KAZAKHSTAN: GOVERNMENT WANTS TO SEE STEPNOGORSK

C O N F I D E N T I A L ALMATY 001846 SIPDIS SIPDIS DEPT FOR SCA/CEN (J. MUDGE),ISN/CTR (E. CAMERON),ISN/NDF (R. SMITH) E.O. 12958: DECL: 05/24/2016 TAGS: KNNP KSCA PARM PREL TBIO TSPL KZ SUBJECT: KAZAKHSTAN: GOVERNMENT WANTS TO SEE STEPNOGORSK VACCINE FACILITY SUCCEED REF: A. ALMATY 1583 ¶B. 5-11-06 MENNUTI-CAMERON EMAIL Classified By: CDA Mark Asquino, reasons 1.4 (e) and (h). ¶1. (C) Summary: Kazakhstani officials dealing with biotechnology issues are eager to see the veterinary vaccine production facility that Betta Star is setting up in Stepnogorsk succeed, as it has the potential to commercialize innovations resulting from Kazakhstani research. According to the director of the National Center for Biotechnology, the GOK has found the Stepnogorsk facility to be in full compliance with Kazakhstani laws, and does not believe that it presents a proliferation or public health threat. Although there is little chance of forcing Betta Star to abandon plans to manufacture veterinary anthrax vaccine, the NCB director thinks the company might be open to discussion of USG support for alternative activities. End summary. ¶2. (C) Following the transmission of Ref A update on plans for veterinary vaccine production in Stepnogorsk, POEC chief discussed the issue with National Center for Biotechnology (NCB) director Yerlan Ramanculov on the margins of Vice President Cheney's May 5-6 visit to Astana. Ramanculov emphasized that he and the other leaders of the NCB, as well as Ministry of Education and Science (MES) officials, are eager to see the Betta Star facility in Stepnogorsk succeed. The NCB is working hard to develop new technologies, and sees the new facility as the only company in Kazakhstan with the potential to commercialize the new ideas. GOK officials with knowledge of the situation very much want to avoid the destruction of the facility, according to Ramanculov. He also mentioned that, after reviewing Betta Star's plans and inspecting the facility, MES had found the operation in full compliance with Kazakhstani laws. ¶3. (SBU) Underscoring the importance the GOK attaches to the success of the project, Ramanculov told POEC chief that at Betta Star director Gaisha Kashikova's request he had seconded one of his assistants to help with the start-up planning. Unfortunately, that individual left Betta Star when Kashikova disagreed with his advice. ¶4. (SBU) Ramanculov said that as he understood the privatization agreement, at the end of the five-year period (i.e. October 2006) Betta Star must be able to show that it has a functioning production facility operating "more or less along the same lines" as the old Biokombinat plant. He explained that for that reason, Betta Star cannot afford to delay its efforts to get a vaccine production facility up and running. ¶5. (C) Ramanculov stressed that there was little leverage to force Betta Star to drop anthrax vaccine production plans, as production would present no proliferation or public health threat. He thought there was a small chance that Betta Star might agree to do so, however, if the USG funded some other activity that would be compatible with the firm's expertise and equipment, and that would broaden the company's economic base. Ramanculov expressed willingness to help convey any proposals to Betta Star's shareholders, as well as to meet with any USG group that visited Kazakhstan for dicussions. ASQUINO