The demand to nationalize certain large business-structures controlled by Nursultan Nazarbayev’s relatives and allies is one of the landmark features of the “New Kazakhstan”. Even those who once occupied serious governmental posts (let alone the opposition supporters or protest-oriented citizens) are talking about it.

Recently, these talks were joined by Urazaly (Orazaly) Erzhanov who was once employed in the capacity of the Deputy Chairman of the National Bank of Kazakhstan and Vice Minister of Finance and who, after he had left state service, served as the head of the already non-existent Nauryz Bank. 

In the interview to “Exclusive” published on June 14, 2022, and titled “Social Modernization Should Be the Goal of the New Economic Policy”, he said (text in bold hereinafter by KZ.expert):

“To achieve this, we must nationalize Karmetkombinat JSC, Kazakhmys JSC, Aluminiy Kazakhstana JSC, Kazkchrome JSC, Sokolovsko-Sarbaysoye SPA JSC, Kazzinc JSC, Ust-Kamenogorsk Titanium-Magnesian Kombinat JSC”.

Here is his explanation for the necessity of such drastic measures.

“These industries must provide raw materials and construction materials for the newly created enterprises as well as ensure the building of new structures. As soon as possible, they must present programs related to the products redistribution and to creating industries for producing the goods with a higher added value cost. The net export of raw materials must stop. The oil and gas industries as well as the natural monopolies must take part in the import phaseout program via ordering their regularly purchased equipment from domestic producers”.

The former Deputy Chairman of the National Bank and Vice Minister of Finance believes that these measures must become a part of the new economic policy and suggests social modernization as the end-goal of this policy. Below you will find another extensive quote from the interview.

“Economy for the sake of economy cannot exist. Therefore, I suggest social modernization as the end-goal of this new economic policy. This is the driver that will pull everything up. One cannot tackle everything at once. By the year 2050, Kazakhstan’s population is to constitute 50 mln people. Ahead lies the nationwide urbanization of the people’s living conditions which, of course, does not mean the universal relocation to the cities. By that time, the human capital must acquire a new quality. 

To achieve this goal, we must provide housing for all families with many children, for the disabled, for the homeless, those who come from orphanages, for rural teachers and doctors, for the paramedical staff at the state healthcare facilities, other categories of state employees. Given the ongoing and expected birthrate growth, we must organize a large-scale construction of modern schools equipped with natural science laboratories, pre-school facilities, centers for extra-curriculum activities, etc.   

Another task is to repair or restore the community centers in all the country’s districts and ensure that they are operational. Capital repairs must be performed in all the outpatient clinics and hospitals that need it. Also, we must begin building sports centers all over the country consisting of an ice stadium, a swimming pool, an all-in-one sports facility and a compact soccer field. In other words, a lot must be done for the Kazakhs to feel comfortable in their own country.

To avoid corruption and regionalism, we must establish the physical parameters for all the structures and work out a standard plan. Apart from that, we must specify the physical volumes of all the construction and trimming materials: cement, concrete, fitting and other metal products, glass, windows, doors, stoves, sinks, toilet bowls, plumbing fixture, wallpaper, paints, electrical appliances, cables etc.

Also, we must decide on the materials for the infrastructure building: pipes, asphalt, bitumen, metal, illuminating equipment, etc. In the next 2-3 years, we must ensure the production of all the aforementioned goods in Kazakhstan. This will allow us to open new plants and create new jobs en masse”.

Urazaly Erzhanov’s demand to nationalize the large business-structures has caught our attention not because we share his view or see any point in enhancing the role of the state in the economy which he, de facto, favors. Simply, his view corresponds to the views of a big part of the Kazakh citizens who demand to nationalize the properties, monetary funds and other assets of Nursultan Nazarbayev, his family and close allies. 

Of course, they demand it for a completely different reason – to restore justice and deprive the Elbasy and his organized crime syndicate of everything they have stolen from the country and the citizens.

In our opinion, the number of those demanding it is already quite large and growing. So, if the people like Erzhanov will join their troops, Kassym-Jomart Tokayev and Akorda may find themselves facing the necessity to make some sort of move. For, the performative arrests of Kayrat Satybaldy and Kayrat Boranbayev, the “de-fatting” of these men as well as of Bolat and Anipa Nazarbayevs cannot keep the public calm forever.

Apart from that, the process that has already begun (albeit remained unnoticed by many) is now gaining momentum. We are talking about the phenomenon when the elite clans that are on the rise want to take away from the weakening clans everything the latter own.

Therefore, there is likelihood that, in time (in a couple of years according to our estimations), Kazakhstan may begin the process of revising the results of the initial accumulation of capital.

The problem, however, is that, in our opinion, restoring justice in the “New Kazakhstan” form will result in new injustices. For, no one has ever been able to feed millions with thousand loafs of bread.

In view of this, we would like to pose a question for which we will probably be bombarded with stones. Should we revise the results of the initial accumulation of capital in Kazakhstan?

As you know, we have never felt any respect towards Nursultan Nazarbayev, the members of his family and his close allies. Moreover, for many years, we have been their political adversaries. At the same time, we realize that, even if they do deprive this clan of at least a half of its current fortune, it will take many years and a lot of money.

With that, these efforts will not lead to a significant result. Simply because the people involved in this project will not differ much from those involved in the “rescue” of BTA Bank JSC on the order of Nursultan Nazarbayev. They had done a much greater damage to the state than Mukhtar Ablyazov in the course of their “rescue operation”.

Apart from that, even if the assets located in Kazakhstan may be taken without much problem, they will invariably end up in the hands of the people who are just the same as the former in terms or their honesty, patriotism, willingness to share their riches with their fellow citizens.

As a result, instead of helping to restore justice, all the ardor and energy generated by the democratic opposition and the protest-oriented citizens will facilitate the redistribution of the fortune of the Nazarbayev clan (or rather organized crime syndicate) in favor of another clan (also an organized crime syndicate albeit under a different leadership).

So, we believe the time has come to discuss the most formidable deal in Kazakhstan’s history involving the following parties – the proactive Kazakh citizens on the one hand and Nursultan Nazarbayev with his clan on the other.

As for Kassym-Jomart Tokayev and Akorda, they may very well perform the role of the intermediaries.

The substance of the deal (unofficial, of course) will lie in the citizens agreeing to make their peace with the results of the initial accumulation of capital in the country in exchange for Nazarbayev and his clan making some kind of (sizable) reparation in favor of the state.

This reparation may take different forms – from a voluntary return of the assets (a practice actively employed in Kazakhstan today) to the payment of an emergency tax or fee as part of the next legalization of monetary funds and assets.

The thing is that, without such agreement, the likelihood of the several billion dollars moved from Kazakhstan over the past two decades returning to the country is virtually non-existent.

Apart from that, Kazakhstan hasn’t managed to form a normal business-climate. For, the latter is based primarily on society accepting the fact that social fairness does not lie in the equal division of everything but in the sacrosanct nature of private property and the general right to run a business.