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					                                                    ASTANA CALLING
                                                    A bi-weekly online publication of the Ministry of
                                                     Foreign Affairs of the Republic of Kazakhstan
                                                                      www.mfa.kz
                                                                       Issue #18
                                                               Friday, 4 December 2009




OSCE Member States Agree to Consider Summit Next Year
(In Athens, Greece all but transfers chairmanship to Kazakhstan)

UN Declares August 29 International Day against Nuclear Tests
(The day when Semipalatinsk nuclear test site was closed forever)

Financial Experts Say Kazakhstan’s Economy Turns toward Growth
(Signs of modest economic gains this year, helped by early stimulus measures)

Kazakh Companies Weather Crisis, Eagerly Waiting Next Year
(Magazine publishes rating of top 100 companies in Kazakhstan)

Kazakhstan Will be in the Spotlight in South Korea Next Year
(Ties between two countries to strengthen further)

Almaty to Be Capital of Islamic Culture for Asia in 2015
(Morocco-based ISESCO makes decision, recognizes city’s role)

OSCE Member States Agree to Consider Summit Next Year
       Member states of the Organization for Security and Cooperation in Europe (OSCE)
                                       expressed willingness to consider a summit next year
                                       during     Kazakhstan’s      chairmanship   in   the
                                       organization. The decision was made at the 17th
                                       Council of Ministers of Foreign Affairs of the OSCE
                                       in Athens on December 1 and 2.
                                               “We welcome Kazakhstan in the 2010 OSCE
                                       chairmanship, the first ever to be exercised by a
                                       Central Asian OSCE participating State. We note
                                       with interest its proposal to hold an OSCE summit in
                                       2010. We point out that such a high-level meeting
                                       would require adequate preparation in terms of
                                       substance and modalities. We task the Permanent
                                       Council to engage in exploratory consultations to
                                       determine the extent of progress on the OSCE agenda
                                       to inform our decision,” the Council of Ministers of

                                           Foreign Affairs of the OSCE, a key decision-making
                                           body of the organization, said in a Ministerial
                                           Declaration on the OSCE Corfu Process.
                                                  In that declaration, member states agreed to
further the Corfu Process, which aims to tackle European security challenges with concrete steps

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to restore confidence. The process was launched following the informal meeting of OSCE
foreign ministers on the Greek island of Corfu last June.
        “The vision of a free, democratic and more integrated OSCE area, from Vancouver to
Vladivostok, free of dividing lines and zones with different levels of security remains a common
goal, which we are determined to reach,” said the 56 foreign ministers in the declaration.
        In addition to this declaration, the ministers also adopted three more declarations and 15
decisions, including on strengthening dialogue and co-operation on energy security, on women’s
participation in political and public life, on assigning the 2012 OSCE Chairmanship to Ireland
and making Australia the Organization’s 12th Partner for Co-operation.
        They also decided to hold the next annual ministerial conference in Astana on December
1 and 2, 2010, as well as an OSCE high level conference on tolerance and nondiscrimination,
also in Astana, on June 29 and 30, 2010.

        Why the Summit?
        The idea of an OSCE Summit was first suggested by Kazakhstan’s President Nursultan
Nazarbayev last October during a visit to Astana by French President Nicolas Sarkozy.
        2010 will the 35th anniversary of the Helsinki Final Act, the 65th anniversary of the end
of Word War II and the 20th anniversary of the Paris Charter for a New Europe.
        “All of this gives a good reason to at least seriously analyze the modern role of the
Organization in ensuring security and prosperity in the area from Vancouver to Vladivostok and
developing the most important priorities for the OSCE for the near future,” Kanat Saudabayev,
Kazakhstan’s Secretary of State – Minister of Foreign Affairs explained at the closing press
conference after the ministerial meeting.
        The subjects for the summit could be pressing issues such as the future of the Corfu
process and the creation of a single trans-Atlantic and Eurasian security architecture, the issues
of tolerance and nondiscrimination and the rehabilitation of and assistance for Afghanistan.
         “We are convinced that today, 10 years since the Istanbul summit, a moment has come
when our top leaders should at the highest level assess current challenges for our countries and
define the most important priorities for ensuring security and prosperity in the area from
Vancouver to Vladivostok,” Kanat Saudabayev said.
        “We hope to continue working fruitfully together during Kazakhstan’s chairmanship both
on organizing an OSCE high level meeting, and on strengthening and developing our
organization in general,” he stressed.

