Tag Archive for: Kazakhstan

Kazakhstan crisis could prove costly for Putin  

The nationwide public unrest in oil-rich and mineral-endowed Kazakhstan, triggered by a hike in fuel prices, has its roots in deeper governance problems and societal demands for structural reforms since the country’s declaration of independence from the Soviet Union in 1990. The upheaval has presented a serious challenge not only to Kazakhstan’s authoritarian regime, but also to Russia. It has carried the potential to destabilise what Russia considers its ‘near abroad’ or zone of security and interests.

The protests have occurred against the backdrop of longstanding authoritarian rule, a public quest for wider participation in a genuinely publicly mandated system of governance, endemic corruption, deprivation of civil liberties, growing social and economic disparities, and the emergence of a better-informed younger generation of Kazakh nationalists who want meaningful reforms.

Kazakhstan was ruled from 1990 to 2019 by President Nursultan Nazarbayev, who had made his career as an affiliate of the Soviet Communist Party. He steered the country through a transition from a communist past to what was initially described as a political and economic liberalisation phase. He stressed the importance and centrality of the Kazakhs to oversee their country, but with noted attention to the multiethnic nature of Kazakhstan, in which, most importantly, Russians formed a substantial minority and had been empowered to play a key role in running the country during the Soviet era. However, he retained full control over the process of change with a Soviet-style approach that had shaped his political life.

While seeking to diversify Kazakhstan’s foreign relations and nurture ties with the West, Nazarbayev ultimately took his cue from Moscow on the main foreign policy issues. This was underlined by Kazakhstan joining the Russia-led Commonwealth of Independent States (made up of 11 former Soviet republics) and Collective Security Treaty Organization (CSTO), which in addition to Russia and Kazakhstan includes three other ex-Soviet nations, Belarus, Tajikistan and Armenia. Nazarbayev’s regional policy also considered China as another neighbouring power, with Kazakhstan becoming a member of the Shanghai Cooperation Organization.

Nazarbayev’s era was generally marked by stability, infrastructural development and growth of a Kazakh-educated younger class in search of its own identity and national stance. It also featured corruption, social and economic inequities, and growing public discontent, which remained suppressed. When he decided to step down after nearly 30 years of rule, the forces of opposition were gaining ground, but without daring to engage in large public displays. Although Nazarbayev was replaced as president by one of his loyalists, Kassym-Jomart Tokayev, he still retained a pivotal role in the conduct of national affairs by heading Kazakhstan’s powerful Security Council. The public frustration underlying the latest unrest is directed as much against Nazarbayev as it is against the decline in living conditions.

Last week, as the protests spread from Kazakhstan’s largest city, Almaty, Tokayev asked the CSTO for security assistance. Moscow has readily obliged by dispatching troops—something that can only have renewed the fear of Kazakh nationalists about Moscow’s reassertion. He also fired Nazarbayev from his Security Council position and arrested his close ally and national security chief, Karim Masimov—a clear indication of an inter-elite power struggle. Meanwhile, he has labelled the protesters as foreign-backed terrorists.

The bloody confrontation between the security forces and protesters has resulted in dozens killed and injured and more than 5,000 protesters detained. Tokayev has acted in close consultation with Russian President Vladimir Putin and it is now clear that he has engaged in a process of instituting his personal rule.

The Kazakhstan crisis confronts Putin with a major challenge. Instability in the largest and most resource-rich of the former Soviet Central Asian Muslim republics may reverberate across all of those states, while Tajikistan, Uzbekistan and Turkmenistan also feel the threat of radical Islamism from neighbouring Taliban-run Afghanistan. Putin has repeatedly said that the security of Central Asia is vital to Russia, and he has already deployed Russian forces to secure Tajikistan’s weak border with Afghanistan. Controlling events in Kazakhstan means spreading Russian military forces wider in view of his military build-up along the border with Ukraine for a possible invasion of that country. Moscow has historically been concerned about the security of Russia’s southern and western borders virtually on equal terms.

The unrest in Kazakhstan, with potential to impact its fragile Central Asian neighbours, where vulnerable authoritarian regimes also prevail, together with the ‘Afghan threat’, constitutes a development that must make Putin wonder whether invading Ukraine to extract concessions from the US and its NATO allies is a fruitful strategy. Turmoil in Russia’s southern backyard gives the US and its allies a card to play in negotiations with Moscow in relation to Ukraine and also in their rivalry with China.

The Kazakh crisis couldn’t have come at a more sensitive moment for Putin and Chinese President Xi Jinping, who also cannot ignore the instability close to the northwestern border of China. The two leaders can now be expected to do whatever is required to contain the Kazakh situation. But the question is, for how long?

