CIC Occasional Paper No. 12 - Why US-Kazakh Relations are Strong, and Getting Stronger

Copyright July 2006


Introduction

Writing in 1997, Zbigniew Brzezinski, former National Security Adviser to President Jimmy Carter, included Central Asia in his “arc of crisis” - a region stretching from the Horn of Africa to the Indian sub-Continent and containing around three quarters of the world’s energy reserves. During her visit to Kazakhstan in March 2006, Condoleezza Rice, the present US Secretary of State, referred to the region an “arc of opportunity.”

Whether Brzezinksi or Rice turns out to have been the more prescient will depend on a complex interplay of political and economic forces. But it is increasingly likely that Kazakhstan – also described by Secretary Rice as “an island of stability” - will come to play a pivotal role in determining the future of Central Asia. If success crowns the ambitious - but so far, promising - attempt to build a secular democracy and a market economy in a predominantly Muslim country, this is likely have a positive impact on the stability and economic development of the region as a whole; it will also advance essential Western interests. If, on the other hand, the region’s economic and political pace-setter falters, the economic and political prospects for the region would be seriously harmed; US attempts to combat radical Islamic terrorism and to fight drug and people trafficking would also be damaged, along with important US economic interests.

It is this realisation which explains the close relations between the US and Kazakhstan and the rising tempo of diplomatic activity between the two countries over recent months. During this time, a stream of senior US officials have visited Kazakhstan, the most important being the Secretary of State Condoleeza Rice during October 2005 and vice-president Richard Cheney in May of this year.

The vice-president’s visit was followed by an announcement on 8th June that Kazakhstan is soon to sign an agreement to pump oil to the West via the Baku-Tbilisi-Cehran pipeline, thereby by passing Russia and Iran. During his visit vice-president Cheney placed the usual emphasis on the importance of developing democratic institutions as the most effective means of ensuring long-term political stability; but he was more fulsome in recognising Kazakhstan’s achievements since Independence in 1991 than any previous high-ranking member of a US administration.

While last December’s presidential election – in which the Kazakh leader won 91 per cent of the popular vote – did not receive the ringing endorsement from the OSCE/ODIHR that President Nazarbayev had plainly hoped for, there is clear evidence that each election in Kazakhstan represents an improvement on the last. It now seems likely that while continuing to press for further political reform, the US will follow the example of some European states by throwing its weight behind Kazakhstan’s bid to claim the rotating chairmanship of the OSCE in 2009. This is a prize which Nazarbayev believes would provide fitting acknowledgement of his country’s progress. The backing of the United States would effectively hand Kazakhstan the prize it seeks.


US-Kazakhstan relations: the first links

Unlike Russia, which in 1991 cut all ties with the newly independent Republic of Kazakhstan only to seek closer relations with it later in a bid to recover lost influence, America has pursued a broadly consistent policy. It has tried to promote democracy and human rights in Kazakhstan while at the same time seeking to advance its own energy and security interests.

US-Kazakh relations got off to a good start in 1991 when the US became the first country to recognise the newly independent state. Two years later, Kazakhstan was the first CIS state to renounce nuclear weapons. Its announcement was followed by a request to the US to assist in the removal of nuclear warheads, weapons-grade materials and their supporting structures. In 1994, Kazakhstan transferred more than half a ton of weapons-grade uranium to the United States; a year later, it removed its last remaining nuclear warheads and, with American help, sealed 181 nuclear test tunnels. Cooperation over security, arms limitation and terrorism-related issues has been generally good and has recently showed further improvements.

A superficial reading of events might suggest that the stronger ties between the two countries are the result of a pragmatic decision by Washington to attach greater importance to America’s national interests than to the promotion of democratic values. In fact, the development of closer relations may also reflect subtle changes in the way in which the US defines its interest in the Central Asian region as well as some wider political developments. Opinion in the US has generally assumed that its long-term interests would be enhanced by the promotion of democracy and human rights universally; it followed that in the case of Kazakhstan, as in other ex-communist states, there was no conflict between seeking to encourage the growth of democratic institutions and the advancement of long-term US interests in the area of security and energy. Events in Iraq and Afghanistan have, however, resulted in a greater understanding among policy makers in Washington of the difficulties inherent in the rapid introduction of democracy to countries with long traditions of authoritarian or theocratic rule. US policymakers may consequently settle for a slower – some would say more realistic - pace of political change in countries with which it seeks closer ties.

