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On October 25, 2001 Kazakhstan celebrates its National Day, the Day of

the Republic. This is the year of the 11th anniversary of the adoption of Declaration of Sovereignty that preceded the fully-fledged independence in December 1991. In light of the horrific tragedy befallen the United States on September 11, 2001 the Embassy has chosen to postpone a reception until a later date.

Vol. 4, No. 45, October 25, 2001

Politics

President Nazarbayev addresses the nation of the eve of the holiday

Rural district akims (governors) elected

President hails grain farmers

Kazakhstan to sell grain to UN program to feed starving Afghans

World Bank to provide financing for Aral Sea clean-up

Economy

Kazakhstan 2002 economic growth to be fueled by strong CIS growth

Kazakhoil nine-month output up 11.6%

Head of Canada-based oil company Hurricane Hydrocarbons met with President

Society

Population of Astana nears half-million

POLITICS

President Nursultan Nazarbayev addresses the nation on the eve of the holiday

On October 24, 2001, President Nursultan Nazarbayev addressed the Assembly of the Peoples of Kazakhstan, a non-governmental body set up 6 years ago to promote interethnic peace and accord, with a major speech in which he praised the stability, economic and social reforms in the country in its 10 years of independence, and called for a more socially-oriented economy.

"The most important of the results of these years is that we have overcome economic decline, we have gone from the hardest social and economic crisis and crossed the painful threshold of the reforms of transition economy", said Mr. Nazarbayev. The GDP has grown from 9.8 percent in 2000 to almost 13 % in nine months of this year.

Mr. Nazarbayev underscored Kazakhstan's leading position in terms of social and economic development and reforms among CIS countries, and, according to the international experts and financial institutions, it has overtaken many East European countries on volume of foreign investment per capita.

The President stressed the importance of peace and interethnic harmony in the republic throughout these years, having attributed it to traditional tolerance and good will of the people of over 100 ethnic groups living in Kazakhstan, and praised the Assembly for promoting these values.

Stressing that the "interethnic and spiritual accord is our strategic resource, the basis for progress of our society and state", the head of state called for tougher measures to protect these achievements and said that "the state structures have a task to bar propaganda of any extremist ideas able to disturb unity of Kazakhstan's nation".

"In this connection we have to make amendments to our legislation, to toughen demands of the laws and responsibility for their observation. But we must strictly observe human rights and freedoms that are the main achievementsof our society during ten years of independence.This is our principal position toward fighting extremism and terrorism", stated the President, saying that Kazakhstan fully supports international coalition in fight against terrorism.

(the full text of Mr. Nazarbayev's speech is available at our web site)

Rural district akims (governors) elected

Kazakhstan's first-ever elections of local executive authorities were held on October 20, 2001. The elections, which took place in two rural districts in each of Kazakhstan's 14 regions, were designed as an "experiment" in local self-governance, Central Election Commission officials said. If deemed successful, similar elections will be set up in larger constituencies throughout the republic.

A total of 28 akims (governors) were elected, 17 of whom were incumbents. Four of the new akims were women. A total of 79 citizens contested the 14 different elections, an average of 5 candidates per race.

The elections were not direct; akims were elected at a meeting of electors (similar to the electoral college in the US presidential elections) who had been previously selected for the role.

President hails grain farmers

President Nursultan Nazarbayev sent an open letter this week to the republic's grain farmers hailing this year's bumper harvest. "This outstanding year, as our country celebrates its tenth anniversary of independence, farmers reaped over 18 million tons of grain at an average yield of 14 centners per hectare; that is the highest yield in the republic since the era of "virgin lands" campaign. You have made a worthy contribution to both the country's economic potential and enhancing Kazakhstan's image as a major grain producer in the eyes of the world community," Nazarbaev wrote.

Kazakhstan's harvest totaled over 18 million tons in 2001, up from 12.5 million tons in 2000. This year's harvest is the largest since Kazakhstan gained independence in 1991.

Kazakhstan to sell grain to UN program to feed starving Afghans

The United Nations World Food Program (WFP) plans to buy 17,000 tons of Iranian wheat and 5,000-10,000 tons of Kazakhstan wheat to help assist in the relief efforts in Afghanistan, a WFP official told Reuters on October 23.

