U.S. Department of State Background Note
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PEOPLE AND HISTORY
The majority of Kazakhstanis are ethnic Kazakh; other ethnic groups include Russian, Ukrainian, Uzbek, German, and Uyghur. Religions are Sunni Muslim, Russian Orthodox, Protestant, and other. Kazakhstan is a bilingual country. The Kazakh language has the status of the "state" language, while Russian is declared the "official" language. Russian is used routinely in business; 64.4% of the population speaks the Kazakh language. Education is universal and mandatory through the secondary level, and the literacy rate is 98.4%.
Nomadic tribes have been living in the region that is now Kazakhstan since the first century BC, although the land has been inhabited at least as far back as the Stone Age. From the fourth century AD through the beginning of the 13th century, the territory of Kazakhstan was ruled by a series of nomadic nations. Following the Mongolian invasion in the early 13th century, administrative districts were established under the Mongol Empire, which eventually became the territories of the Kazakh Khanate. The major medieval cities of Taraz and Turkestan were founded along the northern route of the Great Silk Road during this period.
Traditional nomadic life on the vast steppe and semi-desert lands was characterized by a constant search for new pasture to support the livestock-based economy. The Kazakhs emerged from a mixture of tribes living in the region in about the 15th century and by the middle of the 16th century had developed a common language, culture, and economy. In the early 1600s, the Kazakh Khanate separated into the Great, Middle and Little (or Small) Hordes--confederations based on extended family networks. Political disunion, competition among the hordes, and a lack of an internal market weakened the Kazakh Khanate. The beginning of the 18th century marked the zenith of the Kazakh Khanate. The following 150 years saw the gradual colonization of the Kazakh-controlled territories by tsarist Russia.
The process of colonization was a combination of voluntary integration into the Russian Empire and outright seizure. The Little Horde and part of the Middle Horde signed treaties of protection with Russia in the 1730s and 1740s. Major parts of the northeast and central Kazakh territories were incorporated into the Russian Empire by 1840. With the Russian seizure of territories belonging to the Senior Horde in the 1860s, the tsars effectively ruled over most of the territory belonging to what is now the Republic of Kazakhstan.
The Russian Empire introduced a system of administration and built military garrisons in its effort to establish a presence in Central Asia in the so-called "Great Game" between it and Great Britain. Russian efforts to impose its system aroused the resentment of the Kazakh people, and by the 1860s, most Kazakhs resisted Russia's annexation largely because of the disruption it wrought upon the traditional nomadic lifestyle and livestock-based economy. The Kazakh national movement, which began in the late 1800s, sought to preserve the Kazakh language and identity. There were uprisings against colonial rule during the final years of tsarist Russia, with the most serious occurring in 1916. The destruction of the nomadic life, prior to and during the Communist period, created a Kazakh diaspora in neighboring countries, especially western China. Since independence in 1991, the government has encouraged the return of ethnic Kazakhs by offering subsidies for returnees.
Although there was a brief period of autonomy during the tumultuous period following the collapse of the Russian Empire, the Kazakhs eventually succumbed to Soviet rule. In 1920, the area of present-day Kazakhstan became an autonomous republic within Russia and, in 1936, a Soviet republic.
Soviet repression of the traditional elites, along with forced collectivization in late 1920s-1930s, brought about mass hunger and led to unrest. Soviet rule, however, took hold, and a communist apparatus steadily worked to fully integrate Kazakhstan into the Soviet system. Kazakhstan experienced population inflows of thousands exiled from other parts of the Soviet Union during the 1930s and later became home for hundreds of thousands evacuated from the Second World War battlefields. The Kazakh Soviet Socialist Republic (SSR) contributed five national divisions to the Soviet Union's World War II effort.
The period of the Second World War marked an increase in industrialization and increased mineral extraction in support of the war effort. At the time of Soviet leader Josif Stalin's death, however, Kazakhstan still had an overwhelmingly agricultural-based economy. In 1953, Soviet leader Nikita Khrushchev initiated the ambitious "Virgin Lands" program to turn the traditional pasturelands of Kazakhstan into a major grain-producing region for the Soviet Union. The Virgin Lands policy, along with later modernizations under Soviet leader Leonid Brezhnev, sped up the development of the agricultural sector, which to this day remains the source of livelihood for a large percentage of Kazakhstan's population.
