If a nation does not know its history, if the country loses its history, then its citizens have nowhere to go.
Mirzhakyp Dulatuly

Formation and development of independent Kazakhstan: socio-humanistic analysis

1896
Formation and development of independent Kazakhstan: socio-humanistic analysis - e-history.kz
Main stages, features and tendencies of formation and development of market economy of independent Kazakhstan

Kazakhstan model of mixed economy

The second half of the XX century was marked by global transformations in the social development, having diverse forms of realization. In their variety there are the general trends of social and economic progress conducting to overcoming of class and antagonistic contradictions, to high-quality change of reference points and values of development, a ratio economic and noneconomic composed in public interests. Transformation of the social and economic relations and formation of public system of new type means qualitatively new model of managing leaning on world tendencies. The new forming model of managing represents mixed economy.

The general line on development of the mixed economic system doesn't mean monotony and standardization. In the different countries there are various models of mixed economy which differ from each other the in "national coefficients of mixture" different forms of ownership, the market and state regulation. This feature depends on many factors: level and nature of material base, historical and geopolitical conditions of formation of a social system, national and welfare features of the country, influence of these or those socio-political forces, etc. Nevertheless, in economic practice there were certain national models of mixed economy:

• the Anglo-American - the liberal and market model, being characterized a prevailing role of a private property, encouragement and freedom of business activity and orientation to personal success, a support on market mechanisms, social and property differentiation;

• the German - the social market economy model, being characterized high social guarantees and an active antimonopoly policy of the state;

• the Japanese - model of adjustable corporate capitalism in which the leading role of the industrial and financial capital is combined with the state programming of economy and quite considerable influence of a traditsionalizm

• the Swedish - model of a market economy with an insignificant share of state ownership, but the high level of social guarantees based on broad redistribution of the income at high level of the taxation;

• the Chinese - the model assuming use of a market mechanism at the leading role of state planning and regulation of economy and preservation of the state social guarantees.

Formation of the Kazakhstan model of mixed economy began in the conditions of the economic recession caused by a rupture of traditional economic relations, liberalization of the prices and other tendencies. To create the national structure of the economy adequate to market requirements, Kazakhstan has to pass a long way, determine the priorities by all directions and at all levels of society and economy. Imperatives of the Kazakhstan model of mixed economy are: state and market reintegration; recombination of the relations of property; reintegration of the state and private sectors of economy; social orientation of economy; economy internationalization.

The analysis of formation and mixed economy development in Kazakhstan allows to draw the following conclusions:

• mixed economy formation in Kazakhstan is carried out according to regularities of formation and development of the market relations, the general tendencies of development of economic systems;

• the legislation as a whole conforms to objective requirements of each stage of development of mixed economy;

• institutional transformations are carried out gradually and accompanied: development of the market relations, emergence of new institutes;

• the developed Kazakhstan model of mixed economy is characterized by a multiformity, new economical and legal forms and system of the relations of property organizational structures of management

In view of the above, we allocate four stages of formation and mixed economy development in Kazakhstan.

The first stage of formation of mixed economy in Kazakhstan covers the period of 1992-1993 - from the moment of the announcement the republic of the sovereignty and before introduction of own national currency. Objectively to Kazakhstan, as well as other CIS countries, at the first stage target reference points of the western sample of market model were actually set. Considerably monetary model of the accelerated, "shock" transition to the market was imposed to the republic. This project was rigidly attached to arguments of the western sample and didn't consider own specifics of Kazakhstan. Rather standard procedure of the western economy with full liberalization of the prices and tough restrictive financial and credit policy in the conditions of lack of the developed market infrastructure, loss of controllability of national economy led to sharp rise in prices, acute payment and financial crisis at all levels.

The galloping inflation undermined start of market mechanisms and institutional transformation. Crisis of the budgetary sphere, disorder tax system uncontrollable leakage of the capitals and an aggravation of social problems - all this aggravated inflation, depreciated accumulation and current assets of the enterprises, undermined thereby real base for investments and savings as factors of economic growth In the country there was obviously inflationary model of development.

The second stage of formation of mixed economy (1994-1998) began with formation of independent economic policy in the country. The course on tough monetary policy was used as a priority measure for economy stabilization. In the republic the consistent tough monetary and credit and budgetary policy was pursued that allowed to reduce inflation from level of 2200% in 1993 to 7,3% in 1998.

In the middle 90-g in the republic accepted the comprehensive anti-recessionary Program on macroeconomic stabilization. The main emphasis in it was laid on creation of the competitive environment and restriction of monopolistically activity, price control to services of natural monopolists. Measures for streamlining foreign trade and currency transactions, export and capital import were entered. The course on liberalization of a foreign trade policy was accompanied by stimulation of investment import and cancellation of duties on import of hi-tech goods. These years reforms of pension system and housing and communal services were carried out.

Essentially new economic situation as a result of which process of transformation of command economy in market accepted irreversible character on the basis of key system transformation to which number it is possible to carry the following became the main result of the second stage of reforms:

• reduction of forms of the state regulation of economic life along with more and more extended use of market regulators of social and economic processes, liberalization of foreign economic activity, country opening for the foreign capital, providing rather stable currency mode, development of exchange trade;

• practical realization of the principles of free pricing with use of services of State Regulation on very limited circle of production, works

• change of the general economic environment, creation of conditions for development is market the focused economic structures, formation and expansion of bases of multistructure economy, formation of effective and responsible owners, by carrying out large-scale privatization;

• development of business, small and medium business, formation of the environment of the healthy market competition.

