Muhammad Asif Noor
Over the past three decades, Kazakhstan has undergone a remarkable transformation, emerging as a beacon of economic progress in Central Asia. Since gaining independence from the Soviet Union, the country has demonstrated remarkable resilience and steadfast commitment to economic development. This remarkable progress can be attributed to a series of strategic policies implemented in the areas of business and trade, industrialization, and the country’s active engagement in global politics. With its vast landmass, ranking as the ninth largest in the world and the second largest among the former Soviet Union republics, Kazakhstan possesses immense potential for growth, connectivity, and transit within the region. Its abundant reserves of minerals and petrochemicals further enhance its strategic significance.
Kazakhstan’s strategic geographic location, extensive natural resources, outstanding visionary leadership, hardworking people, and robust economic policies have positioned it as an important player in the region. Kazakhstan’s economic growth has been driven by diversification efforts, focusing on sectors such as oil and gas, mining, agriculture, manufacturing, and services. The government’s commitment to attracting foreign direct investment and creating a favorable business environment has contributed to increased economic activity and job creation.
Kazakhstan’s economic landscape is dominated by its significant reserves of oil, natural gas, and other commodities. With the 12th largest oil reserves and 14th largest natural gas reserves globally, along with abundant reserves of coal, gold, chrome, zinc, lead, and bauxite, the country holds substantial potential in the mining sector. Moreover, Kazakhstan stands as the world’s largest producer of uranium. The industrial sector heavily relies on mining and mineral processing, as well as the production of mining and engineering equipment. However, despite these vast resources, the mining industry in Kazakhstan has yet to realize its full potential, indicating room for further development and growth.
In addition to its mineral wealth, Kazakhstan’s agricultural sector plays a significant role in the country’s economy. With expansive steppe lands capable of supporting both livestock and grain production, agriculture is a crucial industry. The nation is a major producer of wheat and exports primarily to its Central Asian neighbors, Iran, and Turkey. In recent years, Kazakhstan has also expanded its export markets to include China, South Korea, and Japan, reflecting its efforts to diversify its agricultural trade.
In terms of international trade, Kazakhstan became a member of the World Trade Organization on November 30, 2015. It is also a member of the Eurasian Economic Union, along with Russia, Belarus, Armenia, and Kyrgyzstan. These memberships open up avenues for increased trade cooperation and integration within the region, providing opportunities for Kazakhstan to further strengthen its economic ties and leverage its resources and products on the global stage. The country’s infrastructure development, including the construction of transportation networks, logistics centers, and special economic zones, has enhanced its connectivity and positioned it as a crucial transit and trade corridor between Europe and Asia. Kazakhstan has made significant strides in human development and social indicators. Investments in education, healthcare, and social infrastructure have improved the quality of life for its citizens. The government’s focus on promoting innovation, research and development, and digital transformation has fostered a knowledge-based economy and encouraged entrepreneurship and technological advancements.
Kazakhstan’s economic progress has not only benefited the country itself but has also contributed to regional stability and prosperity. It has become an attractive destination for foreign businesses, creating employment opportunities and fostering economic cooperation with neighboring countries. Through its active participation in regional initiatives and its commitment to sustainable development, Kazakhstan continues to solidify its position as a leading financial hub in Central Asia.
Over the past three decades, Kazakhstan has experienced exceptional growth and resilience, establishing itself as a significant player in regional and global trade. This progress can be attributed to two crucial factors that have played a pivotal role in the country’s economic and developmental advancements, making it one of the largest and fastest-growing economies among the Central Asian Republics.
