- The Washington Times - Saturday, November 30, 2002

Kazakhstan plans to skip several stages in the classical model of development on its way to a modern high-tech, knowledge-based, service-oriented economy, Deputy Prime Minister Karim Massimov said in an interview.

"If we are copying someone else's model, focusing on the low-tech industries, we will always be behind," Mr. Massimov told The Washington Times at the tail end of a visit here last week to meet with U.S. government officials and business leaders.

"We think it is in the nature of the post-industrial economy that even a country like Kazakhstan can be an excellent partner for the United States on very high-end projects," he said.

Mr. Massimov said his country hoped to use its vast oil and gas reserves as a base to diversify into promising high-tech sectors, including software production, biotechnology and aerospace.

The Bush administration has pledged $10 million for the first phase of the "Houston Initiative," a joint U.S.-Kazakh program designed to attract more foreign capital to the former Soviet republic beyond the oil and gas industries.

The U.S. seed money is intended to lure other international investors and to build Kazakhstan's small and midsized businesses, while providing subtle pressure on the government of President Nursultan Nazarbayev to maintain open markets and pursue political and legal reforms.

"Oil is what we have been given by nature, but we want to use that money to restructure our whole economy," Mr. Massimov said. "What we have as a target is an economy that is less dependent on oil."

It was the attraction of Kazakhstan's vast untapped oil fields that has spurred strong economic growth in recent years. GDP growth hit 10 percent in 2000, 13 percent in 2001, and it is expected to reach 9 percent this year.

But the economy faces some rough spots as well, highlighted by a very public dispute with Western companies over the expansion of the country's most productive oil field. The government also has struggled to pass a draft investment law clarifying the rights of foreign investors.

The United States has supported Kazkhstan's bid to join the World Trade Organization, but most experts say WTO entry is still at least a few years away.

The cheap-labor, low-tech route to prosperity employed by Japan, South Korea and a slew of East Asian tigers is not right for Kazakhstan in the new global economy, the 37-year-old minister argued.

"Labor costs are simply not a big part of most high-tech goods these days," Mr. Massimov said. "Much more important than the cost of your workers is the knowledge they can apply."

Kazakh officials say they are placing a heavy emphasis on education and on English-language skills.

"We can never compete directly with the United States," Mr. Massimov said. "But we can work together very well."

Copyright © 2019 The Washington Times, LLC. Click here for reprint permission.

The Washington Times Comment Policy

The Washington Times welcomes your comments on Spot.im, our third-party provider. Please read our Comment Policy before commenting.


Click to Read More and View Comments

Click to Hide