Kazakhstan has enjoyed over two decades of robust economic growth and enhanced regional and global integration. However, growth remains heavily dependent on exports of primary commodities, especially fossil fuels, a fact that both reflects and contributes to the limited development of its private sector: exports from non-resource sectors were below 10% in 2020, just as they were in 2013, while small and medium enterprises’ (SME) shares in exports and gross domestic product (GDP) remain below those of regional peers.
Kazakhstan has been diversifying trade, transit, and transport partners to enhance economic resilience. At the national level, Kazakhstan has developed a solid institutional and policy framework to diversify its economy. Particular attention has been paid to export promotion, with the creation of an institutional ecosystem providing firms with capacity-building and financial support (Chapter 2). In recent years, Kazakhstan has also made increased use of digital trade portals to enhance their reach (Chapter 3). At the regional level, Kazakhstan has accelerated efforts to engage with its neighbours to harness the economic opportunities offered by major transregional corridors (Chapter 1). The government has been developing cross-border co-operation (CBC) hubs and has recently focused its attention to the “Caspian Knot” hub, covering Kazakhstan’s two Caspian Sea ports and including a special economic zone (SEZ), in the context of the development of the TITR (Chapter 4).
However, Kazakhstan’s export diversification ambitions have not yet realised their potential benefits. Only a small fraction of Kazakhstan’s SMEs have started exporting, while the effects of export promotion activities are only rarely monitored by responsible public institutions, and policies and tools adapted accordingly. The analysis finds that gaps exist in the current export promotion framework, while its reach and effectiveness can be further improved (Chapters 2 and 3). The analysis also finds that the Caspian Knot has not yet reached its full potential, as gaps in infrastructure and trade facilitation arrangements constrain its development (Chapter 4). Addressing these requires targeted action and to better involve the private sector in policy design, implementation, and evaluation.