At the same time, it is clear that the “coloured revolutions” in Georgia, Ukraine and Kyrgyzstan have not lived up to the hopes and expectations of their peoples or of Western observers; this has had a positive impact on US attitudes to the administration in Astana. A Bill designed to improve the targeting of US aid to Central Asia currently before the US Congress states: “The 2003 Rose Revolution in Georgia, the 2004 Orange Revolution in Ukraine and the 2005 Revolution in Kyrgyzstan demonstrate the essentialness of steady progress toward democracy and the rule of law. While these revolutions resulted in the ouster of corrupt and ineffective regimes by largely peaceful protest movements, the long term interests of security, stability, good governance and economic growth are better served by evolutionary democratisation.” In its concluding section, the bill applauds the readiness of Kazakhstan to cooperate in the security field, its progress towards a market economy, and its record of ethnic and religious tolerance, concluding that “… a relationship with Kazakhstan is of high importance to the United States.”

Warmer relations with Kazakhstan are also a reflection of events elsewhere in the region; these may well result in a significant change in US strategic thinking. After toppling the Taliban following 9/11, the US sought to extend and consolidate its influence in Central Asia. Military bases were established in Afghanistan, Uzbekistan and Kyrgyzstan. By January 2002, American troops were engaged at 13 different locations in nine countries. Many argued that without permanent military bases in the region, the threat of the Taliban would return. But without resulting in the destruction of the Taliban – which recently appears to have been regrouping - American policy has aroused deep suspicions in Moscow and Peking, thereby limiting effective cooperation with Russia and China in the fight against terrorism, and turning the Shanghai Cooperation Organisation into a potentially anti-US alliance .

Among the direct consequences of this policy has been a race to create military bases in the region as well as greater collaboration between Russia and China, both of which have been able to use America’s evident intention to make its bases permanent as the means to exploit anti-US sentiment. There is now deep antagonism to hosting the US military presence in Uzbekistan - which has called for US military withdrawal following the State Department’s denunciation of President Karimov’s treatment of dissidents - and in Kyrgyzstan, where the new President, Kurmanbek Bakiyev, has said that the rationale for the US military presence must be rethought.

Thus, while Kazakhstan has recently confirmed its willingness to maintain its small but useful and symbolic military presence in Iraq, and the US Ambassador to Kazakhstan, John Ordway, has praised improvements in cooperation in security and anti-terrorist activities as “dramatic”, the reality is that US relations with Uzbekistan and Kyrgyzstan have sharply deteriorated. Critics of the present US policy in Central Asia can consequently point to the fact that relations with Kazakhstan, which has resisted US overtures to provide a military base (and which has opposed the establishment of American bases elsewhere in the region), are far more productive, stable and predictable than with Kyrgyzstan and Uzbekistan, both of which were once anxious to play host to the US military.

The experience of the last decade has equipped US with better tools to measure the progress and reliability of the successor states to the Soviet Union than it possessed in the aftermath of the Soviet collapse. A robust line in democratic rhetoric combined with an expression of independence from Moscow is no longer enough, as Fiona Hall, a Russian and Central Asian expert at the Brookings Institute, has recently pointed out. She has noted: “… no matter what ‘colour’ a new government is perceived to be, it has to deliver.” Unlike the new political leaders in Georgia, the Ukraine and Kyrgyzstan, Nursultan Nazarbayev is a survivor of the ancien regime but, also unlike them, he has delivered - both in terms of raising the living standards of his people and in meeting bi-lateral and international obligations. What Margaret Thatcher once said of Mikhail Gorbachev - that he was a man with whom the West could “do business” – may consequently be said with greater accuracy of Gorbachev’s former protégé, Nursultan Nazarbayev.

