Publication: Monitor Volume: 4 Issue: 194

The proposed changes announced by Kazakhstani President Nursultan Nazarbaev in his September 30 address (see the Monitor, October 1) included the creation of two bodies–a Council of Economic Reform and a State Revenues Ministry. These new institutions suggest the consolidation of an economic policy team in the presidential run-up and certain power shifts in the important area of tax collection.

According to an October 12 decree, Kazakhstan now has a State Revenues Ministry. This Ministry–acting head of which is Beysenghaly Tajikyakov–will define fiscal policy and be in charge of regulating taxation and customs. The official head of the ministry has not yet been defined. The ministry’s creation, though, possibly signals the wresting of power from some of Nazarbaev’s younger recruits. For example, the minister of finance, Sauat Mynbaev, will lose some of his powers over taxation and customs. The minister of energy, industry and trade, Mukhtar Ablyazov, will relinquish his ministry’s powers over the lucrative taxation of alcoholic beverages. Rakhat Aliev’s tax police will almost certainly see a diminution in its hitherto extensive powers to track down economic crimes (Focus Central Asia [Almaty], October 15).

Mynbaev and Ablyazov were somewhat compensated by their appointment to the new Council of Economic Reform, also announced in the September 30 televised national address. This council, according to Nazarbaev, will be headed by the country’s six “top economic officials.” The other four officials in the Council are Nurlan Balgimbaev, present prime minister and the Council’s leader; Uraz Jandosov, first deputy prime minister and chairman of the State Committee for Investments, to act as the Council’s deputy chairman; Alexander Pavlov, deputy prime minister and former minister of finance; and Kadyrjan Damitov, chairman of the National Bank. The Council is indicative of the president’s concern both to see increased state management of the economy and to soften the impact of the world economic crisis.

These changes, meanwhile, detract from a central issue raised by Nazarbaev’s criticism of the government in the September 30 speech. Although Nazarbaev had only some days previously come to the public defense of Prime Minister Nurlan Balgimbaev, he stated on September 30 that “nobody, including me, is satisfied with the work of our government” (Focus Central Asia [Almaty], October 15). This has heightened local speculation that Balgimbaev’s days are numbered. The increased powers promised to the prime minister–notably that it would henceforth be his prerogative to appoint and dismiss cabinet ministers–have yet to be enforced. It is unofficially known that Balgimbaev was Nazarbaev’s third or fourth choice as prime minister last November.–SC

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