Amid the ongoing war in Ukraine and geopolitical tensions, Kazakhstan is positioning itself to attract $150 billion in foreign direct investment (FDI) by 2029. The conflict has provided Central Asian nations, including Kazakhstan, opportunities to strengthen economic ties with the West. In 2022-2023, the Netherlands emerged as the leading investor, contributing over $12 billion to Kazakhstan’s economy, followed by the US and Switzerland.
However, despite its ambitious goals, Kazakhstan faces challenges. In 2023, FDI inflows dropped by 32.3%, reflecting a lack of comprehensive development strategies for industries and regions. To counteract this, the government has introduced initiatives inspired by British and UAE models, notably through the Astana International Financial Center, which is modeled after Dubai’s financial hub. These measures aim to attract global investors by offering tax breaks, reduced bureaucracy, and a regulatory framework based on British Common Law principles.
Kazakhstan is also focusing on long-term agreements with foreign companies, particularly in its oil and gas sector. President Kassym-Jomart Tokayev acknowledged that renegotiating production-sharing agreements on favorable terms is essential for securing large investments. However, some companies view these moves as signs of “resource nationalism.”
Further strategies include initiatives like the Digital Nomad visa to attract remote workers and businesses relocating from Russia. Kazakhstan has already attracted 41 foreign companies worth over $1.5 billion and is in talks with Chinese firms such as Xiaomi and TCL to move production facilities.
The geopolitical realignment caused by sanctions on Russia has also funneled trade through Central Asia, benefiting Kazakhstan’s economy. The government is investing in developing the Trans-Caspian International Transport Route to strengthen its trade links with Europe and Asia.
Despite inflation and economic stability challenges, Kazakhstan’s prospects remain strong. The country is now ranked among the world’s top 35 most competitive nations, with the Asian Development Bank projecting 5.1% economic growth by 2025. Kazakhstan’s strategic location, trade agreements, and ongoing reforms position it well to become a regional economic leader.
