Surprises from Samruk-Kazyna

Kazakhstan is undergoing a state property privatisation campaign, the third one in the country’s history. In terms of its size, this campaign is quite comparable with the previous two.  This time, however, it will be conducted without great ado and exclusively for the selected few. We would like to give you a detailed account of the matter.

But first, we would like to offer an apology to the First President of the Republic of Kazakhstan. The thing is that, in the publication dated December 5, 2020, we expressed our doubts regarding Nursultan Nazarbayev’s adequateness.

«But we at, even with all this wild celebration of the personality cult, are interested in just one question — to what extent does the First President of Kazakhstan and the „Leader of the Nation“ place dependence on words? We are talking about both the words that he says himself and the words that he hears from the pro-governmental propaganda machine and the court sycophants?

For it would be better for the country’s future if he didn’t believe those words. From the point of view of the nation’s interests, cynicism and lying are unquestionably better than the self-delusion of the man situated on the top of the authoritarian political system and the „super-presidential“ vertical.

For the Elbasy has still got the last word in much of the decision-making process. We are talking about such decisions as who will occupy the key positions in the state apparatus, how much money will be taken from the National Fund, which elite groups will score an advantage, what state policy will be declared and then implemented.

Unfortunately, it looks like not only does Nursultan Nazarbayev believe in his mightiness and infallibility but also accepts at face value what he is being told by the people close to him today. We could have laughed about this had it not been for one circumstance — it is the national economy, the local business and eventually all the Kazakhs who end up paying for all of this».

You may recall that the quoted passage was written following the idea of transforming the Samruk-Kazyna Sovereing Welfare Fund into an investment holding. On November 13, 2020, Samruk-Kazyna’s Management Council chaired by Nursultan Nazarbayev made a historic decision to transform the SWF and approved the action plan of the transformation.

Now it has become clear that the Elbasy, his immediate circle and the officials involved in the development of the project are navigating the situation with confidence and know full well what they are doing. Obviously, their main goal contradicts what is being declared in public and has to do with a part of the transformation plan.

We are talking about privatising a significant part of the assets of this quasi-governmental company.

The thing is that, contrary to the first two privatisations, only few Kazakh citizens are going to participate in the third campaign. Namely, only those who, first of all, possess significant monetary resources and, second of all, have connections in Akorda and the Library.

To confirm out words, let us quote Lazzat Borankulova, Samruk-Kazyna’s Strategic Development Officer (a very promising strategist by the way) who, for the past months, has spoken on the matter a number of times. For instance, this is what she said in her interview with titled «The Pandemic, Investments and the New Work Style. The Year 2021 Will Be Decisive for Samruk-Kazyna» (text in bold by

«The process of creating a competitive environment via privatising large assets through their listing and selling them to strategic investors is to be completed before the end of 2023. The program is initiated by the government as the sole shareholder.

Simultaneously, before the end of 2028, we expect to divest the Fund’s equity shares as part of the its own divestment program. 

We intend to keep the controlling stakes of the large strategic assets such as KazMunaiGas, Kazatomprom, Qazaqstan Temir Zholy, Kazakhtelecom and KEGOC. With that, up to 49% shares of the said companies as well as 100% shares of the non-strategic companies will be available for divesting.

The divesting will be conducted depending on the existence of the enabling market environment. In particular, the prices of oil, uranium and other indicators of the performance will be taken into consideration. Another important factor is the presence on the market of other investment possibilities that will help increasing the Fund’s profitability index.

With the approval of the sole shareholder, up to 50% of the privatisation earnings as well as all the divestment earnings will be kept in the Fund for investment purposes».

«We expect that the said changes will allow to decrease the share of the controlled companies from the current 11 to 5, increase the price percentage of the listed assets from 14% to 75% by the year 2024 as well as increase the percentage of the new investments (including foreign investments) up to 30% by the year 2028».

In other words, Kazakhstan has launched the third privatisation campaign in the country’s history; a campaign that is comparable with the first two in terms of its volume. However, contrary to the first two, it will be conduct without great ado and will not involve the majority of the Kazakh citizens. 

And, judging by the fact that the non-governmental sector has not responded to this idea, the society has not yet realised that the Elbasy and his circle are going to privatise a huge piece of state property that, prior to this, had remained in the hands of the people.

Even though the state budget is likely to profit from the sale of the assets, the very fact that the systemic and important sectors (objects) will end up in certain hands (and we all know whose) cannot but raise concern.

In our opinion, today, this presents the biggest threat to the national security and stability for, as long as the systemic (important) sectors remain public, the people have the opportunity to influence them (indirectly, of course), among other things, by making the government restrict their appetites. However, as soon as they become private, their appetites are bound to increase. And, since they will be owned by the people associated with power, the government is likely to be much more appeasable towards them.

To those who don’t believe us, we recommend to recall how much the Kazakh citizens had to pay for every business initiative supported by the Elbasy’s relatives or an allies — starting from the 1990s sugar and ending with the parking and the «green» economy projects.


Add comment

Your e-mail will not be published. Required fields are marked with *