, meet international safety standards and integrate both active and passive safety systems. Tricks Up Their Sleeves Behind the scenes, the selection process revealed a quiet tug-of-war between Chinese and Russian interests. Ultimately, Rosatom prevailed, thanks, in part, to two strategic moves. First, Rosatom’s supporters enlisted Assystem, an ostensibly independent nuclear engineering consultancy, to assist Kazakhstan Atomic Power Plants LLP in the evaluation process. The firm’s analysis favored Rosatom. Second, to pre-empt concerns about Western sanctions, the Kazakh authorities emphasized that Kazakhstan would be the sole owner and operator of the facility. Atomic Energy Agency head Almasadam Satkaliev stated that Kazakhstan would control the entire production cycle from uranium mining to fuel processing and plant maintenance, thereby limiting direct Russian involvement post-construction. This arrangement may allow the creation of a Kazakh legal entity immune to Western sanctions, as it would be wholly state-owned. Whether this could offer Rosatom a loophole for acquiring restricted components remains an open question but one that few may press given the global interest in nuclear safety. Another Contender Emerges Just hours after Rosatom’s contract was announced, Satkaliev made a second, equally strategic statement: China National Nuclear Corporation (CNNC) would lead the construction of Kazakhstan’s second nuclear power plant. Satkaliev cited CNNC’s “strongest proposals” and revealed plans for a broader agreement on nuclear cooperation with China. “Objectively, few countries can master the entire nuclear cycle. China is one of them,” Satkaliev noted. Back in February, prior to the agency’s creation, Kazakhstan’s Ministry of Energy, then also led by Satkaliev, had identified Kurchatov and Aktau as potential sites for future nuclear facilities. Kurchatov lies near the former Semipalatinsk nuclear test site, while Aktau once hosted the Soviet-era BN-350 fast neutron reactor. The timing of Satkaliev’s announcement is no coincidence. Chinese President Xi Jinping is scheduled to visit Kazakhstan on June 16 for the second China-Central Asia Summit. For a nation that...

Central Asia-China Summit opinion C5+1 EU-Central Asia Summit U.S. Tariffs Beijing’s initiatives Belt and Road Initiative Xi Jinping

Opinion: Xi Jinping Heads to Astana – What’s at Stake in the Central Asia-China Summit?

On June 16-17, President Xi Jinping of the People’s Republic of China will visit Kazakhstan. The second Central Asia-China summit is scheduled for June 17 in Astana. Leading up to the event, a series of forums, meetings, and conferences have been unfolding across Central Asia and China, drawing experts, journalists, diplomats, and energy-sector representatives. These activities suggest that the upcoming summit is poised to overshadow its predecessor. While U.S. analysts continue debating the viability of their own C5+1 framework for engaging with Central Asia, and the European Union advanced its outreach with the inaugural EU-Central Asia summit, China has relied on a well-worn path. The thousand-year legacy of the Middle Kingdom is filled with moments when it had to engage with the complex mosaic of Central Asia, once a turbulent region of khanates, emirates, and nomadic tribes. Despite the chaos, China succeeded in carving out a secure overland corridor, the Great Silk Road, which threaded through what are now the independent Central Asian republics, linking them like beads in a continental necklace. Then, as now, China is seeking stability in the region, not just for political influence but to safeguard its global supply chains. Beijing’s modern initiatives, including the Belt and Road Initiative and its broader “community of shared future” concept, aim to establish global “islands of comfort” conducive to Chinese interests. At the heart of this strategy lies a deeply embedded worldview: that China represents civilization itself. The Chinese learned long ago to deal with their neighbors not with violence, but through economic incentives, a method which is proving just as effective today. This layer of understanding is notably absent in many Western and post-Soviet analyses of China’s actions in Central Asia, the Middle East, Africa, and beyond. The reasons for this are twofold. First, Chinese officials are careful never to state views about cultural hierarchies explicitly; doing so would risk alienating partners. This reticence is a feature of traditional Eastern diplomacy. Second, Beijing has cultivated its own expert ecosystem within the post-Soviet sphere. In response to a wave of Sinophobia that swept through Central Asia a decade ago, China now primarily engages with favorable media outlets and Sinologists, many of whom are nurtured through carefully managed media tours. One such tour, organized by People’s Daily, is currently underway ahead of the Astana summit. As a result, the discourse surrounding the summit is shaped less by hard policy proposals than by diplomatic pageantry, with everything presented in the best possible light. At the recent 5th Forum of Think Tanks, “Central Asia-China: New Horizons for Regional Partnership,” Kazakhstan's State Councilor Yerlan Karin likened China and Central Asia to “the two lungs of Asia,” emphasizing the symbolic depth of their growing relationship. The 6th Central Asia-China Foreign Ministers’ Meeting, chaired by Chinese Foreign Minister Wang Yi and held in Almaty in April, likewise offered little in terms of concrete summit outcomes. According to a general statement from Kazakhstan’s Foreign Ministry, topics included political dialogue, trade, connectivity, sustainable development, and security cooperation,...

