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Central Asia

Kazakhstan between stability and reforms

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Announced in March, the early presidential election in Kazakhstan has become a debate about the results reached during the past years, the actual problems and the future challenges. The advanced poll was proposed by institutional officials in order to permit President Nazarbayev to lead the country again in the next future.

Kazakhstan is dealing with challenges in political and economic sphere existing in former Soviet space. The country, in addition, is facing some strategic bids directed to promote economic integration in the international markets and its worldwide image. For instance, Kazakh diplomacy is actively working for admission in the World Trade Organization and it has presented its candidacy for a seat as a non-permanent member of the UN Security Council for the years 2017-2018.Moreover, among many relevant events scheduled in the country in the next years, Astana in 2017 will host the International Exposition while Almaty is one of the two candidate cities to host the 2022 Olympic Winter Games.

In this way, in the political establishment gained momentum the idea to ensure stability in phase of great transformations and challenges for the country.

Motivations for the early poll were linked to “technical” as also political and social reasons. One motivation is linked to the willingness to divide presidential and legislative elections, both scheduled for 2016, in order to prevent any sort of threat that could have led to political and institutional paralysis.

The second motivation is related with the increasing tensions in the world scenario and especially in the Eurasian context. The Ukrainian crisis and the current problems between Russia and the Western countries have put under pressure the Central Asian country, always devoted to pursue its “multi-vectorial” foreign policy of good relations with all the most important global players. Moreover, changes in the economic outlook, due to rising prices in the international market and devaluations of national and Russian currencies, have been valuated as possible sources of uncertainty for the next future.

Kazakhstan’s challenges in the next years will be aimed not only at consolidating the stability of the country, but also at establishing a new path of reforms that the presidential bloc is, with all the probabilities, called to implement. On April 11, at Nur Otan (Kazakh ruling party) Congress in Astana, Nursultan Nazarbayev accepted the proposal for candidacy advanced by the professor Kenzhegali Sagadiyev. With this move, there is no doubt about another landslide vicotry of the incumbent. Despite his long staying at power, the Head of the State still enjoys a widespread support throughout the country, thanks to economic and political successes and the objective weakness of the opposition side.

In his acceptance speech, Nazarbayev explained the necessity for the country not to stop its process of modernization, claiming that: “We cannot stand idle. We have to move forward availing on our success to strengthen our statehood”. He underlined the next years are going to assume a great relevance not only for the stability of the country, but also for the realization of a wider spectrum of reforms.The President, in fact, seemed more interested to illustrate the long term path than campaign promises, by identifying five fundamental points for the modernization: state apparatus and meritocracy; rule of law; industrialization and economic growth; strengthening Kazakhstani identity; transparent and accountable state

Among them, there are two key points of Nazarbayev’s presidency. The first, the continuation of the process of economic reforms started with new amendments on law on investments and the main economic development program “Nurly Jol”, within the strategic plan “Strategy 2050”, aimed to put the country among the top 30 world economies. The second, no less important, achievement of a multinational, tolerant and secular society where all the 130 ethnic and 17 religious communities can live in concord.

In addition, Kazakh President stressed the importance of combating corruption, the consolidation of rule of law, the professionalization and training of bureaucratic officials. There is a commitment for the introduction of scrutiny for state apparatus, meritocratic selection criteria and transparency. Moreover, these proposals for “openness” should extend also to political system.

In Nazarbayev’s view, new constitutional reforms should promote a progressive ceding of responsibilities and resources from state structures to regional ones and a transfer of power form the Presidency to the Government and the Parliament. The aim is the creation of a more balanced system of government with a clear division among state institutions, as only in part realized with the constitutional changes in 2007, when were introduced changes to electoral law and the relations between the Prime Minister and the Parliament.

If the calling of new presidential election can be analyzed recurring to motivations of economic stability and the maintenance of socio-political internal concord, the intervention of the President added new significances to the upcoming vote. The five structural areas of reforms listed by Nazarbayev mean the necessity, no longer possible to postpone, to implement a comprehensive package of institutional, administrative, judiciary and economic reforms in order to sustain the modernization of the country.

On one side, these proposals represent a fundamental step for the economic development of the country: after years of impressive growth due to high hydrocarbon prices, it is not possible to conceive a qualitative leap without a more efficient normative and bureaucratic framework.

