"Feedbag" for a Vice-Minister

Based on the information received, a big scandal may break out in the Ministry of Infrastructural Development of Kazakhstan related to an exploration license. The amount involved is $250 000. The persons involved are two investors and a vice-minister. The negotiations were recorded on video.

On the New Year’s Eve, President Nursultan Nazarbayev transformed the Ministry for Investments and Development into the Ministry of Industry and Infrastructural Development. Zhenis Kasymbek was reappointed as the head of the Ministry. Also, the President appointed Beybut Atamkulov as new Minister of Foreign Affairs and Askar Zhumagaliyav as new Minister of Defense and Airspace Industry.

According to Nazarbayev, he had been meaning to do it for quite some time. Here is what he said based on the publication on Kapital.kz.

“I had been meaning to do it for quite some time because the Ministry of Foreign Affairs thinks it is strictly a political organization. But we are not China, Russia or America. What kind of global affairs are we handling? (..) The issues related to investments and export must be monitored by the Ministry of Foreign Affairs whose employees know foreign languages, know their country. So, it is easier for them”.

Nobody knows what they are doing, every Ministry sends representatives to the embassies, the Ministry for Investments and Development, the Ministry of Agriculture (…). Each embassy has two to five people, so probably 200 – 500 people in general are hanging about there and we do not know what they are doing. One agency will be in control of it. We had changed the Ministry’s profile and needed a person who understands economy”.

Nursultan Nazarbayev’s pre-New-Year organizational and personnel reshuffles, as a whole, have received a positive press response as well as an active support of certain experts. However, we will allow ourselves to express doubt in the idea that transferring the responsibilities of forming and implementing the state policy in the field of attracting foreign investments to the Ministry and Foreign Affairs and the Ministry of National Economy will improve the work of the state apparatus as a whole.

The thing is that foreign investors, having successfully touched base with Kazakh diplomates in their home countries, in Kazakhstan, will encounter the same problems as their predecessors. The problems related, among other things, to the mass corruption, the frictions between the agencies, the laziness and the lack of responsibility of the officials, their unwillingness to assume responsibilities, the deficit of the qualified labor force, the high transactional costs etc., etc. 

For example, the investors that want to invest their money in the exploration of the Kazakh mineral fields, will still have to deal with the officials from the Ministry of Industry and Infrastructural Development who are used to receiving bribes in exchange for giving statutory licenses.

By the way, based on insider information, a big scandal may soon break out in this Ministry related to the fact that one of the Vice-Ministers (let us not give away his name) demanded for himself a reward in the amount of $250 000 from two investors competing for the license to explore the same mineral deposit and, as a result, awarded the license to the company that satisfied his demand.

According to our insider, the negotiations between the official and the investor’s representative were recorded on video, therefore, the scandal may turn out to be not just big but very big. Besides, this Vice-Minister is considered Zhenis Kasymbek’s protege and, rumor has it, allegedly shares his earnings with the latter. In other words, this scandal will put an end to the reputation of not only this official but of his boss as well.

So, Nursultan Nazarbayev’s desire to attract as many foreign investors as possible with their capitals, new technologies, modern equipment and highly-qualified management will be actively supported by hundreds and hundreds of the officials who want and are able to make money on the said investors.

Now, there is no point in asking the question whether foreign investors will want to come to this kind of Kazakhstan. Obviously, they will not. Unless the accounting return rate of a given project is so high that it will compensate for all and everything including the unavoidable risk of violating the law.


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