Finance Nuclear power opinion China Russia

Opinion: In Kazakhstan’s Nuclear Race, Financial Muscle Will Decide the Winner

The most closely watched development in Kazakhstan this June is the decision over which foreign company will be awarded the contract to build the country’s first nuclear power plant. According to earlier announcements, the Kazakh Atomic Energy Agency is expected to make its decision by the end of the month. Bidders from South Korea, France, Russia, and China remain in contention, although recent expert commentary suggests that earlier assumptions favoring Russia’s Rosatom may no longer hold. Competing Interests Beneath the Surface In Kazakhstan, there appears to be an internal struggle between two strategic camps with opposing visions for the project’s future. Each faction has its own backers, deeply embedded in the country’s nuclear ambitions. One group, primarily composed of financial officials and economic policymakers, is advocating for the least expensive option. Their preferred bidder is China's China National Nuclear Corporation (CNNC), which is offering the lowest project cost, backed by Chinese bank financing. This group is influenced not only by CNNC’s competitive pricing but also by China’s broader economic leverage over Kazakhstan. The second group consists of nuclear professionals, scientists, engineers, and technicians, who prioritize reliability and operational familiarity. Their preference leans toward Rosatom, given Russia’s historical involvement and established presence in Kazakhstan’s nuclear sector. This technical camp is widely viewed as a de facto ally of the Kremlin, as Rosatom’s participation would extend Moscow’s long-term strategic influence in Central Asia. Given the 50-60-year operational lifespan of such reactors, this influence would be enduring. Though this tension remains speculative, patterns observed over the past decade suggest a real and ongoing tug-of-war. No Thermal Power, No Nuclear Power? At the end of May, media in Kazakhstan reported that Russia might not fulfill its commitments under a 2023 memorandum signed during President Vladimir Putin’s visit to Astana. The agreement with President Kassym-Jomart Tokayev concerned the construction of three coal-fired thermal power plants (TPPs) in Kokshetau, Semey, and Ust-Kamenogorsk, with Russian energy giant Inter RAO designated as the turnkey builder. The total cost was estimated at $2.8 billion. However, in April 2024, First Deputy Prime Minister Roman Sklyar acknowledged financial hurdles. While design and preliminary work continue, difficulties remain in subsidizing equipment interest rates. Sklyar noted that a change in investor may be considered, and the situation could be resolved within a month. Oil and gas expert Olzhas Baidildinov has speculated that the nuclear power plant project may be bundled with the thermal plants as a “social burden”, a condition that CNNC might accept more readily than Rosatom. “If CNNC is chosen to build the nuclear power plant, the thermal plants could follow as part of the package,” Baidildinov suggested via his Telegram channel. Sergey Agafonov, head of the Kazakhstan Association of Energy Supply Organizations, also sees the nuclear and thermal plant projects as interconnected, particularly with regard to financing. Debunking the Price Myth The technical community has responded swiftly to growing narratives about CNNC's supposedly unbeatable offer to construct the nuclear plant for $5.5 billion, a claim spread via Chinese sources. Nuclear...

