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 KAZAKHSTAN International Business Magazine №2, 2010 №2, 2010
 EU cooperation on Kazakhstan: aims, strategy and limits
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EU cooperation on Kazakhstan: aims, strategy and limits
 

Nicola Morfini, PhD Candidate, University of St. Andrews – School of International Relations

Within the frame of the Sino-Russian rivalry on Central Asia, the EU plays a minor role because of the deep lack of knowledge of the cultural, economic and social needs of the partner. It is indeed a paradox that the EU plans of development are constantly put aside in favour of Russian and Chinese ones, much less comprehensive and profitable. The aim of this research is to trace back the evolution and the content of EU programmes on Kazakhstan, assessing both the theoretical and the factual limits of the EU policies.

Principles and plans of EU cooperation for development

The first approach of the European Union to Central Asia started in 1991, after the fall of the USSR and the formation of CIS (Commonwealth of Independent States). The TACIS programme (Technical Assistance to Central Asia Independent Commonwealth) was then ratified in order to systematise assistance and cooperation, lasting fifteen years, until 2006. This plan was developed following several steps with different degrees of cohesion: for the first ten years (1991–2000), according to the official definition of the European Commission, the plan was ‘demand-driven’ in that the Commission received demands from CIS Ministries and ‘assessed [them] on the basis of often scarcely existing information’. Under such conditions the process was essentially top-down in its dynamic, with no role for non-institutional actors. In this period, the EU did not ‘speak with one voice’ and each state pursued its own national way. Although the programme was wide and articulate, the lack of information and instruments for intervention substantially narrowed the field of action, which focused therefore on private sector implementation (mainly SMEs). As years passed, the cooperation took off, becoming cohesive and more effective, so that plans, such as INOGATE, TRACECA and Bologna Process among others, could be launched. The second period of the programme (2000–2006) was, according to the official definition, ‘dialogue driven’: the major difference consisted in the capability of the Commission to make its own proposals, developed through a decade of expertise. This renewed TACIS plan, launched with the Council Regulation n°99/2000, implied ‘technical assistance’ in order to ‘establish [...] a new legal order and a socio-economic framework in these newly independent states, based broadly along the lines of the EU acquis communitarire’. The new plan provided local Delegations of the European Community with the duty to ‘improve project identification, planning and supervision’ in close contact with the local entities. The programme concerned support in effective policy making, justice and home affairs security, economic development (implementing small/medium enterprises and rural economy), relieve the consequences of transition (social protection, health and pension reforms) and infrastructure planning and construction. The plan also covered nuclear safety and border cooperation. European participation consisted of technical support through the transfer of ‘know-how, knowledge and expertise’ in ‘industrial cooperation and partnerships between public and private bodies’. The whole six-year programme was allotted 3,138 billion Euros, redistributed in order to diversify investments by granting comprehensive cooperation and harmonic growth.

After TACIS a further plan was launched, the ‘Central Asia indicative programme 2007–2010’, enhanced by new Development Cooperation Instrument (CDI) and shaped in order to intensify dialogue. Candidates to the programme are developing countries, on the condition that they respect some basic principles such as: a) transparent, accountable and effective public expenditure management, b) well defined macroeconomic and sectorial policies in agreement with their main donors and the International Financing Institutions, c) open and transparent public procurement, and d) precise objectives for direct budgetary assistance.

Indeed, weak institutions and high levels of corruption, could easily lead to the exploitation of international aids by bureaucracy. These provisions are not only a brake on corruption but also a push factor toward the democratisation of regimes in transition, forcing governments to implement participation and fair management.

The three main focal points of cooperation concerned:

1. Promotion of Central Asia regional cooperation and good neighbourly relations

2. Poverty reduction and increasing living standards
 
3. Support for good governance and economic reform

These objectives imply structural reforms in institutional, political and economic fields. The EU, therefore, sees itself as the beacon to follow regarding reforms: establishing effective policies and administration, the EU also sets cultural bonds with the partner aiming, in the long term, to ‘export’ democratic institutions in a smooth and not invasive way.

Support for SMEs, together with transport integration and regional tariff coordination, tend to create the conditions for the birth of a middle class, and in general, for the harmonisation of the social context. Democratisation in the political field is indeed inseparable from democratisation of the economy.

The ongoing European programme ‘Central Asia Indicative Programme 2007–2010’ also provides cooperation in higher and technical education, training systems (through exchange programmes) and research communities. The long term impact foreseen by the Commission would imply a deep people-to-people interaction that would affect positively civil society participation and, consequently, democratic process and institutional reform as well. Indeed, much attention is addressed to democratisation in the paper: the entire 5th paragraph regards the implementation of human rights and participative decision making (supervised by OSCE, Council of Europe and Venice Commission). The paragraph proceeds listing further priorities such as the implementation of a judicial branch, strengthening ‘administrative capacity and law enforcement organs’, ensuring ‘impartiality and effectiveness of the prosecution’. These initiatives would enforce the democratic process and push the transition toward a participative stage, spreading shared values such as human rights, fundamental freedoms and the rule of law. At the same time, the decrease of corruption, the certainty of law and an appropriate legal framework, would ultimately imply the rise of investments – both domestic and foreign – improving the business climate and integrating Kazakh economy into the global system.

In this regard, the regulation ‘Establishing a financing instrument for development cooperation’, approved by the European Parliament on the 18th December 2006, enucleates principles, manners and schedules for the cooperation. First of all, the document states objectives such as ‘sustainable development, social development and smooth and gradual integration of developing countries into the world economy’ within a wider context of ‘peace, stability, respect of human rights, fundamental freedoms, democratic principles, rule of law, good governance and gender equality’. The way to achieve this would be, as stated in paragraphs 7 and 11, ‘sound and sustainable economic policies’ in a ‘long term’ perspective.

