A Victim of its own Success?

Unfortunately, Kazakhstan also runs the risk of becoming, like Russia, a victim of its own success. The World Bank's March 2005 country economic memorandum on Kazakhstan--Getting Competitive, Staying Competitive: The Challenge of Managing Kazakhstan's Oil Boom--encapsulates the dilemma in its title. Kazakhstan's construction, banking, service, and retail sectors are booming. But, as the World Bank's report underscores, most consumer goods are imported, and the manufacturing and agricultural sectors are respectively stagnant and declining. The oil and gas sector accounts for nearly 80% of industrial output, with exports in all other industries holding flat since 1997, defying government efforts to diversify the economy. One of the most precarious sectors is housing construction, which shows every sign of overheating, fueled by the injection of large sums of oil money into the economy, and further encouraged by the massive building project of the new capital in Astana.

Beyond encouraging a construction boom, relocating the capital over 1,000 kilometers north to Astana has had some other downsides. It has moved the focal point of Kazakhstan's population into the geographic region of Western Siberia--a move equivalent to shifting the United States' capital from Washington, DC to Greenbay Wisconsin, or Russia's capital from Moscow to Irkutsk on Lake Baikal in Siberia. Astana is on average 10 degrees Celsius colder than Almaty, which is significant when one considers the additional costs involved in constructing new buildings of glass and steel to withstand the ravages of the elements and of keeping these buildings heated in the winter. Keeping buildings cool in the summer is also an issue. Although Astana holds the distinction of being the world's "coldest" capital city, the region around it experiences dramatic annual temperature swings from minus 30-35 degrees Celsius in the winter to plus 30-35 Celsius in the summer.[20] The plans for Astana envisage growing the city from an initial size of 250,000 (before it was designated as the capital) to 1.2 million over the next several years. Its current population stands officially at around 600,000, and many of the buildings designed for and under construction in the city would not look out of place in the Persian Gulf states like Dubai and Qatar--including a dramatic steel, glass and stone pyramid, designed by world-renowned British architect Sir Norman Foster, to house a new religious and cultural center.[21]

Like many of Russia's Siberian cities, Astana also suffers from problems of remoteness. Travel between Astana and Almaty and the relatively densely populated south of the country is difficult. Almaty remains the natural communications hub for Kazakhstan as well as a hub for the rest of Central Asia because of its location close to the borders with Kyrgyzstan and Uzbekistan. It still attracts most international flights, although the government is trying to redirect them toward Astana to the great irritation of the southern elite and many in the international community in Almaty. Flights between Almaty and Astana, although increasing in frequency, are often over-booked, and the only alternative travel option is by rail--a journey that can take as long as 20 hours between the two cities. For now, the technocratic governing elite in Astana is cut-off from rest of country, with much of the country's international presence and civil society (and the main political opposition) still concentrated in Almaty. Astana was created to solve one set of problems, but like Russia--which moved its capital from Moscow to St. Petersburg, and then back again--Kazakhstan now has two capitals, Astana and Almaty, with very different profiles.

Central Asia's Migration Magnet

Kazakhstan shares other dilemmas with Russia, including an aging population and the kind of general demographic decline associated with the lower birth rates of developed industrial states. Like Russia, Kazakhstan has lower life expectancy and higher than normal adult mortality rates, which have been linked to the stresses attendant at the collapse of the USSR as well as poor dietary and healthcare practices.[22] In fact, the Slavic population in Kazakhstan's north, shows the same poor health profile and low life expectancy as the Russian population it borders in the Urals and western Siberian, while birthrates have been higher among the ethnic Kazakh in the south. Kazakhstan's government has set ambitious targets for population growth from 15 million in 2005 to 20 million in 2015, including introducing programs for the migration of 4.5 million "Oralmans," or ethnic Kazakhs, from neighboring countries of Central Asia, Turkey, Mongolia, and China. Although 374,000 "Oralmans" have "returned" to Kazakhstan in recent years, the bulk of Kazakhstan's population growth is currently the result of illegal migration into Kazakhstan from the rest of Central Asia as well as China.[23]