scrutiny Central Asian migrants Siberia opinion History

Russian Lawmaker Cites Historical Ties Between Siberia and Central Asian Migrants

A Russian regional lawmaker has stirred debate by suggesting that parts of Siberia may be the ancestral homeland of some Central Asian migrants, including Uzbeks. The statement was made by Khalid Tagi-Zade, a member of the Khanty-Mansi Autonomous Okrug (Yugra) regional parliament, during a discussion on birthrate trends among local and migrant populations. His remarks were broadcast via a livestream on the parliament’s official VKontakte page, according to Gazeta.ru. Tagi-Zade emphasized the historical complexity of migration, arguing that “not all migrants are the same.” He pointed to the fact that Yugra and parts of the neighboring Tyumen region were once territories of the Siberian Khanate. He further noted that the Khanate’s last ruler, Khan Kuchum, descended from the Shaybanid dynasty, a prominent Uzbek lineage from the Bukhara Khanate. From this, he implied that some Uzbek migrants could view their presence in the region as a form of return to ancestral lands. The speaker of the parliament, Boris Khokhryakov, quickly moved to halt the discussion, citing procedural rules that prohibit extended remarks during that segment of the session. Tagi-Zade’s comments come at a time of heightened scrutiny over the treatment of Uzbek migrants in Russia. On May 2, Uzbekistan’s Deputy Foreign Minister Bobur Usmonov raised concerns in a meeting with Russian Ambassador Oleg Malginov in Tashkent. According to Uzbekistan’s Ministry of Foreign Affairs, Usmonov expressed alarm over a rising number of reports involving the mistreatment of Uzbek citizens in Russia and urged Moscow to safeguard their rights.

opinion Agreements Oil Production

Kazakhstan Signals Early Review of Oil Production Sharing Agreements

The question of revisiting Kazakhstan’s production-sharing agreements (PSAs) with foreign oil companies is once again gaining prominence both within the country and internationally. While the Ministry of Energy is formally responsible for managing these contracts, growing pressure is coming not only from civil society but also directly from President Kassym-Jomart Tokayev, who has publicly questioned the long-standing terms of these deals since 2022. Confidential Terms, Public Scrutiny Recent revelations have further fueled this debate. The International Consortium of Investigative Journalists (ICIJ) recently detailed the ongoing arbitration dispute between Kazakhstan and the North Caspian Operating Company (NCOC), which manages the Kashagan field. The stakes are high: $160 billion is under contention. Yet what shocked the Kazakh public most was not the litigation itself, but that the state receives just 2% of the field’s profits, with a staggering 98% flowing to foreign stakeholders. Such findings offer context for why the Ministry of Energy is reluctant to release details of these 1990s-era agreements, originally negotiated with significant involvement from Kazakhstan’s first president, Nursultan Nazarbayev. In a recent court case, the ministry successfully blocked a lawsuit by Vadim Ni, founder of the Save the Caspian Sea movement, who demanded public disclosure of PSA terms affecting environmental interests in the Caspian. The ministry argued that Kazakhstan’s adherence to international confidentiality clauses is essential to avoid multibillion-dollar lawsuits and maintain its reputation as a stable investment destination. However, the ministry also emphasized that confidentiality does not shield violators from environmental penalties. Calls for transparency and revision have come from various quarters. Members of the Ak Zhol party and the Parasat Business Alliance have joined the chorus, urging the government to review the PSAs. In this context, President Tokayev’s consistent remarks suggest a coordinated state policy shift. A Change in Presidential Tone Tokayev first broached the subject in a 2022 interview with Russia 24, reflecting on the constraints Kazakhstan faced during the early years of independence. At the time, the country had no legal framework for foreign investment and had to rely on companies like Chevron to develop its energy sector. The president acknowledged the success of some ventures but also suggested the need for a “correction” to reflect current realities. Fast forward to 2023, and the government launched a $5 billion lawsuit against NCOC over alleged environmental violations. Although Kazakhstan has been temporarily barred from collecting the fines pending arbitration, the case marks a significant escalation. In April 2024, the Parasat Business Alliance held a public briefing demanding more local participation in procurement contracts tied to oil fields such as Karachaganak, Kashagan, and Tengiz. Kazakh companies reportedly receive less than 5% of $12 billion in annual procurements, a figure viewed as unacceptable by domestic businesses. By January 2025, Tokayev’s rhetoric had hardened. Speaking at an expanded government meeting, he instructed his cabinet to actively renegotiate PSA terms before their expiration. "The implementation of these agreements has helped Kazakhstan become a reliable global energy supplier,” he said, “but large investments require updated terms that benefit our nation.”...

