Nurgul L., 36, an English teacher in Astana and mother of two girls, was in Dubai last weekend on a pleasure trip. "It's the gift I gave myself for my birthday with the aim of disconnecting a bit and going shopping," she explains naturally behind the wheel of a beautiful BMW as she drives down one of Astana's endless avenues. It is not something that, for now, many people can do in Kazakhstan, where there is less than one car for every hundred inhabitants. Nurgul is part of a privileged group that many aspire to join.
The immense country of almost three million square kilometers and 20 million inhabitants of Central Asia is in a boil: it struggles to detach itself from Russian influence and take advantage of its enormous natural resources –with abundant oil and gas and the world's largest uranium reserves– to let wealth turn into general prosperity.
Despite the advances, today there are still great differences that the statistics are not capable of reflecting. For example, the minimum wage in this multi-ethnic republic is less than the equivalent of one hundred euros a month. For this reason, Nurgul's whim is beyond the reach of the vast majority of Kazakhs, although it is a good example of a social and economic change that began 30 years ago, with the fall of the USSR, and that, yes, it's accelerating. With a per capita income of just $10,000 a year, the country has a great opportunity to move forward.
Looks like you're on the right track. "His project of his is credible and he has shown it in recent years, with an impressive transformation in which wealth has begun to be distributed a little better," says Carmen Claudín, senior associate researcher at Cidob.
The sustained growth of GDP in the last 30 years supports this. Kazakhstan is a very young country, like its population, and the average four children per woman guarantee that it will remain so. The Kazakhs are full of hope and do not tolerate delay.
For this reason, the government of Kasim-Yomart Tokáev, its president, reacted with more openness to the strong wave of protests at the beginning of this year, when the social outburst due to corruption, the unfortunate management of the covid crisis and, above all, everything, the triggered inflation lit up the street. At that time, in the middle of winter and about 40ºC below zero, the population rebelled when the price of gas doubled.
Now, despite the migratory flows – it is estimated that more than 300,000 Russians have crossed at some point on the 7,000-kilometer border with Russia – calm reigns. And in Astana, as in Almaty, the old capital, and the rest of the country they dream of a revolution hand in hand with the economy. The new impulse of the Government pulls the manual that must be followed by those seeking a radical transformation: legal certainty, low (almost zero) taxation, all the facilities for foreign investment and the recruitment of talent and a firm commitment to education.
Rafael Nagel, president of Tactical Management, a Dubai-based investment firm, says Kazakhstan is being watched with great interest throughout the Persian Gulf. "They have to solve logistical problems, but their drive is extraordinary, they are very serious and the changes are real: with these ingredients, with their very competitive costs, I prefer to invest there rather than in Europe," says Nagel. The Government tries to capture new projects, facilitate the stay of the directors of multinationals and retain, as much as possible, well-trained young people.
Erden Abdykalyk is an engineer, 24 years old and recently married. He trained for five years at a branch of the Moscow Aviation Institute located at the Baikonur Cosmodrome, the oldest and largest space base in the world, near the Uzbekistan border. Erden graduated with top marks and now works for the Kazakhastan Aviation Industry company as a maintenance supervisor, with Airbus as the main customer. Thanks to his preparation, he regularly travels outside the country on work missions, such as the one that recently took him to Seville. However, he assures that his dream is not to leave: "What I want is to get as much experience as possible abroad and contribute to developing the aviation industry in my country, Kazakhstan."
The Government is generous in aid, also to study abroad, with the condition of staying in the country for five years. Unemployment is very low, less than 5% of the active population. And only inflation worries, as in the whole world. With prices advancing 17% year on year, interest rates have shot up to the brink of 20%.
But it is a relative problem. Society is not banked at all yet. In the capital, Astana, without going any further, taxis do not have a payment machine to pay by card. For companies that do not pay corporate tax, credit is still something very new, typical of other latitudes.
That, the financial structure, the basic ecosystem on which a market economy is based, is still in its infancy, but evolving. The usual public banks make way for fintech companies, many of them lit up in the Astana Hub. New financial services groups with a high technological component are emerging, such as Freedom Finance, which is listed on the stock exchange and is part of the Nasdaq.
The new Astana Stock Exchange, launched five years ago on the margins of Almaty and with the support of Goldman Sachs, the Nasdaq and the Chinese Equity Fund, advocates modernity. Its size is modest compared to the immensity of the market – there are just 136 listed companies and a capitalization of 23,000 million euros – but it has all the architecture ready to grow. And the new international arbitration court for conflict resolution that has been opened in the capital gives investors in the country the security that the laws will be applied according to Western standards.
Nurgul and Erden, each in their own way, are already benefiting from real change, although there may be bumps in the road. As Cidob researcher Carmen Claudín recalls, Kazakhstan, which is holding presidential elections on November 20, is far from being a full democracy. Statism is still a hallmark of the country, despite everything. The oligarchs have immense power. And Putin's Russia lurks. The Kazakh eagle, symbol of a hard nomadic people, will try to survive by rising from the heights.
