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Nursultan Nazarbayev's new ideas for Kazakhstan's prosperity

By Shahid Qureshi | | Updated: 2018-10-25 14:08
The Chinese national flag and Kazakhstan's national flag. [Photo/VCG]

The Central Asian republic of Kazakhstan is moving toward a welfare state, developing its society on the world-famous "Scandinavian model". The President of Kazakhstan Nursultan Nazarbayev presented a new strategy for the country in which he outlined the main priority was the growth of citizens' well-being, the increase in income and quality of life.

Kazakhstan ranks 72nd in social development and welfare globally, according to The Legatum Prosperity Index. The 72nd position puts it exactly in the middle of the list and highest among all the countries of the former Soviet Union. In the last year, Kazakhstan surged by 11 positions and now ranks 35th in terms of access to education and quality of education.

The dynamics of Kazakhstan in this ranking reflect the qualitative changes that have occurred in the country over the past decades. The country is systematically moving toward the creation of a welfare state, aimed primarily at ensuring the well-being of its citizens, and only then realizing political ambitions.

This, in fact, was confirmed by Nazarbayev in his recent address to the people. He voiced a long list of initiatives that should turn the country into a real social paradise.

For example, Kazakhstan plans to significantly increase its spending on education, science and healthcare. Currently 10 percent of GDP is spent on these areas only in developed countries. Part of this money will go to raising salaries for doctors.

Although the work the government will have to do will perhaps be less. After all, a healthy lifestyle in Kazakhstan is now elevated to the rank of national ideology. The country plans to start large-scale construction of sports and recreation complexes, carry out a complete modernization of hospitals and tighten control over the quality of water and food.

Kazakhstan is also changing its approach to education, even though the current model works successfully. When it comes to education, the country is in the top 35. However, there is still something to strive for. Future qualified personnel in Kazakhstan will now begin to prepare from kindergarten, all schools will switch to international standards, and universities will be evaluated not by the number of "star" teachers or tuition fees, but by how well their graduates find work.

Construction of new homes, preferential mortgages, a comfortable urban environment and increased security on the streets – all these aspects should become parts of the new socio-economic picture of Kazakhstan in the coming years. The country is providing great support for business development. Conditions for starting a business in Kazakhstan are among the most attractive in the world. Tax amnesties, concessional loans and the lack of audits allow start-up entrepreneurs to get on their feet and grow further. Now the share of small and medium-sized businesses in the country's GDP is 30 percent, and the Kazakh authorities plan to increase this figure up to 50 percent.

The remaining GDP share in Kazakhstan is planned to be covered not at the expense of oil revenues. Although the price of black gold is again on the rise, but in Astana they never suffered from the "Dutch disease" and did not rely on only one sector of the economy. Kazakhstan relies on agriculture and manufacturing. In the next three years, the country will spend an additional half a billion dollars on the development of these areas. In addition, a direct investment fund in the non-resource sector will be created in Kazakhstan, which will operate on the principle of co-investment with foreign partners.

These measures, it seems, will allow the formation of new stable sources of growth for the Kazakhstani economy, stimulate the inflow of investments and promote freedom of the market. And this, in turn, will directly affect the welfare of citizens and their level of income. What, in fact, is the ultimate declared goal of all the transformations that the Kazakh authorities have started.

The model of the welfare state that Kazakhstan is developing can be compared with the "Scandinavian" one. It is often spoken of as the symbiosis of the most successful elements of capitalism and socialism. The model is based on capitalism, whose weaknesses are corrected by the best practices of socialism, and the whole system is structured so that it works exclusively for the benefit of the population.

How successful the "Scandinavian model" of economic development can be judged by the level of per capita GDP in the states of this region and the places that they occupy in various world rankings, welfare indices and lists of the happiest countries. Denmark, Sweden, Finland and Norway are always in the top 10.

The stability of the economy, social mobility, universal employment, equal access to education and healthcare, the redistribution of wealth are the distinctive features that these Scandinavian countries have already acquired, and which Kazakhstan is acquiring now, creating its own unique model of a social state.

The author is the chief editor of The London Post and a visiting Professor at Heibe University in China.

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