Kazakhstan Essay ⋆ Business Essay Examples ⋆ EssayEmpire

The largest of the central Asian countries, and the ninth-largest country in the world, with a population of over 15.3 million (2008) in a land area of 2,724,900 sq. km, Kazakhstan was a part of the Russian Empire and then the Soviet Union until independence in 1991. It shares borders with Russia, Kyrgyzstan, Turkmenistan, Uzbekistan, and China, and has a significant coastline in the Caspian Sea. During the Middle Ages, the famed Silk Road connecting China with Europe went through Kazakhstan, which was occupied by the Mongols at that time.

During the 19th century the Russian Empire gradually took over the area controlled by the Kazakhs and from the 1890s a significant number of Russians settled in the region, becoming the government and business class. When the Trans-Aral Railway was completed in 1916, there was even more migration from Russia, encouraged by the government. This led to tensions including the Central Asian revolt of 1916. This led to attacks by the Kazakhs on Europeans, and the Tsarist soldiers then took part in a large-scale massacre of Kazakhs, devastating Kazakh society. During the famine that took place in the region from 1921 until 1922, about a million Kazakhs died from complications from malnutrition and from starvation.

The Soviet Union transformed the country, establishing large collective farms and destroying the power of the local elite. From 1926 until 1939, the population of Kazakhs fell by 22 percent. Stalin deported many people, such as the Kalmyks, to Kazakhstan during the 1940s, with the “Virgin Lands” program that saw an enlargement of the agricultural sector. In 1959 the ethnic Russians made up 43 percent of the population, with only 30 percent being Kazakhs. The centrally planned Soviet system led significant investment in the region that was rich in natural resources, particularly oil and natural gas.

With independence in 1991, many companies recognized the great economic potential of Kazakhstan. It had a well-developed industrial sector involved in the production of chemicals, textiles, the processing of food, and metals. Indeed, some geologists claimed that just about every element in the periodic table could be found in the country, with the gold mines there making up 24 tons, or about 7 percent, of the gold production of the former Soviet Union. The mineral sector has been closely controlled by the Kazakh government since independence, and the country remains rich in iron ore, manganese, and also uranium, chrome, nickel, titanium, silver, wolfram, molybdenum, bauxite, and copper. Its coal mines located at Torghay, Qaraghandy, and Ekibastuz produce most of the coal in the country. This has led to a large heavy manufacturing base. During the 1980s Kazakhstan made up some 11 percent of the military production for the entire Soviet Union, and since independence most of these factories have been transformed to make nonmilitary products.

In 1993 and 1994 the country went through a major economic crisis coming from the separation of their economy from that of the rest of the former Soviet Union. Since then, it has partially recovered. Nowadays, some 30 percent of the workforce is employed in the industrial sector that makes up 40 percent of the nation’s gross domestic product (GDP). There are plans to expand this sector with the exploitation of new oil fields that have been found around the country. The existing ones, such as that on the Mangyshlak Peninsula, on the east coast of the Caspian Sea, have already generated great wealth. However, there have been problems over the use of the Russian oil pipeline, which has therefore involved Kazakhstan in the building of a new pipeline to the Black Sea to reduce the dependence of the country on the politicians in Moscow.

In addition to minerals, agriculture has remained a large industry in the country. Agriculture employs about 20 percent of the population, but makes up only 8 percent of Kazakhstan’s GDP, well down from 36 percent in 1993. This drop in the agricultural sector has come largely from mismanagement of resources, and also the lack of water. After independence, the government ensured that it kept control of most of the agricultural land, operating it in about 7,000–8,000 collective farms, each being, on average, about 35,000–40,000 hectares in size.

Bibliography:

John C. K. Daly, Kazakhstan’s Emerging Middle Class (Central Asia–Caucasus Institute & Silk Road Studies Program, 2008);
Europa Year Book (Europa Publications, 2008);
Mark J. Kaiser and Allan G. Pulsipher, “Business Environment Still Seen as Risky in Kazakhstan,” Oil and Gas Journal (v.104/27, 2006);
Natalya Shevchik Ketenci, Kazakhstani Enterprises in Transition: The Role of Historical Regional Development in Kazakhstan’s PostSoviet Economic Transformation (Ibidem-Verlag, 2008);
Nursultan Nazarbaev, The Kazakhstan Way (Stacey International, 2008);
Martha Brill Olcott, Kazakhstan: Unfulfilled Promise (Carnegie Endowment for International Peace, 2002).

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