What chance for genuine change in Kazakhstan?

Kazakhstan is reeling from the aftershock of the largest and bloodiest unrest it has seen since independence. Without fundamental reform, protests will return.

Explainer Updated 13 October 2022 Published 7 February 2022 6 minute READ

Virtually overnight, the international image of a prosperous and stable Kazakhstan became stained by anarchy, violence, and social inequality.

The multidimensional nature of the turbulence during ‘Bloody January’, which brought together peaceful protestors, marauding mobs, organized criminal groups, and an inter-elite power struggle, does not fit easily into any analytical template. The government of President Kassym-Jomart Tokayev is unlikely to engage in full disclosure regarding human rights violations and the identities of the perpetrators, given its disinformation tactics to date.

Having now consolidated his power, Tokayev faces even greater challenges. Can the process of ‘de-Nazarbayevication’ really dislodge corrupt elites in charge of lucrative sectors? And as Kazakhstanis increasingly demand an overhaul of the system to achieve greater social justice, is the leadership in a position to undertake cardinal reforms?

A tale of two struggles: Peaceful protest and insurrection

The protests began on 2 January over a single economic issue but then escalated into nationwide demonstrations calling for improved socioeconomic conditions and a more accountable political system, before morphing into scenes of violence.

The tensions inherent within this dual power arrangement ultimately gave way to insurrection on the part of those Nazarbayev loyalists who feared a loss of power and wealth

Tokayev quickly declared a state of emergency, ordered a communications blackout, issued a shoot-to-kill-without-warning order, and replaced the government. Then, after taking control of the chairmanship of the National Security Council from former president and Elbasy (Leader of the Nation) Nursultan Nazarbayev, he called in troops from the Russian-led Collective Security Treaty Organisation (CSTO) to prop up a tottering regime.

Within only a few days, the era of Nazarbayev – spanning more than three decades – came to its final conclusion, leaving at least 227 dead and almost 5,000 wounded.

Tokayev was quick to blame the violence on ‘terrorists and bandits’ – even making the highly improbable claim there were 20,000 terrorists in Almaty alone – but he has failed to offer any evidence, instead declaring the bodies of the ‘terrorists’ were snatched from the city’s morgues and so could not be identified.

Such implausible and unsubstantiated statements, along with the arrest on 8 January of Karim Masimov, Nazarbayev’s right-hand man and chairman of the National Security Committee (KNB) on charges of high treason, lent weight to suspicions that Tokayev was trying to deflect attention from an intra-elite struggle at the highest echelons of power.

Nazarbayev and Tokayev had ruled as an unofficial duumvirate since 2019. Although Nazarbayev handpicked Tokayev as his successor in a managed transition, the former president was widely seen as wielding the real power behind the scenes. Attempts by Tokayev to consolidate his authority inevitably collided with the interests of entrenched Nazarbayev cronies, whose wealth the managed transition was intended to safeguard.

The tensions inherent within this dual power arrangement ultimately gave way to insurrection on the part of those Nazarbayev loyalists who feared a loss of power and wealth – particularly considering the former president’s advanced age and declining health.

Russia to the rescue, but at what price?

The dramatic appearance of CSTO troops in Kazakhstan, departing almost as swiftly as they arrived, adds a geopolitical dimension to the unrest, marking the first time the security alliance has agreed to deploy military forces to support a member state since its founding in 1999.

The key question now is what payback the Kremlin might exact from Kazakhstan in exchange for its assistance in keeping Tokayev’s regime afloat, and to what degree Kazakhstan’s leadership can succeed in pushing back

Vivid images of popular anger directed against a long-time autocrat must have been unsettling for Russian president Vladimir Putin, much less the idea of instability rocking an important political and economic ally that shares a 7,000 km border with Russia.

But, in the event, the intervention was a complete success for Moscow, reinforcing its role as the main security guarantor in the region and demonstrating – contrary to widely-held opinion – that the CSTO can act when needed. The instability even afforded Putin an opportunity to make reference to international interference by using buzzwords such as ‘maidan methods’ and ‘colour revolutions’ when describing events in Kazakhstan.