Growing tensions within Soviet society led to a demand for political and economic reforms, which came to a head in the 1980s. In December 1986, mass demonstrations by young ethnic Kazakhs took place in Almaty to protest the methods of the communist system. Soviet troops suppressed the unrest, and dozens of demonstrators were jailed. In the waning days of Soviet rule, discontent continued to grow and find expression under Soviet leader Mikhail Gorbachev's policy of glasnost. Caught up in the groundswell of Soviet republics seeking greater autonomy, Kazakhstan declared its sovereignty as a republic within the Union of Soviet Socialist Republics (U.S.S.R.) in October 1990. Following the August 1991 abortive coup attempt in Moscow and the subsequent dissolution of the Soviet Union, Kazakhstan declared independence on December 16, 1991.
The years following independence have been marked by significant reforms to the Soviet command-economy and political monopoly on power. Under Nursultan Nazarbayev, who initially came to power in 1989 as the head of the Kazakh Communist Party and was eventually elected President in 1991, Kazakhstan has made significant progress toward developing a market economy, for which it was recognized by the United States in 2002. The country has enjoyed significant economic growth since 2000, partly due to its large oil, gas, and mineral reserves.
GOVERNMENT AND POLITICAL CONDITIONS
Kazakhstan is a constitutional republic with a strong presidency. It is divided into 14 oblasts and the two municipal districts of Almaty and Astana. Each is headed by an akim (provincial governor) appointed by the president. Municipal akims are appointed by oblast akims. The Government of Kazakhstan transferred its capital from Almaty to Astana on June 10, 1998.
The president is the head of state. The president also is the commander in chief of the armed forces and may veto legislation that has been passed by the Parliament. President Nursultan Nazarbayev has been in office since Kazakhstan became independent. In 1995, President Nazarbayev called for a referendum that expanded his presidential powers: only he can initiate constitutional amendments, appoint and dismiss the government, dissolve Parliament, call referenda, and appoint administrative heads of regions and cities. The prime minister, who serves at the pleasure of the president, chairs the Cabinet of Ministers and serves as Kazakhstan's head of government. There are three deputy prime ministers and 16 ministers in the Cabinet.
Kazakhstan has a bicameral Parliament, comprised of a lower house (the Mazhilis) and upper house (the Senate). Single mandate districts popularly elect 67 seats in the Mazhilis; there also are 10 members elected by party-list vote. The Senate has 39 members. Two senators are selected by each of the elected assemblies (Maslikhats) of Kazakhstan's 16 principal administrative divisions (14 regions, or oblasts, plus the cities of Astana and Almaty). The president appoints the remaining seven senators. Mazhilis deputies and the government both have the right of legislative initiative, though the government proposes most legislation considered by the Parliament.
Elections to the Mazhilis in September 2004 yielded a lower house dominated by the pro-government Otan party, headed by President Nazarbayev. Two other parties considered sympathetic to the president, including the agrarian-industrial bloc AIST and the Asar party, founded by President Nazarbayev’s daughter, won most of the remaining seats (Asar and Otan subsequently merged in July 2006 to form the new Otan party). Opposition parties, which were officially registered and competed in the elections, won a single seat during elections that the Organization for Security and Cooperation in Europe said fell short of international standards. The opposition party Ak Zhol refused to take the seat in protest of the flawed elections.
In December 2005, President Nazarbayev won a new 7-year term in an election that the Organization for Security and Cooperation in Europe said fell short of international standards. Official results gave the president 91% of the vote, although independent exit polls found this figure to be somewhat inflated. Opposition candidates Zharmakhan Tuyakbay (For a Just Kazakhstan) and Alikhan Baymenov (Ak Zhol) were able to compete freely in this election.
Principal Government Officials
Kazakhstan's economy grew by 8.5% in 2006. Gross domestic product (GDP) grew 9.4% in 2005, 9.1 % in 2004, 9.2% in 2003, 9.5% in 2002, and 13.2% in 2001.
