Succession and Modernization
The first steps taken by the new Kazakhstan government have a great significance for this strategically important country situated in the very heart of the Eurasian continent. The most vital issue currently facing the country and its main foreign partners is proceeding with the policy of modernization, which turned the country into an economic and political leader of Central Eurasia under President Nursultan Nazarbayev.
On March 19 of the current year, Nursultan Nazarbayev announced his resignation, even though his term as president still lasted another year and a half. After this, the 66-year-old Kassym-Jomart Tokayev, speaker of the Senate of Kazakhstan, became his constitutional successor.
Kassym-Jomart Tokayev is one of the most competent statesmen in Kazakhstan, previously holding important positions of head of the Senate, Prime Minister and Minister of Foreign Affairs. On the other hand, he still remains a world-class politician.
Suffice to say, there have only been two Asian politicians among the UN leaders in the 21st century. They are Ban Ki-moon, representing Korea, and Kassym-Jomart Tokayev, representing Kazakhstan. What is more, Tokayev was more than just a regular Under-Secretary-General of the United Nations. He spent two and a half years working as Director-General of the United Nations Office at Geneva, holding the second most important position within the organization after New-York, also serving as the Secretary-General of the UN Conference on Disarmament. There is no need to remind you just how significant this agenda is in the present-day unstable world, and how important it is to manage the situation frequently threatening to develop into a full-blown crisis.
In 2013, he was considered as one of the possible candidates for the position of the UN Secretary-General, but Tokayev preferred serving his own country to a global career.
He later reminisced: “When I notified Secretary-General Ban Ki-moon of quitting my job at the United Nations, the line went silent, after which my former boss said: ‘I always thought you were not going to stay at the UN long, but never thought you would quit so soon…’.”
All of the above turns Tokayev into the most high-profile politician not only in Kazakhstan, but also in the international arena. Therefore, no wonder that it was Tokayev who got picked by the First President Nursultan Nazarbayev as his successor. After all, Kazakhstan’s development during all these years after gaining independence has not only been related to its domestic political agenda, but also to the important role Kazakhstan has been playing globally.
In actual fact, these two were closely related. A combination of assertiveness and persistence in conducting domestic reforms, and a highly active foreign policy have become a signature style for Kazakhstan when we talk about running the country after the demise of the Soviet Union.
It should also be mentioned here that Kazakhstan had to implement painful market reforms in a situation of collapsed socialist economic system and acute political crisis. Not all of the states founded instead of the dissolved Soviet Union realized the necessity of implementing such reforms. We know of examples where new states would seal off their economies against any changes and seek to preserve the state capitalism of late USSR epoch. For example, this was typical for Belarus, Turkmenistan and Uzbekistan.
Such a policy could be justified by the need to resolve tactical issues, but also meant avoidance or postponement of complicated economic challenges. Thus, these countries avoided the risks accompanying the process of building a market economy. But today, they are in fact having to tackle the same issues they faced back in the 1990s.
Meanwhile, Kazakhstan placed its bet on market reforms. The logic of such reforms not only was seeking to unlock the potential of economically active part of the population, which was impossible in the Soviet-type state capitalism model, preferred by many in the countries of the former Soviet Union. It was also important to get Kazakhstan’s economy to interact with the outside world.
The thing is, Kazakhstan was faced with the task of overcoming the historic isolation of the Soviet era. After 1991, the country had ample opportunities for building its own contacts with the outside world. This was particularly relevant due to the status of Kazakhstan as a landlocked country, having no access to the sea, and therefore, located at a distance from the main global markets.
Therefore, it was strategically important for Kazakhstan, on the one hand, to ensure competitive ability of its domestic economy, securing its compliance with the best global standards. For this purpose, a favorable investment climate had to be created. On the other hand, Kazakhstan needed infrastructure for improving both, its domestic transportation and logistical infrastructure, and transport links to its main trade partners.
Tackling all these problems was the main priority for the government of Kazakhstan during the entire term in office of the first President Nazarbayev. As a result, at the end of year 2018, Kazakhstan was ranked 70th in a global rating in terms of GDP per capita ($8,840). At the same time, if we consider the purchasing power parity (PPP), Kazakhstan ranks already as high as 41st globally, with its GDP of $427 billion.
It should also be mentioned that in the last 20 years, the country has attracted $300 billion of foreign direct investment.
Kazakhstan is currently ranking 58th in the Human Development Index rating, being included in the same group as some highly developed countries, along with Norway, Germany and Sweden. In 2016, according to the Heritage Foundation, Kazakhstan’s economic freedom index rose, reaching 69 points out of 100, which promoted Kazakhstan’s economy to the 42nd position of 178 countries.