World Bank to provide financing for Aral Sea clean-up

On October 22, 2001 the government of Kazakhstan and the World Bank signed an agreement for a USD 64.5 million loan to widen the Syrdarya riverbed to help increase the water level in the Aral Sea. The water level of the Aral has been receding for years due to overuse of the sea's resources and general environmental conditions. The aforementioned loan agreement was signed by the World Bank President for Europe and Central Asia Johannes Linn and Kazakhstan Deputy Prime Minister Uraz Jandosov.

The 20-year loan will have a five-year grace period. Kazakhstan also pledged to earmark USD 21.5 million from the republican budget to help co-finance the environmental clean-up effort.

ECONOMY

Kazakhstan 2002 economic growth to be fueled by strong CIS growth

On October 23, 2001, speaking to reporters Minister of Economy and Trade Zhaksybek Kulekeev said that the government tight 2002 budget foresees a 7% increase in gross domestic product, on top of expected 11-12% GDP growth this year. GDP growth through nine months of 2001 was registered at 12.3%.

Though Kazakhstan's raw materials dependent economy is expected to take a hit as international commodities prices continue to slide, Kulekeev said that strong economic growth in the CIS, which consumes over half of all of Kazakhstan's exports, should help maintain positive growth. The government could also use its USD 1 billion-plus National Fund, which reinvests revenues from oil projects, to pick up the slack if oil and metal prices fall.

The healthy economic growth in Russia, Kazakhstan's main trading partner, will certainly help keep the Kazakhstan economy rolling, Kulekeev said. He also noted that Kazakhstan was in close contact with Russia on the schedule of its entry into the World Trade Organization. "The most positive fact is that the economies of all CIS countries have rebounded, and more than a half of our foreign trade is with these states," Kulekeev said. Combined GDP growth in the CIS was expected to total about 6-7% in 2001, building on 8% growth in 2000.

Kazakhoil nine-month output up 11.6%

National oil and gas company Kazakhoil and its subsidiaries produced 4.9 million tons of oil in the first nine months of 2001, beating last years' nine-month output by 11.6%. The boost in production was credited to the launching of new wells as well as ramped up output at existing wells, company officials said.

Kazakhoil also credited the boost in extraction to the company's aggressive investment this year. The level of investment after nine months of 2001 was 37% higher than the previous year.

Head of Canada-based oil company Hurricane Hydrocarbons meets the President

President Nursultan Nazarbayev on October 22 met with Bernard Isautier, President and Chairman of Canada-based Hurricane Hydrocarbons, a major investor in the oil industry in South Kazakhstan and Kyzylorda oblast (region).

Hurricane Hydrocarbons' Kazakhstan-based subsidiary Hurricane-ShNOS Group will produce six million tons of oil in 2001; over the next few years, oil production at the company's fields is expected to be doubled. In addition, in 2002 Hurricane will open a new 40 MW power station at the Kumkol deposit fueled by associated gas from oil production.

Isautier also noted Hurricane's continuing interest in acquiring a stake in the Caspian Pipeline Consortium's new Tengiz-Novorossiisk pipeline.

SOCIETY

Population of Astana nears half-million

As of October 1, 2001, the population of Astana, the capital of Kazakhstan, stood at 490,646, deputy mayor Nurlan Nigmatullin reported at a briefing on October 19.

Mr. Nigmatullin recalled that in February 1999 that number was just under 320,000, meaning that the growth since that time had amounted to over 150,000. The majority of new citizens, 70 percent, are from 15 to 60 years old.

Originally, the population of half a million people was expected to be reached in Astana by 2010. "But the actual growth outpaces the projected one", stressed Mr. Nigmatullin.

He underlined, however, that the infrastructure of the capital, which is fast becoming the most modern and speedily developing business hub in Central Asia, is sufficient to provide the people with all the necessary communal services.

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News Bulletin of the Embassy of the Republic of Kazakhstan

(Compiled from own sources and various agencies' reports)

Contact persons: Roman Vassilenko, Aibek Nurbalin

Tel.: (202) 232- 5488 ext. 104, 115

Fax: (202) 232- 5845