The second-largest of the former Soviet republics, Kazakhstan extends almost 2000 km (1240 miles) from the Caspian Sea in the west to the Altai Mountains in the east and 1300 km (800 miles) north to south. It borders Russia to the north and China to the east. Kazakhstan was the last Soviet republic to declare its independence, in 1991. In 1999, elections confirmed the former communist Nursultan Nazarbayev and his supporters in power. Kazakhstan has considerable economic potential, and many Western companies seek to exploit its mineral resources.

Kazakhstan's ethnic diversity arose mainly from the forced settlement during the Soviet era of Germans, Tatars, and Russians. By 1959, Kazakhs were outnumbered by ethnic Russians. This balance has been redressed by the immigration of ethnic Kazakhs from neighboring states and the departure in the 1990s of some 1.5 million ethnic Russians. In addition, a majority of ethnic Germans have opted to live in Germany, although in 2000 the government announced a campaign to try to lure some of them back.

In 1995, ethnic Russians criticized the country's new constitution for preventing dual citizenship with Russia and refusing to recognize Russian as an official language. Central control over ethnic Russians has been reinforced by shifting the capital to Astana (formerly Akmola) in the north, where the majority of ethnic Russians reside.

Few Kazakhs retain their traditional nomadic life. Commitment to Islam and loyalty to the clan remain strong.

Strengths

Mineral resources, notably oil and gas, and bismuth and cadmium, used in electronics industry. Joint oil and gas ventures with Western companies. Mass privatization program launched in 1994.

Weaknesses

Collapse of former Soviet economic and trading system. Reliance on imported consumer goods. Rapid introduction of the tenge in 1993 increased instability and fueled sharp price rises. Inefficient industrial plants.

Profile

Kazakhstan has moved faster than other former Soviet republics to establish a market economy. Prices have been freed, foreign trade deregulated, and the tax system reformed. Petroleum revenues have been the main engine of growth, and inflation, at one time rising sharply, has been brought under control.

Foreign direct investment is mainly in the energy sector. Outdated equipment and inadequate distribution networks mean that energy has to be imported, although Kazakhstan exports fossil fuel.

An oil price boom set the tone for the country's first "five-year plan" in 2000, part of Nazarbayev's "Kazakhstan 2030" program. It promised long-term land leases, although not full private ownership, from 2001.

Legislative authority is vested in the bicameral Parliament. The president, who must be fluent in Kazakh, has supreme executive power.

Profile

Despite a democratic government, the president enjoys political dominance, and the patronage of the Kazakh clans is still important. Since coming to power in 1989, President Nazarbayev has concentrated on market reforms. There have been allegations of electoral fraud, and domestic and international criticism of Nazarbayev's attempts to expand the scope of presidential powers. In 2000 the Assembly granted him special powers to advise future presidents after his term expires in 2006, and opposition parties were effectively neutered in 2002 by reform of the party registration process.

Main Political Issue

Presidential powers

The increased powers of Nazarbayev are the focus of political controversy. Critics accuse him of developing a personality cult. The 1995 constitution strengthened presidential powers, conferring a veto over the decisions of the Constitutional Council. A referendum extended Nazarbayev's term of office until 2000, but in 1998 the legislature approved constitutional amendments forcing him to hold a presidential election in 1999. Although reelected, Nazarbayev was tarnished by allegations of voting irregularities. In April 2002 Nazarbayev's credibility was again shaken by the revelation that he had moved $1 billion of state oil revenues into a secret overseas bank account, without parliament's knowledge.

Mining is the single most important industry in Kazakhstan. The US company Chevron has been developing the huge Tengiz oil field since 1993. Joint ventures to exploit substantial oil and gas reserves in the Caspian Sea were agreed with Russia in 1995, and the USA and Japan in 1998. Kazakhstan also possesses vast iron ore and gold reserves.

Kazakhstan's ill-equipped and poorly funded health system has produced one of the highest infant mortality rates in central Asia.

