ERI at international conference in Astana discusses best practices in economic diversification with KISR


International conference "Modernising Kazakhstan's economy: Cooperation with the European Union and priorities" ends in Astana on 22 November 2022.

It wa.organised by the Kazakhstan Institute for Strategic Studies under the President of the Republic of Kazakhstan (KISI) and the Friedrich Ebert Foundation in Kazakhstan.

As noted by the KISI, against the backdrop of the current situation in the world and in the post-election period, it is important for Kazakhstan to focus on the socio-economic block of public policy. There is a growing need to develop a new economic policy and to work out fundamentally new approaches to economic governance.

The conference was attended by the Ambassador of the European Union to the Republic of Kazakhstan, ambassadors extraordinary and plenipotentiary of European states in Kazakhstan, heads of relevant state bodies, representatives of academic and expert communities.

In the first panel session, speakers discussed "Stimulating economic growth in Kazakhstan: productivity and inclusion». 

In Kazakhstan, the issue of intensifying structural modernisation based on new ideas aimed at the efficient use of economic potential is acute. The basic goal of transformation is qualitative and inclusive economic growth for the benefit of everyone. The panel discussed conceptual ways to resolve systemic problems hindering economic development in Kazakhstan.

The experts noted the ambitiousness and comprehensiveness of the reforms implemented in the country and offered their own vision of a new paradigm of economic transformation in Kazakhstan against the backdrop of global shocks.

Session speakers:
-  Marek Dombrowski – a freelancer at Bruegel, a professor at the Higher School of Economics in Moscow and co-founder and researcher at CASE - Centre for Social and Economic Research in Warsaw (online)
- Saule Kemelbayeva – Dean of the International School of Economics at KAZGUU after M.S. Narikbayev
- Alexander Libman – Professor of Russian and East European Politics at the Freie Universität Berlin (online)
- Kuat Akizhanov – Head of the Economic Research Department at KISR in the Office of the President of the Republic of Kazakhstan
- Yeldar Madumarov – Head of the Economics Department, Faculty of Social Sciences, KIMEP

The second panel session focused on decarbonisation and achieving hydrocarbon neutrality in cooperation. The topic for discussion claimed: "How to increase economic resilience?»

The "new reality" dramatically raised the relevance of export route diversification and energy transition. 

During the session, experts discussed prospects for strategic projects of mutual interest to Kazakhstan and the EU, as well as greening the economy. The importance of applying new approaches to achieve carbon reduction goals and levelling the effects of decarbonisation on socio-economic processes is a priority. 

Session speakers:
-  Daulet Akhmetov - Senior Energy and Clean Energy Market Specialist, USAID PCA
- Sebastian Schick - Founder, Sustainable Development Partnership Hub for Central Asia and Europe (SPCE HUB), Eurasian Processes Explorer.
- Alexey Kobzev - Head of the Laboratory of Green Energy and Climate Change, Kazakh-German University 
- Peter Howe - Associate Professor, School of Public Policy, Nazarbayev University.
- Rahim Oshakbayev - Director, Talap Centre for Applied Research”

In the third session, speakers discussed the challenges and prospects of pursuing diversification and industrialisation in Kazakhstan.

David De Remer, assistant professor at Nazarbayev University Business School, noted the importance of studying the experience of developed countries in building relationships with subsidised industry businesses:

"The state needs to focus on so-called visible policies and analyse protectionist and regulatory measures. Reformers need to understand the policies behind the 'subsidisation' of industries and there should be no favouritism."

Kamran Bokhari, director of analytical development at the New Lines Institute for Strategy and Policy, said:

"Kazakhstan's analysis of the external environment, including the political landscape in other countries, is necessary. Political changes, which at first glance seem to be going on, can have a chaotic effect on economic modernisation."

Alma Kudebayeva, senior lecturer at the Economics Department, Faculty of Social Sciences, KIMEP University:

"The state needs to pay special attention to reducing the risks of poverty, especially child poverty. In doing so, the mechanisms of targeted social assistance should also be reconsidered."

Ruslan Sultanov, chairman of the board of the Institute for Economic Research, said during his speech that technology plays a major role in the development of industrialisation:

"Our desire to produce finished or high value-added products is hindered by the classical laws of economics: the problem of the market, the lack of economies of scale, a critical mass of actors, technological gaps and elementary factors of production.

The law of gravitation has not been abolished; it works equally well for industrialisation. We are equally distant from the main consumers of industrial products (Western Europe, Eastern China and the US). If we had a large and solvent consumer of industrial products nearby, multinational companies would have long since come to us themselves, given our resources and manpower".

As Sultanov noted, the level of high-tech industries is important for Kazakhstan. The development of exports will contribute to the competitiveness of Kazakhstani production. At the same time, despite the policy of diversification in Kazakhstan, the country will not abandon the development of traditional industries due to the importance for the formation of budget revenues.

ERI's chairman of the board highlighted five policy directions for further diversification of Kazakhstan's economy.

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Saved: 24.11.2022

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