Kazakhstan’s foreign policy is based primarily on the principle of multi-vector relationships. In this context, particular attention is given to the expansion of cooperation with the People’s Republic of China based on mutual trust, friendship and good neighbourliness.
In 2012, the two nations celebrated the 20th anniversary of their diplomatic relations. Over those years, we have achieved considerable success in the cooperation in the fields of economics, environment, culture, education, security and military affairs. Kazakhstan and China are actively cooperating in the framework of the Shanghai Cooperation Organization (SCO). In a fast-changing geopolitical environment, the SCO acts as an effective mechanism for maintaining peace, stability and security in the region.
Both nations are currently working on a project to revive the ancient Silk Road. This New Silk Way will include the main transport corridor between Western Europe and Western China. It will bring great economic benefits to both Kazakhstan and China. Today, our two countries also face similar tasks of economic development related to the modernisation of industrial plants and research, development and invention applied in the new global economy.
The succession of Xi Jinping as president of China confirmed the continuity of policies and strategy in Beijing. The government of China has unveiled its Development Strategy until 2050. It is planned that by that time the country’s GDP in absolute terms will be twice that of the United States. China has also drafted its Energy Development Concept until 2050. By 2030, the proportion of ecologically clean fuels used in the Chinese economy is projected to reach 50 percent.
It is impossible not to admire the ambitious goals of our neighbour. However, it is important to note that since gaining independence, Kazakhstan has also followed its own unique path of development, and international experts have recognised it as highly successful.
The Kazakhstan2050 national strategy announced by President Nursultan Nazarbayev in December 2012 defines the development priorities of the country over the next 38 years. This expansion of planning horizons is very timely. As President Nazarbayev noted, the United Nations drafted its Global Forecast of Civilizations Development until 2050 and the UN Food and Agriculture Organisation adopted its forecast report for the same period. The European Commission has adopted its Energy Roadmap 2050 and large international companies such as HSBC and Citigroup in the banking sector assess the growth of global demand2050.
In 1997, President Nazarbayev approved and implemented a national strategy for the country’s development until 2030. The goals set then seemed to be grandiose, but they are an accomplished fact. The significance of that programme for the people of Kazakhstan can be compared with the reforms of Deng Xiaoping that enabled the Chinese economic miracle to happen. The new strategy assumes the entry of our country into the top 30 developed countries of the world by 2050. It does not just determine a course of social reforms. It also acts as a symbol of the unity of the people of the nation in achieving high goals.
The strategy considers the global challenges of the 21st century as new opportunities for the country. Thus, the rapid population growth in developing countries creates additional demand, including in those areas where Kazakhstan is able by its own efforts to occupy market niches, such as producing food, primarily grain and meat, on a large scale. It is not by accident that President Nazarbayev singled out the domestic agro-industrial complex as one of the priority directions of economic development. By 2050 it is planned to increase the share of agricultural output in GDP of the country by 5 times to a 25 percent share of total GDP. This is achievable with adequate state support. I am confident that we can gain a foothold in the world’s major export markets through the creation of a national brand of available, organic food.
The demand to solve the global problem of energy security creates incentives for Kazakhstan in the development of green or sustainable energy. It is symbolic that the theme of the EXPO 2017 international exhibition to be held in Astana is “Future Energy.”The European Commission’s estimates that wind power will provide Europeans with 49 percent of their electricity by 2050 against the current level of only 5 percent. Due to its geographical location on the steppes of Eurasia, Kazakhstan possesses great potential for the development of wind and solar energy.
The Third Industrial Revolution offers nations around the world the prospect of transition to a new way of life driven by technological breakthroughs. This is very important for our economy, which is still heavily dependent on the materials sector. However, with the correct choice of development strategies in key high tech industries and the support for innovation clusters, Kazakhstan can make a breakthrough similar to the ones by Japan, South Korea, Singapore have already achieved. Therefore, we have set the task of doubling the share of non-resource exports in the total volume of exports by 2025 and tripling it by 2040.
President Nazarbayev has noted the global problem of fresh water shortage. By 2030 the number of people living in conditions of permanent water shortage will exceed four billion. Water is a scarce resource. Therefore, the issue of water efficiency has been singled out as a strategic priority. It is expected that the problem of providing sufficient drinking water will be settled by 2020 and that of a shortage of fresh water will be resolved through irrigation policies by 2040. After that date, a severe shortage of fresh water around the globe will open vast opportunities for Kazakhstan to export its growing surplus of water.
The new economic challenges require new approaches to economic policy. The president has discussed the importance of applying the practical principles of profitability, return on investment and competitiveness. Therefore, our tax, fiscal, monetary and credit policies require revision.
National fiscal policy should be based on the principles of austerity and efficiency of expenditure. Favourable tax policies are needed to foster enterprises in the fields of production and new technologies. Tax credits are needed to stimulate investment activity.
Threats of financial instability in the world economy make monetary policy of paramount importance. This is used by most states to overcome financial imbalances. President Nazarbayev has proposed new system of monetary policy to protect the economy. It requires new approaches in social policy.
The government also plans to step up its fight against poverty. Healthy eating and healthy lifestyles are also important. The state needs to continue to provide targeted social assistance to those groups that need it – pensioners, the disabled, sick children and the unemployed.
It is important to solve the problems of social imbalances in different regions of the country. We need to create new effective mechanisms to balance socio-economic living conditions. We also need to create favourable conditions for domestic skilled workers to prevent them from going to foreign labour markets. This will require new approaches in payment for labour and reduction of imbalances, and the fundamental revision of laws to protect mothers and children.
These issues are all addressed in the Kazakhstan2050 national strategy. The document presents specific tasks in all areas of public life. Its successful realisation may lead to Kazakhstan’s entry into the top 30 developed countries of the world ahead of schedule.
Citigroup projects that no European country will be among the top 10 largest economies of the world by 2050. By then, Asia will generate almost half of global GDP. In this context, the prospects of Kazakhstan look favourable. However, such development is not possible without strengthening cooperation with China.
Kazakhstan and China share the strategic goals of achieving sustainable economic development and raising the social welfare of their peoples. Both countries will achieve great success in the implementation of these programmes: It is therefore important to further develop their bilateral relations.
The author is a deputy of the Mazhilis of Parliament of Kazakhstan and a member of the Central Committee of the Communist People’s Party of Kazakhstan. He holds a PhD in Economics.