Tax Reform opinion tax code Economy

Opinion: Kazakhstan’s Tax Reform May Come as an Unpleasant Surprise

Kazakhstan's tax reform has reached a critical juncture. This week, the Mazhilis, the lower house of parliament, approved the draft of the new Tax Code in its first reading. The sweeping document, comprising 822 articles, proposes the repeal of the current Tax Code along with the accompanying implementation law. While the reform fulfils directives issued by President Kassym-Jomart Tokayev in his 2022 and 2023 state-of-the-nation addresses, skepticism abounds. Experts and business leaders have voiced concerns, and lawmakers themselves have offered mixed reviews, with many adopting a critical stance. Concerns About Scope and Timing Though tax professionals broadly agree on the need for tax reform, some warn that the current version may be the most stringent in over two decades. Critics argue that without addressing structural inefficiencies in government spending, raising taxes alone will not yield the desired outcomes. They emphasize the need for a balanced approach that supports both fiscal sustainability and economic resilience. Adding to the unease is the timing. Kazakhstan, like many economies, faces mounting global pressures. The threat of a financial downturn, exacerbated by falling energy prices and international tariff disputes, has prompted urgent consultations at the highest level. Tokayev recently convened a closed-door meeting with the prime minister and the head of the National Bank, instructing them to finalize a government action plan to mitigate potential economic fallout and maintain investment flows. A Mixed Bag of Reactions Some analysts acknowledge that the existing Tax Code, adopted in 2008, is outdated. They argue that reforms are essential to address digitalization, evolving business models, and new global challenges. Calls for improved tax administration, especially the simplification of procedures and adoption of risk-based oversight, aim to ease pressure on law-abiding businesses while better targeting the informal sector. The draft law also seeks to limit inefficient tax exemptions and make incentives more focused and transparent. These changes are framed as part of Tokayev's broader economic transformation agenda, which prioritizes fair taxation, industrial processing, and innovation. Nonetheless, many entrepreneurs remain uneasy. Economic instability, lingering post-pandemic effects, geopolitical risks, and sanctions-related supply disruptions have left businesses vulnerable. Critics worry that introducing a more demanding tax regime now may fuel uncertainty and discourage investment. Additional concerns center on governance. Persistent issues of corruption, selective enforcement, and administrative overreach have eroded public trust. Without parallel reforms in public administration, experts argue that changes to tax policy alone may fall short. Divided Political Reception The draft Tax Code’s passage through its first reading does not guarantee smooth sailing. Even the ruling Amanat party, while supporting the bill, has voiced reservations. Its members have called for safeguarding small and medium-sized enterprises and enhancing investment incentives. The opposition Ak Zhol party has been the most vocal critic. Its leader, Azat Peruashev, characterized the proposal as a fiscal crackdown rather than genuine reform. The faction demands greater transparency, public consultations, and a reconsideration of proposed VAT hikes and lower registration thresholds. Meanwhile, the pro-business Respublica party supports the reform in principle but insists on greater simplification in business-tax...