The key question now is what payback the Kremlin might exact from Kazakhstan in exchange for its assistance in keeping Tokayev’s regime afloat, and to what degree Kazakhstan’s leadership can succeed in pushing back.

High on a possible list of Russian demands are further integration within the Moscow-led Eurasian Economic Union (in 2020 Kazakhstan rejected a Russian proposal to expand EEU cooperation); full alignment with Moscow in any stand-off between Russia and Ukraine, and recognition of the annexation of Crimea; specific guarantees for the use of the Russian language in Kazakhstan; and the adoption of ‘copycat’ legislation such as the Russian ‘foreign agent law’.

Tokayev has already announced that Kazkahstan’s renowned Bolashak programme for the training of the country’s brightest scholars is to be re-oriented to send students primarily to Russian technical institutes. And if further sanctions are slapped on Russia, Moscow could insist that Kazakhstan act as an ‘anti-sanction buffer zone’ to help it circumvent restrictions on Russian banks’ access to the international Swift network.

While any potential payback is still at the stage of speculation, it is conceivable the Tokayev leadership’s increased indebtedness to Russia could impact Kazakhstan’s reform process, in so far as Moscow would be likely to object to any potential attempts on the part of Kazakhstan’s government to liberalize the country’s political structures.

Is de-Nazarbayevication a distraction from genuine reform?

Although fuel price rises were the initial trigger for the January demonstrations, at the heart of the protesters’ grievances was long-contained anger at perceived misrule, particularly the perception the country’s immense oil-generated wealth has not been distributed fairly. This grievance is not without merit, given half the country’s wealth is owned by only 162 people, according to accounting firm KPMG.

In his first direct criticism of Nazarbayev, Tokayev told parliament on 11 January that under the first president ‘there emerged a group of very lucrative companies and wealthy people, even by international standards’, noting also that the mining and oil and gas sectors were in the hands of members of Nazarbayev’s extended family and inner circle.

Given that many elite assets are hidden and difficult to track down, it is probable both the government and key oligarchs have opted for the less messy option of brokering a deal behind the scenes

Without naming names, he declared it was time for them ‘to pay their dues to the people of Kazakhstan and help them on a systematic and regular basis’. Announcing a new fund ‘For the People of Kazakhstan’ to engage in beneficial charitable activities, the president said he expected all major companies to annually contribute a government-determined percentage of taxable income to its funding.

But it is one thing to announce the creation of a fund based on ‘voluntary contributions from enterprises’, and quite another to persuade oligarchs to put sufficient sums into it to achieve any measurable redistribution of Kazakhstan’s oil and mineral riches. The fund chairman Bolat Zhamishev said initial contributions will amount to $230 million, which is only a drop in the ocean of ill-gotten gains.

Given that many elite assets are hidden and difficult to track down, it is probable both the government and key oligarchs have opted for the less messy option of brokering a deal behind the scenes. Under this scenario, part of the political and business elites closely associated with Nazarbayev will transfer their loyalty to Tokayev, provided they are willing to share their wealth and invest in his pet projects, while die-hard Nazarbayev cronies will end up in prison or in exile.

But going after Kazakhstani elites’ overseas holdings in jurisdictions such as the UK and the US can be a timely and costly venture. And any backstage brokering with the former first family is complicated by the absence of concrete information on the scale and scope of its assets, particularly as much wealth is stashed abroad, often through intermediaries.

In the UK alone, Nazarbayev’s extended family is estimated to own at least £330 million in luxury property, according to a recent Chatham House report on kleptocracy. The Nazarbayev charitable foundations own assets including banks, luxury hotels, trade centres, and factories, estimated to be worth at least $8 billion. But they do not publish annual reports and lack transparency.

It is feasible that as part of a larger behind-the-scenes immunity agreement, Tokayev began purging key members of ‘the family’ from official posts, but refrained from prosecuting them or stripping them of their assets. Timur Kulibayev, husband of Nazarbayev’s second daughter Dinara and one of the wealthiest people in Kazakhstan, left his post as chairman of Kazakhstan’s National Chamber of Entrepreneurs on 17 January.

The same day, Tokayev issued a decree dismissing Nazarbayev’s nephew Samat Abish from the post of deputy chairman of the KNB. And, in a further squeeze on the former first family, Nazarbayev’s two other sons-in-law were pushed out of their jobs as chairmen at two major state energy companies, KazTransOil and QazaqGas (formerly KazTranGaz).

