The global economy has taken a distinct turn for the worse since politicians, experts and the media gathered for the last Astana Economic Forum in 2015. The collapse in oil and commodity prices, the slowdown in China and the continuing problems in many other parts of the world have hit growth and reduced confidence.
Kazakhstan, as a large producer of oil and a major trading partner of China and Russia, which is in recession, has felt the full impact of these global forces. Without early and determined action, including the decision to float the tenge, the long-term damage to the country’s progress and prosperity could have been much worse.
It is always dangerous to tempt fate and there are many challenges to overcome. But with oil prices beginning to show signs of a slight recovery and the anti-crisis measures beginning to have an effect, it may be that the path ahead may be less difficult.
The events of the last 12 months and the continued turbulence and concern formed the backdrop for this year’s Astana Economic Forum on May 25-26. With discussions around the theme of “New Economic Reality: Diversification, Innovations and Economics of Knowledge,” it has again attracted a cast list of global leaders, CEOs, Nobel laureates and renowned economic experts. Each year, the forum grows in importance as an influential platform for dialogue in the Eurasian region.
There is, of course, plenty to discuss. There is a growing sense that the global economy is shifting, yet it is not yet clear where it is heading. Answers to this puzzle may emerge during the session “The End of Hyperglobalisation,” which will focus on making sense of current developments and trends.
How growth can be stimulated in a way that does not damage our planet and where the rewards are shared fairly also feature high on the agenda. It is important as countries struggle to kick-start their economies that the importance of truly sustainable development is not forgotten.
There are also plenty of domestic issues to discuss. Last year, Kazakhstan announced its ambitious privatisation programme involving more than 60 state-owned firms. On the first day of the forum, Kazakhstan’s Prime Minister Karim Massimov and senior figures leading the privatisation drive will be looking to offer an in-depth analysis on the economic outlook for Kazakhstan in the wake of the reforms and restructuring that have taken place.
The ambitious privatisation programme is just one of the strategies put in place to help achieve Kazakhstan’s goal of joining the top 30 most-developed countries by 2050. Nobody is under any illusions that this will be an easy task given the current economic climate. But the successful direction the country has followed since independence and the major challenges which have already been overcome give confidence for the future.
Opening up to the global economy has its risks, but it has already been a major driver of prosperity for Kazakhstan. The experience of other countries also shows the long-term benefits of continuing on this path are worth it.
Kazakhstan has already stepped up its efforts to attract foreign investment since the last Astana Economic Forum. After many years of negotiations, the country has finally joined the World Trade Organisation last year. Last year too, the government also extended the visa-free regime to 19 countries to help foreign investors do business in Kazakhstan. All members of the Organisation for Economic Cooperation and Development (OECD) joining most of the world’s advanced economies are expected to start enjoying the visa-free regime for travel to Kazakhstan starting Jan. 1, 2017.
These policies are already having an impact. According to the World Bank, Kazakhstan ranks 41 out of 189 countries in “Ease of Doing Business” and 21 out of 189 countries in “Starting a Business.”
The Astana Economic Forum will serve as a useful platform not only to discuss the progress made so far but identify the further steps needed to ensure Kazakhstan returns to high economic growth. Given the complexity of our world, it is unlikely that the participants of the forum will have all the answers to every problem. But the expert discussions will help generate new insights and options which explains the success and attractions of the forum for all who attend.