Kazakhstan: Grain Harvest Scandal Recalls Soviet Economic Traditions

As Kazakhstan, the breadbasket of Central Asia, struggles with a disastrous grain harvest this year due to drought, Astana has accused local officials of massaging statistics. It’s all reminiscent of the Soviet-era tradition of overstating production to meet central government plans.

Deputy Agriculture Minister Muslim Umiryayev said discrepancies had been revealed between satellite monitoring data on the harvest and preliminary figures supplied to the government by Kazakhstan’s three northern grain-growing regions: Kostanay, Akmola and North Kazakhstan.

He said there was a discrepancy of 1.4 million metric tons.

Umiryayev added that Astana was receiving desperate appeals from farmers being forced by local governments to overstate production. “This fact is confirmed by the presence of appeals reaching the minister’s blog from agricultural producers, in which they indicate that local government employees are in a number of cases asking them for false reports overstating productivity,” he said in comments carried by Bnews.kz. 

In the Soviet Union, local officials often distorted economic output figures to Moscow in order to conceal poor production, as well as corruption. In the 1980s, for example, Kazakhstan’s neighbor Uzbekistan was rocked by scandal when Moscow accused Communist Party officials of skimming off billions by submitting distorted reports on cotton harvests. 

Commentators in Kazakhstan were quick to draw a parallel as accusations of false reporting on the grain harvest surfaced. “It turns out that Soviet traditions are still alive,” noted Kazakhstan’s Ekspress K tabloid.

The false accounting has serious implications for Kazakhstan’s economy. The government has already slashed its 2012 GDP growth forecast partly because of the poor grain harvest, and is now predicting growth of 5.4% compared to 7.5% in 2011. 

An even lower-than-expected harvest will hit export plans, too. The government hoped to use reserve stocks to export 8 million metric tons of grain, which would still have been only two-thirds of exports compared to last year, when Kazakhstan enjoyed a record grain harvest of 26.9 million tons.

The false accounting comes as a double whammy on top of this year’s miserable harvest, pointed out Ekspress K. “With this year’s poor harvest -- and it is half the size of last year’s -- the bogus statistics could cost us twice over,” the tabloid concluded gloomily.