KAZAKHSTAN: OPTIMISM IN EAST KAZAKHSTAN OBLAST

UNCLAS SECTION 01 OF 02 ASTANA 002127 SENSITIVE SIPDIS STATE FOR SCA/CEN, G/TIP E.O. 12958: N/A TAGS: PGOV PHUM ECON EINV KWMN KCRM CH KZ SUBJECT: KAZAKHSTAN: OPTIMISM IN EAST KAZAKHSTAN OBLAST REF: ASTANA 1867 ¶1. (U) Sensitive but unclassified. Not for public Internet. ¶2. (SBU) SUMMARY: Poloff visited Ust-Kamenogorsk, the capital of East Kazakhstan oblast, September 10-13. In addition to attending a Global Initiative to Combat Nuclear Terrorism exercise (see reftel),poloff also conducted a series of meetings with representatives of industry, educational institutions, and non-governmental organizations. East Kazakhstan oblast has a strong industrial base, particularly in metallurgy and mining. While per capital income in East Kazakhstan is below the national average, poloff's interlocutors expressed satisfaction with local economic conditions. Two NGO representatives described good cooperation with local authorities on trafficking in persons issues. Though the oblast borders China, there was no evidence of a significant Chinese presence in Ust-Kamenogorsk. END SUMMARY. STRONG INDUSTRIAL BASE ¶3. (U) East Kazakhstan oblast is located in Kazakhstan's northeastern corner, more than 1,000 miles from Astana. The oblast, which borders both Russia and China, is Kazakhstan's third largest in both territory and population. In contrast to Kazakhstan's western oblasts, East Kazakhstan has no major hydrocarbon deposits, but it does have a well-developed industrial base. Industry, especially non-ferrous metallurgy and mining, dominates the oblast's economy, accounting for 31.2% of its GDP. The once top-secret Ulba Metallurgical Plant, which currently produces uranium, beryllium, and tantalum byproducts, is the oblast's most well-known industrial concern (see septel). Kazzinc, a mining conglomerate, is a second notable East Kazakhstan enterprise. The Asia Auto Joint Stock Company has invested $2.15 million in East Kazakhstan to begin the first phase of a project to assemble up to 9,000 General Motors automobiles per year. ¶4. (U) East Kazakhstan's most famous local product is honey. While in Ust-Kamenogorsk, poloff stopped into a honey store, where prices ranged from $2 for 200 gram bottles with run-of-the-mill honey to $40 for 1000 gram wooden containers with specialty honey. The store also sold elaborately packaged, honey-infused medicinal products, some designed "for men" and others "for women," which ranged in price from $40 to over $120 per one liter bottle. Several local enterprises have established joint ventures with Chinese and South Korean firms to export honey products to Asian markets, the honey store's salesperson explained to poloff. UPBEAT ON ECONOMIC OPPORTUNITIES ¶5. (SBU) According to Kazakhstani government statistics, per capital GDP in East Kazakhstan oblast is $4,464, somewhat below the national average of $6,870. Despite these numbers, poloff's various interlocutors in Ust-Kamenogorsk without exception expressed satisfaction with the current economic situation. Managers from the Ulba Metallurgical Plant and Eastern Mining Institute, as well as students from the Kazakh-American Free University, all said they were optimistic about opportunities for economic development, employment, and career advancement in East Kazakhstan (see septels). NGOS REPORT GOOD COOPERATION WITH LOCAL AUTHORITIES ¶6. (SBU) NGO representatives Nazigul Akhmetkaliyeva and Yulia Natarova explained to poloff that they have had good ASTANA 00002127 002 OF 002 cooperation with local authorities. The two run NGOs which provide assistance to victims of trafficking in persons and legal consultation services on a number of issues. The anti-trafficking NGO operates an information hot-line, provides training to those who assist trafficking victims (including police and lawyers),and conducts public education campaigns. Akhmetkaliyeva said that local authorities even allowed her NGO to conduct training at government-run orphanages. She described other examples of successful cooperation with the authorities on specific trafficking cases, including repatriating and rehabilitating a group of Kazakhstani women who had been trafficked to the UAE, returning a young man who had been a victim of forced labor in Kazakhstan to Russia, and returning several sex-trafficking victims from Kazakhstan back to Uzbekistan. According to Akhmetkaliyeva, local authorities rendered various types of assistance, from helping to coordinate the repatriations with other government entities to providing shelter and financial support to victims. Akhmetkaliyeva noted that local authorities even provided her with transport to travel to neighboring Pavlodar oblast to assist with a case that occurred there. Akhmetkaliyeva praised East Kazakhstan officials for their willingness to confront, rather than try to conceal, trafficking problems. Both Akhmetkaliyeva and Natarova contrasted the good cooperation of East Kazakhstan authorities with reports they have heard that the authorities in Kazakhstan's southern and western regions are less constructive. OPTIMISM ABOUT RELATIONS WITH CHINA ¶7. (SBU) Despite the fact that East Kazakhstan oblast shares a long border with China, poloff saw surprisingly few visible signs of Chinese influence in Ust-Kamenogorsk. Local residents told poloff that there is a "Chinese bazaar" on Saturdays, and that local grocery stores stocked more Chinese products than in Kazakhstan's capital, Astana, but there were no signs of a large Chinese trader or migrant worker community. In addition, Akhmetkaliyeva said that her anti-trafficking NGO had dealt with just one or two cases of trafficking across the Kazakhstani-Chinese border, which she attributed to the fact that the border between Kazakhstan and China remains heavily fortified. HOAGLAND