COMMENT: Nazarbaev's succession challenge

By bne IntelliNews May 21, 2007

Ariel Cohen in Washington -

The vote in the Kazakh parliament last week that granted President Nursultan Nazarbaev the ability to run for a fourth presidential term raised a few eyebrows in Washington.

The amendment is part of a broader constitutional reform, which brings a lot of positive change. The international investment community, as well as business and political leaders, should cautiously embrace the changes as a guarantee for a level playing field, the rule of law and a liberal investment regime. This is the reaffirmation of the incipient statehood that Kazakhstan has achieved.

A key ally

Kazakhstan has over the last couple of years become the key US partner in Eurasia and is a potentially major oil exporter to the global market, eventually overtaking that of Kuwait or Iran. It has attracted the top marquee names in the energy business and beyond.

President Nazarbaev has also been the US' favourite leader in Eurasia, calling for Iran to abandon nuclear arms programme and providing steady supplies of oil and gas to world markets. Vice President Dick Cheney on a trip to Kazakhstan last year called the country "a key strategic partner of the United States."

Yet critics from human rights organizations continue to criticize Kazakhstan for falling short of Western democratic criteria. They will undoubtedly oppose Kazakhstan's bid to become the chairman of the Organization for Security and Cooperation in Europe in 2009.

Regardless of who heads the next US administration, Washington will continue to work closely with Nazarbaev. For oil companies, the Caspian is one of the top-three global priorities, after the Gulf and Russia. Too much is at stake in terms of US interests, including keeping Central Asia independent of Russian, Chinese or radical Islamist dominance.

Long reign

Effectively, the constitutional amendment extends Nazarbaev's chances to stay in power, if he so chooses, beyond 2012 when his third term expires. With the term changing from seven to five years, he may stay in power another 10 years, until 2017. Health allowing, he would be 77 by then.

The new political reforms are enhancing political stability, while developing political institutions, including the parliament and the parties. The new legislation envisages a shift from presidential to presidential-parliamentary republic. The political reform package for the first time will require parliamentary majority approval of the prime minister (and the cabinet). The role of the courts is also enhanced.

Constitutional changes are also increasing the role of the Assembly of the People – a unique instrument to preserve the religious and ethnic peace and mutual tolerance of the multi-ethnic and multi-religious society of Kazakhstan.

The proposed changes appear as a new stage of a steady process of political reform supervised by Nazarbaev. For real democratic change, elections should come after democratic institutions are built.

Yet by allowing for a lifetime presidency, Nazarbaev is opening the door to some pitfalls, of which a statesman of Nazarbaev's stature should be aware. If he chooses to stay beyond 2012, his options range from Lee Kwan Yu, the "inventor" and the father of Singapore, whom he admires, to Deng Xiaoping, the greatest Chinese emperor of the last 400 years, who secured his succession and legacy, to the tragic decline of Indonesia's Sukharto and Zimbabwe's Robert Mugabe.

The future of Kazakhstan, with its unprecedented economic development, looks bright. The country's GDP grew 75% over the last six years, with the stable annual economic growth in the 10% range. Its bankers and businessmen now invest in neighbouring countries, and its economic reforms and banking system have surpassed those of Russia.

Kazakhstan also educates 3,000 of its best and brightest in the top schools around the world. These young professionals then return to their homeland to quickly assume positions of power in the government and industry. The slogan is: "Economy first, then politics."

Kazakhstan is an Asian, formerly nomadic, nominally Islamic (and also Russian Orthodox) but mostly secular society. There was no nation state until 15 years ago and no tradition of formal democracy until 1992. Yet it is developing and modernizing impressively.

This current period of calm, economic prosperity and growth will allow Kazakhstan to develop political institutions and allow potential successors to build up their support base. However, the Western policymakers and the business community hope that the succession, when it comes, will be institutions- and rules-based, and orderly. Kazakhstan's opposition figures who are part and parcel of the current political system should also be allowed to compete. Developing the rule of law and fighting corruption should be the key priorities.

The true challenge and test of Kazakhstan is modernization and development. This is the yardstick that the current political reforms and the life of President Nazarbaev will be measured by.

Ariel Cohen, Ph.D., is Senior Research Fellow at the Heritage Foundation. He recently visited Kazakhstan.

Send comments to The Editor

Related Articles

Retail trade slows in Kazakhstan amid economic uncertainty

Naubet Bisenov in Almaty - A free-floating exchange regime for Kazakhstan’s currency, the tenge, is taking its toll on retail trade as the cost of imports rise. While prices have not changed ... more

bne:Chart - Russia begins to steady the ship according to latest Despair Index

Henry Kirby in London - Ukraine and Russia’s latest “Despair Index” scores suggest that the two struggling economies could finally be turning the corner, following nearly two years of steady ... more

New Kazakh central bank governor re-adopts free floating regime

bne IntelliNews -   The National Bank of Kazakhstan, the central bank, has re-adopted a free-floating exchange regime under the new governor, Daniyar Akishev, who has ... more

Notice: Undefined index: subject_id in /var/www/html/application/controllers/IndexController.php on line 335