Moreover, implementation of a number of infrastructure development programs that has been intensified starting from the 2000s, helped build transport corridors between Asia and Europe. Tellingly, it was in Kazakhstan that China’s famous Belt and Road Initiative was proposed by Xi Jinping, President of the PRC, back in 2013. But it is important that even before this historical moment that gave a boost to the flow of cargo from China to Europe via Kazakhstan territory, the country had successfully implemented a number of domestic projects.
In particular, as part of the Nurly Zhol program, modern road infrastructure was developed in Kazakhstan. Subsequently, a part of this infrastructure became a key component of the global Western Europe – Western China international transport corridor. By the way, in terms of logistical efficiency, Kazakhstan is a leader among the CIS countries, ranking in 2017 77th in the Logistics Performance Index of the World Bank. On top of that, Kazakhstan ranks 63rd in the Global Competitiveness Index of the World Economic Forum in terms of infrastructure quality.
Kazakhstan is one of the few countries which was not simply waiting for the implementation of the Chinese initiative; the republic was interested in enhancing its own transportation and transit capacities and made a serious investment into their development. Perhaps, it is the significant efforts made by Kazakhstan that stimulated China’s interest in building new trading routes westwards. Characteristically, Kazakhstan and China set up at their border railway and logistical infrastructure with a throughput capacity exceeding 40 million tons of cargo per annum.
The project of building a transport corridor across Kazakhstan has already yielded some impressive results. For instance, in 2018, volumes of cargo shipped through Kazakhstan’s territory via the China – Europe – China route amounted to 300,000 containers, which is a 61% increase year-on-year. On the whole, the volume of transit cargo traffic across Kazakhstan territory amounted to 18 million tons according to the results of 2018.
Such performance took a lot of effort to achieve, and yet much remains to be done, given that Kazakhstan is faced with a number of tasks in the area of the country’s economic modernization. One of the key tasks is securing the inclusion of Kazakhstan in top 30 most developed countries of the world.
In order to resolve these tasks, the new President Tokayev will doubtless need the experience he acquired while serving as Prime Minister of Kazakhstan. During his term as Prime Minister, the republic achieved one of the world’s highest economic growth rates. For example, in 2001, it reached 9.6%. During his term in office, production rates grew by 14.6%, and investment into fixed assets grew by nearly 30%. His top priorities as Prime Minister included an intense economic growth with a low inflation rate, improvement of the investment climate, boosting employment and real income of the population.
On the whole, a significant feature of Kazakhstan’s modernization model consists in the fact that it is the country’s domestic development that provides a basis for resolving some of the most complicated geo-economic problems. Competitive ability of Kazakhstan’s economy, its stability amid the turbulence in the global economy was experiencing secured conditions enabling successful advocacy of the country’s interests in the international arena.
Geopolitically, Kazakhstan is located in one of the most sensitive regions, where interests of such majors as China, Russia, the US and other important regional states are merging. Under these conditions, Kazakhstan is pursuing a successful multi-vector policy, allowing it to preserve independence and freedom of maneuver.
It is also important that Kazakhstan is playing a very active role in international relations. The country has been known to successfully mediate complicated situations, for example, the Astana process, which is highly significant for further dialogue on the Syrian agenda. Earlier stories to be mentioned include providing a platform for negotiations on Iran’s nuclear program, resulting in the execution of the agreement of 2015.
In this sense, the background Kassym-Jomart Tokayev comes from will be especially relevant. In particular, in June 2012, it was Tokayev who played a key role at the United Nations in finding the seemingly impossible balance between the interests of Russia and the US, when the Americans were insisting that ‘Assad had to quit’ and Moscow was unrelentingly advocating in his favor.
Tokayev succeeded in proposing a wording in the nature of a compromise, allowing the parties to meet halfway. Hillary Clinton representing the US at the meeting was shocked by this result. “Without realizing it herself, she agreed to the text of the final draft that did not provide for mandatory resignation of Bashar al-Assad,” Tokayev recalled. “I remember, it was getting late, the Palace of Nations had gotten empty, and then I received a report that Hillary was still in the building, being interviewed by the US mass media and proving that this wording was to be agreed with under the circumstances, as otherwise the document risked not being adopted at all ‘due to pressure from Russia’.”
Obviously, the skills acquired by Tokayev during his term as a world-class politician will directly contribute to maintaining the traditional efficiency of Kazakhstan’s foreign policy.
Among the many close associates of the first President Nazarbayev, Tokayev is the one most suitable to continue his line of policy. His vast experience in economic management and international background will be instrumental in ensuring Kazakhstan’s interests are most adequately protected.
