[OUTLOOK]Kazakhstan, where the heat is on

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[OUTLOOK]Kazakhstan, where the heat is on

Ask anybody on the streets if they know where Kazakhstan is and I wonder just how many would say “yes.” I wouldn’t be exaggerating too much to say that not many would be able to locate its specific whereabouts on the map. I have to admit, I used to be one of them. Worse still, I would only remember the suffixes of “stan” when the names of such countries as Turkmenistan, Kyrgyzstan and Uzbekistan were thrown at me all at once. But I recently traveled to these countries, prompted by a genuine curiosity about the raging global energy war. The heat is on, they say, foremost in Central Asia, and I wanted to see this with my own eyes.
Called the second Middle East, the countries along the Caspian Sea have oil reserves of about one third those of the Middle East, as well as massive amounts of a variety of valuable resources, such as natural gas, uranium, copper and manganese. Such richness in natural resources has the United States and Russia wrangling to gain footholds in the region. Recently, China and India have jumped into this deadly-serious race to secure natural resources.
Kazakhstan attracts the highest attention among these countries. If you turn the clock back a little, you would perceive that Kazakhstan was a country without anything to offer. Located in Central Asia where Stalin forcibly relocated ethnic Koreans from the Maritime Provinces, Kazakhstan was also a place where the former Soviet Union conducted its nuclear tests. Of course it was formerly a part of the Silk Road, but it was one vast stretch of barren land within the former Soviet Union. Its fortunes have completely been reversed. In the span of a decade or so, Kazakhstan has grown into a country that speaks its own voice on the global stage. The adoption of an open-door policy, combined with the development of oil fields, has enabled the economy to grow at a rate of 10 percent over the past five years. The gross domestic product per capita is expected to record $3,400 this year, and that figure seems bound to hit $10,000 soon.
While it has a population of 16 million, in land size, Kazakhstan is about 26 times larger than South Korea. In my eyes, Kazakhstan is the fifth-largest potential industrial power, with no less potential than that of Brazil, Russia, India or China. Its population may be small but, with abundant natural resources and a strong leadership, the transition of Kazakhstan’s economy to a market economy has been more rapid than that of South Korea’s.
The key to Kazakhstan’s rise is oil. The world’s major oil companies advanced there a long time ago. Neighboring China is another variable in upping Kazakhstan’s value. Large amounts of “Made-in-China” goods flow in through Urumuchi, and the China National Petroleum Corp. shocked the world with a $4.2 billion dollar takeover of PetroKazakhstan (India unsuccessfully bid $3.6 billion). These illustrations show how hot the global energy race is becoming. Having obviously judged Kazakhstan as the ideal location to make up for its energy shortfalls, China has already completed a trans-border pipeline. Rival India is engaged in various informal negotiations with the Kazakh government in an effort to secure oil fields. The Kazakh government also employs a diversification strategy in order to reduce its one-sided dependence on China.
Visit the new capital, Astana, and you will witness another dimension in the rise of Kazakhstan. In its seventh year of construction, the new capital is nearing completion and is sure to beat out other cities in splendor and grandeur. From an economic point of view, the city makes no sense as it is widely known that nobody really knows just how much it cost to build the presidential palace, the foreign and defense ministry buildings ― all architectural masterpieces on their own. If I were to come up with a comparison, a grand movie set in Hollywood would come close.
Luck also played a part. The construction of a preposterously grand capital would not have been possible if not for high oil prices. Anyway, Astana will be remembered in history as the world’s largest and best administrative capital, built in the barren lands of Central Asia. Nothing beats seeing it with your own eyes. Do travel to Kazakhstan, if you can: it also makes for a great tourist destination.

* The writer is the CEO of the JoongAng Ilbo News Magazine. Translation by the JoongAng Daily staff.

by Lee Chang-kyu
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