The Minister of Agriculture of Kazakhstan Sauat Mynbaev offers to cheapen oil products for the forthcoming sowing by means of oil companies� royalty paid to the national budget not in cash but in the form of crude oil.

The volume of royalty from the oil production to be paid to the budget in the first quarter 2000 comes to about 220 to 230 thousand tons, the Minister said.

Contracts with oil companies provide the collection of royalty in both cash and products, Mynbaev stated.

Most oil companies working in Kazakhstan export oil at understated prices. According to his information, today the average export oil price from Kazakhstan is US$ 130 per ton, while the average world�s price is US$ 200.

Mynbaev explained that the difference gained in the result of sale at the world price comes to 220 to 230 thousand tons, i.e. the royalty volume, may be used to cheapen oil products for the rural districts.

According to this scheme, it is possible to gain 90,000 tons of diesel fuel at a price appropriate to rural producers. This price is equal to the barter ratio: 1 ton of grain to 2 to 2.2 tons of diesel fuel.

Astana, (THE GLOBE)

In 1999 the annual turnover of Kazpochta (the Kazakh post office) was 2.5 billion tenge. In 2000 it is planned to increase the turnover up to 3.7 billion tenge due, as pensions and grants included to the post services.

The present model of the Kazakhstani post office is the connection between the state company rendering a wide range of mail, financial and advertisement services and the non-banking financial organization.

In terms of agent services Kazpochta cooperates with the JSC State Accumulating Fund, Tumar, Oil Insurance Company and the pension fund ABN AMRO. In the last year Kazpochta worked out new main services. The most promising of them are the address and non-address delivery of advertisement materials rendered to corporate clients.

According to the result of the tender, the Halykh Bank allotted US$ 10.4 million to equip Kazpochta with computers.

From March 1, 2000 Halykh Bank is to transfer its functions on delivery of pensions and grants to Kazpochta. From April 1 Kazpochta will take all these deposits, that come to about US$ 12 million. Kazpochta executes remittances to all countries, except Uzbekistan that does not accept them.

Almaty, Feb 28


There is no other way, - Kasymzhomart Tokaev

The Main Way to Raise the Local Production through Foreign Investors


ALMATY, Feb 28


�Today to guarantee foreign investors� rights is one of the government�s priorities,� Kasymzhomart Tokaev announced on February 25 in Almaty. He stressed that Kazakhstan needs foreign investments, because now it is the only possible way to raise the local production. �For the time being there is no other way,� Tokaev said.

The former Cabinet staked on foreign small and middle-sized investors. Such big companies, as Mobil, do not face any significant difficulties in Kazakhstan, as they have connections at the highest level, the Prime Minister thinks. �Investors are to be sure that laws are stable and they will not have to run after ministries and Akims,� Kasymzhomart Tokaev says.

Tokaev considers it necessary first of all to accentuate the economic policy. He called the fight against corruption one of the priorities of his government. According to the Prime Minister, most claims by investors are regarding corrupted functionaries.

It is quite reasonable. However, another question emerges: how the government is going to realize the above-mentioned ideas, if it does not have any accurately based economic program?

The Government is Going to Collect the Oil Royalty Paid in Kind

The Government�s Actions Have Embryos of a Civilized Approach


On Friday the government announced to some oil companies that it was not going to collect a due part of the oil production in Kazakhstan in the form of dividends on oil sales, but as a payment in kind, i.e. by oil, the national TV channel Khabar stated.

Daniyal Akhmetov verbally declared to representatives of a number of companies, including the China National Petroleum Company, the JSC Hurricane KM, the JSC Karazhanbasmunai and others, that according to the contract, the state can collect the royalty paid in kind. He said that the Ministry of Energy is entitled to prepare corresponding documents in accordance with the contracts concluded with each company.

On Monday the Ministry of Energy spokesman said to THE GLOBE that the state is going to gain extra US$ 10 million from this change. The point is that some companies sell oil through the so-called transfers, when the value of the contract in Kazakhstan is sometimes twice less than the real oil prices.

This event is one of few ones, when the government tries to settle the problem in a civilized way according to the contracts concluded with the oil companies, and meets the mood of the Prime Minister Tokaev�s speech before U.S. investors. Anyhow, this is significantly better than the governmental Decree # 1978 restraining the oil export from Kazakhstan to 22 million tons that choked literally all investors. By the way, Tokaev promised to ban this Decree soon.

