26 Years of independence and looking into the future

Monday, 18 December 2017 14:13
Theodor Wilson

Theodor Wilson is a Brussels based analyst. He has work experience in Central Asian countries and Russia.
Kazakhstan’s President Nursultan Nazarbayev with world leaders at a photo shoot, prior to the opening ceremony of Expo 2017 in Astana Kazakhstan’s President Nursultan Nazarbayev with world leaders at a photo shoot, prior to the opening ceremony of Expo 2017 in Astana

Twenty-six years ago on December 16, Kazakhstan became an independent nation after seven decades as an “autonomous republic” in the Soviet Union.
The country has the largest and strongest economy in Central Asia, and aims to become one of the world’s 30 most competitive economies by 2050. 

2017 has been a spectacular year for Kazakhstan vis-à-vis its relations with the EU, and it is worth considering some interesting events which took place during the year for this amazing Central Asian country.

On January 1st, Kazakhstan took its temporary seat on the UN Security Council alongside Sweden, Ethiopia and Bolivia, a major milestone in its foreign policy to engage with international organisations at the highest levels, following on from 2010 when the country became the first former Soviet state to hold the Chair of the OSCE.

Since the beginning of this year, Astana, the Kazakh capital has been host to a series of peace talks on Syria, aimed at finding a peaceful solution to a conflict that has been roiling the Middle East for over six years and shows no signs of letting up.

The choice of location for the talks is not surprising. Kazakhstan has worked hard over the past quarter of a century to create an image of peacemaker. President Nazarbayev is famous for having launched initiatives driven by a desire for peace and trust in the international community.

The initiative of Russian, Turkish and Iranian leaders to launch the inter-Syrian talks in Astana opened the way for delegations, from Damascus and the armed opposition, to sit down and meet at the same negotiating table, for the very first time.

Moreover, in September in the capital of Kazakhstan, counterparts agreed to set up de-escalation zones – a significant step forward in a complex conflict.

The Astana platform is a complement to the Geneva Process, but it is worth also to note the fact that previously belligerents "on the ground" were not admitted for negotiations on the political future of Syria.

The country's economic progress deserves special attention. Internationally, Kazakhstan is known for the incredible economic transformation from an ineffective Soviet model of a centrally planned economy to a free market economy.

This year President Nazarbayev announced five main priorities to advance a third stage of modernization in Kazakhstan. Each is aimed at driving balanced economic growth and will ensure the country’s global competitiveness.

“Only those nations, which manage to get ahead of the future and decisively meet the challenges, without standing and waiting, are the winners. The next and fourth industrial revolution starts in the world,” Kazakhstan’s President said in his address to the country.

The transition to a new economic reality can be explained by the shocks on global raw materials markets – just some signs of rapid and irreversible change in the world. Kazakhstan’s economy cannot be unaffected by international issues on the global economy and geopolitical events.

2016 had been rather complicated for Kazakhstan and the government tried to find new ways to adapt an oil-reliant economy to new external conditions. Astana decided to introduce elements of the 4th industrial revolution: automation, robotics, artificial intelligence, exchange of “big data” and others.

“It is critical to cultivate such sunrise industries as 3D printing, online commerce, mobile banking, digital services, including health and education sectors, and others. These sectors have changed the economic structure of the developed countries and have given a new quality to senile industries,” Nazarbayev thinks.

Confirmation of Kazakhstan's strong international intentions was testified with the organisation of Expo 2017, an International Exposition which took place in Astana this summer. The expo stunned and delighted the international and local visitors with the new technical innovations on display, many for the first time.

By hosting Expo 2017, a global event visited by millions, Kazakhstan indeed reached two goals: It brought home the world’s best expertise in green energy, and reaffirmed its commitment to the Paris climate agreement unlike some countries.

The exhibition pavilions themselves were designed to provide the base for the International Financial Centre Astana (AIFC), an attractive gateway to the Eurasian Economic Union, giving another powerful impetus to the diversification of the biggest economy of the region.

The new financial centre will focus on the development of several strategic pillars such as capital markets, asset management, private banking, FinTech, Islamic Finance and Green finance.

The key feature of AIFC is the attractive business environment and the presence of a separate legal and regulatory system based on the principles of the English Common law. This will ensure fairness and justice and will greatly enhance the credibility of Kazakhstan in the eyes of investors.

AIFC participants are granted various incentives such as tax exemption for 50 years (corporate income tax, personal income tax, land tax, property tax), simplified currency, visa and labor regimes for participants and employees of AIFC as well as the connectivity of Astana with the key financial centres around the world via direct flights and the open sky policy. 

It is worth also reiterating that Kazakhstan serves as an attractive platform for the gateway to the CIS region and the role of the Astana International Financial Centre in this context is becoming important. AIFC will serve as the Capital Markets gateway and the Financial Hub for the region. 

Hopefully these events will allow us to take further steps towards the development of the Financial Hub and increase public awareness about the industry in Europe.

As Kazakhstan celebrates 26 years of independence this week, it stands well positioned to purse and benefit from many more prosperous achievements and an increase in regional importance and strength.
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