''KAZAKHSTAN WAY – 2050: COMMON AIM, COMMON INTERESTS, COMMON FUTURE''
PRESIDENT OF KAZAKHSTAN DELIVERED
STATE OF THE NATION ADDRESS
Astana, January 17: President Nazarbayev today gave his annual state of the nation address, setting out the next steps in Kazakhstan’s pursuit of the ambitious 2050 Strategy in a project entitled “Manghilik Yel” (Eternal Land).
• Kazakhstan has achieved tremendous progress over the past 22 years. Today, Kazakhstan's people look into the future with great confidence.
• To ensure future growth prospects, we announced a long-term strategy called “Kazakhstan 2050”. Its main goal is Kazakhstan's entrance into the club of 30 most developed nations in the world. Only strong, forward-thinking nations can develop and implement long-term strategies for long-term economic growth.
• Strategy 2050 is like a beacon, which will allow us to achieve our goal while we work on day-to-day living.
Overview of Strategy 2050 Implementation
• The Plan for Strategy 2050 will be soon adopted after the President’s changes are incorporated.
• The next 15-17 years will be a “window of opportunities” for massive breakthroughs of Kazakhstan.
• The developed nations are members of OECD. The following six nations are candidates for OECD membership: Brazil, China, India, Indonesia, Russia and South Africa. The OECD members have covered a journey of deep modernization. They also demonstrate high levels of investment, research and development, labor efficiency, business opportunities and standards of living. These are the standards for our entrance into the ranks of the 30 most developed nations.
• We will introduce a number of OECD principle and standards, which are included in the plan’s Concept paper. GDP growth will be no less than 4% annually. Investment will be grown from current 18% to 30% of GDP. The share of non-resource goods for export will be 70%.
• Funding for research and development will be no less than 3% of GDP. The energy-output ratio should be decreased by half. By 2050, small and medium enterprises will produce no more than 50% of the GDP, as against the current 20%.
• GDP per capita will be increased by as many as 4.5 times, from $13,000 to $60,000 per year. Kazakhstan will be a middle class dominated country. Urbanization will continue; the share of city dwellers will grow from 55% to 70%. Cities and settlements will be linked by highways, high quality roads and high-speed routes.
• Healthy lifestyles and progress in medical science will allow the longevity of Kazakh citizens to increase to 80 years and higher. Kazakhstan should become one of the Eurasian centers of medical tourism. Kazakhstan should become one of world’smost secure and comfortable countries to live in. Peace and stability, a fair system of justice and efficient law and order are the foundations of a developed nation.
Structureof the Concept on Implementation of Strategy 2050
1. Innovational Industrialization. The Government will develop the second five-year plan for rapid industrial and innovational development for 2016-2019. It should be focused on a smaller number of industrial priorities.
• The efficiency of the traditional extractive sectors such as oil and gas, where we have natural competitive advantages, should be increased. We should further develop rare earth metals, given their importance for electronics, laser technology and communication and medical equipment.
• Kazakhstan should enter the world market of geological exploration.
• Each five-year plan should create new sectors.
• Under the first five year plan, we created car manufacturing and aircraft engineering and production of locomotives, passenger and cargo cars. These products should be exported.
• Until 2050, there are 7 five-year plans. Under the second and subsequent five-year plans, new industries will be founded, such as mobile and multi-media, nano and space technologies, robotics, genetic engineering and alternative energy. In the next 10-15 years, a knowledge-based economy will be founded.
2. Introduction of innovations to the agro-industrial complex, which is our traditional sector. The global demand for food will increase and the investments to this sector will increase. Therefore, our farmers should think of increasing the output, not settling for short-term achievements related to weather conditions. Our farmers should use new technologies and follow with the best, world standards.
• We should create an efficient land market. Leasing lands to those who bring advanced technologies and investment will increase our competitiveness. We should remove all barriers that impede the development of agribusiness, farmer's cooperation and effective land-use management.
• We should create conditions for the establishment of food processing enterprises and small and medium enterprises. Kazakhstan should be one of the major regional exporters of beef, diary and other agricultural products.
• In crop farming, we need to cut production of low-return, water-intensive varieties and replace them with vegetable, oil and fodder products.
• Under the transfer to “green economy” concept, by 2030, 15% of acreage will be cultivated with water-saving technologies. Agrarian science will be developed. Experimental agrarian and innovational clusters will be established. Drought-resistant GM crops will be developed.
3. Knowledge economy. We should improve our laws on venture financing, protection of intellectual property, support for research and innovations and commercialization of scientific developments.
• The Government should develop and submit to the Parliament a package of bills by Sept 1.
• Special focus should be on the transfer of knowledge and new technologies to our country and on cooperation with foreign companies to establish R&D and engineering centers.
• We should encourage multinational companies working in major oil and gas, mining and smelting sectors to create industries to source required products and services.
• We need to further energize the technology parks such as the Nazarbayev University Intellectual and Innovational cluster in Astana and the Alatau IT Park in Almaty.
4. Infrastructure. We should develop metropolitan areas, transportation and energy sectors.
• The metropolitan areas will be developed in Astana, Almaty, Shimkent and Aktobe, which will attract investment and population and will provide high quality educational, medical, social and cultural services.
• Kazakhstan should serve as a logistics hub between Europe and Asia, North and South. New highways are being constructed: Astana-Karagandy-Almaty, Astana-Pavlodar-Uskemen, Almaty-Kapchagai-Uskemen.
• The “Western Europe – Western China” corridor will be completed soon and a railway to Turkmenistan and Iran has been launched, which will allow goods access to the Persian Gulf. We should cut the time for customs clearance of goods, increase the throughput capacity of border posts, increase the capacity of the Aktau port and simplify export-import procedures.
