Whom Akorda and the Library Should Fear

On February 16, 2021, the National Statistics Bureau of the Agency for Strategic Planning and Reforms, published a monthly press-release showing that the Kazakh economy had rather successfully lived through the blows that shaken up the developed countries.

According to the press-release, the 2020 short-term economic indicator constituted 94.2%. In other words, the decline is clear albeit non-critical. The January 2021 indicators also pose no cause for concern. Even though the volume of capital investments had declined against last year’s figures by 17.5%, the mining industry production had shrunk by 10.2% and the passenger operations had dropped by 75.3%, the rest of the main economic sectors had shown a growth.

Even the decline of the 2020 foreign trade value against the 2019 results by 13% is easily mendable if the oil prices are kept at the current (plus-minus) level and the OPEC restrictions are lifted or seriously weakened. If this happens, the export volume will be restored.

The only thing that, as we at KZ.expert believe, should cause concern in Akorda and the Library is the citizens’ real income. According to the official data, in December 2020, it dropped by 3% against the December 2019 figures.  

On one hand, it is a relatively small decline; on the other, there is no guarantee that the National Statistics Bureau is telling the truth. The thing is that the Kazakh statisticians make their calculations by using the “hospital’s average temperature” method. According to our subjective view (the view that, unfortunately, is not based on social research), the people’s real income had dropped much more drastically than by 3%.

Moreover, since the country’s social inequality continues to grow while the COVID-19 pandemic and its consequences have accelerated the process, there can be no doubt that the number of the poor in Kazakhstan surpasses the official estimations. And Akorda is very likely to start working our new mechanisms and tools for supporting those not being able to buy not just cloths but food.

Especially since it is the retail prices for groceries that are growing the fastest. For instance, the January 2021 consumer price index constituted 100.6% against December 2020 while the prices of food products had grown by 1.1%. This means that the number of citizens with a declining level of life is growing on a day-to-day basis. Therefore, the number of those who have nothing to lose is rising as well.

It is these church mice and not the few civil activists that, in our opinion, pose the gravest danger for the Kazakh authoritarian system and the “super-presidential” vertical. For not only must they cling to any opportunity to survive here and now, but they exist stably in their unstable state.

And since a significant part of these people exist in the grey zone unseeable or poorly seeable to the authorities, the state can do nothing about them except perhaps try and temporarily manage the situation by working out new social support programs.

Therefore, we are certain that the Kazakh authorities are doomed to increase the state expenses on all kinds of social projects even when the economic problems that have caused the decline of the level of life end. In other words, willingly or not, the sovereign and independent Republic of Kazakhstan, has already embarked upon the path that led to the political, economic and social downfall of the Soviet Union.

To confirm our idea, we will recall the the way the Kazakh state acted after the tragedies in Zhanaozen (2011) and in the Korday district (2020). In both case, the state had made (is making) large investments in the affected residential areas, tried to increase the number of jobs and reduce unemployment, is forcing or convincing entrepreneurs to open new industries and retain a relatively high compensation rate.  

Since, in each of these cases, we are talking about a large number of people and this number is still, by one or two orders, smaller than the number of those whose level of life decreased in 2020 and continues doing so now, Akorda and the Library will soon encounter new challenges. Even if they do manage to retain stability by using the repressive means, they will have to spend money not only to placate and silence but to feed the citizens. Even if it’s only for a time.

In our opinion, the Kazakh authorities may not realise it but they can sense it. For this reason, they are trying, to the best of their abilities, to support small and medium-size businesses, promise to support the poor and the needy. But even if small businesses do receive a substantial support (which we doubt), it will take them quite a lot of time to recover. This, in its turn, means that a lot more time will be needed for the stabilisation of the level and the quality of life than for the general economic recovery.

But do Akorda and the Kazakh ruling elite have this time?

Only Jesus Christ was able to feed the 5 thousand. Or so the story runs.


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