Today, Kazakhstan is going through the most complex phase of its contemporary political history, after the long-accumulated popular discontent has turned into a massive wave of violence.
The unrest in this country began with protests by car owners in the southwestern province of Mangistau against the sharp rise in the cost of liquefied petroleum gas, which is used to fuel cars. According to the Kazakh Association of Energy Complex Companies, about 80% of the province’s vehicle fleet uses gas as the fuel, because it is cheaper than gasoline.
In 2021, the Kazakh authorities decided to gradually liberalize prices in the liquefied gas market, and increase the share of liquefied petroleum gas sold through e-commerce platforms on the basis of supply and demand, including car gas filling stations; In other words, it was known that as of January 1, 2022, 100% of liquefied gas will be sold through exchanges (with the exception of a number of categories).
However, the transition to market prices, and consequently the rise in the price of a liter of liquefied gas in the same area of Mangistau from 80 to 90 tenge at the end of last year to 120 tenge (approximately $ 0.28) at the beginning of this January, inflamed final consumers while Surprisingly, until March 2021, this region had a ceiling on the price of gas at gas stations of 50 tenge per liter, the lowest among all Kazakh regions.
The government’s announcement of raising prices sparked protests in the country, and the slogans evolved from restoring gas prices to what they were before to present political slogans calling for the overthrow of the ruling regime, and the question about the causes of poverty in the most Central Asian republics rich in natural resources.
Rich country and poor people
According to some estimates, Kazakhstan has the second largest reserves of uranium, chromium, lead and zinc, the third largest manganese reserves, the fifth largest copper reserves, and it is among the top ten in terms of coal, iron and gold reserves, and is a diamond exporter.
According to the World Bank, Kazakhstan ranks tenth in the world in terms of the share of non-renewable natural capital (oil, gas and minerals) in the country’s total wealth (about 27%).
In 2020, half of Kazakhstan’s total exports of goods turned to crude oil at a rate of $23.7 billion out of $47 billion, and in the “OPEC Plus” group, the country’s oil production share is about 1.6 million barrels per day, or more than 4% of the total production The countries of the group, and natural gas supplies abroad last year amounted to another 2.5 billion dollars (according to the data of the United Nations foreign trade database).
In numbers, Kazakhstan’s exports of copper ore and its products are estimated at $4.25 billion in 2020, iron and steel $3.18 billion, and uranium $1.71 billion, with 12% of the world’s uranium reserves, and ranked first in the world in its export (according to data for the same year). .
Moreover, Kazakhstan’s sovereign fund – which manages the country’s largest state-owned companies – owns assets equal to about 40% of the national GDP.
Kazakhstan’s economy has also attracted tens of billions of US dollars in foreign direct investment, and the rich country has a good reputation among investors as a reliable partner that ensures stability and mutually beneficial cooperation.
On the other hand, inequality was steadily increasing in the republic, and the low-income groups were most affected by the unfair distribution of wealth, and social tensions increased as a result.
In 2011, a months-long strike by oil workers in Zhanauzen ended in clashes that left 16 people dead. At the height of the fraught atmosphere as a result, the government controversially raised the retirement age to 63 years for men and women, and the Corona pandemic shattered the myth of “social peace.” In Kazakhstan, poverty rates continue to rise, even according to official data.
The high level of corruption, defects in the independence of the judicial system and its weakness were among the factors that limited the growth of investments in the Kazakh economy.
Although the formation of a Supreme Council for Reforms was announced after Nursultan Nazarbayev resigned from the presidency, no tangible reforms occurred during this time, according to the Kazakh opposition.
Just before New Year’s Eve, Kazakhstan’s minimum wage (converted to dollars) was less than $100 a month, lower even than in Kenya or Pakistan, and the country’s minimum wage has not risen since 2018, and the decision to increase it appears to be on the first of January 2022 by 41% (to about $137) came late.
Besides, Kazakhstan complains of inequality between regions; A few years ago, the per capita GDP of Atyrau province (the richest agglomeration in the country) was more than 3 times the national average, while in Turkestan (the poorest region of the republic) it was only 33% of the average, according to a report Organization for Economic Cooperation and Development last year.
According to the same report, the regional differences in living standards in Kazakhstan are two to three times higher than in large OECD countries with similar sparsely populated populations (for example, Canada and Australia).
At the same time, the oil and gas resource base in the western part of Kazakhstan (Atyrau, Mangistau and Western Kazakhstan), due to which the per capita GDP of these regions is higher than the national average; It also masks internal inequality given the limited circle of highly paid workers in the oil sector.
Demographics of the protests
Finally, the demographic aspect is also an important part of the social and political landscape in Kazakhstan, as there is a relatively large number of young people, as the average age in the country is 30.7 years, while in neighboring Russia – for comparison – it is about 40 years.
In 2021, the population of Kazakhstan exceeded 19 million people, and the natural increase is about 250 thousand people on average since 2013.