Kazakh economy: from Soviet socialism to neo-liberal trap 

After the monopoly of the Soviet economic model, independent Kazakhstan has embraced, without questioning, the Western neo-liberal economic ideology which by design serves the rich. 

Neo-liberal capitalism has become the official policy and dominant economic thought in the country, economist Kuat Akizhanov said in a recent interview, calling for economic pluralism. 

Modern neo-liberal capitalism leads to a huge income gap between the super-wealthy few and the poor majority, Akizhanov said in the interview with KSAP, the independent School of Applied Politics.   

Akizhanov said that the neo-liberal policies of deregulation, privatisation and cutting public spending had led to the creation of a rentier economy in Kazakhstan. 

He said that 90 percent of Kazakhstan’s wealthiest people got their wealth from rent payments.  

“They do not create any products, do not create jobs – I am not even talking about the government’s tax policies, the offshorisation and so on,” Akizhanov said. 

He said that the Kazakh political and economic elite had been holding on to “fundamentally flawed” neoliberal concepts, as “an axiom”, “without any attempt to dig deeper”. 

“We blindly re-broadcast those imposed concepts,” he said.  

One of these concepts, he said, was that the Central Bank must be independent – “an idea that the IMF and World Bank have started to impose on everyone on the 1990s”- and its main job is to control inflation and prices. It means it is not involved in creating jobs and stimulating economic growth. 

The “free trade” concept, he said, was the exact opposite of what it said it was. What it really does is help to maintain the poorer countries’ post-imperialist dependency on the rich ones. 

“We are part of the architecture of global capitalism where there is no fair playing field,” Akizhanov said. 

He added that the neoclassical economy was also presented as something progressive. “If you begin to oppose it you are made to look like a regressive leftist,” he said.  

Asked why Kazakhstan ended up taking the neo-liberal economic model at face value, Akizhanov said it was a combination of the timing of the country’s independence, Western political pressure, and the Kazakh elite’s economic ignorance and greed. 

It was “unlucky” that by the time the Berlin wall fell, neoliberal economic policies were dominant in the world, he said. 

“The collective West told us this is exactly what you need. We did not ask any questions. Market economy? Okay let it be market economy!”. 

“We gave up socialism, adopted capitalism, without any idea that there are different forms of capitalism – the Anglo-Saxon and American (more liberal), Swedish (Scandinavian) and continental (German, French), and Asian (with more government control). 

“Most importantly, our old-new Soviet bureaucratic apparatus quickly understood the benefits of such a system – sounds cool, actually, let’s privatise everything and get very rich. And our former party bosses became our first businessmen and created this oligarchic system,” Akizhanov continued. 

“To put it simply, as a result the funds generated by our economy are not going towards building roads and such, but to buy yachts for the rich,” he said.  

Akizhanov called for promoting critical thinking and economic pluralism in the country. 

“We have to understand that there are alternative views to those promoted by the Davos Forum which serve the interests of a very narrow circle of plutocrats. 

“We need a layer of people with critical thinking who can see through such things and help the political class to understand what the country really needs.  

Akizhanov, who heads the Centre for Political Economic Research, added that would be an important step towards decolonisation. 

“We cannot decolonise our minds without learning how to produce, or at least interpret knowledge,” he said.

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