Kazakhs question legacy of $5bn Expo 2017

Kazakhs question legacy of $5bn Expo 2017
By Kanat Shaku in Astana September 14, 2017

In final two days of the three-month Expo 2017 international fair in the Kazakhstani capital Astana, Kazakh citizens leapt at the opportunity to buy up cheap tickets to get a taste of the $5bn green energy theme-park.

A tightly packed queue formed outside the spherical central exhibit, with lines of mainly Kazakhs plus a few foreign visitors willing to spend two to three hours waiting to see inside. Dubbed the National Pavilion of Kazakhstan and separated into eight floors — each floor dedicated to a different type of renewable energy — this was the centrepiece of the event, functioning as its own “fair within a fair”, as one American visitor put it. More crowds clogged up entryways to the German, French, US, Korean and Japanese segments of the “Future City”. 

As the green energy-themed Expo came to a close on September 10, the debate over visitor numbers sparked by negative press coverage in July continued. Locals told bne IntelliNews that the flood of visitors in the final days wasn't very different from in the previous weeks, at least since the middle of summer. With one exception — very few of the visitors appeared to be foreign tourists during the last couple of days of the event. 

This was a stark contrast to some hard-hitting negative coverage made in early July by some of the attendees at the beginning of the event, including media representatives who had described the event as mostly empty with just a handful of people in several pavilions. One such piece, run by Foreign Policy and titled “Kazakhstan Spent $5 Billion on a Death Star and It Doesn’t Even Shoot Lasers” said the Central Asian nation “forgot to invite guests”. Locals generally appeared to agree with that description at the very beginning of the event, but insisted that the number of foreign visitors skyrocketed towards the middle of the summer. 

“Quite a lot of the visitors were foreigners in the middle of the summer,” an Astana resident, Sveta, said. “I’ve seen Westerners, Russians and East Asians [at the event], though overall I’d say most visitors throughout the entire fair were probably locals.”



In total, however, the expensive event had garnered approximately 3.9mn visitors as of September 10 — a fifth short of the Kazakh authorities’ goal of 5mn visitors. The figure certainly makes Expo not the epic failure the Foreign Policy piece painted it to be, although locals have implied that the real attendance could have been somewhat lower than officially reported, all variables considered.

“Some of those attendees visited the event more than once,” Sveta posited. “I think that helped bolster the hypothetical number of visitors.”

Astana Airport, with an annual capacity of 8.2mn, at maximum passenger throughput, would have been able to allow around 2mn visitors from other countries to arrive in the country. National flag carrier Air Astana recently reported a 22% rise in international traffic between January and June — though the number is not too relevant for the June 10 - September 10 duration of the Expo. 

Worth the money? 

The Kazakh authorities have described the event as a success as far as the event was a PR campaign designed to burnish the image of the capital. Some locals begged to differ, while others saw positive sides to the exhibition beyond its marketing purpose. 

“The Expo was a great source of employment and much needed experience for university students and young people in Astana,” said Aigul, a volunteer at the event. Other Kazakhs saw the fair as an opportunity for adults and kids from the impoverished areas of the country to learn about sustainability. 

However, the critics focused on what they felt was a misallocation of government funds. The expensive price tag of the event left some Kazakhs wondering if the price was worth the residual benefits to the locals. Astana applied to host the international fair in 2010, when the price of the event was estimated at $3bn because oil prices were high and there were hopes that most of the infrastructure needed for the fair would be covered by private investors. Fast forward to 2016: the country was engulfed in an economic crisis which is still ongoing due to unexpected circumstances — low oil prices and economic troubles in its main trading partners, including Russia.  

These developments shattered hopes of smooth financing and the post-Soviet nation had to tap into the country’s state-owned pension fund to finance the Expo’s completion, much to the consternation — as expressed on social media — of some Kazakhs. Moreover, independent sources claim Kazakhstan’s proceeds from the event stood at between $300mn-$400mn, though there’s no way to verify the actual figures. The authorities hadn’t necessarily counted on the event to reap big profits either.

What will happen to the exotic buildings put up to host the Expo on what was once empty steppe but has now become a new suburb of Astana is unclear. One volunteer said the buildings would pass on to Astana International Financial Centre (AIFC), while the spherical central building will remain a green energy museum. Other locals said the surrounding buildings will become science labs for the nearby Nazarbayev University. 

Renewable potential untapped

Yet more questions have been raised about whether Expo will yield any concrete results in promoting the use of green energy in oil, gas and coal rich Kazakhstan. 

“The money was wasted on the event,” another local, Volodya, said. “They could’ve spent $5bn on building wind farms in the steppes to develop the actual green energy sector instead.”

Such criticisms aren’t uncommon from representatives of Kazakhstan’s political opposition.

“At one point, 20 years ago, [the authorities] said that it was necessary to put power plants: there is a lot of wind [Kazakhstan] - the [potential] energy is colossal. Then they said that one percent of [wind] energy from the Dzungarian Gate is enough to cover the [energy] needs of Kazakhstan," head of the Tabigat environmentalist movement, Mels Eleusizov, told RFE/RL’s Kazakh Service.

“But renewable energy accounts for just 0.6% of all power installations,” a 2016 UNDP report states. “Of that, 95% comes from small hydropower projects.”

The actual development of renewable energy in the country has been a widely discussed topic, but not a widely implemented one. The other side of the Expo was the promotion of the AIFC, an English law-based financial services hub, which will feature a “green financial system” aimed at specifically drawing investments into renewable energy. The system is currently under joint development between the European Bank for Reconstruction and Development (EBRD) and the AIFC, but no specifics of the system have yet been publicised. 

The EBRD’s 2017-2021 Kazakhstan Country Strategy notes that the bank hopes to continue its assistance to “Kazakhstan’s transition to a low-carbon economy, including in relation to its Conference of the Parties (COP21) commitments, green legislation and investments in energy efficiency and renewables… Energy and resource efficiency and climate change mitigation will continue to be a major focus of its work”.

Agris Preimanis, EBRD director and head of Kazakhstan, told bne IntelliNews in May that “non-extractive sectors in [Kazakhstan] will be key for the EBRD, as well as working towards improved connectedness and a greener, more sustainable energy sector.”

Looking forward, Kazakhstan has yet to prove its willingness to invest in the expansion of its renewable energy sector rather than spending money on talking about it.