Kazakhstan’s Economic, Legal Reforms Ensure Continued Development

By Yerbolat Uatkhanov

Sometimes, the evolution of a still-developing state can seem like a flurry of activity without a lot of results. Ministries are created and disbanded, projects are launched, headlines are grabbed – but the long term, incremental changes they create can often fly under the radar.

Official Kazakhstan can sometimes seem like an alphabet soup of similar state programs. But don’t dismiss them just yet. The 100 Concrete Steps Plan of the Nation outlined by President Nursultan Nazarbayev in 2015, is in fact a very specific, very forward-thinking plan based on very careful decision-making – and a lot is expected of it. In additional to it, a number of specific state development programs are being implemented ensuring both the introduction of reforms and the economic growth.

EdgeKz takes a look at what the government has done with the development plans over the first half of 2016.

Economy

Financing is a key factor in national projects and the allocation of funds is extremely important. Government representatives reported that 409.2 billion tenge (US$1.19 billion) or 53 percent of the country’s budget was allocated in the first half of the year.

Minister of National Economy Kuandyk Bishimbayev said this year economic growth is being driven by state programs, which also provide jobs for the country’s population. The implementation of state programs contributed to a 1.3 percent increase in gross domestic product in 2015 and is estimated to have given GDP a 1.2 percent boost this year.

Transport, Logistics and Industrial Infrastructure

Kazakhstan is working to diversify its economy, and the transport and logistics sector and the development of industrial infrastructure are two linchpins of this transition.

This year, expanding and modernizing the state’s road infrastructure took priority, particularly roads linking to the capital, Astana. The government has settled on a ray design of new roads to connect the capital with the vast country’s regions, and a plan has been launched to construct and repair more than 6,700 kilometers of roads from 2015 to 2020. In 2015, 178 billion tenge (US$517.5) was spent and it is estimated that 151.3 billion tenge (US$439.8) will be spent in 2016.road-construction

In 2015, 456 kilometers of roads were constructed and reconstructed. As of today, 96.9 billion tenge (US$281.7 million) has already been allocated for road construction and reconstruction works. In total, 1,038 kilometres of roads are under construction and 920 kilometers of them will be completely ready for operation before the end of the year.

In a massive country where travel has historically taken days and weeks or more, the arrival of new roads will bring more work and education opportunities – and big changes to the country’s villages.

Kazakhstan wants to become a transportation hub between China, the world’s factory, and the European Union, one of the largest markets. The Kazakh government sees the country as an important part of the modern Silk Road and is doing everything possible to make this a reality.

Two major highway projects have drawn major investment from the Kazakh government and loans from the International Bank of Reconstruction and Development and the Asian Development Bank: the Western Europe-Western China highway and the Beineu-Aktau highway. Construction of both highways will cost 147.8 billion tenge (US$429.7 million).

It is planned to increase transit capacity from 25 to 88 million tons of goods per year by 2020, and annual passenger traffic capabilities will be increased from 3 to 7.6 million people.

In addition to those to major long-term road investments, rail and water transport development is also being funded. In 2015, 48.8 billion tenge (US$141.9 million) and in 2016, 46.4 billion tenge (US$134.9 million) were allocated to build the Borzhakty-Ersai and Almaty-Shu railroads and a ferry terminal in Kuryk port and to enlarge Astana airport.

The 100 Concrete Steps include the creation of special economic zones, which can boost the development of industry. The most successful zone so far is the National Industrial Petrochemical Technological Park in Atyrau region. It is planned that different companies operating in the zone will provide a number of services and produce products for Kazakhstan’s crucial oil and gas sector, decreasing the country’s dependence on foreign imports.

Socially Important Infrastructure

Nazarbayev ordered the end of the three-shift system of education – made necessary because of a lack of education facilities – and has ordered that schools across the country be refurbished and modernized by 2018. By 2020, the capabilities of all preschool facilities are to be improved.

kazakh-school-childrenIn 2015, 19.4 billion tenge (US$56.4 million) and in 2016, 57.9 billion tenge (US$168.3 million) were spent to build schools and kindergartens, with many added in the Akmola region, the Almaty region, the Aktobe region, the Kostanai region and the South Kazakhstan region. Today, 29 new schools and 14 new kindergartens have already been put into operation and more will be opened before the end of the year.

Kazakhstan has not been able to afford to modernize its municipal heat and water supply systems for many years. Decades of neglect resulted in amortization reaching a horrible 67 percent in 2014. Now these systems are being modernized under the state programs. It is estimated that the number will be reduced to 53 percent by 2020 and the quality of service will be much better.

For these purposes 60 billion tenge (US$174.4 million) was allocated in 2015. In 2016, the number reached 90 billion tenge (US$261.6 million).

Rule of Law

The 100 Concrete Steps Plan of the Nation addresses Kazakhstan’s judicial system, mandating a transition from the current five-level justice system (first, appeal, cassation, supervisory and repeated) to a three-level system (first, appeal, cassation). (A court of cassation does not review the facts of a case, but reviews the interpretation of the law as applied in a case.)

In the last year or so, relevant amendments have been made to Kazakhstan’s legislation and to the Constitutional Law of Kazakhstan on the Judicial System and Status of Judges of Kazakhstan.

On Oct. 31, 2015, Kazakhstan’s new Civil Procedure Code was signed. For the first time in the country’s 25 years of independence, the signing of a law took place in public in the presence of media, indicating the significance of the new code.

Along with other major changes in procedural legislation, the new Code of Civil Procedure contains the rules associated with the transition to the three-tier system of justice.

This reform has direct practical value. The jurisprudence of courts shows that the miscarriage of justice in the activity of a particular court is inevitable. To correct this, there are higher authorities. Procedural law determines the appeal to higher authorities, which checks judicial acts for scales-of-justicetheir compliance with the law and corrects mistakes.

The three-level system has operated for only 10 months in Kazakhstan so far, but progress is already evident. The speed of judicial processes has significantly increased, which is extremely important, as it protects the rights of individuals awaiting trial.

The results of Kazakhstan’s reforms are being recognized outside the country. In 2015, Kazakhstan rose 14 positions, from 86 to 72, in the Judicial Independence indicator of the World Economic Forum’s Global Competitiveness Index. Kazakhstan is now ranked higher than such developed states as Italy, Spain, Turkey and Russia. In 2016, this figure rose by another four categories, and now Kazakhstan occupies 68th place.

In 2011 the country Kazakhstan was in 111th place – so in six years, the country has vaulted 43 positions.

This rating provides a very clear picture of the independence of the judiciary. It is based on a set of criteria that includes how judges are selected and how court personnel are trained and educated. The rating estimates the operation of courts’ self-management as well.

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