There is one important aspect: will all oil companies have to pay the royalty in kind? If no, there is a danger of functionaries� arbitrariness. Otherwise, accurate criteria of this or that approach to this problem are to be determined.

Radio Liberty

From the editors: resonance caused by the unilateral delimitation of the Kazakhstani-Uzbek border has not settled down yet. This incident resulted in presenting pending problems by media. They again spoke of interrelations between the Central Asian countries, and in connection with the new Russian leader�s coming � about its interests in the region. The opinion of the foreign analytical center Stratfor that THE GLOBE quoted in January (# 6, 424) is interesting. If Russia manages to introduce order in the country, it will understand that it is possible to capture countries situated southwards with the help of diplomacy, political swindle and an open demonstration of force, according to Stratfor. Of course, it is early to talk of capture, but the coming to power by supporters of the idea of supreme-power in Russia makes us anxious. Many experts state this, including the director of the Kazakhstani Institute of Social-Economic Researches and Prognoses Sabit Zhusupov, who directly says that the opposition in the region is advantageous to our northern neighbor. The expert reminds Batken and the Tajik-Uzbek conflicts. The last years of the previous millenium visually demonstrated the disorder in the region and disclosed the facade of �friendly� relations. Giddiness caused by sudden gaining of sovereignty is ceasing, and the fight for leadership in Central Asia has started. We see that not only regional countries started this fight.

The Kazakh Service of Radio Liberty being a Kazakh media, naturally, could not avoid discussing this topic. In the last week it broadcast opinions of a scientist and a former citizen of the disputable territory � the Bostandyk region. The material does not contain any geopolitics, but it is interesting, as it gives the history of the topic, as well as contains the story by a man who knows moods wandering along the Kazakh-Uzbek border.

Around the border problem

At present independent Kazakhstan has not more important problem that the situation at the Kazakhstani-Uzbek borders. Every second Kazakh discuss this topic. The country�s society pays great attention to this problem and attentively follows the events. The audience of Radio Liberty is not indifferent to the results of this situation. They call to the Almaty bureau, send letters, some of them come. Today Zhanat Akhmadi, the scientist-researcher and the former citizen of the Bostandyk region Kosyl Toganai participates in our program. We think that their opinions regarding this problem will coincide greatly opinions of many Kazakhstanis.

- Akhmadi, you have many documents from the archives. In 1970s for the first time over 50 people appealed to leaders of the country demanding to return Kazakhstan its lands. What can you say about this?

- The land is always the most painful place for people. State documents prove that in 1976 citizens of the Bostandyk region appealed to Dinmukhamed Kunaev asking to take back this region. This appeal was signed by the Hero of the USSR Kaldybai Tynyshkulov, the director of the collective farm Talgat Duisenov and others. Among them were Maulen Abdikerimov and Yerkesh Turlybaev. They both are veterans of the Great Patriotic War. They collected all archives material and came to Kunaev in 1991. That time I worked in the state archives as a senior officer and I personally saw these people to Dinmukhamed Kunaev. Kunaev was surprise how these common people interpreted the issue as true historians. He considered the documents, according to which the Kazakhstani regions had been transferred to Uzbekistan, with them. I remember him saying:

�When the Uzbek administration, having agreed with Khruschov, did its best to gain these lands, I was against of it. Then I was dismissed from my post in the Kremlin and appointed the first secretary of the communist party of Kazakhstan.�

As far as the present situation at the Kazakhstani-Uzbek border is concerned, I would like to say that the country�s leaders are to treat the problem of land, for which many our forefathers shed their blood, in a more responsible way.

- I want to ask Kosyl Toganai. You were born in the Bostandyk region and now you often visit the region. Tell us what the people�s moods are.

- Recently my brother died and I went there to bury him. In Tashkent our relative met us. When we passed the Customs, there was the first police station. They stopped our car with Uzbek numbers and checked our documents. Then the policemen said to our relative who drove the car in Uzbek: �We said you not to bring your Kazakhs!� I was astonished. It appears that they speak of eternal friendship between our peoples, but in fact the situation is different. These acts on quiet may be characterized only as hypocrisy by the people who are considered fraternal.