In contrast to Gorbachev, whose policies of perestroika and glasnost released forces he did not understand and was ultimately unable to control, Nazarbayev has displayed a shrewd awareness of what is politically feasible. He has also demonstrated a greater instinct for survival. (The Kazakhstan President’s achievements have not gone unnoticed by his mentor; in August 2005, after Nazarbayev announced that he would again run for President, Gorbachev complimented his former protégé for “having the most successful model of society in the post-Soviet space” and for his achievements in implementing socio-economic reforms.)


Economic Ties

The US has an interest in close economic ties with Kazakhstan not only because of its oil wealth - it is currently producing 1.2 million barrels of oil a day and is set to become one of the world’s top ten oil producers by 2015 - but because it believes Kazakhstan’s economic success may have a ripple effect which will assist democratic change and the growth of political pluralism in the region. Urging US business to step up its investment and trading opportunities in Kazakhstan, E. Anthony Wayne, Assistant Secretary for Economic and Business Affairs told the US Chamber of Commerce in Washington on 25th October last year: “Kazakhstan is an important example of hope … As Kazakhstan’s economy continues to develop, it will be an engine for growth within Central Asia. Its neighbours - Kyrgyzstan, Tajikistan, Uzbekistan and Afghanistan - would benefit immensely from Kazakhstani investment and energy exports to create jobs.” For that reason, as Wayne made clear in his speech, the US has applauded President Nazarbayev’s plan to make Kazakhstan one of the world’s 50 most competitive countries as “an ambitious an admirable goal.”

That ripple effect could conceivably extend beyond the Caspian. One American analyst reported that during a visit to Astana in March 2004, “several senior Kazakh officials made a point of letting me know (with considerable satisfaction) that I had just missed running into the Russian presidential adviser, economist Andrei Illaronev, who had just been on one of his frequent trips to Kazakhstan capital to ‘see what to do and how to do it!’ ”

To date, US investment to Kazakhstan exceeds $9 billion and there are over 100 American companies active in the country. US exports to Kazakhstan peaked in 2004 when they exceeded $600 million. Chevron’s and Exxonmobil’s investment in the huge Tengiz oilfield are the largest; AES Corporation and Phillip Morris are also major investors. Kazakhstan purchased goods and services valued at US $320 million from the US in 2004 and shipped $540 worth of exports, mainly energy related, to the United States.

Between 1992 and 2005 the US government provided Kazakhstan with more than US$1 billion in technical assistance and investment support with the aim of assisting market reform and promoting political pluralism. Under the US-Kazakhstan Programme for Economic Development (PED) – an offshoot of the Houston Initiative which was conceived during President Nazarbayev’s visit to the US in 2001 - Kazakhstan will become the first country to share directly in the costs of a foreign assistance programme. During the first year of the programme, which was formally agreed in May 2006, Kazakhstan will provide 25 per cent of the costs rising to 50 per cent in the fourth and final year of the programme; its aims are to sustain the country’s high level of economic growth, to strengthen democratic institutions and to improve the quality of health care.

Kazakhstan’s economic growth has been assisted by the development of human capital, a process in which the US has made a significant contribution. Kazakhstan’s national strategic plan – “Kazakhstan 2030” – was drawn up in 1990 with the help of a team of Harvard economists. Under the Bolshak (“The Future”) Programme, the country’s best and brightest students are able to attend foreign universities, including those in America.

In 2005 there were 6,716 fully-financed places on the programme, with the largest groups of applicants seeking to study respectively in the United States (2,006), Great Britain (1,704) and Russia (1,184). As a consequence of the Bolshak programme, which has already produced a number of middle-ranking ministers, Kazakhstan now has a new and Western-educated elite in both government and the private sector. A series of high-level international conferences such as the Eurasian Media Forum, in which US speakers including Henry Kissinger and Richard Perle have been keynote speakers, have extended contacts with influential Western public figures and led to the development of a small but growing body of international admirers. As Fiona Hill commented: “… Kazakhstan is not just ‘another stan’ and Nazarbayev is not just another Central Asian dictator. In fact, Kazakhstan is emerging as one of the more advanced and substantial states in post-Soviet Eurasia – more akin, politically and economically, to Russia and the Ukraine than to its other Central Asian neighbours – and it should be viewed as such.”