        Kazakhstan’s Commitment to Principles and Values of OSCE
        Kanat Saudabayev said Kazakhstan is “fully committed to bringing a worthy contribution
to strengthening and developing the OSCE” during its chairmanship next year.
        “As chairman-in-office, Kazakhstan will be unwaveringly committed to fundamental
principles and values of the OSCE, and proceed from the interests of all its members in order to
strengthen the trust and mutual understanding between the countries to the west and to the east of
Vienna,” Kanat Saudabayev said. “We will seek to ensure the balance of all three baskets of the
Organization’s activities,” he stressed.
        He praised the Greek chairmanship for a “truly breakthrough performance” and its launch
of a dialog on the future of European security under the Corfu Process. He expressed
Kazakhstan’s readiness to build on the arduous efforts to promote this process.
        The OSCE should be relevant as an effective mechanism of regional implementation of
universal international legal documents in areas such as maintaining military and political
security, promoting conflict resolution and post-conflict rehabilitation, economic and
environmental cooperation, and the protection of human rights and democratization, Kanat
Saudabayev said, as he specifically noted the need for the OSCE to counteract threats coming
out of Afghanistan.
        Kanat Saudabayev added he visited Kabul recently, signing an agreement under which
Astana will allocate 50 million dollars to educate 1,000 Afghans at Kazakhstan’s universities.
“We would like to bring our own contribution to involving the Afghans in the peaceful life.”

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        “Today we made history,” Greece’s Prime Minister, Minister of Foreign Affairs and
outgoing OSCE Chairman-in-Office George Papandreou told the reporters at the press
conference. “But we are still at the beginning. There are hurdles ahead.”
        During a symbolic handshake with Kazakhstan’s Foreign Minister, Papandreou wished
him luck as the next chairman, saying that while this role for the country is challenging, it is also
a very interesting one.
        Kazakhstan formally assumes the one-year rotating chairmanship on January 1, 2010.
The country’s foreign minister will then act as the OSCE Chairman-in-Office.

UN Declares August 29 International Day against Nuclear Tests
       The United Nations General Assembly approved unanimously a resolution put forward by
Kazakhstan proclaiming August 29 the International Day against Nuclear Tests.
                                                       The resolution, approved on December 2, is
                                                devoted to promoting global public awareness of
                                                the negative consequences of nuclear test
                                                explosions and the need to stop them. It invites
                                                various actors to commemorate this date annually.
                                                       The date chosen for the International Day
                                                against Nuclear Tests is deeply symbolic as it is
                                                the day that Kazakhstan shut down the world’s
                                                second largest nuclear test site at Semipalatinsk in
                                                1991.
                                                       On August 29, 1949, the Soviet Union
                                                conducted its first nuclear test at that site. During
                                                four decades the Soviet Union conducted over 450
                                                explosions at this site which ruined the lives of
                                                more than 1.5 million innocent people and
                                                irradiated vast areas of once fertile land. The
                                                 official closure of the site by the decree of
                                                 President Nursultan Nazarbayev on December 29,
                                                 2009, based on the will of population, set the
stage for the unilateral and voluntary renunciation of Kazakhstan’s nuclear arsenal, the world’s
fourth largest. The country had possessed 104 SS-18 intercontinental ballistic missiles, each
tipped with 10 nuclear warheads.
       In cooperation with the United States under the Nunn-Lugar programme, Kazakhstan rid
itself of these nuclear weapons and the associated infrastructure. Both the US Senate and House
of Representatives have called Kazakhstan’s cooperation with the US in this area a model for
such efforts by other states. This bold move and continuing leadership have contributed to global
non-proliferation of weapons of mass destruction.
       Speaking in Semipalatinsk in June 2009 at a public rally to commemorate the 20th
anniversary of the last nuclear test at the Semipalatinsk test site, President Nazarbayev called on
the international community to commemorate August 29 as the day of the struggle for a nuclear-
weapons-free world. His call has now been heeded and the vision translated into a UN
resolution.
       Activities on the International Day against Nuclear Tests are intended to help accelerate the
entry into force of the Comprehensive Nuclear Test-Ban Treaty. Such events would be similar to
a joint Kazakh-Japanese exhibition "Against Nuclear Arms", organized at the UN in New York
in August and September of this year. It told tragic stories about the consequences of the
existence of nuclear weapons, as well as emphasized the importance of achieving a nuclear-
weapon-free world. Describing it as a powerful exhibition, the UN Secretary General Ban Ki-
moon said: “These are just some of the real life experiences that should compel us to act.”