Kazakhstan's monetary policy has been well managed. In 2006, inflation remained relatively steady at 8.6%, up from 7.5% in 2005. Inflation from 2001-2003 was 6.4%, 6.6%, and 6.8%, respectively. Because of its strong macroeconomic performance and financial health, Kazakhstan became the first former Soviet republic to repay all of its debt to the International Monetary Fund (IMF) in 2000, 7 years ahead of schedule. In March 2002, the U.S. Department of Commerce graduated Kazakhstan to market economy status under U.S. trade law. The change in status recognized substantive market economy reforms in the areas of currency convertibility, wage rate determination, openness to foreign investment, and government control over the means of production and allocation of resources.
In September 2002, Kazakhstan became the first country in the former Soviet Union to receive an investment-grade credit rating from a major international credit rating agency. Estimated level of external debt in 2005 was $41.66 billion. In 2004, Kazakhstan's gross foreign debt was about $26.03 billion. Kazakhstan has been successful in reducing the ratio of debt to GDP in recent years. In 2005, total governmental debt was $5 billion, which amounts to 8.9% of GDP. In 2000, total government debt equaled 21.7% of GDP.
The upturn in economic growth, combined with the results of earlier tax and financial sector reforms, dramatically improved government finances from the 1999 budget deficit level of 3.5% of GDP to a deficit of 0.5% of GDP in 2005. Government revenues grew from 19.8% of GDP in 1999 to 22.6% of GDP in 2001 to 25.7% of GDP in 2005. In 2000, Kazakhstan adopted a new tax code in an effort to consolidate these gains. On November 29, 2003 the Law on Changes to Tax Code was adopted, which reduced the value added tax (from 16% to 15%), the social tax (from 21% to 20%), and the personal income tax (from 30% to 20%). Kazakhstan furthered its reforms by adopting a new land code on June 20, 2003 and a customs code on April 5, 2003.
Oil and gas is the leading economic sector. Production of oil and gas condensate in Kazakhstan amounted to 61.9 million tons in 2005, which was 4.3% more than in 2004. Kazakhstan exported 52.4 million tons of oil and gas condensate a year in 2004 and 2005. Natural gas production in Kazakhstan in 2005 amounted to 14.5 billion cubic meters, a 25% increase from 2004. Kazakhstan holds about 4 billion tons of proven recoverable oil reserves and 3 trillion cubic meters of gas. Industry analysts believe that planned expansion of oil production, coupled with the development of new fields, will enable the country to produce as much as 3 million barrels per day by 2015, lifting Kazakhstan into the ranks of the world's top 10 oil-producing nations. Kazakhstan's 2005 oil exports were valued at $17.4 billion, representing over 70% of overall exports. Major oil and gas fields and their recoverable oil reserves are Tengiz (7 billion barrels); Karachaganak (8 billion barrels and 1,350 billion cubic meters of natural gas); and Kashagan (7-9 billion barrels). Starting in 2004, the Government of Kazakhstan increased its take of oil deals by increasing taxation of new oil projects.
Kazakhstan instituted an ambitious pension reform program in 1998. There are 14 saving pension funds, one of which is state controlled. The National Bank oversees and regulates the pension funds. The pension funds' growing demand for quality investment outlets triggered rapid development of the debt securities market. Pension fund capital is being invested almost exclusively in corporate and government bonds, including Government of Kazakhstan Eurobonds. The Kazakhstani banking system is developing rapidly. Its capitalization now exceeds $1 billion. The National Bank has introduced deposit insurance in its campaign to strengthen the banking sector. Several major foreign banks have branches in Kazakhstan, including ABN-AMRO, Citibank, and HSBC.
The United States was the first country to recognize Kazakhstan, on December 25, 1991, and opened its Embassy in Almaty in January 1992. In the years since Kazakhstan's independence, the two countries have developed a wide-ranging bilateral relationship. The current Ambassador is John Ordway, who assumed his post in September 2004. The bilateral relationship has witnessed a surge in activity in recent months, including visits by Vice President Cheney, Secretary of State Rice, Secretary of Energy Bodman, Secretary of Agriculture Johanns, and CENTCOM Commander Abizaid. President Nazarbayev met with President Bush in the White House on September 29, 2006.
