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Kazakhstan: President Meets Challenge Of Growing Discontent

By Lisa McAdams/Bruce Pannier

Kazakhstan's President Nursultan Nazarbayev is attending the World Economic Forum in Salzburg, Austria. Kazakhstan has recently devalued its currency as a result of being hit hard by the financial crisis in Russia -- its leading trade partner -- and by falling prices for its major exports, oil and metals. Nazarbayev was interviewed today in Salzburg by RFE/RL's Lisa McAdams, who asked him about the state of the country's economy and about political developments.

Salzburg/Prague, 1 July 1999 (RFE/RL) -- Kazakh President Nursultan Nazarbayev, responding to questions asked by our correspondent, first talked about recent difficulties in getting this year's budget through parliament.

"Society never applauds when it is necessary to make budget cuts, [particularly when it] affects the allocation of funds for social needs. Therefore, the question of [budget cuts] did not elicit much joy in our parliament. This is natural."

Nazarbayev was next asked about growing discontent with the standard of living in Kazakhstan. Yesterday, a group of pensioners blocked main roads in the former capital, Almaty, demanding special privileges for using public transportation. The pensioners claimed their income is not sufficient to spend on public transportation.

Nazarbayev said pensioners were taken into account when this year's budget was revised:

"I had to choose a regime of tough economic measures. I believe this is a normal thing, but budget cuts did not affect social programs, especially for pensioners and those who receive their salaries from the state budget."

A month ago, the governor of the Almaty District, Zamanbek Nurkidilov, initiated a campaign to donate gold and jewelry to bolster Kazakhstan's hard currency reserves. The government has promised eventually to return the contributions. Nazarbayev publicly endorsed the idea, which many believe was originally his own. A similar campaign met with success earlier in South Korea.

Foreign media reported Kazakhstan's campaign involved the entire country, and some reports alleged citizens were pressured to contribute. Nazarbayev was asked about the campaign.

"As for the gold and jewelry collection... I don't think we are in the same situation as South Korea was. But the initiative took place openly in one region, which was the Almaty district. Of course, if ordinary citizens are eager to assist us in these very tough economic conditions, if they really want to make contributions to the social fund to help the needs of families with low incomes or many children, to support pensioners, I believe the government will not be against that. This is not a government policy. It was not organized from above."

Nazarbayev also spoke about the development of private business in Kazakhstan, noting that such businesses now employ a large segment of the country's eligible work-force:

"There are some people who have managed to become rich in the course of reforms. I can assure you that we have many rich people and many with mid-level incomes. We have people working in small- and medium-sized businesses. Their number is 1.2 million" [out of a total population of 15 million].

According to figures from the government's own statistics agency, there are eight million eligible voters, three million of whom are pensioners. A large percentage of the population is not yet old enough to enter the work-force. So the figure of 1.2 million people working in small and medium-sized businesses would seem to indicate a significant trend toward employment in private enterprises.

Nazarbayev concluded his remarks to RFE/RL with comments on upcoming elections to parliament and his responsibility to the country at this time.

"Of course, when we have such economic hardships, political forces in the country become more active. For the first time in the history of Kazakhstan, there will be parliamentary elections by party lists. That is normal, but if the political struggle becomes more acute in the period prior to elections, I think I myself, as leader of the country, must educate my nation on how to introduce democracy to the country. We never had any sort of democracy before."

Nazarbayev also said he believes the worst of his country's financial crisis is over. He admits that times are hard in Kazakhstan, but says he expects the situation to begin improving, perhaps before the end of this year.