SEATTLE — Kazakhstan is blessed with abundant natural resources like vast mineral deposits and oil fields. It has one of the fastest growing economies in the world and a strong political system even though it became independent only 25 years ago.
The rate of poverty (below subsistence level) in Kazakhstan is estimated to have declined from 50 percent in 2012 to around 2.8 percent in 2014. The country’s agriculture sector employs one-fourth of the population but accounts for only 5 percent of GDP. Kazakhstan is especially vulnerable to price fluctuations of commodities. A fall in oil prices has a negative impact on its national income.
Moreover, the country faces income inequality and regional variations in poverty levels. The regions of Akmola, Karagandy and East Kazakhstan have the highest level of inequality and are among the poorest in the country, even though their GDP per capita is growing the fastest. It could be said that the face of poverty in Kazakhstan is its regional disparity.
Though the poverty rate looks low, the relative (median consumption level) poverty in Kazakhstan could be as much as 20 percent of the population. Food represents 60 percent of the overall consumption of poor households.
Facts about poverty in Kazakhstan
- Rural poverty is higher than urban poverty. However, 14 percent of the poor live in cities, probably because they migrated in search of work.
- The largest share of the poor are children (around 35 percent) and they are at the greatest risk. Pension rates have ensured that the retired are well above the poverty line.
- Poverty is inversely related to education, but almost 10 percent of the educated remain poor.
- The agricultural sector employs many but provides very low wages, making those employed by it susceptible to poverty.
- Landowners are at higher risk of poverty in Kazakhstan. 6.6 percent of landowners are poor compared to 2.4 percent who do not own land.
Though Kazakhstan has achieved 100 percent literacy, it still lacks access to clean water, sanitation facilities, health services and prevention against HIV. The government provides a social protection system that includes social insurance benefits, social assistance and social services. It also has many inclusive growth plans for alleviating poverty in Kazakhstan like the Accelerated Industrialization Development Program and the Business Road Map – 2020 Program for job creation and sustenance.
According to the World Bank, the social transfers primarily help households that receive pensions, but has failed to counter poverty in Kazakhstan. The biggest challenge for the government remains the creation of high-quality and productive job opportunities while maintaining its social spending commitments to strengthen the safety net for people living in extreme poverty. According to the report, Kazakhstan has a real chance to raise rural incomes by improving its agricultural sector, given its scale of available agricultural resources.
– Tripti Sinha