“Hard” versus “Soft” power

The US is frequently accused by its critics, especially those in Western Europe, of failing to use “soft power” effectively in order advance Western interests, and of relying excessively on “hard power.” But Kazakhstan contradicts this perception, and provides a striking example of American “soft power” being combined with high levels of US investment to contribute greatly to the transformation of an impoverished Soviet backwater into one of the fastest-growing economies in the world.

Over the last five years, Kazakhstan’s GDP has grown at almost ten per cent per annum; it means that its economy is larger than that of all the other countries of Central Asia and the South Caucasus combined, while the proportion of those living below the poverty line has fallen to around 16 per cent compared to 30 per cent in 2000. This process - which could not have happened without shrewd political leadership and a high degree of adaptability on the part of Kazakhstan’s people - has in turn led to the growth of civil society and the emergence of a professional and business middle class. Societal change now provides a solid basis for further political reform.

If US policy sometimes appears to rest on a balance between the promotion of democratic reform on the one hand and the pursuit of national interest on the other, a no less delicate balancing act (or set of balancing acts) is required of Kazakhstan. Kazakhstan is strongly dependent on US investment, technical and economic advice; US assistance is also important if it is to achieve early success in its application to join the WTO. But it must also maintain good relations with Russia and China. It is a measure of Nazarbayev’s diplomatic and political skill that he has maintained good relations with all three. The key has been to ensure that energy companies of all three countries have been involved in major production deals; furthermore, by developing a multiplicity of pipelines none are in a position to monopolise energy routes. The same balancing act is required in the security field: Kazakhstan has signed a “Partnership for Peace” agreement with NATO but has been an active participant in the meetings of the Shanghai Cooperation Organisation and acted as the catalyst in the creation of a regional security organisation, the Conference on Interaction and Confidence Building Measures in Asia (CICA). Like the US, Russia and China have an interest in Kazakhstan’s continuing stability; Nazarbayev’s policy of international engagement and constructive dialogue is intended to serve as a reminder of just how important his country is to the wider stability of the region.


Conclusion

US-Kazakh relations are close and improving; they perhaps serve as a pattern for future relations between the US and the states of Central Asia. Kazakhstan accepts that America has a legitimate role in seeking to influence trends in a region which has become economically and strategically more important, but which nonetheless faces serious problems. However, because of the danger that US policy may arouse suspicion and hostility among its neighbours, Kazakhstan believes that US policy goals should be pursued through cooperation with strategic partners with whom it shares basic interests. In the words of Kanat Saudabaev, Kazakhstan’s ambassador to the US: “Central Asia is still plagued by drug and human trafficking, poverty, and, in some areas, Islamic fundamentalism. Human rights problems and corruption still persist. But the causes and impact of these problems extend far beyond our region. The United States cannot flee from the challenges posed by these conditions, and these challenges cannot be met without competent regional partner s… Kazakhstan is the logical and solid lynchpin for this effort and is eager to expand cooperation with the United States.”

For its part, the US is likely to press Kazakhstan to continue along the path of democratic reform. America’s goals consequently remain the same, but recent developments suggest that these will be pursued more pragmatically. Events in Iraq and Afghanistan have demonstrated the difficulties of imposing democracy from the top down, while the so-called “coloured revolutions” have shown the superiority of an evolutionary process of democratic change over “popular” political upheavals. Along with the deterioration in relations with Uzbekistan and Kyrgyzstan, these developments mean that Kazakhstan’s value as an ally has grown appreciably. In a region where it is not exactly spoiled for choice, Kazakhstan is the best strategic partner that the US is likely to find.