The problem of the Bostandyk region is not a problem of a separate people, of a country, this is the problem of several republics. That is why is want to thank especially the radio Azattyk that presents our opinion to the international community.

As far as moods of people living in that region are concerned, I want to say that all of them, young and old, care for the land. They do not want anything except to live in their land.

- You know, the multilateral state commission on delimitation of the Kazakh-Uzbek border worked in Tashkent. How do you think, if there were people from the Kazakhstani party who could prove that these lands really belong to U.S.?

- Possibly, no. For the time being there were no such people, because no local head said on behalf of people living there. None of the Parliamentary Houses touched this problem. But there are parliamentarians who can say this, for example, Gani Kasymov and Serik Abdrakhmanov. What is the use to talk of the Akims: neither Muhitdinov nor Nusupov think of the local population. But people are suffering due to these events with usage of weapons, etc. I am surprised with speeches by some politicians who say that this may be the second Karabah in future. I do not understand who needs this. This is an international problem. As a last resort it can be settled with the help of international organizations in a peaceful, civilized way. This land was transferred to Uzbekistan for a temporary usage. But leaders of the countries can also settle this problem without interference by any party. It hurts me that some people, of course, not all people, but many people being at the wheel of our state do not have national consciousness. They do not care for their land and sometimes they think worse that 80-years-old men who live there, at the border.


THE GLOBE based on materials from the Kazakh Service of Radio Liberty

(Translated from Kazakh by THE GLOBE, full text)

Karaganda Power + Antimonopoly Committee = Merely Catholic Marriage

Investment Plan on Power Complex in Karaganda Overfulfilled




A noted trial held in Karaganda. Opponents of the trial were Karaganda Power and the oblast Antimonopoly Committee.

In December 1999 the above-mentioned state body reduced heat and electricity tariffs without prior agreement with Karaganda Power. The latter brought an action against the Committee. The court�s sentence was not in favor of the power company.

On Friday, February 25, the Karaganda Power General Director Ilan Ben Guigui said that these events did not affect the company�s main principle: to settle all disputes by means of negotiations. He added that they their relations with the Antimonopoly Committee are normal � sometimes good, sometimes bad. Nevertheless, the dialogue was not destroyed. Ben Guigui compared their relations with the modern Catholic marriage.

Karaganda Power was established in August 1997 for leasing and usage of the property purchased by Ormat company from the JSC Karagandateploenergo at the open investment tender.

Ormat Industries Ltd. registered by the Tel Aviv stock exchange and since 1965 has been dealing with renewable and long-term energy sources.

When Ormat began its operations, it was found out that thanks to years of irresponsibility and insufficient financing, the technical aspect of the production was in a very bad condition. Temperature in dwelling houses was close to the outside temperature (winters are usually severe in Karaganda � 30� to 40� C. Losses in heating networks were treble than standard. The personnel did not receive salary for 8 months. Karaganda that was the second industrial center in the country with a high demand for power, was at the verge of downfall.

To prepare for the winter 1997-98 Ormat started the intensive repair investing about US$ 7 million for less than 6 months. Ormat also provided Karaganda Power with working capital, as the collection of payments for rendered services was too low. The company had not enough money to purchase fuel and to pay salary regularly. Karaganda Power worked out the general investment plan in the amount of US$ 60 million for 3 to 4 years to improve gradually the efficacy and to modernize generators, transport and distributive equipment. Ben Guigui said that at present that had invested over US$ 30 million.

To finance and to work out this investment project the UK company National Power, one of the world�s leading joint-stock companies was included in the Karaganda Power Group. This company is experienced in development, management and exploitation of power electric stations all over the world. In June 1998 the company bought 50% of shares of Karaganda Power and became an equal partner in the business.

The investment plan includes settling of the problems with power supplies to customers. The company worked out the perspective plan to settle problems of electrification of rural districts in Karaganda oblast.

The Karaganda Power General Director mentioned two main issues that they will have to settle in 2000. First, it is necessary to increase efficacy of registration of supplied energy. The company is incurring significant losses due to unregistered energy. 90% of all electric meters do not meet technical standards. Second, it is necessary to clarify the position of the state supervising bodies.

