Kazakhstan’s President Kassym-Jomart Tokayev waves during the opening ceremony of the Beijing 2022 … [+]
POOL/AFP via Getty Images
On January 2, mass protests erupted in Kazakhstan over removing price caps on liquefied petroleum gas (LPG) leading to a 100% spike in fuel costs. It was the beginning of the worst political earthquake the young Eurasian country has seen since its founding in 1991.
Peaceful demonstrations quickly morphed into violent political protests – the worst the country has seen in its 30 years of nationhood. Approximately 225 people were killed, and up to 5,000 were arrested in the ensuing crisis, though that number has since dropped to 2,500.
Kazakhstan is an oil and natural resource-rich country and consequently the destination for a great deal of energy and other investment. Western companies with an economic interest in Kazakhstan such, as Chevron and Exxon Mobil, are now assessing the security of their investments. For now, things seem stable.
Over the last 30 years, Kazakhstan has built a robust relationship with western investors. In 2020 alone, the Netherlands was the country’s largest source of foreign direct investment (5.1 billion USD, 30.1%), followed by the US (2.24 billion USD, 13.12%), Switzerland (1.7 billion USD, 10.4%), the Russian Federation (1.2 billion USD, 7.09%), China (0.96 billion USD, 5.62%) and the UK (0.85 billion USD, 5%).
As of 2022, some 600 US companies are operating in the region with an average of $45 billion in investments. On top of that, Kazakhstan’s cumulative energy investment from 2005 to 2020 was $161 billion, of which $30 billion came directly from the US. This demonstrates the unique economic partnership between the two nations. The US – Kazakh energy relationship is vital as China with its Belt and Road Initiative (BRI), and Russia with its iron ore investments are looking to expand influence in the region. Kazakhstan produces around 2% of the oil that the world consumes daily and makes up 8% of Europe’s oil import supplies.
Kazakhstan also represents 40% of the world’s uranium production. With French nuclear companies such as Orano sourcing directly from the country, this investment remains stable. Europe has been steadily moving toward green and sustainable – with nuclear power and small modular reactors now under the “green” label. Sustaining uranium production out of Kazakhstan remains essential to Europe’s energy security and is likely to grow. These are impressive achievements, which made Kazakhstan the economic leader of Eurasia with an annual per capita income of $11,500 – higher than Russia’s.
The protests were triggered by acute income inequality, aggravated by the involvement of criminal elements and possibly some Islamists. Scenes of looting and killing …….