The reforms Kazakhstan needs

Kazakhstan’s former president, Nursultan Nazarbayev, who resigned in March after nearly 30 years in power, was a great admirer of the Singaporean leader Lee Kuan Yew. For Nazarbayev, Lee’s leadership showed the importance of strengthening the economy before liberalising politics. But the flaws in that approach are now on stark display.

As Nazarbayev put it, ‘The middle class will not emerge without a sustainable economy, which cannot exist without a sufficiently strong and wise leadership capable of getting the country out of freefall.’ But a sustainable economy is not what his government built. Instead, it relied on oil revenues—which constituted more than 27% of the country’s overall budget in 2014—to keep taxes low, effectively buying citizens’ acquiescence to authoritarianism.

When global oil prices plummeted in 2014, from over US$100 per barrel to about US$50, Kazakhstan was hit hard. The local currency, the tenge, lost nearly half its value against the US dollar, real incomes dropped to pre-oil-boom levels, and unemployment skyrocketed, especially among the young.

But the problem extends far beyond economics. Amid surging inequality, frustration with pervasive corruption has intensified. In 2018, Kazakhstan ranked 124th out of 180 countries in Transparency International’s corruption perceptions index. Meanwhile, the state is failing to provide basic security: in July 2018, an Olympic ice-skating medallist, Denis Ten, was murdered in broad daylight in the centre of Kazakhstan’s largest city, Almaty, for trying to prevent his car mirrors from being stolen.

All of this has made emigration an increasingly appealing option, especially for young people, raising the spectre of a ‘brain drain’. It has also turned up the heat on simmering social unrest, which has boiled over since Nazarbayev’s resignation (which may well have been intended specifically to pre-empt popular protests).

Nazarbayev claims that he wants to help a ‘new generation of leaders’, and his resignation did, for a brief moment, give Kazakh citizens hope that change was coming. But Nazarbayev installed a loyal successor, Kassym-Jomart Tokayev, who used his first presidential decree to name the capital city after Nazarbayev and then called a snap election that, like those held by his mentor and patron, was rigged. According to the Organization for Security and Co-operation in Europe, the 9 June election ‘was tarnished by clear violations of fundamental freedoms, as well as pressure on critical voices’. When hundreds of people took to the streets of two major cities to protest the vote, about 500 were detained.

Nazarbayev also retained sweeping powers: not only is he lifelong chairman of the influential security council; he has also devised a new title for himself—the so-called Elbasy, or ‘leader of the nation’—that grants him immunity from any prosecution. Last month, on Nazarbayev’s 79th birthday—a national holiday tied to the renaming of the capital from Astana to Nur-Sultan—protesters again held rallies, this time demanding that he cede all power. Dozens were arrested.

More than 4,000 people have been detained in all the protests during and since the election, according to Erlan Turgumbayev, the minister of internal affairs. The UN Human Rights Office for Central Asia has called the crackdown on peaceful protesters, activists and journalists during and after the presidential election ‘extremely regrettable’. Given Tokayev’s former position as UN deputy secretary-general, this condemnation should sting.

In any case, Kazakhs are not done fighting, and grassroots movements—organised through social media and financed through crowdfunding—are leading the way. One such movement, called Oyan, Qazaqstan (Wake up, Kazakhstan), emerged just before the June election. After making clear that it’s not a political party trying to secure power, it introduced a nine-part program focused on reforming the electoral system, shifting to parliamentary rule, preventing political repression and protecting human rights.

Meanwhile, ongoing political instability and the resulting capital flight, even more than economic factors, are driving down the value of the tenge, which last month reached its lowest point since 2016. This highlights a reality that Tokayev has recognised rhetorically but still has to prove with real political reforms: contrary to the logic of Nazarbayev and Lee, economics doesn’t always take precedence over politics.

That doesn’t mean that there are no economic solutions to Kazakhstan’s struggles. In my view, three economic reforms should urgently be pursued to help address inequality and unemployment in the short term.

First, the tax system needs to be overhauled to encourage the development of micro- and small businesses that can help to create jobs. Second, in order to stimulate the growth of underdeveloped medium-sized firms, the government should grant them preferential treatment in public procurement. And third, tax revenues should be decentralised, with local authorities keeping more of the corporate taxes that they collect, thereby increasing their accountability to local business.

Nonetheless, appeasing Kazakhstan’s people—and thus stabilising its politics—must take priority. That means, first and foremost, credible and concerted action to root out corruption and strengthen the rule of law. As a banner unfurled during a marathon in Almaty (which earned its creators 15 days in jail) declared, the still-powerful Nazarbayev and his protégé, Tokayev, ‘cannot run from the truth’.

What’s next for Kazakhstan?