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Financial Experts Say Kazakhstan’s Economy Turns toward Growth
       Kazakhstan’s economy is on the right track to overcome the crisis, international financial
experts say in a recent report.
       Thanks to the recovery of the extracting industry, active crisis management, the doubling
of oil prices and the successful anti-crisis plans, Kazakhstan’s economy turns upwards, the
British financial research institute “RIA Capital Markets” said in their analysis.
       Progress in the extracting industry boosted the Central Asian country’s economy and
generated increasing interest among international investors. “The growing price for crude oil
relieved the pressure from the Kazakh economy”, says Harald Eggerstedt, consultant of ‘RIA
Capital Markets’ in an interview to the Austrian economy magazine ‘Wirtschaftsblatt’.
       He noted the government’s
successful efforts to restructure the
banking industry, which were taken at
the appropriate moment and already
show the first results.
       This      confirms       government
forecasts which in June had announced
that by the end of 2009 the country
expected a growth of 2% in the fourth
quarter against the same period in 2008.
       Government’s         efforts     are
beginning to take effect. In June 2009,
Kazakhstan’s Economy Minister Bakhyt
Sultanov had announced that, despite the
ongoing global crisis, Kazakhstan’s
economy had grown 1.4 percent in the
first half of the year compared to the same period last year. Agricultural production output grew
by 2.7 percent and capital investments showed an increase of 7.3 percent on the same period in
2008.
       “I think that Kazakhstan took the right decisions to restructure its banking sector to make it
more efficient,” said Mr. Eggerstedt.
       The analysis of credit default swap spreads proves the decreasing risk for investors. “One
year ago Kazakhstan was almost on the brink and now signs demonstrate that its economy
returns to stability,” noted Mr. Eggerstedt.
       This viewpoint is also supported by leading international banks such as ING Direct and
Commerzbank. They currently advise investors to buy shares not only in the extracting industry,
but also in the banking sector.
       Kazakhstan’s stock exchange also shows signs of recovery. This year, it saw a growth of
85 percent, which is more than twice the MSCI Emerging Markets benchmark.
       Soon after the first indicators of the crisis appeared, the government of the Central Asian
country reacted promptly and took actions to stimulate its economy. It created the Samruk
Kazyna fund – a merger of the Samruk and Kazyna funds - which supports new investment
projects. The government also used more than 18 billion dollars out of its own reserves and the
National Fund, the ‘rainy day’ fund accumulated over the past nine years from excess revenues
from extracting industries. The money was used to implement the stimulus package and to
support the banking, agriculture and housing construction industries.
       In order to boost the domestic economy, the government’s second crucial measure was to
accelerate its diversification through the extensive ‘Road Map’ program which supports non-
extracting industries including manufacturing, agriculture, electricity, IT and transport. The
program already created about 240,000 new jobs.

Kazakh Companies Weather Crisis, Eagerly Waiting Next Year
     One of Kazakhstan’s leading specialized publications, Expert-Kazakhstan magazine
published a rating of top 100 companies in the country saying they saw a robust growth of
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almost 35 percent in 2008, the last year data is available, while this year they are expected to
show either zero and slightly positive growth.
      The rating, the first of its kind, was unveiled during an economic forum in Astana on
November 30. The study is supported by the Government of Kazakhstan. The main purpose of
the rating is to analyze the main trends in the economy and offer proposals for improvement of
economic policies.
      The research which underlies the studies have shown that total revenues of Kazakhstan’s
100 biggest corporations in 2008 increased by almost 35 percent compared to 2007 against
annual inflation of 9.5 percent. Total revenues of Kazakhstan’s top 100 companies amounted to
72.6 percent of the country’s GDP.
      According to the rating the companies will continue to grow, while state policies in the
future will be able to stimulate the growth in several sectors such as the agro-industrial complex.
      “In the next rating, including the data for 2009, Kazakhstan’s large companies will
demonstrate a zero or weakly positive growth,” Director General of "Expert Rating Agency
Kazakhstan,” Igor Nuzhdin noted in his remarks at the forum.
      Oil, gas and steel companies dominate in the rating. Their revenues account for 64.8
percent of the total for top 100. Their net income grew by 51 percent. Other sectors that have
shown a significant growth are trade (3.3 percent of total revenue and 64 percent growth in net
profit) and the agro-industrial complex (1.7 and 42 percent respectively).
      Aset Issekeshev, Minister of Industry and Trade of Kazakhstan spoke at the meeting and
reminded the delegates that the Government is developing a program of accelerated industrial
and innovative development of the country for the next years, whose main objective will be to
increase the competitiveness and sustainability of the national economy and its effective
integration into the global economy.
      “The state program will take into account the balance of interests between government and
business. We want to build it right in order to realize the specific challenges facing the country,”
Issekeshev stressed.
      Prime Minister Karim Masimov also attended the event and explained measures to be taken
to overcome the global economic crisis, which he called a “crisis of global reset.”
      “Now, the government, business and financial sector work to stimulate domestic
production. The state will adhere to the principles of market economy, preserving the sanctity of
private property,” Massimov said as he added that the country needs to create competitive
production.
      Massimov also spoke on the establishment of the Customs Union. “From 1 July next year,
the customs border between Kazakhstan and Russia will cease to exist and goods, which cross
the Kazakh-Chinese border and goods that cross the Russian-Polish border will move within the
three countries [Kazakhstan, Russia, Belarus] without any customs examination. This will be a
huge new market. In the future, we will have a lot of interesting economic events and processes
that will occur after the establishment of a common economic market,” Massimov explained.