From the other side, the provision for new constitutional changes could contribute to the improvement of political system. Of course, Nazarbayev’s speech must be analyzed considering the particular Eurasian context. The demand for an immediate introduction of the so called “Western democratic standards” could have a logic in theory but not necessarily in political reality. The choice made by Nazarbayev is the adoption of a gradual, progressive and “Kazakhstani” path of democratization to be completed in four or five decades: considering the work done from 1991 till today, it is possible to reduce this lapse of time to 15-20 years.

This may be not easy to understand for the West, but recent events have demonstrated   the failure of an immediate imposition of external cultural and political values not only in former USSR, but also in other parts of the world. Where the process of democratization ignored the establishment of strong institutions, the aspiration to democracy gave the way to chaos or, in the worst scenarios, new forms of authoritarianism. This kind of situation is what a country with such precious, but delicate, social and ethnic equilibrium needs to avoid. Abrupt, not programmed changes within this framework, in order to adhere to a precise political ideology, could lead to risks for the survival of the country.

If, as said before, Kazakhstan is in the middle of the path of modernization and the next election can be defined as another turning point in its history. Kazakhstan’s development from 1991 till today was characterized by the transition from socialist economy, the definition of a new “Eurasian” identity and the achievement of a notable position in the international community.

After the celebration of this election – and the extension of Nazarbayev’s presidency for another, and maybe the last, mandate – the “leader of the nation” will have to face one of the most delicate challenge: granting to his nation a “legacy” not only in terms of political succession, but also for durable, efficient and stable mechanisms of government. Only in this way, Kazakhstan can maintain and consolidate in the future the positive objectives achieved since independence, improving its position in the international arena and the world economy.

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Central Asia

Chimes from Tashkent

Sabah Aslam

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Located at the new center of global attraction for economic activity, Pakistan and Uzbekistan share a long string of relations. After the independence from the soviets, Pakistan was among the first countries to recognize it. In 1992, Pakistan established their first diplomatic sanctuary in Tashkent. Since then delegations from both the countries paid visits to each other.

The bond shared between the two countries, that lie in close proximity, is strengthened by similar eastern culture and fortified by the religious ties. This sharing of cultural and religious values is clearly visible in the national language of Pakistan which borrows thousands of words from Uzbekistani language. This nexus is now getting even stronger with the increase in co-operations in social and economic sectors.

Relations between both the states saw an unprecedented growth in recent times and this social integration is ever growing. During the last year only,

63events such as seminars, presentations and business forums were arranged for general public. Whereas, the Uzbek Embassy had a significant number of bilateral meetings with the top tier of business community including several associations and unions. The same sentiment was reciprocated by Pakistani side when more than 50 companies paid visit to Uzbekistan with the purpose of investment. There were a number of exhibitions, events and investment forums in Tashkent, Jizzakh and Bukhara. Eight different Pakistani companies participated in such events.

Uzbekistan and Pakistan have also been working on 38different joint ventures for launching import/export operations.

In economic sphere, Islamabad and Tashkent hold great trade potential. In just 2018, the mutual trade between both countries crossed USD 98.4 million’s mark, which means a raise of around 170%.Prior to 2018 in 2017 numbers of economic activity between two states were low and accounted for just USD 36.6 million.

In 2018 Pakistani export to Uzbekistan increased for 150% and amounted 66 million USD (in 2017 – 26 million USD).

Last year Ambassador of Uzbekistan to Pakistan Mr. Furqat A. Sidikov while addressing business community at Islamabad Chamber of Commerce and Industry expressed that trade volume between Pakistan and Uzbekistan has the potential to rise up to USD 1billion in next 5-6 years. It clearly signifies that both countries can provide enormous benefit to each other’s socio-economic segment. Pakistan has been exporting edibles like mango, citruses, raw and refined sugar. Furthermore, chemical products, pharmaceutical products, and leather and textile goods are major exports of Pakistan to Uzbekistan.

Uzbekistan is also a hub for petrochemical goods, cotton and silk goods. Its exports to Pakistan includes: leather raw materials, petrochemical products and mineral fertilizers, cotton yarn, cotton fiber, raw silk, plastic products, agricultural machinery, clothing, etc. Not only this, dry fruits and vegetables are also exported from Uzbekistan to Pakistan.

