Washington’s potential hidden ace in rift with Russia: Kazakhstan

Because the U.S. sanctions on Russia over its invasion of Ukraine tighten, greater than 300 U.S. firms pulling out of Russia are seeking alternate options to arrange their regional headquarters. Kazakhstan could show to be the most effective wager, each from the financial and geostrategic perspective. This largest Central Asian nation is second solely to Russia in terms of pure assets — from oil to titanium, an integral part for each the medical and airplane industries, particularly after Boeing lately suspended titanium purchases from Russia. Kazakhstan can be the biggest uranium producer on the earth.

With meals shortages looming, significantly in Africa, as a consequence of rising prices and vital cuts in exports from Russia in addition to restricted entry to delivery ports for Ukraine, Kazakhstan — with its agricultural capability — may also help ameliorate these shortages. Earlier this week Roman Vasillenko, Kazakhstan’s Deputy Overseas Minister, invited firms exiting Russia to maneuver their manufacturing to his nation. He said emphatically that, “Kazakhstan doesn’t wish to be behind a brand new iron curtain.”

An elevated enterprise presence by america and Europe will surely assist Kazakhstan to maintain itself from falling beneath the brand new iron curtain — and boosting cooperation may assist cut back present world provide chain considerations attributable to Russia’s struggle in Ukraine.

This land-locked nation, positioned in one of many world’s hardest neighborhoods between Russia and China, has a lot to supply U.S. and Western companies. And the Kazakhs are eager to develop equally robust ties with the West and the U.S.

Recognizing Kazakhstan’s potential, in September of 2020, the U.S. Chamber of Commerce introduced the launch of the U.S.–Kazakhstan Enterprise Council.

A worldwide push is on to safe critically wanted uncommon earth minerals, and Kazakhstan ranks amongst the world’s main nations with reserves of chromite, wolfram, lead, zinc, manganese, silver, and uranium — with a big reserve of bauxite, copper, gold, iron ore, coal, pure fuel, and petroleum. The nation is poised for a uncommon earth minerals growth, with companies comparable to Glencore, Stans Power, and Greenland Minerals & Power main the exploration.

There are a number of points the U.S. may deal with instantly that might assist solidify good will in Kazakhstan and assist facilitate the entry of Western companies.

The U.S. has exempted the Caspian Pipeline Consortium (CPC) from the sanctions towards Russia, however the Atyrau-Samara pipeline, which accounts for 18 % of Kazakhstan’s oil exports and is operated by nationwide firm “KazMunayGas,” may face financial prices. Disconnection of key Russian banks from the SWIFT cost system severely hinders Russian firms’ skill to pay Kazakh exporters — and plenty of Kazakh firms are dealing with the issue of so-called over-compliance, when merchants droop transactions to keep away from any cost and insurance coverage dangers attributable to worldwide sanctions.

Hollywood expressed help and noticed second of silence for Ukraine through the 94^th Academy Awards, however it could do extra. Whereas the Hollywood studios are placing new film releases and tasks on maintain in Russia, the business may additionally resolve to bypass Russia’s holding copyrights and award buying and distribution rights on to Kazakhstan, which at present has to request them and purchase them from Moscow.

Kazakhstan has had its personal challenges, however solely two weeks in the past, President Kassym-Jomart Tokayev introduced a set of reforms triggered by the unrest in January. The measures embrace a change from “superpresidential” rule to a presidential republic with a powerful parliament, ending the cronyism of the Nazarbayev period by banning the closest family members of the president from holding political or government positions, and modifications in electoral legislation to safe formation of a multi-polar aggressive and merit-based social gathering system. 

Solely time will inform how significantly such measures will likely be applied, however a strong financial rapprochement between the U.S. and Kazakhstan would additionally considerably assist these efforts — and could be a blow to Russia, one Putin definitely did not anticipate.

Sasha Toperich is senior government vice chairman of the Transatlantic Management Community. From 2013 to 2018, he was a senior fellow and director of the Mediterranean Basin, Center East and Gulf initiative on the Middle for Transatlantic Relations, on the Paul H. Nitze Faculty of Superior Worldwide Research at Johns Hopkins College in Washington, D.C.

Debra Cagan is distinguished power fellow on the Transatlantic Management Community. Beforehand she labored as a profession State Division diplomat and Protection Division official from the Reagan to Trump administrations, together with serving as deputy assistant secretary of Protection for Coalition, Peacekeeping, Humanitarian and Catastrophe Reduction; senior director of European, Russian and Eurasian safety points; particular adviser for Strategic and Nuclear Coverage for Europe; senior adviser to U.S. and NATO navy officers. Cagan additionally led negotiations for a extremely enriched uranium settlement with Russia and headed coalition affairs for Iraq and Afghanistan.