On 19 March, the only president that independent Kazakhstan has ever known, Nursultan Nazarbayev, announced his resignation after almost three decades of near-absolute power. In a televised speech, Nazarbayev praised the country’s achievements and called on its youth to build a bright future.

Yet it was not a full farewell, because Nazarbayev said that he’s not leaving the political scene. The big question now is what comes next for Kazakhstan.

Although Nazarbayev’s resignation came as a surprise, his promise to remain in politics was years in the making. He previously received the titles of First President (2000), Leader of the Nation (2010), and, in 2017, Elbasy, a Kazakh word meaning head of the nation or people. Because of his ‘historic mission’, he was given the lifelong right to present initiatives on state-building, domestic and foreign policy, and national security. What’s more, Kazakh state bodies are obliged to consider his proposals.

The ‘First President’ also heads the Assembly of the People of the Republic of Kazakhstan and the Security Council (which was elevated from an advisory to a constitutional body in 2018), and is a member of the Constitutional Council. Nazarbayev, his family and their property and bank accounts have also been given full immunity from prosecution. In addition, he is chairman of the ruling Nur Otan party.

This exit without leaving resembles the semi-departure of Singapore’s founding father Lee Kuan Yew, and is very different from the resignation and full political retirement in 1999 of Boris Yeltsin, independent Russia’s first president. Singapore has always been a major inspiration for Nazarbayev, who held Lee in the highest regard. Effective and highly respected at home and abroad, Lee tops the short list of leaders who made authoritarianism look good.

Nazarbayev would like to follow Lee in becoming an elder statesman, thereby avoiding the less pleasant fate of other authoritarian rulers. He is certainly well aware of the fragility of power. He became Kazakhstan’s leader amid the tumultuous collapse of the Soviet Union, and has witnessed the downfall of authoritarian peers around the world.

Resigning, and having to trust new Kazakh leaders, must therefore have been a difficult decision. Nazarbayev’s record in office, marred by corruption scandals, is more controversial than Lee’s, and he felt betrayed by his own family when his son-in-law attempted a coup d’état over a decade ago.

In addition to his personal security, Nazarbayev is eager to ensure his legacy as a statesman and founding father. Balancing those two goals will not be easy. He could best guarantee his security by maintaining the status quo and continuing to exercise tight political and economic control. Burnishing his legacy, on the other hand, will require reforms that boost further development and prosperity. Adding to the challenge are a build-up of domestic problems and a more dangerous and unpredictable international environment.

The careful preparations for Nazarbayev’s post-presidency suggest that his resignation is most likely part of a long-term strategy. As the Kazakh constitution stipulates, the speaker of the Senate, Kassym-Jomart Tokayev, a Nazarbayev loyalist, was appointed president until the end of the current presidential term in 2020. His daughter, Dariga Nazarbayeva, was elected to be the new speaker of the Senate.

Although there are few clues as to what will happen next, speculation tends to focus on three issues: political power relations, social discontent and Nazarbayev’s personality cult.

Nazarbayev has built a political system that combines Singaporean-style technocratic governance with feudal loyalty. True, Kazakhstan has made some progress in fostering a professional state. But, unlike Lee, Nazarbayev has not built strong institutions, such as a competitive political party system, or an independent judiciary. This will make the political transition particularly difficult, because institutions will need to be built along the way.

Some decentralisation of power seems inevitable. If the current highly presidential system remains intact, Nazarbayev and his successor will probably maintain a duopoly. But if the new president cannot consolidate power sufficiently—a distinct possibility—then multiple power brokers will emerge, with no strong parties to help channel their differences. In this scenario, even Nazarbayev might not be able to keep the resulting conflicts under control.

In this context, recent and ongoing protests could be precursors of more serious upheavals later. Although there are currently no clear demands for democracy, there is growing dissatisfaction with social injustices. And, ad hoc measures aside, Kazakhstan currently has no mechanism for channelling and addressing popular grievances.

Finally, unlike Lee, Nazarbayev ended up encouraging his own personality cult. Public officials and ordinary citizens alike praise the president’s genius, wisdom, devotion and other qualities. There are monuments to him throughout the country. The most advanced university and schools, the central avenue in Almaty, and the airport in the capital, Astana, had all borne his name prior to his resignation.

The cult is getting stronger. On 20 March, Kazakhstan’s parliament voted to rename the capital Nursultan and many cities renamed their central streets after Nazarbayev. This is raising concerns among some sectors of the population—a response that the government shouldn’t ignore.

The cult will most probably soften with time. But it’s unlikely to disappear, because it would be impossible (and unfair) to decouple Nazarbayev from Kazakhstan’s independence narrative. This is why Nazarbayev’s resignation marks a critical juncture for Kazakhstan. He came to power at a time of profound and unexpected change, and his semi-departure could have equally unpredictable consequences.