U.S.-Kazakhstani cooperation in security and non-proliferation has been a cornerstone of the relationship. Kazakhstan showed leadership when it renounced nuclear weapons in 1993. The United States has assisted Kazakhstan in the removal of nuclear warheads, weapons-grade materials, and their supporting infrastructure. In 1994, Kazakhstan transferred more than a half-ton of weapons-grade uranium to the United States. In 1995 Kazakhstan removed its last nuclear warheads and, with U.S. assistance, completed the sealing of 181 nuclear test tunnels in May 2000. Kazakhstan has signed the Conventional Armed Forces in Europe Treaty (1992), the START Treaty (1992), the nuclear Non-Proliferation Treaty (1993), the Chemical Weapons Convention, and the Comprehensive Test Ban Treaty (2001). Under the Cooperative Threat Reduction program, the United States has spent $240 million to assist Kazakhstan in eliminating weapons of mass destruction and weapons of mass destruction-related infrastructure.
Sections 402 and 409 of the United States 1974 Trade Act require that the President submit semi-annually a report to Congress on continued compliance with the Act's freedom of emigration provisions by those countries, including Kazakhstan, that fall under the Trade Act's Jackson-Vanik Amendment. Bilateral trade in 2005 was valued at $1.64 billion, a 91% increase from 2004.
Since 1993, the U.S. Agency for International Development (USAID) has administered technical assistance programs to support Kazakhstan's transition to a market economy, fully integrated into the world trade system. These programs include cooperation in privatization, fiscal, and financial policy; commercial law; energy; health care; and environmental protection. In 2006, Kazakhstan became the first country to share directly in the cost of a U.S. Government’s foreign assistance program. Through 2009, the Government of Kazakhstan will contribute over $15 million to a $40 million USAID economic development project aimed at strengthening Kazakhstan’s capacity to achieve its development goals. The U.S. Commercial Service provides U.S. business internships for Kazakhstanis, supports Kazakhstani businesses through a matchmaker program and disseminates information on U.S. goods and services. Additional information is available on its website: www.buyusa.gov/kazakhstan/en/. The Peace Corps has about 120 volunteers working throughout Kazakhstan in business education, English teaching, and the development of environmental non-governmental organizations. Since 2001 and the advent of the war on terror, the U.S. has assisted Kazakhstan to combat illegal narcotics, improve border security, and, more recently combat money laundering and trafficking in persons.
The United States supports increased citizen participation in the public arena through support for non-governmental organizations (NGOs). Dozens of grants have been provided to support NGOs that promote an independent media, legal reform, women's rights, civic education, and legislative oversight. USAID also has provided training courses for leaders and professionals.
[ Fact sheet on FY 2006 U.S. Assistance to Kazakhstan.]
To address the water management problem of the Syr Darya River, Kazakhstan and other basin states, with technical assistance from USAID/Central Asia, established the 1998 Framework Agreement on the Use of Water and Energy Resources of the Syr Darya Basin. Kazakhstan became a signatory to the Convention on International Trade in Endangered Species (CITES) in 1999.
The United States and the European Union worked together with the Ministry of Environmental Protection to establish an independent, nonprofit, and nonpolitical Regional Environmental Center (REC) in Almaty in 2001. The mission of the REC is to strengthen civil society and support sustainable development by promoting public awareness and participation in environmental decision-making among the countries of Central Asia. In 2002, the U.S. Environmental Protection Agency, U.S. Embassy, and Ministry of Environmental Protection signed a memorandum of understanding to provide the REC with funding for its grants program.
Principal U.S. Embassy Officials
U.S. Embassy Contact Information
U.S. Commercial Service / Public Affairs Section
U.S. Embassy Branch Office, Almaty
U.S. Agency for International Development (USAID)
Kazakhstani business people are generally less direct than American business people, and what can be accomplished in a few meetings in the United States might take more in Kazakhstan, requiring patience and discipline on the part of the U.S. business people. An experienced and competent interpreter can add invaluable context to your business meetings.
It is common in Kazakhstan to have dinner with business contacts, but usually only after establishing business contacts in a more formal setting. Business attire is worn. Usually diners share a bottle of vodka or cognac and offer toasts, stating their desire for a fruitful business relationship and warm personal relations between partners. After-hours informal meetings, dinners and toasts, as well as weekend hunting and barbecues can be very important to forge business relations.
