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 KAZAKHSTAN International Business Magazine №1, 2002
 Kazakhstan's Hospitality Industry: Problems and Outlook
Kazakhstan's Hospitality Industry: Problems and Outlook
Rosa Rayeva, President of the Kazakhstan Association of Hotels and Restaurants (KAHR)
Rashida Shaikenova, Executive Director of the Kazakhstan Association of Hotels and Restaurants (KAHR)
Today, the global tourist industry, including hotel and restaurant businesses, is developing quicker than any other sectors of the world economy. According to specialists, tourism will become a major business on the global marketplace by 2020, leading to a growing number of jobs and increased possibilities of making a career in this sector.
Statistics show that tourism nourishes and contributes to the development of large cities like Paris, New York and London. Not just separate tourist companies, but entire countries, are trying to win the favour of "His Majesty the Tourist."
According to the World Tourist Organisation (Kazakhstan became a full member of the WTO in 1993), the tourism industry is among the five top 'exports' of 85% of countries. At the same time, 38% of countries regard tourism as a major source of foreign exchange. In fact, the revenue gained from one foreign tourist is equal to the export of nine tonnes of coal, 15 tonnes of oil, or two tonnes of high-grade wheat. The amount of money spent by one tourist (over $1,000) is enough to create five to nine jobs.
All this indicates that tourism can and must become a quite profitable sector of Kazakhstan's economy. All the more so as our country shows promising potential for the development of tourism. Astonishing landscapes, untouched mountains, rushing rivers and steep rocks, unique species of fauna and vast variety of birds; all these are the riches of Kazakhstan.
There are around 27,000 ancient sites lying along the Great Silk Road. These are the Mausoleum and Mosque of Khodja Akhmed Yassawi in Turkestan, the unique Golden Man, which was discovered in the Saka burial mound near the city of Yesik, the funeral chamber of the Besshatyr burial, and many other archaeological discoveries. Kazakhstan surely excites the keenest interest of the prospective tourist who wants to visit the countries of Central Asia along the Great Silk Road.
Nevertheless, travelling via the Great Silk Road is a costly and rather difficult undertaking. This is largely due to the extended red tape obstructing every foreign tourist's efforts to cross the frontiers of the countries of Central Asia. That is why it is necessary to initiate a revival of intergovernmental agreements among the CIS countries on the mutual recognition of visas.
Another problem that requires closer consideration is the registration of foreign tourists in Kazakhstan. Let’s take the average tourist. He wants to get to know the local traditions, and enjoy the culture and nature during his voyage. However, he encounters numerous barriers: his journey in Kazakhstan begins with registration at OVIR (the visa and registration department), which implies standing in endless queues to temporarily exchange his passport for a dubious document that is not always recognized even by local policemen. It is clear that, after these procedures, he would want to return home.
Unfortunately, the registration of foreign passports in hotels, which we achieved in 1999, was cancelled in early 2002. The Interior Ministry abolished the Almaty Centre for Information Systems. The directors of this department assured us that they were planning to introduce an automated registration system for foreign citizens at control posts by the end of last year. In reality, the Ministry simply cancelled the registration of foreign citizens in hotels, instead of applying the promised automated system. Unfortunately, attempts to draw the attention of the state authorities and the mass media to this problem were unsuccessful. The Interior Ministry is sticking to its policy...
Why should we advertise Kazakhstan's tourist potential on the world market if there are so many artificial barriers to tourism? The only thing we can do is to offer a tour of this country of barriers, one which includes visiting the law enforcement bodies.
The other side of this problem is the barriers that face our fellow citizens abroad. During working meetings with the consuls of embassies of various countries, such as Turkey, Korea, Spain, Greece, Germany, Egypt, Malaysia, etc., we have not even had the chance to discuss the problems our tourists face. We are exposed to such a severe squall of criticism due to the current procedure for registering foreign citizens in Kazakhstan.
Having such rich tourist potential, we are faced with the problem of developing it efficiently. It is a vital necessity that the state structures and NGOs make joint efforts to resolve the current problems facing Kazakhstan's tourist industry.
The terrorist attacks on the USA brought a negative influence to bear on the tourist business throughout the globe. People now fear travelling. Kazakhstan was also affected by these trends: a number of hotels and tourist companies suffered devastating losses.
After the tragic events of 11th September, a number of countries sent us letters encouraging us to attract tourists jointly, given the need to adapt to the current political situation and its unpredictable aftermath.
Only a continuous and well-planned policy aimed at increasing domestic tourism will contribute to making tourism a really profitable industry. We must adapt to the new economic conditions. Taking into account the current situation, probably the CIS and Baltic countries are the most promising areas for the development of various types of tourism, such as nostalgic, business, etc.
Perceiving the wishes of a tourist and responding to his challenge is an important condition for the successful development of the tourist industry. Today, only those who have understood the necessity to unite, who have extended their horizons and discovered new opportunities in due time, are occupying the prime positions.
Currently, there are around 600 tourist companies represented in Kazakhstan, half of them with offices in Almaty. They face a mountain of unsettled issues and problems. Expensive rates for advertising services, impossibility to get in touch with government bodies and consular services, insufficient information about the recent events, and a lack of professionals: all this reminds our entrepreneurs about the instability of the tourist business. Creating the Kazakhstan Association of Hotels and Restaurants (KAHR) in 1998 and the Kazakhstan Tourist Association in 1999 made it possible to focus joint efforts on resolving these problems.
Here are some examples of recent crucial achievements. Entry visas were cancelled for Kazakhstani citizens in July 2001 at an initiative of KAHR. The consular fee for entering the country was cut to $30 for foreign citizens. On 1st January 2002, an experimental streamlined visa procedure for citizens from 22 countries was launched. In October 2000, the Kazakh government issued the resolution On Measures for Improving the Tourist Image of Kazakhstan for 2000-2003. In July 2001, the bill On Tourist Businesses in Kazakhstan and Concepts for the Development of Tourism in Kazakhstan was passed. Members of the KAHR and KTA participated in the consideration of this bill, and made important proposals for its improvement. KAHR members also took an active part in developing Kazakhstan's new Tax Code. They have also contributed to cancelling the annual re-certification of hotels.
The association has acquired a good deal of experience of taking part in various world and regional exhibitions, such as the World Travel Market (2001, 2002), ITB fair of Berlin (2001), KITT Exhibition in Almaty, KITT in Moscow (2001), and other exhibitions.
We took the decision to join the Russian Association of Tourist Agencies (RATA) at the annual Hotel Conference of the CIS and Baltic countries, which was organized by the Best European Hotels and Akademservis. Since January this year, members of KTA and KAHR have been receiving electronic versions of the RATA-News daily newspaper, which conveys detailed information about the latest events in the tourist business.
Moreover, KAHR co-operates with the Almaty Association of Entrepreneurs, Russian Restaurant Guild, Kazakhstan Franchise Association, Central Kazakhstan Association, and other non-government associations.
The Kazakhstan Association of Hotels and Restaurants is grateful to all who support it and share its precious experience, and shows respect to those whose future is connected to the tourist industry.

Table of contents
Eurasia Economic Summit 2002  Thierry Malleret 
Phases in the Development of Arbitration in Kazakhstan  Peter Greshnikov, Igor Greshnikov 
Kazakhstan's Hospitality Industry: Problems and Outlook  Rosa Rayeva, Rashida Shaikenova 
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