Knowledge-Based Economy Key Component of Kazakhstan 2050

YespayevThe sixth technological revolution is the main trend of development for the nation designated by the President Nursultan Nazarbayev in Kazakhstan 2050 Strategy 2050.

In the next 10-15 years, it is vitally important to create a knowledge-intensive economic base, without which it will be difficult to compete with developed countries. The key condition for that, emphasised the head of state, is the introduction of a knowledge-intensive economic model, which aims to increase the share of finished products in Kazakh exports to 70 percent, decrease energy consumption two times and improve productivity five times. This requires a specific plan and developments.

The results of research at our institute suggest that we need a fundamentally-new paradigm of public administration and planning in order to achieve strategic goals on the development of a scientific-driven economy and to join the 30 most-developed countries of the world. It should be based on the latest achievements of the theory of public management with regard to specific conditions of our state and national economy.

The analysis of economic growth and its factors in Kazakhstan (capital, labour resources and productivity) shows that all this is still provided mainly by the growth of capital and, to a lesser extent, by productivity.

The average contribution of the capital’s factor to economic growth is 6 percent, while the contribution of productivity is only 3.2 percent. In this regard, it is expedient to develop and adopt a law on Kazakhstan’s priorities of economic strategy. This will ensure the coordination of long-term strategies, programmes of development in general, regions and industries as well as mutual coordination of targets, schedules and measures to implement the strategic documents. By the way, Russia has already developed the law on state strategic planning of socio-economic development.

It is also advisable to legally establish control methods and mechanisms of accountability of all participants of strategic planning on the basis of public-private partnership. It is especially important to integrate into the state strategic planning system the institutes of development, business entities, companies, banks and other participants.

In addition, it is recommended to develop a concept for management of state property and national assets in order to assess the expediency of existence of state-owned companies and enterprises and reform their work.

Currently, the main criterion for evaluating the activities of development institutions is the profitability of their work. In this respect they do not differ from the second-tier banks, except for their annual capitalisation from the budget. But their work should be assessed by the degree of participation in the diversification of domestic economy, implementation of investment projects and creating the added value and export volumes of goods and services.

In addition, almost 30 percent of joint stock companies and partnerships,  as well as about 70 percent of communal property, are marginally profitable or even have a zero result of financial and economic activity. Taking into account the fact that a significant part of state property objects are working in the social sector, agriculture and housing, it is necessary to develop clear criteria for assessment of socio-economic benefits from the activities of state-owned enterprises, joint stock companies and limited partnerships.

All these speak in favour of the need to classify the existing state organisations based on strategic, social and commercial orientation and conduct ongoing monitoring of their activities. These strategic and social companies should be evaluated primarily on the end results of their work.

And, of course, it is impossible to transfer to the sixth technological mode without the Agency for Planning and Management of Knowledge-Based Economy (APMNE). Its priority should be improving the efficiency of innovation potential, including the formation of research and development infrastructure, regulation, planning, financing, science and technology forecasting. Simply, the agency must help all enterprises to identify promising directions of development in order to maximise the use of available resources.

To achieve the goals defined by the President, we also need to develop and adopt a government programme on human resources for knowledge-based economy by 2030. The emphasis there should be on the quality of human capacity and innovation mindset of people. That is, the country needs human potential that corresponds to the sixth technological structure.

Creating a knowledge-intensive economy will also require the adoption of new laws on cluster economy, high technologies and innovations and the development of the map to place innovative economy and regions on the base of the fifth and sixth technological structures. The creation of an effective system of public administration and planning is a complex, multifaceted and continuous process. However, the results of research conducted by our institute and international experience suggest that Kazakhstan certainly has great potential for the organisation of a new economic model, the expediency of which is clearly argued in the President’s strategy.

Therefore, it can be safely expected that Kazakhstan will join Singapore, Malaysia and other countries where this model has already been created and the reforms were carried out successfully and effectively.

The author, a doctor of economics, is Director of the Institute of Economics of the Committee of Science of the Ministry of Education and Science of Kazakhstan.

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