European cooperation has the ambition of rising to the role of primacy among the donors: paragraph 20 states that the Community has the duty to harmonise and coordinate plans between ‘member states, other donors and development actors’. The Community ‘shall improve coordination and complementarity of their policies on development cooperation by responding to partner countries’ and regions’ proprieties at country and regional level. Community policy in the sphere of development cooperation shall be complementary to the policies pursued by the member state’. The Community therefore promotes a diversification of the sources of aid, but endorses at the same time the coordination of all those plans under its shield, in order to prevent ‘overlap and duplication’.

In case the EU actually becomes responsible for all the programmes on Kazakhstan, the government of Astana will be forced to halt its oscillation between Russia, China and EU. This would stop the competition in the country in favour of Europe and therefore Kazakhstan would lose its edge on the competition due to its favourable position.

Perspectives on Kazakh-EU cooperation

The EU plan on Kazakhstan moves on two directions: on the one hand it promotes national economic and social development, whereas at the regional level it promotes infrastructural and tariff integration.

At the international level, the EU provides direct investment to enhance regional cooperation. The fields of action are water (Water Management Project), trade (TRACECA) and energy (INOGATE), and are designed in order to: a) provide an input in order to stimulate an endogenous process of cooperation and b) create infrastructural networks and economic frames to bind Central Asia with Europe.These plans did not evolve in an outline of regional cooperation for two reasons: first of all the national particularisms obstructed dialogue within the region, and secondly the lack of funds and reliability on the long term prevented the EU from properly supporting the initiatives.

These infrastructural plans, however, are not a push factor per se: it is difficult to foresee a commercial approach between Central Asia and the EU in the short/middle term. From a commercial viewpoint Kazakhstan is beneficiary of the EU ‘Generalised System of Preference’ (GSP), but the country still represents 0.7% of the overall EU global trade. EU goods cannot easily be sold in Kazakhstan because of the weak Kazakh purchasing power and the Chinese and Russian competition. Kazakh manufacturing, if supported by sound policies, would therefore have the possibility of penetrating the EU market more easily than the EU would be able to do in Kazakhstan. At the moment, however, Kazakhstan is unable to compete in the European market because of a deep technological and qualitative gap.

Conclusions

In conclusion, we can see that the European approach on Kazakhstan is characterised by an invasive attitude. The aims of the programmes can be summed up as follows: the first step consists of inducing structural changes in the institutional and economic frame. Once this has been achieved, the Union’s purpose consists of obtaining the role of hegemonic partner on the political field. At the same time, the programmes would imply structural change in the social context, pushing for the creation of a middle class and therefore for economic and political democratisation.

It is clear that the government of Astana has no interest in modifying the institutional and economic balance that enables the local élite to maintain power. Moreover, the EU cannot provide the necessary expenditure for such a wide-ranging and continuative cooperation. Within the frame of the international competition in Central Asia, Russia and China seem both able to grant massive fund in a long-term economic partnership, without considerable interference on the domestic sphere. The EU therefore appears unlikely to become a preferential partner for Kazakhstan.

The major difference between the EU and its two regional competitors consists mainly in the fact that the EU imposes political relations ex ante, before the implementation of economic relations, whereas Russian and Chinese political intervention is ex post, sealing the ongoing economic partnership. In this way Europe poses conditions without proving its real potential, thus denying the possibility of a productive dialogue since the very beginning. These European conditions move from the general principles of the Union, and, more importantly, are imposed in a political and social context that does not suit such a strict liberal and democratic order – at least in the short period.

In conclusion, we can see how EU cooperation could give a response to the main incumbent issues in the country, such as market regulation, macroeconomic policies, communication routes, employment and human development. European programmes are more comprehensive and profitable than those of its regional competitors, however, they present several aspects that are somewhat incompatible with the Kazakh context, since they appear in deep contrast with the interests of the country’s élite. The local élite is, indeed, the key subject of this process and it has to become, instead of a mere subject of conditions and restrictions, a serious interlocutor for the EU policies in the country. EU programmes are more like a declaration of principles than proper cooperation plans. The only way for EU plans to be competitive is to start from the knowledge of the partner, considering its peculiarities and needs, and mediating it with the EU basic principles.

Nicola Morfini is Junior Researcher at the Istituto Affari Internazionali (IAI) in Rome. He graduated at LUISS Guido Carli (Italy) and continued his postgraduate studies at the Durham University (UK). His research activity includes researches on the field in Tiranë (Albania) in the Ministry of European Integration – Ministria e Integrimit, Almaty (Kazakhstan) in the Public Policy Research Centre and Baku (Azerbaijan) in the Center for Economic and Social Development. His research activity includes Central Asian and Caucasian affairs, Kazakh and Azeri political economy and neighbour policies, Albanian international relations.

 
 


Table of contents
· 2016 №1  №2  №3  №4  №5
· 2015 №1  №2  №3  №4  №5  №6
· 2014 №1  №2  №3  №4  №5  №6
· 2013 №1  №2  №3  №4  №5  №6
· 2012 №1  №2  №3  №4  №5  №6
· 2011 №1  №2  №3  №4  №5  №6
· 2010 №1  №2  №3  №4  №5/6
· 2009 №1  №2  №3  №4  №5  №6
· 2008 №1  №2  №3  №4  №5/6
· 2007 №1  №2  №3  №4
· 2006 №1  №2  №3  №4
· 2005 №1  №2  №3  №4
· 2004 №1  №2  №3  №4
· 2003 №1  №2  №3  №4
· 2002 №1  №2  №3  №4
· 2001 №1/2  №3/4  №5/6
· 2000 №1  №2  №3





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