Economic migrants are attracted to Kazakhstan by the prospect of low-skilled jobs in the growing construction and service sectors. For example, the Kazakh government itself suggested (during interviews I conducted in Astana on this subject in March 2004) that Kazakhstan may presently have as many as a million illegal migrants, working either temporarily or permanently in the country. Officials from the Migration Agency and the Presidential Administration indicated that, according to their estimates, there are at least 500,000 people from Uzbekistan alone working illegally in Kazakhstan, with most working in the southern agricultural regions on the Kazakh-Uzbek border and in construction in Astana. As a further illustration, the local government in Almaty estimates that as many as 100,000 migrants from neighboring Kyrgyzstan come to work in the region every summer.[24] Shanty towns have sprung up on the outskirts of Astana, Almaty, and other cities, creating social pressures and a new underclass that the Kazakh government has not yet devised policies to deal with. The concentration of new wealth in cities like Astana and Almaty have also exacerbated existing economic disparities among Kazakhstan's far-flung regions, increasing domestic political tensions.

Ensuring New Leadership

In large part, as already noted, many of these issues are a mark of the success of Kazakhstan's post-Soviet transition. Modernization and rapid economic development of the kind that Kazakhstan is experiencing always bring new social problems, as well as demands for more change--especially political change. Although the Bolashak program has been very successful in bringing a new generation of people into positions of power, Nazarbayev's is still an aging regime held in place by what is essentially an old Soviet elite. Nursultan Nazarbayev may have been the most successful of the former Soviet leaders who inherited a new state, but he is still a Soviet holdover. And unlike in many other states, including Russia and Ukraine, there has been no post-Soviet transition of executive power in Kazakhstan. If Nazarbayev completes his third term in 2012, he will have been in power for almost a quarter of a century. All of which raises the question of how to create the mechanisms to bring in an entirely new president and leadership in the near future.

The Kazakh parliament, which is now generally seen as tightly controlled by the executive branch, has not yet emerged as a route to the upper echelons of power. Presidential preference (enlightened as it may be at times) is still seen in Kazakhstan as the way ahead. If Nazarbayev is re-elected in December 2005, the top job will be locked in for the next seven years. And, with decisionmaking authority centralized in the presidential administration, Kazakhstan has all the basic conditions for a ruinous round of infighting over the question of a successor--very similar to the waning days of Boris Yeltsin's regime in Russia, and to the drama unfolding again in Russia as President Putin approaches the end of his term in 2008.

A Growing But Fractious Opposition

Frustration with the Nazarbayev regime is already bubbling up to the surface of politics. There have been numerous splits in the ruling elite over the last several years, illustrated by the defection, ostracizing, and even imprisonment of political figures once close to Nazarbayev, including former Prime Minister Akezhan Kazhegeldin, and Galimzhan Zhakiyanov, the former Governor of Pavlodar, and a sometime protégé  of the Kazakh President. Both were accused of corruption after publicly parting ways with the President and entering the opposition, with Kazhegeldin ending up in exile abroad, and Zhakiyanov jailed for several years.[25] The Zhakiyanov case, although shrouded in a great deal of intrigue, is particularly striking, as Zhakiyanov was, in the late 1990s, viewed within the Kazakh government as a rising star, designated by the President for greater things. He moved rapidly in this period from the head of the Agency for Control Over Strategic Resources to the governorship of Pavlodar, a key province on the Russian border. His equally rapid demise suggests that some of the members of Nazarbayev's "anointed" young generation may have pushed for too much power, too fast and too early for the President's preferences.

The Kazakh opposition is now filled with people who have been in power, or close to the center of power, and have had the opportunity of participating in the running of the country, but who have felt stifled by Nazarbayev's heavy top-down control, or disillusioned with the lack of political and economic opportunity. These include figures like Oraz Zhandosov, the former Deputy Prime Minister, Finance Minister, and Chairman of the Central Bank of Kazakhstan, once seen as one of Nazarbayev's "young Turks," spearheading the country's reform program; and Zharmakhan Tuyakbay, a former Nazarbayev loyalist and ruling party member, the former Prosecutor General and Speaker of Parliament, who parted ways with Nazarbayev after accusing the government of manipulating the outcome of Kazakhstan's last round of parliamentary elections.