The second stage of reforming of economy, in view of the carried-out radical institutional restructurings, put a basis for stabilization and formation positive tendencies in development of social and economic processes of national economy

Meanwhile radical transformations of the relations of property on the basis of privatization and privatization caused absolute domination of the private sector in national economy.  By the end of 1998 in Kazakhstan the services sector, construction, the motor transport, the food industry absolutely most part of the oil and gas industry, power, metallurgy and other branches of economy were almost completely privatized.  The state ownership generally in full remained on iron and the highways, fundamental science, basic education out-patient health care, and also part of the enterprises (organizations) of other branches of economy.

The third stage of economic transformations in Kazakhstan (1999-2003) is characterized by relative stability of positive dynamics of the main macroeconomic indicators. The system of measures for macroeconomic stabilization of economy and the consecutive market reforms imposed on favorable external economic factors, allowed Kazakhstan at a boundary of the 90th - the beginning of 2000 to create bases of market economy, there was a radical change of social and economic system. Sustainable, dynamic development of economy for the last five years fixes irreversible nature of market transformations. The international financial centers recognized Kazakhstan as the country of market economy.

At the same time world and Russian financial crisis of 1998-1999 has negative impact on forward development of economy of Kazakhstan. Owing to adverse conditions of the world prices for goods exported by the republic, and also reduction of external demand for the Kazakhstan production in 1999 decrease in gross domestic product of the country was noted, and in 2002 the national currency underwent essential devaluation. With all evidence dependence of economy of the republic on fluctuation in prices in the world commodity and raw markets and an economic situation in other states was shown. Problems of development of manufacturing industry, support of domestic producers and small business, deepening of structural reforms of the economy directed on overcoming of raw orientation of an economic complex were staticized.

The solution of these problems found the expression in essential deepening of institutional transformations. Considerably the standard and legal base of economic processes extended, a number of the program documents promoting development of the most significant spheres of economy was accepted, measures for approach of the economic environment to standards of the developed market are taken. In the Republic of Kazakhstan, by one of the first among the republics of the former USSR, structural transformations separate, the most significant, first of all in the social plan, economy spheres began to be carried out:

• creation of essentially new pension system focused on personalisation of pension means of citizens in system of accumulative funds, powerful national investment institutes carrying out, besides, function;

• transition to market mechanisms in housing and communal services sphere with full payment by consumers of cost of services, along with improvement of system of the state support of needy citizens;

• introduction of market mechanisms in health care and education, private sector development stimulation in these spheres;

• improvement of processes of privatization and management of state ownership;

• acceptance of a package of measures on support of domestic producers and import substitution development that allowed to begin restoration of the enterprises of manufacturing industry;

• deepening of reforms in the financial sphere, directed on further strengthening of the domestic banking sector and involvement in investment processes of means of the population (creation of fund of guaranteeing deposits in banks of the second level, reform in the insurance market);

• the decision on formation of National fund of the Republic of Kazakhstan, allowing to reduce dependence of the country on adverse changes of a price environment of the world markets;

• Development bank creation for the purpose of expansion of practice of long-term crediting of investment projects;

• adoption of the new Tax code which forms the tax system directed on stimulation of domestic producers and revival of economy.

The fourth stage is characterized as a stage of "sustainable development" of mixed economy. At this stage socially focused development is defining: priorities on social orientation of the relations of property, distribution of the income, partnership and rivalries, a full development of the person, a humanization of economy, growth of national welfare. Industrial and innovative development, development of a korporatization, business, the state-private market, formation of progressive structure of a social production belong to economic priorities on the basis of prevalence of a services sector, providing the economic sovereignty and safety of the country increase of a role of Kazakhstan in world division of labor.

At the same time, the negative factors interfering a sustainable development of economy, are:

• preservation of a raw orientation and stagnation of processing branches;

• strong vulnerability of export-oriented branches from fluctuations of an environment of the world prices for narrow group of the goods being the main articles of export of the country; the growing competition from producers of similar production in the adjacent states;

• strengthening of dependence on external deliveries at available and potentially possible to realization of own productions of the equipment and accessories (technological dependence), energy carriers;

• replacement from an internal consumer commodity market of a domestic production import production;

• unfair competition and protectionism in the world market, bringing to economic discrimination of the Kazakhstan producers.

All these existing and possible negative factors on ways of industrial and innovative development of economy of the republic have to be comprehensively considered at accession to WTO which will define in many respects the strategic directions and limits of economic achievements of progress of national economy of the republic.

To win positions in the world markets it is necessary to reach high competitiveness of concrete types of an industrial output and services of domestic producers. In the message of the President to the people of Kazakhstan the urgent problem of increase of competitiveness of our economy, transition to model of technical regulation and product quality control according to the ISO international standards, justifications of priorities of competitive clusters of branches and the productions which are closely coordinated to the Innovative program (on March 19, 2004) is proved.

Industrial and innovative development and deepening of market reforms in the republic in a defining measure are interfaced to system transformation of the basic economic relations - the property relations. Privatization process in national economy promoted formation of the new owners having the purposes and playing a various role in corporate governance. Therefore studying of influence of various categories of subjects of property on model of economic behavior of the enterprises and motivation of their activity, including being in foreign property is especially significant.

Within development of the state-private partnership (SPP) formation of the standard and legal and methodical base providing broad application in practice of instruments of financing of GChP, provided to subjects of the private sector is expedient from the state, and also introduction in action of system of tax incentives for participants of GChP in the social sphere.

At this stage of development it is expedient to strengthen a state position in all spheres of economy that will allow to protect national economic interests more effectively. Proceeding from world experience in rigid competitive fight only powerful national corporations which creation without participation of the state is represented impossible can stand. The close attention is demanded also by questions of stability of a financial system of the state as its condition and possibilities of development define conditions of growth of economy.

As a whole the Kazakhstan model of mixed economy quite proved the viability. It contains the potential of future sustainable development at preservation of its essence when the stable economic basis is necessary for formation of the strong state.