Then on 18 January, the former president was officially stripped of his lifetime appointment as chair of the powerful security council and the chair of the People’s Assembly of Kazakhstan, a body intended to support inter-ethnic harmony.

Tokayev has also taken over from Nazarbayev as chair of the leading Nur Otan Party, although the former president still has his title of Elbasy for now. However, Tokayev began gently backtracking on de-Nazarbayevication within days, stating ‘due credit should be given to the historic achievements of the First President’.

Half-measures will not allay popular grievances

Political mobilization in Kazakhstan was already picking up speed well before the January events. When the staged election of Tokayev in 2019 unleashed a wave of unusually large anti-government protests, authorities raided activists and rally organizers, taking people into custody ahead of planned demonstrations and holding them on spurious charges until the rallies were over.

The state’s current regulations on peaceful assembly are reminiscent of Russia’s and require organizers to apply in advance to local authorities who can deny permission for a potential gathering or determine its location. But despite such onerous restrictions, there were more labour strikes in Kazakhstan in 2021 than in the three previous years combined, according to the Oxus Society’s Central Asia protest tracker.

It is therefore reasonable to expect protest sentiment to continue to grow, even if the cleansing of the political playing field over many years means there are no high-profile opposition figures to unite a protest movement.

At least two online petitions have been launched by groups of Kazakhstani citizens since the violence took place. The first demands the repeal of a law which guarantees Nazarbayev and his immediate family lifetime immunity from prosecution, while the second demands the previous name of Astana be reinstated to the capital city Nur-Sultan. Activists have also demanded the names of those who perished during the January violence be made public.

Tokayev’s traditional modus operandi in response to an upsurge in political activism is to alternate the granting of the occasional concession with the doling out of repressive measures, while vastly underestimating popular discontent. But more and more people are demanding nothing less than fundamental reforms. Half-measures – such as removing some of Nazarbayev’s lifetime positions – are bound to be regarded now as ‘too little, too late’.

Prospects for reform are slim

With official authority consolidated in the hands of Tokayev, many members of Nazarbayev’s inner circle have either left their posts or been pushed out. But the expansive and complex system of intricate networks built up by the former president over the course of his 30-year reign remains in place.

Protesters’ demands for an independent parliament and truly free and fair elections cannot be met given an unmanaged election would likely topple Tokayev’s regime

Far from being a ‘mere pensioner’ – as Nazarbayev referred to himself in his first public appearance following the unrest – Elbasy still retains certain privileges, including life membership of the Constitutional Council. A much trickier task than stripping the former president of some of his lifetime titles will be extracting the extended Nazarbayev family from the major private businesses controlling huge swathes of Kazakhstan’s economy.

The Samruk-Kazyna sovereign wealth fund – a holding company to manage state assets – is to undergo detailed restructuring, but this $65 billion behemoth has been impervious to reform for years. And the creation of an extra-budgetary fund operating as a quasi-tax on the ultra-wealthy will not succeed in redistributing wealth or solve Kazakhstan’s major budget policy problems.

Protesters’ demands for an independent parliament and truly free and fair elections cannot be met given an unmanaged election would likely topple Tokayev’s regime. And so, as in a never-ending game of musical chairs, Tokayev’s new cabinet is filled largely with familiar faces who were likely selected based on loyalty.

What chance for genuine change in Kazakhstan? 2nd part

New prime minister Alikhan Smailov was Tokayev’s deputy in the foreign ministry in 2003, and 11 of the 18 ministers in the ‘re-invigorated’ government served in the old cabinet under a different prime minister.

The promised independent investigation of the January violence appears unlikely as Tokayev is yet to back away from his claims it was a pre-planned action by foreign terrorists who flew in under the guise of being guest workers. He has also rejected international assistance to investigate the riots, as suggested in a resolution adopted by the European Parliament.

With political reforms now postponed until the autumn, popular mobilization is likely to grow. The architecture of the political economy constructed under Nazarbayev remains intact, which means it is only a matter of time until protests appear again on the streets of Kazakhstan.