As a middle power in a dangerous neighbourhood, Kazakhstan might be expected to be under the influence of China, its much more populous neighbour. Kazakhs have long feared a Chinese invasion, or at the least a slow colonisation.
A closer examination suggests Kazakhstan is taking advantage of its strategic location to diversify its partners and pursue its national interests. It could yield some lessons for other middle powers on how to coexist with China.
When it comes to the initiative, Kazakhstan has bent it to its own interests. It offers an opportunity to diversify away from its traditional dependence on Russia. Rather than replacing one dependency with another, Kazakhstan has aligned belt and road projects with its own domestic infrastructure development plan.
The project was supposed to be funded largely by a loan from the usually commercially savvy China Development Bank, but after transferring funds to a Kazakh partner, hundreds of millions of dollars disappeared before the project could be completed and resulted in the departure of the Chinese partners. It was a lesson for the Chinese side about the political risks of doing business in Kazakhstan.
In ensuring these are aligned with its own industrial strategies, projects are geared to local interests. The World Bank has assessed that Kazakhstan could grow its GDP by up to 9 per cent as a result of belt and road investments if the government implements complementary reforms including trade liberalisation and more efficient border crossings.
In response, the Kazakh government has released a list of “55 projects” with Chinese investment which defused the fears somewhat. Concerns about leasing agricultural land to Chinese interests sparked huge protests, and the government has subsequently kept a tight grip on foreign leases.
If it can develop faster and more efficient rail links to major markets, Kazakhstan has potential to reap more value from agricultural exports. It might well need foreign investment to do so. For now, the US is leading the way, with Tyson Foods’ Kazakhstan operations processing and exporting meats to China.
An added benefit for China is that energy supplies from Kazakhstan do not rely on the chokepoint of the Strait of Malacca. During his 2022 visit, Xi pledged China’s support for Kazakh “independence, sovereignty and territorial integrity”. That was a useful declaration given fears that Russia could meddle in northern Kazakhstan, where a sizeable Russian-speaking population lives. A stable Kazakhstan is very much in China’s interests.
The emerging multipolar world order might suit Kazakhstan, with a relatively declining but still dangerous Russia, a growing China and greater connectivity to the Middle East and Europe. Kazakhstan has shown it can assert its own interests – including, unfortunately, its elite kleptocratic traditions – and direct belt and road projects to its own imperative to develop more trade connections across Eurasia.
David Morris is a senior fellow at the Centre for China and Globalisation, and a research fellow at the Corvinus University of Budapest. His research visit to Kazakhstan was funded by the Erasmus+ Programme of the European Union. Twitter @dm_1earth
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