The magazine business new europe (bne) has recently issued a special report on Kazakhstan. The journal covers eastern, southeastern and central European markets.
The special report on Kazakhstan is especially interesting right now as the country is closely tied to world markets and is therefore struggling. KazakhGold, the state gold company, listed on the London Exchange, has been recently downgraded by international credit raters as they have been unable to pay their bills.
Kazakhstan maintains that they will continue to maintain high levels of growth and while this year’s growth will be small, at about 1%, the economy will bounce back soon. However, it is clear that most of the country’s large banks have borrowed too much money and are having a hard time paying it back.
Of course, the economy is affecting politics. Criminal investigations of various elites have been pursued as money is scarce and blame needs to be put on someone. On May 25, the head of the state uranium mining company has been arrested and charged with theft. Heads of the state railway and energy companies have also been jailed.
The government is trying to save itself with enormous bail-outs, but unless global commodity prices turn around, the country is just too leveraged to save itself.
Follow this link to see the head of Kazakhstan’s National Bank explain how Kazakhstan will be just fine:
