Nazarbayev brings in young
blood By Georgiy Voloshin
Just two weeks into 2013, Kazakhstan's
President Nursultan Nazarbayev announced the
reorganization of the country's government. On
January 16, he ordered the establishment of a new
ministry in charge of regional development whose
head, Bakhytzhan Sagintayev, had previously led
the day-to-day activities of the ruling Nur Otan
party in the capacity of its deputy chairman. He
also served as the minister of economic
development and trade following his stint in the
city of Pavlodar as a regional governor.
Sagintayev's appointment comes at a time
when Kazakhstan's political system is undergoing
visible political transformations, with more
young, Western-educated top managers, often trained
in the private sector,
acceding to high-level government positions, both
at the national and regional levels.
Yerbolat Dossayev, who had previously
worked for Lancaster Group, an Almaty-based
investment company specializing in the trade of
oil, gas and metals, was chosen by President
Nazarbayev to replace Sagintayev as economy
minister back in September 2012, when Serik
Akhmetov's government was formed. Earlier in
January, Dossayev's business partner, Nurlan
Kapparov, who holds a Master's degree from Harvard
University's Kennedy School of Government, was
invited to take up the post of environmental
protection minister.
Apart from the
transformation of several government agencies into
ministerial committees, Nazarbayev also decided to
transfer the government's budget planning
functions from the ministry of finance to the new
ministry of economy.
Therefore, this
structure will hence be responsible for the short-
and long-term strategic management of budgetary
funds in line with Nazarbayev's idea of keeping
the national budget permanently balanced and
focusing state attention on large-scale investment
projects rather than on smaller ones, which would
be better implemented by privately owned
companies. This idea was recently made public in
the "Kazakhstan-2050" strategy announced in
December 2012.
Kazakhstan's shift toward
more rigorous public spending together with budget
planning and forecasting, as well as the
establishment of a ministry dealing exclusively
with the issues of regional and local development,
are quite symbolic.
At a time when the
rapid economic growth of both Astana and Almaty is
creating an ever-expanding gap in terms of overall
attractiveness and employment opportunities
between the two biggest cities and other regional
centers, the necessity of improving living
conditions in provinces and boosting their
productive potential becomes increasingly clear.
Also, the continuing volatility of energy prices,
which only aggravates the uncertainty regarding
future revenue expectations, makes it all the more
reasonable to concentrate on large projects
requiring state participation in relation to their
technical complexity and potentially broad impact
on the population.
On January 23,
Nazarbayev announced two more decisions. First, he
proposed to create a single pension fund that
would merge the assets of all existing private
organizations entrusted with the management of
individual pension charges. According to
Kazakhstan's president, this new entity could
ensure better transparency and increased
accountability. In his view, private funds, while
providing a stable income to their clients, have
been mostly unable to guarantee the integrity of
their pension accounts. However, a recent
survey conducted by Kapital.kz revealed that 37%
of Kazakhstanis are openly opposed to the transfer
of their pension money into state management,
whereas 19.6% of respondents expressed their
mistrust in the state as the guardian of private
savings. The head of the Kazakhstan Association of
Pension Funds, Aidar Alibayev, believes that this
proposed merger will in no way improve the
operation of the pension system and may even
increase its sluggishness in the face of eventual
market shocks.
Second, the Kazakhstani
president said that a new development agency would
be created for the purpose of optimizing state
expenditure and the attraction of foreign funds
aimed at boosting Kazakhstan's competitiveness.
Currently, this responsibility is shared between
several ministries, the Development Bank of
Kazakhstan and the National Welfare Fund
"Samruk-Kazyna".
As in the case of a
single pension entity, the centralization of
planning and funding functions is expected to
yield better results in terms of project
performance, with foreign investors and donors
acquiring more visibility as regards the
establishment of partnerships and the
implementation of joint projects in Kazakhstan.
Nazarbayev's stress on the development agenda is
once again an illustration of the priority
treatment that this topic is already receiving
from the central government.
Finally,
Nursultan Nazarbayev held a meeting on the last
day of January with representatives of law
enforcement authorities. After summing up the
results of a recent reform that permitted the
departure of over 16,000 police officers who had
not passed a rigorous evaluation of their
professional skills, the president insisted on the
need to improve the quality of service and restore
citizens' trust in the uniform.
Kazakhstan's domestic stability and its
capacity to cope with terrorist and extremist
threats were highlighted by Nazarbayev as the
country's priority goals, while he also urged the
heads of law enforcement bodies to ensure
efficient coordination and to curb interagency
competition, namely between the ministry of
interior and its regional offices, on the one
hand, and the National Security Committee, on the
other.
By opening up the country to
foreign investment and greater participation in
international markets, Kazakhstan has experienced
enviable economic growth in the past decade. Yet,
the social inequality this growth has engendered
between the financial centers and the countryside
has convinced President Nazarbayev that more
centralized, long-term economic and security
planning will be necessary to maintain stability
over the coming years and decades.
And
although the aforementioned Kapital.kz opinion
poll suggests that not all Kazakhstanis fully
trust the government's competence in all areas,
nevertheless this trend toward more centralized
long-term planning is likely to continue at least
until the "Kazakhstan-2050" strategy is replaced
with something new.
Georgiy
Voloshin is an analyst at The Central
Asia-Caucasus Institute & Silk Road Studies
Program of John Hopkins University and a
researcher for Wikistrat, a geopolitical
consultancy. He is also an Executive Advisory
Board Member of Paratus Europe Ltd, a strategic
management and business consulting firm.
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