Kazakhstan holds on to Chinese ‘Belt’

Today, during his visit to Beijing President of Kazakhstan Kassym-Zhomart Tokayev proposed to China a new model of economic cooperation. At the same time, he assured that the previous agreements reached between first president Nursultan Nazarbayev and chairman Xi Jinping will be implemented and developed. Experts believe that Tokaev’s statement is a response to the anti-Chinese rallies held yesterday in several cities of the republic.

"China has invested about 20 billion dollars in Kazakhstan," Kassym-Zhomart Tokayev said during a meeting of the Kazakh-Chinese Business Council on Wednesday in Beijing. According to the Kazakh president, China has become one of the largest foreign trade and economic partners of Kazakhstan. The trade turnover between the two countries is 12 billion dollars. The development of a “new economy” based on innovation and new technologies, as well as high-tech industries and industry elements 4.0 are of particular interest to Kazakhstan. The bilateral cooperation in this area, according to Tokayev, is of particular importance due to the fact that in recent years China has become a recognized world leader in the development and implementation of the latest technologies. "We are interested in creating joint innovative enterprises, technology parks and IT centers with Chinese companies," the head of Kazakhstan emphasized.

On Thursday, Tokayev will visit Hangzhou, where he will get acquainted with the activities of Hikvision - a leading global supplier of innovative products. Kazakhstan, he said, is interested in creating joint innovative enterprises, technology parks and IT centers with Chinese companies. The Astana Technological Park of IT start-ups - Astana Hub - has opened in Nur-Sultan, where development is underway in such areas as Big Data, artificial intelligence, cloud technology and supercomputers. Simplified visa, labor and tax regimes are provided for the technopark participants, the President of Kazakhstan noted.

Tokayev called on Chinese businessmen to use more actively the Astana International Financial Center for financial operations, noting that this exchange is a unique institution for the region, where more than 250 companies are already registered.

Tokayev singled out agriculture and the development of transport infrastructure as promising areas of bilateral cooperation. “Five railways and six international automobile routes pass through Kazakhstan, connecting China and other Asian countries with Europe and the Middle East. This allows you to deliver goods to Europe from China through Kazakhstan and back in 15 days, while shipping by sea takes two to three times as much time. The state-owned infrastructure development program Nurly Zhol implemented in Kazakhstan along with the Chinese project Belt and Road will allow reviving the former greatness of the Silk Road,” Tokayev noted.

During the negotiations with the Foreign Minister of China, Yang Jiechi, the Kazakhstani President drew attention to the fact that all the agreements that were reached between the first President Nursultan Nazarbayev and Chairman Xi Jinping will be further developed. This is an agreement that was signed in 2015 by Nazarbayev in the framework of the Belt and Road initiative on the commissioning of 55 objects worth $ 27 billion. During a visit to Beijing in April this year, Elbasy confirmed that the implementation of these projects had already begun. 12 projects from the list have already been implemented. This year, it is expected to launch five more projects worth $ 310 million, including the construction of solar power plants, hydroelectric power stations, and a meat factory. Another 11 projects worth $ 5.5 billion are under implementation. The remaining projects are undergoing preparatory work. The full implementation of all projects will create about 20 thousand new jobs.

Exactly these projects caused a storm of protests in Kazakhstan. The rally activists claim that this is not about the construction of new enterprises, but the transfer of old Chinese factories to Kazakhstan, where Chinese labor migrants would work.

“It’s not possible to change the program that Nazarbayev created within the Belt and Road initiative,” the director of the Risk Assessment Group, Dosym Satpayev, told Vestnik Kavkaza. “This is a problem for the new president because the anti-Chinese sentiment will not dissolve.”

The expert named three reasons for the anti-Chinese sentiment in the republic: "The first is historical memory. For many centuries China was perceived by the majority of Kazakhs more as an enemy than a partner. The second is the policy of the Kazakh leadership. Many experts suspect that the government is signing contracts with China that are disadvantageous for the country. Kazakhstan is a rich state, the authorities have powerful financial resources - the National Fund where serious reserves are accumulated, the Pension Fund, the funds of which are often spent for other purposes. People do not understand,  why having its own financial resources, Kazakhstan is so actively increasing its financial dependence on China? If Kyrgyzstan and Tajikistan are poor countries in need of investment, it is unclear, for what reason Kazakhstan, with its own investment potential, is creeping into a trap called Chinese loans. The third reason is China itself, for example, its re-education camps in Xinjiang that caused a tough, negative reaction of many Kazakhs.”

At the same time, Satpayev noted that the partnership with China should be remote but very precise: "Such a partnership should be with all countries, Russia, the US, China, the EU ... Kazakhstan should not push itself too far into the Chinese economic trap. As experienced by other countries, it’s hard to get out of this trap."

According to the director of the Research Center on Central Asia and Afghanistan Problems at MGIMO, Andrei Kazantsev, China is Kazakhstan’s partner, despite all the anti-Chinese protests. The main thing is to fulfill all the obligations undertaken. As for Kazakhstan, the expert noted, the country has no alternative but to continue to develop cooperation with China. ”Today China is the major global economy, the second superpower that competes with the first (the US) and Kazakhstan’s closest neighbor. Therefore, Tokayev will continue to pursue Nursultan Nazarbayev’s policy regarding China, and even develop it due to the well-known circumstances related to his career and scientific specialization. I don’t exclude that Tokayev will receive a certain vote of confidence from China, and I think that he will justify it,” Kazantsev told Vestnik Kavkaza.