With new dovernment into the year

It is worth mentioning that there is a phantom in Kazakhstan, which regularly circles the country; the phantom is the dismissal of the government. Usually it appears right after the formation of a new government and terrorises the worn nerves of our ministers until their resignation. Some observers apparently noticed a seasonal pattern in the activity of the phantom, in that it is active in autumn and at the beginning of every year. However, the longstanding governmental member Danial Akhmetov has been dispelling such conjectures for a long time, which are usually of little importance anyway, given that the President is the single decision maker for important political issues. That is why the decision to dismiss the government took place when people got tired of discussing it and most politicians conceded the invulnerability of Akhmetov.
However, considering the fact that after the government of Akezhan Kazhegeldin, virtually all succeeding governments were only technical bodies without a serious political essence, I still cannot understand the artificial excitement in Kazakhstan, which is always centred on the possible change of the government and its head. In a political system with a strong President, the role of Prime Minister and his team is fundamentally secondary. This has its advantages and disadvantages.
Continuity in the implementation of socio-economic programs approved by the President is an advantage. It means that the dismissal of the government and arrival of a new Prime Minister doesn’t imply cardinal revision of the strategy of transferring the economy of the country into a non-resource based mode. Only insignificant corrections of the chosen course can take place. That is why whoever replaces Danial Akhmetov, whether or not it is Karim Masimov, it is only a technical movement on the level of technical figures, however strong the latter is. It is true that such movements change the balance of power among the competing elite groups, but the fundamental preservation of the balance is in the hands of the President.
With respect to the disadvantages, the most important of them is the lack of independence and creativity of the government, which always waits for directions from above. It has reached the extreme when parts of the government’s functions are undertaken by the Security Council and the Administration of the President.
Of course, one can guess at the true reasons for the dismissal of Danial Akhmetov and his government for a long time. One naturally remembers the demonstrative argument between the Prime Minister and the major bankers of Kazakhstan before the President’s eyes at the Congress of Financiers of Kazakhstan in November 2006. Interestingly, the President had a meeting with bankers, including the critics of Akhmetov, on 3rd January. Some people would view the reason as the inability of the government to hold inflation down. Others would consider the government’s implementation of the industrial-innovation program to be obviously slow. In addition, some individuals would view the dismissal as a result of the parliament starting to participate in the formation of the government after the creation of the “NurOtan” party. There may be many hypotheses, but one thing is clear. The new government and new Prime Minister will only take the baton from their predecessors and move in the same direction, though probably at twice the speed.
One of the tasks of the government in the economic sphere will be to create favourable socio-economic conditions for Kazakhstan to enter the WTO. This automatically implies more active implementation of the industrial-innovation program and a reduction of the natural resource share in the export structure of the country. With all that, taking into account that, from last summer, all resource revenue is transferred to the National Fund rather than the state budget, the new government will have to conduct tax reforms more thoroughly and search for other sources of finance for the state budget. In addition, this must be done without harming social policy, which should preserve the high legitimacy of the government until the parliamentary elections in 2009, especially in case of realisation of the project “successor”.
Recently, under the aegis of the World Bank, institutional economic experts Kifer and Shirley conducted research into the economic competitiveness of 84 countries. The conclusions were interesting, though not in the favour of many states, including the former Soviet territory. In particular, the thesis that states that develop better are not rich in natural resources has been known for a long time. However, the fact that even the countries where economic policy seems to be correct are not always considered to be truly competitive should alarm our policy makers, who narcissistically speak of Kazakhstan’s economic leadership and new economic programs. It appears that the competitiveness of a country is primarily defined by the presence of a stable and transparent system of rules, which does not change on the whim of some political and business groups, depending on their particular interests and the current political state of affairs. Even if we agree with the argument of the Nobel Prize winner in economics Joseph Stiglitz that the conclusions and recommendations of the World Bank didn’t always correspond to the real economic requirements, the thesis of Kifer and Shirley has real evidence proving its validity.
