At the end of April, thousands took to the streets across the country to protest against changes to the land code. It is feared that these modifications will lead to large privatisations of farmlands and will open the door to land ownership by Chinese investors. In response, President Nazarbayev put the land reform on hold but this did not prevent the protests from continuing. Hence, mid-May, police broke up the protests and detained some of the protesters.

Impact on country risk

Large protests are uncommon in this authoritarian country. Last protests took place in 2011 in Zhanaozen when oil workers went on strike. The recent wave of protests highlights growing discontent among the population following the sharp depreciation of the tenge which lost nearly 50% of its worth last year (cf. graph) – and recovered slightly thereafter – and amid economic difficulties. Indeed, the Kazakh economy has been hit hard by a triple external shock: the sharp drop in oil prices (its main source of current account receipts and public revenues), the economic crisis in Russia (and the sharp depreciation of the rouble) and the slowdown in China (its main trading partner). GDP growth is expected to increase by a mere 0.1% this year. The protests also took place in a context of rising uncertainty regarding the succession of the aging president, who is a key figure for political stability in the country.

Analyst : Pascaline della Faille, p.dellafaille@credendogroup.com