In an effort to prevent international child abduction, many governments have initiated procedures at entry/exit points. These often include requiring documentary evidence of relationship and permission for the child's travel from the parent(s) or legal guardian not present. Having such documentation on hand, even if not required, may facilitate entry/departure. All children adopted in Kazakhstan after May 2003 must obtain exit stamps from both the Ministry of the Interior and Ministry of Foreign Affairs before departing.
OVIR registration. There are local Kazakhstani registration requirements. All U.S. citizens arriving in Kazakhstan through 12 international airports and the railway point of Dostyk (Druzhba) are registered at the moment of the border crossing and, as proof, receive a migration card with entry and registration marks from the Border Service of Committee of National Security of the Republic of Kazakhstan. Registration of U.S. citizens is also done at automobile checkpoints in Khorgos, Dostyk, Bakhty, Maikapchagai, Kordai and Kolzhat, and the seaports of Aktau and Bautino. The registration upon arrival is valid for 3 months. For stays longer than 90 days, travelers should register with the Migration Police. However, if for any reason, a U.S. citizen was not registered in the Kazakhstan Embassy or immediately upon arrival in Kazakhstan, the traveler should register with the Office of Visas and Registration (OVIR) within 5 calendar days. Visitors who do not register may have to pay fines upon departure and their departure may be delayed.
Registration/embassy location. Americans living in or visiting Kazakhstan are encouraged to register with the U.S. Embassy Consular Section in Almaty through the State Department’s travel registration website at https://travelregistration.state.gov and obtain updated information on travel and security within Kazakhstan. Registration with the Embassy is different from Kazakhstani OVIR registration. It can help the U.S. Embassy contact you in case of an emergency, and it can streamline replacement of a lost or stolen passport. The U.S. Embassy in Almaty is 11 hours ahead of U.S. Eastern Standard Time. The Embassy Consular Section is located at 97 Zholdasbekova, Samal-2, Almaty 050059, tel. 7-3272- 50-49-00, fax 7-3272-50-48-84, e-mail ConsularAlmaty@state.gov or web site http://www.usembassy.kz/consular/.
TRAVEL AND BUSINESS INFORMATION
For the latest security information, Americans living and traveling abroad should regularly monitor the Department's Bureau of Consular Affairs Internet web site at http://www.travel.state.gov, where the current Worldwide Caution, Public Announcements, and Travel Warnings can be found. Consular Affairs Publications, which contain information on obtaining passports and planning a safe trip abroad, are also available at http://www.travel.state.gov. For additional information on international travel, see http://www.usa.gov/Citizen/Topics/Travel/International.shtml.
The Department of State encourages all U.S citizens traveling or residing abroad to register via the State Department's travel registration website or at the nearest U.S. embassy or consulate abroad. Registration will make your presence and whereabouts known in case it is necessary to contact you in an emergency and will enable you to receive up-to-date information on security conditions.
Emergency information concerning Americans traveling abroad may be obtained by calling 1-888-407-4747 toll free in the U.S. and Canada or the regular toll line 1-202-501-4444 for callers outside the U.S. and Canada.
The National Passport Information Center (NPIC) is the U.S. Department of State's single, centralized public contact center for U.S. passport information. Telephone: 1-877-4USA-PPT (1-877-487-2778). Customer service representatives and operators for TDD/TTY are available Monday-Friday, 7:00 a.m. to 12:00 midnight, Eastern Time, excluding federal holidays.
Travelers can check the latest health information with the U.S. Centers for Disease Control and Prevention in Atlanta, Georgia. A hotline at 877-FYI-TRIP (877-394-8747) and a web site at http://www.cdc.gov/travel/index.htm give the most recent health advisories, immunization recommendations or requirements, and advice on food and drinking water safety for regions and countries. A booklet entitled "Health Information for International Travel" (HHS publication number CDC-95-8280) is available from the U.S. Government Printing Office, Washington, DC 20402, tel. (202) 512-1800.
Further Electronic Information
Export.gov provides a portal to all export-related assistance and market information offered by the federal government and provides trade leads, free export counseling, help with the export process, and more.STAT-USA/Internet, a service of the U.S. Department of Commerce, provides authoritative economic, business, and international trade information from the Federal government. The site includes current and historical trade-related releases, international market research, trade opportunities, and country analysis and provides access to the National Trade Data Bank.
Revised: Feb. 2007