Firstly, visionary leadership has played a critical role in shaping the country’s trajectory. With forward-thinking decision-making and a clear vision for the future, Kazakhstan’s leadership has provided the necessary guidance and direction to drive economic growth. Secondly, the active participation of the people of Kazakhstan has been instrumental in realizing the country’s economic potential. With unwavering national enthusiasm, the people have wholeheartedly embraced the vision set forth by the leadership and actively contributed to its realization. This collaboration between visionary leadership and an engaged citizenry has been pivotal in ensuring a stable and sustainable economic growth path, particularly in the aftermath of the Soviet Union’s collapse. Through their visionary approach, Nursultan Nazarbayev and Kassym-Jomart Tokayev have provided the necessary stability, direction, and policy framework for the people of Kazakhstan to contribute to the country’s economic growth and prosperity actively. The visionary leadership of both the first President of Kazakhstan, Nursultan Nazarbayev, and the incumbent President, Kassym-Jomart Tokayev, has played a fundamental role in driving the economic progress of the country. Nursultan Nazarbayev’s leadership during the early years of independence was crucial in navigating the challenges faced by Kazakhstan after the collapse of the Soviet Union. His wise political decisions and emphasis on putting the economy first laid the foundation for stable economic growth. Notably, the decision to abandon the nuclear missile arsenal, which was one of the worlds most powerful at the time, significantly enhanced Kazakhstan’s international reputation and opened doors for economic cooperation. Nazarbayev’s initiatives, such as creating the Shanghai Cooperation Organization, the Eurasian Economic Union, and the Turkic Council, have further strengthened Kazakhstan’s regional and global economic ties.
Under incumbent President Kassym-Jomart Tokayev’s leadership, the visionary approach to economic progress has continued. President Tokayev has unveiled a comprehensive set of policies and reforms aimed at driving Kazakhstan’s economic progress during his address to the Parliament. Tokayev has prioritized democratization, transparency, and fair political competition, ensuring a conducive environment for sustainable economic development. His commitment to strengthening civil society and fostering mutual trust between the state and society has created a favorable climate for economic growth and social advancement.
President has emphasized the need to create an open and self-sufficient market economy which can play a crucial role of small and medium-sized enterprises (SMEs) in fueling economic growth and employment. Recognizing the existing challenges in this area, the President has also proposed a range of measures to support SMEs and foster their development within the country. He also emphasized the importance of attracting significant investment, including foreign investment, to key sectors of the economy, while reducing bureaucracy and ensuring fair and open competition.
Economic diversification has been identified as a top priority, with the aim of reducing reliance on the commodity market and maximizing the value of Kazakhstan’s resources through the development of the non-oil sector. Tokayev’s policies, including introducing quotas for women and young people in political parties, have contributed to greater gender equality and increased representation of women in leadership positions. By promoting inclusive economic policies and encouraging entrepreneurship, Tokayev has empowered the people of Kazakhstan to participate in the country’s economic progress actively. The proposed policies and reforms underscore the government’s commitment to ensuring sustainable economic development and positioning Kazakhstan as a dynamic and competitive player on the global stage.
The people of Kazakhstan have played a crucial role in the progress and economic development of their country through active participation in various initiatives. Their dedication, hard work, and entrepreneurial spirit have been instrumental in driving economic growth and transforming Kazakhstan into a modern and prosperous nation. The government’s efforts to create a favorable business environment and support small and medium-sized enterprises have empowered individuals to start their businesses and contribute to the country’s economic landscape.
The increasing number of small and medium-sized businesses, which has grown from 500,000 in 2005 to 1.4 million in 2021, is a testament to the people’s eagerness to seize opportunities and drive economic progress. Moreover, the government’s emphasis on industrialization has allowed individuals to contribute to developing new products and technologies. Through the implementation of over 1,500 projects and the launch of more than 500 new products, the people of Kazakhstan have demonstrated their innovation and capability to compete in the global market. Their active involvement in export activities, with Kazakhstan now exporting its products to over 130 countries, further showcases their entrepreneurial spirit and commitment to the country’s economic success.
The government’s initiatives to promote gender equality and empower women in leadership positions have led to increased representation of women in politics and decision-making roles. The active participation of both men and women in shaping the economic landscape of Kazakhstan highlights the collective effort of the people to contribute to their country’s progress. Through their engagement in economic development initiatives, the people of Kazakhstan have demonstrated their resilience, adaptability, and determination to build a prosperous future for themselves and their nation.
Positioned strategically at the intersection of Europe and Asia, Kazakhstan has capitalized on its favorable geographic location to tap into regional trade opportunities. With well-developed rail, road, and maritime routes in the Caspian Sea, the country offers vital connectivity between South Asian, Chinese, European, and Russian markets. This robust transportation infrastructure has established Kazakhstan as a pivotal hub for logistics, transit, and trade in the region.
