Ten years ago, Kazakhstan was known for two things – an epic debt-powered construction boom that comprised as much as 8% of the country’s GDP, and the brilliant satirical film ‘Borat’ in which a British comedian portrayed the country as an impoverished and incestuous backwater. The global ‘credit crunch’ of 2007 brought the country’s construction sector to a screeching halt, and its government’s passive-aggressive response to ‘Borat’ provided plenty of free entertainment.
Now Kazakhstan is adopting a new strategy to remain competitive. In June, its government announced agreements with some of the world’s largest IT companies including General Electric, Microsoft, Intel, Hewlett Packard, Samsung, and Huawei. The six technology giants will reportedly join Kazakhstan’s new Silicon Valley-style innovation cluster, the Science Park Astana Business Campus, located within Astana’s Nazarbayev University. Kazakhstan, Central Asia’s largest economy by far, is almost totally reliant on its resources industry and any attempt to diversify its growth is well-advised. Despite its participation in the Eurasian Economic Union, which launched in 2014 with Armenia, Belarus and Russia, Kazakhstan’s economic growth is forecast to slow to 1.5% in 2015 due to slumping oil prices and overall weakness of the Russian economy. However, growth in the coming years is expected to rise buoyed by infrastructure projects as the country gears up to host Expo 2017.