• We are constructing a 1,200 kilometer railway called “Zhezkazgan-Shalkar-Beineu”, which will connect the East of the country with the West after its completion in 2015. It would provide access to the Caspian region and the Caucasus in the West and the Chinese port of Lianyungang in the Pacific.
• The energy sector will be developed in its traditional forms. We will add clean energy technology to the thermal power stations, which widely use energy saving technologies.
• While we prepare for EXPO 2017, we will establish a research center that will introduce best practices on future energy and green economy. Our public transportation should use environment-friendly fuel; electric cars will be introduced. We will establish a new refinery that will produce gas, diesel and aviation fuels.
• We will set up nuclear power plants and produce our own fuel for them. Kazakhstan is the number one uranium producer.
5. Small and Medium Enterprises. According to various global ratings, Kazakhstan is among the nations that have the most favorable conditions for business. We should remove all laws and rules that hamper development of business. The Government will prepare the second five-year plan along with the roadmap “Business 2020”. The Government and National Entrepreneurs Chamber will create an effective mechanism for helping start-up businesses.
6. Education, healthcare and culture. We need to improve our education system. By 2020, we should ensure that 100% of 3-6 year-olds get a pre-school education. High schools should be of the same quality as the Nazarbayev Intellectual Schools. Those who finish these schools will know Kazakh, Russian and English and will master critical thinking, self research and deep analysis of information.
• We should ensure academic and managerial autonomy for the leading universities.
• The Government will increase scholarships for students by 25% starting Jan 1, 2016.
Primary medical services will be improved. We should explore offering universal medical insurance. We should encourage healthy lifestyles, including regular athletics.
We should develop an all-Kazakhstan culture. The Kazakh language has become a language of science and knowledge as well as for the Internet. Compared to the last year, those willing to learn the Kazakh language has increased by 10%.
We will adopt a new social package for civil servants working in education, healthcare and social security. Beginning July 1, 2015, a new salary scheme will be adopted, which will increase pay for civil servants working in healthcare by 28%, in education by 29% and in social security by 40%.
We should care more about physically challenged people. Kazakhstan should be a zone of no barriers. They can work on the food processing and agricultural enterprises. Businesses should hire them so they can become productive members of society. The Government will increase social assistance to people with disabilities and to families who have lost their bread earners.
We should continue the fight poverty by creating more jobs.
7. State Institutions. We will create an atmosphere of fair competition, justice and rule of law. We need to update relationships between the state and NGOs and the private sector.
• Everyone should be equal before law. The justice system should be transparent, effective and accessible for all. Law enforcement officers should have excellent work ethics and high professionalism.
• We should continue to shape and implement new counter-corruption strategies. We should give more autonomy to local governments, at the same time increasing their responsibilities for the results they produce. They must be accountable to the public.
• We should introduce principles of meritocracy in human resources policy at the state owned enterprises, national companies and budget organizations. The Government will increase the salary of the Corps “B” civil servants by 15% on July 1, 2015 and will add 15% on July 1, 2016.
Two Stages of Strategy 2050
1. The first stage covers the period until 2030, during which we need to make a modernization leap just like the developed countries’ achieved during the industrial boom in the last century. A similar path was taken South Korea and Singapore. During this stage, we will ensure dynamic growth of our traditional industries and create processing industrial sector.
2. During the second stage, which covers the period from 2030 to 2050, we should ensure sustainable development by emphasizing the knowledge economy. In the traditional sectors, we will produce high value added goods; engineering services will be a foundation of the knowledge economy.
The Goals for 2014
1. Annual GDP growth should be 6-7%. The GDP per capita should reach no less than $14,500.
2. By May 1, 2014 the National Bank and the Government will adopt comprehensive measures to get inflation down to 3-4% in the mid term.
3. By June 1, 2014 the Government and the National Bank should draft the 2030 Financial Sector Development Program.
4. The Government and Sovereign Wealth Fund “Samruk-Kazyna” should make a list of enterprises that should be privatized. In the first quarter of this year, we should adopt 2014-2016 Privatization Program.
5. By the year end, the Government should develop strategies for developing metropolitan areas in Astana and Almaty until 2030.
6. By September 1, 2014 the Government should develop a 2030 Kazakhstan's Transit Potential Use Program, which removes barriers impeding international trade.
7. The Government should finalize the ways and means and dates for the construction of the fourth oil refinery and nuclear power plant.
Principles of the Strategy 2050 Implementation
1. We should make decision in a pragmatic and evolutionary way. We should avoid making haphazard judgments in economic policy, the political arena and in our daily lives.
2. We should be open to the world’s best practices. We will invite foreign investment, technologies and innovation. We will continue the integration processes, including participation in the establishment of the Eurasian Economic Union and accession to the WTO.
3. We should continue improving the wellbeing of Kazakh citizens. The wellbeing of ordinary citizens should serve as the most important indicator of our progress.
4. We need to ensure that the Strategy is supported by the public, so we must explain its important goals and tasks.
The National Idea
The Everlasting Nation is the national idea of our homeland and the dream of our ancestors. Over the last 22 years of independence, we have achieved the Kazakhstan Way, which is the main value that has stood the test of time.
The following are the features of Kazakhstan way:
•Preserving Independence and the development of Astana;
• National unity, peace and accord in the society;
• Secular society and high spirituality;
• High economic growth achieved on the basis of industrialization and innovation;
• General Employment Society;
• Unity of history, culture and the language;
• National security and participation of our country in resolving global and regional problems.
Implementation of the Strategy 2050 is important, especially for young people. It is the destiny of the nation and everyone should help make it happen. It will further strengthen our independence. Kazakhstan 2050 is the noble route to our long-term development.
A full copy of the speech is here.