KAZAKHSTAN - Decision Makers - Daniyal Akhmetov.
A figure loyal to President Nazarbayev, Akhmetov was made prime minister after Imangali Tasmagambetov resigned on June 12, 2003, following a bitter standoff with parliament over land reform. Since then, Akhmetov has been acting as chief co-ordinator between Nazerbayev and each of the people, foreign petroleum companies, etc. But KMG has direct access to the president, through the latter's son-in-law Timur Kulibayev (see earlier profile above).
Among issues on which Akhmetov has been working is strong opposition by foreign oil companies to proposed changes to petroleum laws that could spoil Kazakhstan's impressive track record of attracting more than $20 bn in foreign direct investment (FDI) over the past ten years. The republic has so far received the highest per capita FDI in the former Soviet Union.
In May 2004, PM Akhmetov received a letter from 47 foreign oil companies - including the leading investor in Kazakhstan, ChevronTexaco, as well as ExxonMobil, Shell, the BG group, ENI and others - which said they were concerned that the proposed changes to the petroleum laws could adversely affect the investment climate in the country. Among other issues, the letter said the local content requirements (see DT) were "unnecessarily burdensome" and that a requirement for KMG to own at least 50% of any development "may not be advisable in all circumstances" (see below).
Akhmetov's predecessor, Tasmagambetov, had been made Prime Minister on Jan. 28, 2002. That was immediately as President Nazarbayev got Kasymzhomart Tokayev to resign from this post, which has a reputation as a "revolving door". Until then Tasmagambetov was deputy premier for education, culture and social and ethnic affairs. From 1998 to 2000, he was governor of Atyrau and became popular for directing oil money to a number of projects in the city. Petroleum Argus said on Feb. 4, 2002, Tasmagambetov was in line with a policy practiced by Nazarbayev, "who likes to rotate government officials once every year or two to avoid the creation of any power base opposed to him".
Tasmagambetov caused a stir two months later as he told parliament the government had secreted abroad some $1 bn in profits from the sale of 20% of the Tengiz venture to Chevron in 1996. The money was deposited in a Swiss bank account and used to pay off $480m of pension arrears to stabilise the tenge, the national currency, after the Russian default of August 1998. Nazarbayev explained in an interview with The Financial Times published on April 16, 2002: "I was not involved day-to-day but I supervised where the money went. If it were not for this fund, Kazakhstan would not be independent today. I give you my personal word that everything was clean. Not one kopeck disappeared, it all went into the state budget". He said "what little remained was transferred to the government-controlled National Fund set up last year" (2001). This oil fund is modelled on a Norwegian stabilisation facility fund. By April 16, 2002 it had accumulated about $1.3 bn mainly from oil revenues in excess of $19/barrel. Now the fund must be huge as oil prices since late 2002 have been quite high (Brent having averaged over $28/b in 2003) and above $44.50/b in the past week. But Nazarbayev has since failed to explain why the fund has been secret or how much money remains - see background in Vol. 59, OMT No. 9).
The situation in Kazakhstan now is quite different from that of 1993, when the first investment law in Kazakhstan was drafted. Because of a severe economic crisis then, many strategically important plants and petroleum fields were ceded to foreign investors under very advantageous conditions. Kazakh companies had neither the capital nor the know-how to compete with foreign investors. So from 2002 the regime of Nazarbayev has been trying to be tough on foreign investors with a new tax law.