In 2018 Uzbekistan-Pakistan Business Council was established in Islamabad in order to facilitate and support the business community in two countries. Apart for this, several forums are also established in main cities of Pakistan to boost up the economic potential.

Accessibility remains a key subject in establishing people to people relations thus recognizing this flight route from Tashkent-Lahore-Tashkent was resumed in April of 2017. Both states also look forward to initiate new routes from Islamabad and Karachi as well. Earlier in May Uzbekistan’s Ambassador to Pakistan had a meeting with Chairman Senate of Pakistan to discuss the inter-parliamentarian cooperation between Pakistan and Uzbekistan. Sideways to expanding parliamentarian relations it was also discussed to further strengthen the cooperation on transport sector to provide uninterrupted route to trade of goods.

Both countries share many economical and regional platform and are member of Organization of Islamic countries (OIC), Shanghai Cooperation Organization (SCO), and Economic Cooperation organization (ECO)and others. Multiple times these platforms were used to freshen up the relations between two countries. Based on mutual trust both countries can have free trade agreements to amplify the relations between them.

Enormous potential lies in social, economic and political sectors on which both countries can work. Both countries can play a key role in bringing peaceful non-military solution to misery in Afghanistan as well as in the region. Pakistan needs to explore new avenues for cooperation with countries like Uzbekistan and extract the maximum benefit for itself.

Uzbekistan understands importance of Pakistan in keeping stability and prosperity of the whole South Asian region. Both countries are interested in continuing bilateral partnership on all key issues of the regional security and stability agenda, including the conflict resolution in Afghanistan and expansion of infrastructure, trade and economic ties between Central Asia and Pakistan.

Uzbekistan initiated logistic project that project will include the construction of the massive railroad transport corridor “Uzbekistan-Afghanistan-Pakistan”. In details, this corridor will compose the rail line “Uzbekistan-Mazarisharif” which has been already realized between Uzbekistan and Afghanistan as well as construction of new rail road “Mazari-Sharif-Kabul-Peshawar”. 

In perspective, full realization of this unique transport corridor, will make Pakistan as a Central regional trade hub between South Asian and Central Asian regions.

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Central Asia

No More Business as Usual: Improving Water Usage in Central Asia

MD Staff

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Central Asia’s future economic development, including its energy and water security, depends to a great extent on how effectively countries manage their natural water supplies, especially under increased pressures from climate variability, economic growth, and population expansion.

The population of Central Asia is expected to grow by around 30% by 2050. As such, demand for water services will also increase significantly.

Central Asia is heavily dependent on agriculture, which provides livelihoods for about 50% of the population in some countries. But its level of water productivity is one of the lowest in the Europe and Central Asia region. More efficient use of water in the economy could significantly contribute to increased agricultural productivity, green energy production and the health of the region’s environmental assets.

According to estimates, the adoption of modern agricultural techniques and methods could increase the region’s crop yields by over 20% by 2030, and by 50% by 2050. On the other hand, if countries continue a “business as usual” approach, Central Asia is among the regions that could experience a significantly negative impact on GDP under climate change. Each year, inadequate water supply and sanitation leads to overall economic costs equivalent to around $2.1 billion, although these costs differ from country to country – ranging from almost 0.5% of GDP in Kazakhstan to around 4.25% in Tajikistan (2017 data).

“The water agenda in Central Asia is always viewed through the lens of the Aral Sea disaster,” said Ato Brown, World Bank Country Manager for Kazakhstan. “Today, it is high time for us to start changing the narrative so that Central Asia is known for being an oasis of production and productivity.”

According to a World Bank report, Central Asia is among the regions that have most to gain from properly managing water resources under climate change.

Most of the major rivers in Central Asia cross borders, therefore countries need to coordinate water management to advance sustainable development and climate resilience.

Water resources in the region are sensitive to climate variability, which poses significant challenges to the agriculture and energy sectors.

Since the 1950s, average annual temperatures have increased by 0.5°C in the mountainous areas of southern Central Asia, and glaciers that feed the region’s main rivers – Amu Darya and Syr Darya – have shrunk by a third. With the melting of glaciers, the expected fall in river flows will have a major impact on agricultural production.

By 2025, hydropower is expected to overtake gas as the main fuel source for energy production in Central Asia. Where hydroelectricity production is based on reservoir storage, there can be flow management benefits for climate change adaptation, including flood and drought prevention and mitigation, as well as timely delivery of irrigation and drinking water.

“Central Asian countries need to start with a joint project, and there are opportunities for working together,” said Ato Brown at the Astana Economic Forum. If the countries of Central Asia invest sufficiently and effectively in better water management, they have the potential to become not just economically prosperous and resilient to climate change – but also to provide new opportunities and hope for all their citizens.

World Bank

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Central Asia

Pakistan and the -Stans

Sabah Aslam

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From the coasts of Caspian Sea to the rouged lands touching Afghanistan, there lies a belt of resource opulent countries, the Central Asian States. Comprising of five states, it is now becoming the new hub for social and economic development. As it lies at the heart of ancient silk route, central Asia also holds key importance in the new  geo-economics of world as well. With combined population of more than 66 million and alone Uzbekistan accounting for approx. 29 million, Central Asia is an emerging market for investing companies.

Known as the five -STANs since all five states include -STAN at the end of their respective names. When these states got independence from the Soviet Union in 1991, Pakistan was among the first and few countries to recognize them and establish diplomatic relations with them. Since then, Pakistan and Central Asian countries enjoy healthy relations. Form visits of high-level delegations to signing of MOUs for establishing Joint Economic Commissions (JECs) Pakistan is fully acknowledging the role and importance of Central Asian states.

Geography plays a key role in the importance of these states located on the crossroads of East and West, Central Asian culture is an amalgam of ancient civilizations and modern era. Pakistan and the other STANs have a lot in common. Deeply connected with the bond of the religion, Pakistan and Central Asia, share many similitudes in culture. For instance, Sufism is enrooted in both societies. The architecture, cuisine, arts and handicrafts and even the dresses are somewhat similar. The languages also contain words and structures that are common. Thus, implying that both have immense potential of bilateral co-operation. For this, cross-cultural integrating policies and measures will boost the relations.

Out of many cross-cultural programs, Students’ exchange programs can be very beneficial. Pakistan in 1992-93 started Special Technical Assistance Programs, under which apart from language courses, diplomacy, banking and accountancy expertise were also exchanged. Programs were fully funded by the government of Pakistan. Presently, Central Asian Faculty Development Program had 7% of its fellows from Pakistan in Phase I. Similar programs can help improve the relationship between Central Asia, at not only state level but also it will be beneficial in context to people to people diplomacy.

Economic diplomacy stands as one of the guiding principles for Pakistan’s foreign policy now, hence the already important trade and commerce now stands even more important between the two societies. Presently, Pakistan’s trade volume is almost 58.4 USD in region with exports comprising of larger numbers, indicating the Central Asia can be very favorable market for Pakistani exporters and investors. Kazakhstan being the largest trade central Asian partner of Pakistan, is followed by Tajikistan and Turkmenistan. This trade and commerce between the two can contribute a lot in economic development of the countries and uplifting the standard of living.

Pakistan now is lying a greater emphasis on tourism industry than ever before. It has also been a driver for development in Central Asia. Travelers from across the globe are now visiting the region because of its unique cultural heritage and landscape. The number of visitors to Central Asia is ever increasing as it increased from 2 million visitors in 2010 to 6 million in 2016. Pakistan has also aims at a single tourist visa for all Central Asia Regional Economic Cooperation (CAREC). The promotion of tourism for strengthening of economic and cultural ties across countries and generation of employment and business opportunities had been the priorities under CARCE 2030.

After Washington’s venture on War on Terror and Pakistan becoming the pivot of it tables got turned. When Pakistan experienced the ricochet of Uncle Sam’s policies in Afghanistan , there seemed a decline in Pakistan’s heed towards the Central Asia. Affected by terrorism and its export from across the border with severe internal security challenges, discourse of Pakistan’s foreign policy took a major shift. Pakistan’s primal objective was to secure its internal and external parameters. After more than a decade, the dark clouds are dispersing from Pakistani skies and it is rising from the dungeon of bloodshed.

Now is the time for Pakistan to revamp its foreign policy framework and extend its diplomatic arms across the regions. Since both societies can benefit and can bring robust advancements to their socio-economic fabric by cooperating with each other. Pakistan should thus align its foreign policies with the overall shift in global politics. Since East now holds much important on international scenario, Pakistan and Central Asian co-operation will stand for a more promising future of region.

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