Friday, August 5, 2011

The Emerald City

Hello readers!

I am back from visiting Astana, the capital of Kazakhstan and a truly spectacular city. I am back in Almaty for two days and will be flying back to Washington Sunday evening. How time flies! While I do not have time to provide my full analysis of my trip to Astana, I want to share a few comments on the city.

Before I begin, thank you Madina, Beck and Dinara for welcoming me into your city with that famous Kazakh hospitality. Thank you! 

Astana is an incredibly impressive city unlike any other. To the right of the Ishim River, you are in Soviet Central Asia and to the left, you are in the capital of a new Kazakhstan. It reminds me of The Emerald City from The Wizard of Oz, with towering green-blue buildings. From the shanyraks on the park benches, to the Timurid-style blue domes on the houses of parliament to the Kazak Yeli monument that includes a women dressed in traditional Kazakh attire but in the stance of Nike of Samonthrace, Astana crystallizes the new Kazakhstan. Or at least what the new Kazakhstan should be.

Astana is rapidly expanding. According to my tour guide in the Palace of Independence, the population of Astana is currently 800,000 and is expected to grow to 1.5 million by 2030. This is still small compared to other world capitals, and is about the size of the population in the Panama Canal Zone. Currently, the city is only 20-30% complete. By 2015, 50% of the city plans will be implemented and by 2030, 100% of Astana will be constructed. "Come back in 2030, then you'll really be impressed," he remarked. It is easy to be blinded by the glitz and glamor of the new city, but keep in mind that Astana was established as the new capital in 1997. In 33 years, Astana went from a small Russian trade post to a billion-dollar capital of Kazakhstan, a resource-rich country with a population of 16 million representing 130 different nationalities in between Russia, China and a major-transnational drug route (Afghanistan-Europe). Is this massive and concentrated growth sustainable? Kazakhstan confronts many foreign policy challenges and the country is in need of extensive institutional and economic development. I question the sustainability of channeling so much time, money and resources into the capital. Astana has experienced astronomical growth in such a short amount of time. 

Once all the buildings are completed, who will work in all of the new office space in Astana? Who will live in the new houses? Astana was built using foreign expertise. Norman Foster designed five buildings. Korean, Swiss and Arab firms spearheaded the construction and technology. A Canadian firm provided genetically modified trees suitable for the steppe climate. Kazakhstan lacks the human capital necessary for the high-skilled jobs that will be centered in Astana. Moreover, few Kazakhs earn enough money to afford living in the city, which is pricier than most. An unscientific indicator of price levels is the cost of a camca: a camca in Almaty costs 70 TT, 50 TT in Turkestan, and 120 TT in Astana.

I fear in the future, Astana will be the next Abu Dhabi. Abu Dhabi was hit hard by the 2008 economic crash and now has a surplus of real-estate. Similarly, should an economic or political crisis cripple Kazakhstan's growth, Astana's development would certainly suffer. 

Instead of funneling billions of dollars into the new capital, there are a few policy alternatives that would be much more effective in promoting wealth throughout the country. First, raise the salaries for civil servants. Nearly every person I have spoken with complained that people who work for the government receive ridiculously low salaries. Increasing the salaries at all levels of government, from municipal districts to the federal level, will promote efficient bureaucracy and hopefully eliminate corruption. Second, invest in human skill development projects. Take Turkestan. Yasawi's mausoleum is gorgeous but the town is devoid of life. There are also more known artifacts under the ground that have yet to be explored. The state should invest in creating an archaeological program and art-restoration program to train local Kazakhs in how to study art and restore historical monuments. Investment would promote an art and archaeological industry and provide economic value-added to the mausoleum. Finally, invest in infrastructure development. After traveling on the train, I have observed that most of the country still retains Soviet-era infrastructure. Modernize the entire country, do not build The Emerald City on steroids.

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