In the early 1990s, immediately after the collapse of the Soviet Union, the establishment of a market economy began in Kazakhstan. Companies, deposits and parts of the infrastructure were privatized. In 1993, the country abolished the Soviet Ruble and introduced its own currency, the Tenge. Kazakhstan managed to build an effective banking system from literally nothing although the country had never before had experience of banking traditions. This sector is now reformed and is developing well. Ferrous and non-ferrous metallurgy, chemical, light and heavy industry, machine building, oil refining and food technology are the leading spheres in the economy of Kazakhstan. The Republic possesses large reserves of explored non-ferrous and ferrous metals, coal and lignite, oil and gas, phosphorites, common salt and asbestos.
The main resources of Kazakhstan’s earth are ferrous and non-ferrous metals including copper, zinc, lead, nickel, tungsten, molybdenum, ferrous and magnesium ores and chromites. The Republic also possesses vast reserves of coal and lignite, oil and gas, phosphorites, common salt and asbestos. In total, Kazakhstan’s land contains over 90 kinds of natural resources as almost all of the elements in the Period Table can be found in the Republic. From an ecological point of view, it is important that most natural resources are situated close to the surface which is why they can be developed using inexpensive open pits. The largest variety of natural resources can be found in the Rudniy Altai, Karatau mountains, Mugodzhary, Turgai valley and the Mangistau peninsula. The confirmed gas reserves in Kazakhstan as of the beginning of 2009, reached 1.82 trillion cubic metres (BP estimate) which is 1.7% of the world reserves. The Republic also ranks second in the world regarding its explored reserves of uranium deposits which total 1.69 million tonnes.
Ferrous and non-ferrous metallurgy, chemical, light and heavy industries, machine building, oil refining and food technology are the leading spheres of the economy of Kazakhstan. Oil refining and construction material production have also been developed in the country. Coal, oil, natural gas, iron ore, copper ore, lead and zinc ore, uranium ore, nickel ore, bauxites and other natural resources are also actively extracted in the country. Export of metallurgical products, oil, gas and oil products are the main source of income for the economy.
Agriculture is an important sector in the country’s economy. Spring crops, oats, barley and other cultures are grown in the North of the Republic. Kazakhstan also ranks third in the CIS after Russia and Ukraine concerning wheat production. Climatic conditions enable vegetable production, melons and gourds to be grown as well as the cultivation of other crops such as sunflowers, flax, tobacco and others. In the south of the country, cotton, sugar beet and rice are grown with orchards and vineyards also being popular in the region. Cattle breeding is one of the priorities of Kazakhstan’s agricultural sector. The Republic is traditionally involved in sheep, horse, camel and cattle breeding. The desert and semi-desert areas in Central and South-Western Kazakhstan are widely used as seasonal pastures for livestock. The mountain meadows in the East and South East of the Republic are used as summer pastures.
The geographic layout of Kazakhstan is located in the heart of the Eurasian continent and provides the necessary conditions for transit transport. The length of the surface transport routes in the Republic is 106 thousand kilometers, 13.5 thousand of which are railways, 87.4 thousand kilometres are public roads with metalled surfaces and 4 thousand kilometres are river routes. The construction of the border railway route from Druzhba to Alashankou linking Kazakhstan and China and the launch of the Serhas-Meshhed railway line between Turkmenistan and China opened up new transit corridors passing along the former Great Silk Way, which began at the Pacific Ocean ports of China such as Lianyungang, Qingdao, Tianjin and ran through Kazakhstan, Kyrgyzstan, Uzbekistan, Turkmenistan, Iran and Turkey through to the ports located on the Mediterranean Sea and the Persian Gulf. The motorways in the country link the republic with Russia and other former Soviet republics as well as China, Turkey and Iran, which enables access to the ports of the Black and Mediterranean Seas and the Indian Ocean. Kazakhstan also has navigable waters in the Caspian Sea (via Aktau Port) through which it may access the Black and the Baltic Seas through the rivers in Russia.
At the moment, the export potential of Kazakhstan has a clear raw material dependence and is formed due to the fuel, metallurgical and chemical industries. The major share of Kazakhstan’s exports is occupied by oil and oil products (35%), non-ferrous metals (17%), ferrous metals (16%), ores (12%) with crops also taking a share of the exported goods (9%). The main items imported by Kazakhstan are vehicles and equipment, transport, automatic equipment, chemical products, fuel, mineral fuel, food, ready-to-use products and consumer goods. The state of Kazakhstan’s export-import balance of trade changes every year relating to the diversification of business relations. However, the share of commercial relations with traditional partners such as the CIS and Baltic states is still large as it takes around 59% of exports and up to 63% of imports. Russia remains the main trade partner for Kazakhstan. The Republic is also successfully developing relations with Germany, Turkey, Switzerland, The Czech Republic, Italy, China, The USA. Great Britain, South Korea and others.
As well as the national anthem, flag and emblem, the national currency is also on the list of state symbols. In the early 1990s, when the Soviet Union collapsed, the Soviet Ruble suffered rapid devaluation. In 1992, inflation hit 250%. In July 1993, Russia introduced its own currency having notified Kazakhstan just three days before its introduction. As a result, a huge flow of old Soviet money streamed into the Republic. An appeal made by the head of state on television and radio shortly before the launch of monetary reforms managed to calm down the people of Kazakhstan. The mass exchange of Soviet currency into the Tenge began at 8am on November the 15th, 1993 and finished at 8pm on November the 20th, 1993. Ever since then, on November the 15th, Kazakhstan celebrates finance day and national currency day. In order to provide the country with its own banknotes, it was decided to establish a mint. Kazakhstan’s mint is among the world top 6 mints. As the national currency, the Tenge plays a significant role in the Republic’s history. It was the introduction of the national currency that helped the country to carry out its own monetary policy. The introduction of the tenge provided a boost to structural changes aimed at the establishment of a market economy. Kazakhstan built its own banking system from virtually nothing which was a considerable achievement as the Republic had never previously had any banking traditions. This sector is a reformed and dynamic part of the economy and Kazakhstan’s banking segment is seen as competitive within the former Soviet Republics and exports its products.
No reproduction of the materials may take place without the written permission of the copyright holder. All the rights for the pictures and texts reserved.