Moreover, Kazakhstan’s active participation in regional integration initiatives, such as the Eurasian Economic Union (EAEU) and the Belt and Road Initiative (BRI), has further bolstered its economic prospects. The nation’s regional trade volume has grown consistently, reaching an impressive $183 billion in 2020. This underscores Kazakhstan’s increasing significance as a thriving regional trade hub, attracting businesses and fostering economic cooperation across borders.
Kazakhstan’s trade performance has showcased a remarkable rebound and growth in recent years. In 2022, the country achieved a record-breaking total trade turnover of $134.4 billion, surpassing the previous year’s figure of $97.8 billion. Notably, Kazakhstan experienced a temporary decline in foreign trade in 2020, with a contraction of 11% attributed to global market closures amidst the pandemic. However, the subsequent years witnessed an impressive comeback.
The year 2022 witnessed a substantial increase in Kazakhstan’s total exports, reaching $84.4 billion. The country’s export portfolio was predominantly driven by oil and metals, which served as the primary export commodities. This highlights the significance of Kazakhstan’s rich natural resource base in fueling its export-oriented economy. According to official sources, Kazakhstan’s economy has exhibited positive growth and resilience, with a 4.5% increase in the first five months of 2023. In 2022, Kazakhstan’s GDP in current prices reached $220.5 billion, representing a solid growth rate of 3.2%.
To foster a favorable business environment, Kazakhstan has implemented a new regulatory policy to alleviate the burden on enterprises. This initiative has resulted in the elimination of approximately 9,000 unnecessary requirements for entrepreneurs out of more than 10,000 identified in 44 industries. This regulatory streamlining contributes to the overall ease of doing business in the country. The critical components of GDP—trade, construction, and transport—will continue to play a significant role in driving the country’s economic expansion.
Concurrently, the import volume of Kazakhstan has been on the rise, hitting a record high of $50 billion. While the overall increase can be partially attributed to global inflation and rising commodity prices, it also reflects the vibrant consumer market within the country. Notably, the unit import of automobiles, processed food, and engineering goods has witnessed a noticeable upward trend. This suggests a growing demand for these products among the domestic population, further contributing to the country’s import growth.
Kazakhstan’s robust trade performance and increasing import volume demonstrate its active engagement in international commerce and its integration into the global economy. The country’s ability to adapt to market fluctuations and capitalize on emerging opportunities showcases its resilience and potential as a key player in the regional and global trade landscape.
As the nation gears up to attract foreign direct investment, the market size is expected to expand exponentially. The 19 million people of Kazakhstan are enjoying moderate living standards due to a developed economy backed by abundant natural resources and investment-friendly policies. T presents enormous potential for domestic and international investors to explore and kickstand new business opportunities in Kazakhstan. Stimulating various sectors, including manufacturing, agriculture, energy, and technology, Kazakhstan aims to diversify its economy and establish itself as a leader in emerging markets.
With a renewed focus on innovation, infrastructure development, and sustainability, Kazakhstan is paving the way for a thriving economy in the years to come. Beyond the numbers, it is crucial to understand how Kazakhstan’s economic growth will transform its society. The country’s dedication to human capital development, social welfare policies, and poverty reduction initiatives promises a brighter future for its citizens. Increased investments in education, healthcare, and social infrastructure are already empowering the population, fostering social mobility, and narrowing the inequality gap.
Moreover, Kazakhstan’s evolving economic landscape encourages entrepreneurship, innovation, and international collaboration. As the nation fosters an ecosystem conducive to startups and technological advancements, it sparks a wave of creativity, fostering a dynamic society characterized by forward-thinking individuals.
Kazakhstan’s remarkable economic growth and steadfast commitment to sustainable development set a thrilling stage for the nation’s future. As the country continues to attract investments, diversify its economy, and leverage regional trade opportunities, it will become a shining example of progress and prosperity in Central Asia. The transformative power of this economic growth extends far beyond the numbers, promising a society teeming with opportunities, social inclusion, and a promising future for its citizens.
( The writer is Chief Editor, The Diplomatic Insight Magazine)