The time for showers of gold is over, President Nursultan Nazarbayev warned his countrymen on February 16 in his latest attempt to inculcate a popular spirit of parsimony.
Instead, the people of Kazakhstan should exploit the opportunity of a crisis caused in part by low oil prices to transform the country into a more innovative and dynamic economic performer.
“We should not expect to be showered with gold,” he said in remarks quoted by the Nur news agency.
Those remarks appear much in the same mold as recent exhortations by Nazarbayev for the people of Kazakhstan not to indulge in luxuries such as lemons.
“Every crisis is a stage ahead of new development,” which, he said, means weaning the economy off its current dependence on oil and gas.
One way the government intends to that is by raiding the state pension pot, which Nazarbayev ordered last week as part of measures to stimulate growth.
The economy is in desperate need of help. Some economists are forecasting that the economy will shrink this year for the first time in almost two decades.
In line with Nazarbayev’s order, issued on February 10, 1.5 trillion tenge ($4 billion) worth of assets will be withdrawn from the state pension fund — a quarter of its total holdings of nearly 6 trillion tenge — to help plug holes in the budget deficit and support small businesses and infrastructure projects.
That prompted howls of concern from citizens concerned that their pensions may be frittered away as the economy tanks. Officials have vowed, however, that they will see good returns on the investments.
The crisis is also threatening to derail ambitious plans to transform Nazarbayev’s capital city into an international financial hub.
The central bank, which is struggling to contain a currency collapse that has seen the tenge lose half of its value against the dollar since last summer, has abandoned plans to move its headquarters to Astana from the commercial capital, Almaty, because of “difficult economic conditions,” its chairman Daniyar Akishev admitted on February 12.
The central bank’s relocation was ordered by Nazarbayev himself last year as part of plans to set up the Astana International Financial Center — but on February 16 he said during a visit to Almaty that it did not really matter where the bank was located after all.