Kazakhstan Will be in the Spotlight in South Korea Next Year
      The Ministry of Foreign Affairs and Trade of the Republic of Korea designated the next
year the Year of Kazakhstan as part of efforts to strengthen ties between the two countries.
      The news was announced during the third annual forum between Korea and five Central
Asian countries which took place in Seoul on December 2.
      Kazakhstan’s Deputy Foreign Minister Nurlan Yermekbayev attended the discussions
which touched political, economic, social and cultural issues and ways to support companies
from Korea and the five countries. He met Minister of Foreign Affairs and Trade of the Republic
of Korea Yu Myung-hwan and his first deputy Shin Gak-soo, during which they discussed issues
related to the current state of bilateral relations between Kazakhstan and Korea.
      Last May’s visit of Korean President Lee Myung-bak to Astana was a significant milestone
in bilateral relations. Following his talks with President Nursultan Nazarbayev, the two countries
signed the US$ 5 billion agreements on Korean investments in Kazakhstan’s economy. The

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parties agreed to expand cooperation in the petrochemical, mining, energy and
telecommunications.
      The Republic of Korea was one of the first countries in the region to recognize the
independence of Kazakhstan. With more than 100,000 Koreans, the Korean Diaspora in
Kazakhstan is one of the most numerous.
      Since Kazakhstan’s independence in
1991, there have been numerous joint
projects between two nations in many areas
of the economy.
       One notable example is the LG
factory in Almaty which was launched in
1997. The plant assembles washing
machines and TVs to meet the needs of the
countries in Central Asia and Russia.
      One of the most promising projects is
the construction of US$2.5 billion worth
Balkhash thermal power plant, which will
begin in the middle of next year and will
cover needs of country’s southern part in
electricity.
       The most notable player from South Korea who came to Kazakhstan is the largest Korean
bank Kookmin, which acquired a 28 percent stake in Kazakhstan’s Center Credit Bank with the
prospect of bringing its share to the control package. Shinhan Bank, another bank from Korea, is
also looking to get a foothold in Kazakhstan.
      Despite extensive communications, trade turnover between Kazakhstan and Korea in 2008
amounted to only 754.1 million dollars, although after the visit of President Lee Myung-bak, the
figure is expected to substantially.

Almaty to Be Capital of Islamic Culture for Asia in 2015
       The Islamic Educational Scientific and Cultural Organization (ISESCO) has approved
Almaty as the capital of Islamic culture for Asian region in 2015. The organization’s Director
General Dr. Abdulaziz Othman Altwaijri announced the news Kazakhstan’s Ambassador
Bakhtiyar Tassymov in a meeting in Rabat, Morocco. The dialog took place within the third
meeting of the Alliance of Civilizations Focal Points.
                                                            Dr. Altwaijri praised the policies
                                                     pursued by President Nazarbayev and noted
                                                     Kazakhstan’s increasingly important role in
                                                     the world. The upcoming chairmanship of
                                                     Kazakhstan in the Organization of Islamic
                                                     Conference (OIC) in 2011 indicates a high
                                                     degree of credibility of the republic, he said.
                                                     He also expressed hope for the future
                                                     opportunity    to     strengthen     ties    in
                                                     humanitarian and cultural spheres between
                                                     the EU member states and Mediterranean