Today Karaganda Power Group is not profit-making, as the population�s debts are increasing. The collection of payments comes to 2/3 of the total number of customers. Here they again face the tariff problem. Tariffs of electricity are really overstated, but because of a different reason. The Karaganda citizens pay for heat only during the heating season, hence the tariff is high enough. For example, in Almaty people pay for heat all the year round, hence, the amount is evenly divided. Karaganda Power offered the Karaganda authorities to do the same, but this issue has not been settled yet.

Both heat and electricity are vitally important to the population in Karaganda oblast, as winters are really cold and long. Despite everything, the Karaganda Power administration closely cooperates with the local authorities. This makes us optimistic that the reconstruction of the power complex in the Karaganda region will be successfully realized.

7 days in Kazakhstan by Radio Liberty


On February 23 about thousand pensioners gathered in the center of Ust-Kamenogorsk. On that day two parallel meetings were held, one of that permitted by the authorities. The leader of the oblast subsidiary of Pokolenye Nikolai Fomenko said in his interview to Radio Liberty that they have mainly economic demands. The head of the department of the domestic policy, the oblast Akimat Askar Nurgisaev announced to Radio Liberty that pensioners� demands are not feasible at the oblast level, but at the national one.

The leader of Ust-Kamenogorsk pensioners Nikolai Kornienko was repeatedly called to account for his activity. On the last day of February he is again ready to lead people to the town square. Almaty pensioners are also going to hold a meeting.

It is known that main activists of the January meeting summonsed on February 25. Valentina Gugueva and Maria Plahotina got a formal notice and will not be able to participate in unsanctioned meetings any longer. But they announced that they will not obey the court sentence. One of the summonsed activists, the leader of the Working Movement Madel Ismailov did not come to the court. Another hero of the meeting � Dauren Satybaldy was ill and was not present at the court as well.


President Nazarbaev made a speech at the OSCE meeting in Austria. The Prime Minister Tokaev received the Russian Minister of Fuel and Energy Kalyuznhy and met U.S. businessmen. Considering the results of the negotiations, Kazakhstan may join the future Baltic pipeline consortium.


Since the last week Kazakhstan introduced the visa regime with all CIS countries. Only border on the Russian Federation will be opened. First of all Kazakhstan will close the Uzbekistan borders. The Prime Minister Tokaev explains this step as the told by the time.

In the before last week the first round of negotiations with Uzbekistan on delimitation of the border concluded. In the last week Uzbekistan again stretched barbed wire along the undetermined border, that contradicts to the international standards. On Friday the Prime Minister Tokaev severely criticized the event.


THE GLOBE based on materials from the Kazakh Service of Radio Liberty

(Translated from Kazakh by THE GLOBE, brief variant)

84.2% of the Karaganda Population Appreciate the Work of the Power Company



The Institute of Social-Economic Researches and Prognoses polled 450 respondents in Karaganda.

59% of respondents consider the condition of the Kazakhstani economy bad, 21% consider it very bad. 71% of polled people characterized the economy in Karaganda as bad, and 28% - as very bad.

60% of respondents think that companies with foreign participation favorably affect the country�s economy. Among these companies most often they mention Karaganda Power (85%), Ispat-Karmet (77%) and Samsung (27%). 37% of respondents expect the activity of foreign investors to influence favorably the life of common people in the region.

Among profits from the foreign investors� activity people mention restoration of enterprises (46%), creation of new jobs (46%), and provision of supplies of products and services (28%). Among negative consequences there are high prices of these companies� products (70%), reduction of jobs (50%), moral losses (33%), and increased load on workers (23%).

To the question about the level of market prices, 96% of respondents consider heating most expensive, 65% - electricity.

It is noteworthy that 29% of the polled people earn 7,000 to 10,000 tenge, 19% - 3,000 to 5,000 tenge, 18% - 10,000 to 12,000 tenge, 17% - 5,000 to 7,000 tenge.

41.7% of respondents have belated heating bills, 26.4% - electricity bills. Debts of 18% of them come to 10,000 to 50,000 tenge.

They do not pay for municipal services in time because of: insufficient income (68%), delayed salaries and pensions (43%). They agree that suppliers can stop rendering services (51%), to bring an action against them (34%), to deduct debts from debtors� salary and pensions (30%). Every fifth Karaganda citizen knows people who illegally connected to electricity.

84.2% of respondents appreciate the activity of Karaganda Power. On the whole, the Karaganda population says that in this year their houses are heated better than in the previous year, according to the Karaganda Akimat.

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