The health system is limited in terms of both facilities and coverage. Rural people have minimal access to clinics. The country's size means that extending coverage and improving the quality of care will be costly. Attempts are therefore being made to attract foreign investment into the health sector. Many doctors have emigrated to Russia.

Education remains based on the Soviet model. Since its adoption as the state language in 1995, Kazakh is gradually replacing Russian as the main instruction medium in schools, but there is a shortage of Kazakh textbooks and Kazakh-speaking teachers. There are a large number of higher-education institutions and medical schools.

Life for the majority of Kazakhs has always been hard, and has grown even more difficult since 1989. Living standards have deteriorated and unemployment has risen as a result of market-oriented reforms within Kazakhstan. In addition, the liberalization of the economy has had the effect of fueling sharp price rises for essential commodities.

The rural population, which is the poorest group in Kazakhstan, has been badly affected. The small wealthy elite is made up mainly of former communist officials, many of whom have benefited from privatization, or belong to President Nazarbayev's clan.

Once part of the Mongol Empire, Kazakhstan was absorbed by the Russian Empire in the 19th century. Ethnic Russians began to settle on land used by nomadic Kazakhs. Russian settlement intensified after the 1917 Revolution and Kazakhstan was subjected to intensive industrial and agricultural development.

• 1916 Rebellion against Russian rule brutally suppressed.
• 1917 Russian Revolution inspires civil war in Kazakhstan between Bolsheviks, anti-Bolsheviks, and Kazakh nationalists.
• 1918 Kazakh nationalists set up autonomous republic.
• 1920 Bolsheviks take control. Kirghiz Autonomous Soviet Socialist Republic (ASSR) set up within Russian Soviet Federative Socialist Republic.
• 1925 Kirghiz ASSR renamed Kazakh ASSR.
• 1936 Kazakhstan becomes full union republic of the USSR as Kazakh SSR.
• 1930s Stalin's collectivization program leads to increase in Russian settlement and the deaths of an estimated one million Kazakhs. There are large penal settlements for victims of the Stalinist purges.
• 1941–1945 Large-scale deportations of Germans, Jews, Crimean Tatars, and others to Kazakhstan.
• 1950s Nuclear test site set up at Semipalatinsk; 500 nuclear explosions follow before testing ends in 1991.
• 1954–1960 Khrushchev's policy to plow "Virgin Lands" for grain most vigorously followed in Kazakhstan. Russian settlement reaches a peak.
• 1986 Riots in Almaty after an ethnic Russian, Gennadi Kolbin, appointed head of Kazakhstan Communist Party (CPK) to replace Kazakh Dinmukhamed Kunyev.
• 1989 Kolbin replaced by Nursultan Nazarbayev, an ethnic Kazakh and chair of Council of Ministers. Reform of political and administrative system.
• 1990 CPK wins elections to Supreme Soviet by overwhelming majority. Nazarbayev appointed first president of Kazakhstan. Kazakhstan declares sovereignty.
• 1991 Kazakhstan votes to preserve USSR as union of sovereign states. USSR authorities hand control of enterprises in Kazakhstan to Kazakh government. CPK ordered to cease activities in official bodies following abortive August coup in Moscow. CPK restructures itself as Socialist Party of Kazakhstan (SPK). Independence of Republic of Kazakhstan declared; joins CIS.
• 1992 Opposition demonstrations against dominance of reformed communists in Supreme Soviet, now Supreme Kenges. Nationalist groups form Republican Party, Azat.
• 1993 Adoption of new constitution. Introduction of new currency, the tenge.
• 1994 Legislative elections annulled after proof of widespread voting irregularities.
• 1995 Adoption of new constitution broadening presidential powers; referendum extends Nazarbayev's term until 2000; legislative elections.
• 1998 Legislature approves constitutional amendments, including the holding of early presidential election.
• 1999 Nazarbayev reelected president for seven more years.