                                                    world, during Kazakhstan’s chairmanship in
                                                    the OSCE in 2010.
                                                           Bakhtiyar Tassymov familiarized Dr.
                                                    Abdulaziz Altwaijri with the main foreign
policy initiatives of the republic, aimed at strengthening stability and security at a global and
regional level, explaining the activity of the Assembly of People of Kazakhstan.
       He also stressed the significance of the historical legacy, playing a key role in
Kazakhstan’s cooperation with the Islamic world. Thus, one of the major steps in reconstructing
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and preserving Kazakh cultural property sites abroad was the financing by Kazakh authorities of
restoration of Sultan Beybarys’ mosque and mausoleum in Cairo and Damask, as well as the
construction in Damask of a historic and cultural center of the great Oriental scientist Abu Nasr
al-Farabi.
        Being an Islamic cultural capital implies organizing a number of international
conferences, meetings and various events, which should take place in Almaty throughout 2015.
        Today, Kazakhstan’s former capital remains the largest industrial, financial, and cultural
center not only in the republic, but in the Central Asian region as well. Almaty still hosts a
number of old and new nationwide religious centers, including the Spiritual Administration of
Muslims of Kazakhstan, and numerous religious educational institutions, including the Egyptian
University of Islamic Culture.
        Since the objectives of ISESCO as the largest international Islamic organization include
consolidating and promoting cooperation among OIC member states in education, culture,
science and communication, the selection of Almaty as a capital of Islamic culture witnesses the
maturity of Kazakhstan’s Muslim community and high potential of the city itself. Likewise, the
main tasks of the organization involve developing applied sciences and use of the advanced
technology within the framework of Islamic values and ideals, consolidating understanding
among Muslim nations, and contributing to the achievement of world peace and security.
        Kazakhstan’s chairmanship of the OSCE in 2010 and of the OIC in 2011 gives a unique
opportunity to promote the dialogue between the Muslim East and the West. Provisional items
on the agenda, considered by Kazakhstan for OIC chairmanship in 2011, include problems of
migration and integration of Muslim communities in European countries and the rights of
Muslim women and youth in Western societies.

Also in the News
   •   On December 1, Christmas trees were lit all around Kazakhstan. President Nurslutan
       Nazarbayev participated at the lighting ceremony of the country’s main Christmas tree in
       Astana as he congratulated the people with the upcoming holiday.
   •   The 9th meeting of the Secretariat of the Congress of Leaders of World and Traditional
       Religions took place in Astana on December 2. The delegates discussed topics of the
       forthcoming IV Congress in 2012 and determined the date for the tenth meeting of the
       Secretariat of the Congress. The Secretariat also reappointed Kasymzhomart Tokayev,
       Chairman of the Senate of Kazakhstan, as its head.
   •   President Nursultan Nazarbayev met members of the Foreign Investors Council under the
       President who gathered for the 22nd plenary meeting of the Council which took place in
       Astana on December 4. In a meeting, Thomas Mirrow, President of the European Bank
       for Reconstruction and Development, praised Kazakhstan’s anti-crisis program and noted
       the favorable investment climate in the country. For full story on FIC meeting see Astana
       Calling on December 8.
   •   President Nazarbayev took part in the ceremony of the Paryz competition on corporate
       social responsibility. Speaking at the ceremony, President noted that Paryz participants
       carried out more than 70 social projects worth more than 30 billion tenge (KZT 150= 1
       US $) worth.
   •   Kazakhstan’s Prime Minister Karim Massimov met Vice President of the Asian
       Development Bank Zhao Xiaoyu in Astana this week. Xiaoyu informed of the decision
       taken by ADB to turn the regional center in Almaty into a representative office, whose
       activities will focus on coordinating the interaction with the private sector and regional
       financial institutions to attract investments. He also informed Massimov that ADB will
       participate in the reconstruction project of Aktau – Beineu highway.
   •   Almaty hosted the first organizational meeting of the ad hoc working committee to
       finalize the Doctrine of National Unity of Kazakhstan, initiated by the President.
   •   Almaty hosted the 10th Choice of the Year awards. Winners have been chosen in 36
       nominations. Olga Shishigina, an Olympic champion athlete, a recognized symbol of the

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      sporting decade, and renowned violinist Marat Bisengaliev were chosen as laureates of
      the special category “People of the Decade.”

Things to Watch
  •   Since this year’s celebration of the Independence Day (December 16) falls on
      Wednesday, the government decided to extend holidays till Friday. According to the
      legislation December 16 and 17 are declared not working days, Friday December 18 this
      year will be offset by the working day on Sunday.


                      ASTANA CALLING is a bi-weekly online publication of
                    the Ministry of Foreign Affairs of the Republic of Kazakhstan.
                      Please send your requests and questions to pressa@mid.kz




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