However, three dates in the activity of any government in the history of sovereign Kazakhstan were always important. First is the first week of a new Prime Minister and his ministers in the office. Usually at this time, the “new broom” method is used; that is, a lot is spoken about a reinvigorated approach and new plans, predecessors are praised (amid minor criticism of some defects), and the continuity in the implementation of the President’s strategy of economic development is assured. At this time, the main intrigue is the composition of the new government, especially if some new faces are involved. This is also informative about the length of the President’s governmental reserve bench.
Then there are the first hundred days. This is a more important time in the activity of the government, because usually by this time everybody understands who is worthy of what and where everything goes. The final date is the end of the government, or just another dismissal. Many of those who excitedly discuss the figure of the new Prime Minister and gossip about the old one, those who, with the same enthusiasm, study every newly assigned minister searching for a fine political intention, usually forget that there is a power in Kazakhstan that is more influential than any government. It is the apparatus of the state, which often runs free. Because in the whirling of the personnel movements, only the bureaucratic apparatus stays unshakable, including its middle and low chains, which directly participate in the implementation of all those beautiful socio-economic programs, which solemnly descend from above. The ministers come and go, but the apparatus stays!
The main problem of all Kazakhstan’s governments is that this executive body has lived its own life while the bureaucratic apparatus lived its own. This happened when Sergey Tereshenko was in office, as well as Imangali Tasmagambetov and Danial Akhmetov. By the way, during the times of the latter, a recent example is the attempt to legalize property, which almost failed.  In this case, the lower administrative chains were accused, while they themselves didn’t understand what did the President and the government wanted from them. Another example is the well known statement suggesting that some lower governmental structures engaged in sabotage, which, according to the point of view of the ex-minister of justice, impeded the creation of public service centres.
As once was noted by Enzo Maravati, the head of the TACIS program for the Investments Committee of the Ministry of Industry and Trade, there are universal parameters that influence the investment attractiveness of any state. These are the efficiency of its bureaucracy, a high level of information accessibility, an independent judiciary and a low level of corruption. With respect to the latter, Kazakhstan, according to the assessments of experts, is ranked around the middle, in terms of the level of bribery and provision of groundless privileges. Even the suspicious tenders are an example, without mentioning anything else. Besides, an important role is played by innovations, proper logistics for the accessibility of local products on the international markets and serious investments in human capital. These parameters underlie the economic success of Hong Kong, Singapore and South Korea.
Thus it appears that applying for the list of competitive countries of the world is only the beginning of a long and hard job, which not everyone can finish. Although according to the last report of the World Bank and an international financial corporation, Kazakhstan is ranked 62 in terms of the easiness of running a business, which is even better than the ranking of Russia. However, according to the technological index of the Worldwide economic forum, we are only ranked 77. In addition, according to UNESCO, the expenditures of Kazakhstan on scientific research in experimental design development are 11,4 USD per capita, which is 87 times less than in small, non-resource based Israel.
After all, it is not only about the creation of institutes of development or attracting investments into the innovation sector. It is about a serious reform of the political and judicial systems, which should make the rules of the game for the public, government and business not only clear but fair. Eventually, the absence of fairness leads not only to sharp social stratification but also to the danger of changing of contracts. At the same time the unclear and shady rules of the game are based on a weak system of management skills within the bureaucratic apparatus. There appears a strange situation in Kazakhstan, where some parts of the bureaucratic apparatus more or less meet the international standards of state governance, and the rest, which makes up the majority, are absolutely inefficient. As mentioned above, there is a danger that the lower chains of the administrative world of the country will be absolutely unreceptive to the innovations embarked upon from above to increase the transparency and effectiveness of the governance system.
All of this means that another important task for the new government and the Prime Minster is the continuation of administrative reform, which officially started last year, though it is still unclear how successful it has been. Moreover, it seems that this reform will be slowed down and gradually stopped by the apparatus itself, although one of the goals of the reform is to increase the authority and independence of the departments and akimats in making managerial decisions. Without the reform, however good a manager the Prime Minister is and however clever the government technocrats are, the implementation of all the socio-economic programs would spin the wheels free, causing disappointment in the population, criticism from the parliament and the discontent of the President.