Wednesday, 27 March 2013

Toward A New Kazakhstan-U.S. Partnership

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by Richard Weitz (03/20/2013 issue of the CACI Analyst)

In accordance with its efforts to diversify its allegiance with major powers, Kazakhstan supports a strong U.S. economic and defense presence in Central Asia. The U.S. is equally interested in preserving Kazakhstan’s balanced relationship with the other great powers. Renewing the partnership requires realigning its focus as the U.S. military presence in Central Asia declines but U.S. interests do not, while Kazakhstan responds to China’s growing regional role and strong Russian interest in maintaining Moscow’s primacy in the region. An effective U.S. diplomatic approach toward the region requires reaffirming U.S. support for the political and economic independence of Kazakhstan and its neighbors.



BACKGROUND: The U.S. was the first country to recognize Kazakhstan, on December 25, 1991. Since then, energy and security issues have been a cornerstone in relations between the two countries. According to the U.S. Department of State, the U.S. provided roughly US$ 1.2 billion to Kazakhstan in technical assistance and investment support between 1992 and 2005. More importantly, private U.S. companies have invested more than US$ 20 billion in Kazakhstan during the last two decades. The U.S. remains an important economic partner for Kazakhstan. Bilateral trade last year was some US$ 2.5 billion.

In the security realm, the U.S. provided Kazakhstan with considerable financial assistance to eliminate its nuclear warheads, weapons-grade materials, and supporting infrastructure. The ties strengthened after the U.S. invaded Afghanistan in October 2001. Kazakhstan’s leaders immediately proclaimed solidarity with Washington in the fight against international terrorism, while the U.S. reciprocated by increasing its counterterrorist and counter narcotics assistance to Astana. In recent years, the two countries have joined forces against terrorism, nuclear proliferation, in Iraq and especially in Afghanistan. The U.S. and Kazakhstan recently signed a new five-year defense cooperation agreement which foresees the Pentagon helping Kazakhstan reform its military training and improve its defense interoperability with NATO and the U.S. armed forces. Building on a long-standing nonproliferation partnership, Almaty has hosted the most recent round of Iran’s talks with the P-6+1 (Germany and the five permanent UN Security Council members) seeking to resolve differences over its nuclear program.

From Washington’s perspective, Kazakhstan’s growing role in its extended neighborhood advances significant U.S. interests. Through its increasing economic engagement in Eurasia – which has involved direct investment and trade as well as support for improving regional commercial and transportation infrastructure – Kazakhstan is helping transform Central Asia and the Caspian region into an “arc of opportunity” rather than an “arc of crisis.” In addition, Kazakhstan’s authorities have supported the development of energy pipelines that circumvent Russian territory. Kazakhstan’s government is in the process of establishing a KazAID Agency, modeled after USAID, through which Kazakhstan will provide large-scale technical assistance in Central Asia and to other developing countries. Finally, Kazakhstan is helping develop Central Asia’s economic infrastructure in order to transform Kazakhstan from “land-locked” to “land-linked” since it wants to become a “land bridge” between Europe and Asia. This supports the U.S. vision for a New Silk Road of closer economic ties among these countries through expanded mutual trade and investment and people-to-people exchanges.

Kazakhstan’s support has been vital for sustaining the U.S. military campaign in Afghanistan. The U.S. and its allies convey large quantities of non-lethal supplies from Europe to their troops serving in the International Security Assistance Force (ISAF) in Afghanistan through Russia, the Caucasus, and Central Asia. Kazakhstan’s role is this so-called Northern Distribution Network (NDN) is pivotal. The NDN comprises three main land routes, all of which converge and traverse Kazakhstan’s territory before leading to Afghanistan. Kazakhstan has led the “Istanbul Process,” a series of high-level meetings launched in Nov 2011 in Istanbul to promote regional cooperation in the “Heart of Asia” region, especially between Afghanistan and its neighbors. It includes six clusters of confidence-building measures in the areas of education, counterterrorism, counter narcotics, disaster management, infrastructure, and commercial and trade engagement. The next ministerial will occur in April 2013. In addition, Kazakhstan supports international efforts to strengthen the Afghan National Security Forces with money, personnel, and other resources. The Kazakhstani government also provides Afghanistan with considerable humanitarian, financial, and technical assistance, including hundreds of scholarships for Afghan students to study in Kazakhstan’s educational institutions as well as subsidized grain and financing of bridges, schools, hospitals, and the “Kunduz-Taloqan” road.

IMPLICATIONS: Despite their shared interests, the Kazakhstan-U.S. partnership is not unproblematic. The main U.S. complaint is that the Kazakhstani government has failed to make greater progress in transitioning into a liberal democratic country with competitive national elections and greater freedoms for opposition leaders, critical media outlets, and nonviolent religious practitioners. In particular, U.S. officials do not believe that Kazakhstan meets the human rights and democracy commitments it made to chair the 56-nation Organization for Security and Cooperation in Europe (OSCE) in 2010. Kazakhstan’s officials consider their OSCE-related goals as intentions rather than legally binding commitments. They also argue that they are focusing on constructing the economic and institutional preconditions for their state’s successful transition into a political democracy.

Conversely, Kazakhstan’s main complaint is that the U.S. does not compensate Kazakhstan suitably for its critical role in supporting U.S. regional goals. Fundamentally, Kazakhstan’s government feels taken for granted. For example, it has seen a lack of U.S. interest in the work of the Conference on Interaction and CBMs in Asia (CICA), which Kazakhstan launched and led shortly after gaining independence. The CICA aims to extend confidence-building measures, which are common in Europe, to Asia, where they are not, as well as between Near East countries such as Israel and Iran, which are both members. Despite the Obama administration’s increased focus on Asia, senior U.S. officials rarely attend CICA meetings.

In addition, Kazakhstan’s officials believe the U.S. has not met its 2010 commitments to purchase many Kazakh goods in return for gaining access to Kazakhstan’s territory through the NDN. In the view of Astana, Kazakhstan has fulfilled its commitments in this area, but U.S. purchases are at exceedingly low levels. Kazakhstanis believe that the Pentagon spends more on NDN-related items in Russia and Uzbekistan than in Kazakhstan, despite of Kazakhstan being the location through which all NDN routes converge regardless of their originating routes.

Another of Kazakhstan’s concerns is that it is still subject to the Jackson-Vanik Amendment. The U.S. Congress has already extended Permanent Normal Trade Relations (PNTR) treatment to twelve other former Soviet bloc countries, leaving Kazakhstan among only seven former Communist countries affected by outdated legislation to induce the free emigration of Soviet Jews. Kazakhstan’s post-Soviet government has become a model of religious harmony and has launched several initiatives to promote moderation within the Islamic community and better understanding between Muslims and other religious groups. The U.S. government waives Jackson-Vanik for Kazakhstan and other countries every year, but Kazakhstan’s officials want Congress to repeal the amendment, which they consider insulting, especially considering how open Kazakhstan is to U.S. business and the good relations between the two countries.

Washington’s self-inflicted budget mess will keep the U.S. from increasing its aid levels any time soon. U.S. civilian assistance for all Central Asian countries is low and on a downward trajectory. In the aggregate, U.S. assistance to Central Asian countries is relatively modest compared with the vast sums spent in Afghanistan and Pakistan. In FY 2010, for example, the total U.S. assistance to Central Asia was less than three percent of what the U.S. provided to Afghanistan that year. In contrast, China has established a commanding presence in Central Asian markets by directly supporting the industrial and infrastructural development of these countries. But the U.S. government can respond to Kazakhstan’s desires and encourage the U.S. private sector to focus more on trade cooperation and establishing business-to-business partnerships beyond hydrocarbons. Kazakhstan’s officials see U.S. investors as key partners in Kazakhstan’s efforts to diversify its economy. Hundreds of U.S. firms now operate in Kazakhstan, with their direct net investments exceeding US$ 15 billion, but most of these funds are still placed in the oil sector.

CONCLUSIONS: In accordance with its efforts to diversify its allegiance with major powers, Kazakhstan supports a U.S. economic and defense presence in Central Asia. The success of Kazakhstan’s multi-vector foreign policy requires having Western countries engaged in Central Asia, which otherwise would naturally gravitate toward Russia, China, or a Beijing-Moscow condominium, to the detriment of Kazakhstan’s sovereignty. The U.S. is equally interested in preserving Kazakhstan’s balanced relationship with the other great powers. An effective U.S. diplomatic approach toward the region requires reaffirming U.S. support for the political and economic independence of Kazakhstan and its neighbors.

AUTHOR’S BIO: Dr. Richard Weitz is a Senior Fellow and Director of the Center for Political-Military Analysis at the Hudson Institute.

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