The wisdom of youth
The youthful managers of Kazakhstan's financial sector are determined that oil and minerals wealth will be used to create a strong mixed economy. A well-regulated banking system and controls on the inflationary effects of oil earnings have been established but diversification and financial markets development still face significant hurdles.
THE YOUNG MEN, many less than 30 years old, who manage much of Kazakhstan's economic and banking sectors should be smiling. Wealth is pouring in from oil and mineral sales to an extent not seen in the country's 14-year history as an independent entity. This is reflected in growth in GDP – more than 10% over each of the past four years. But instead of joy, they exhibit an austerity and caution unusual in people of their age.
These bright but inexperienced operators are the heirs to the discredited communist managers who allowed their country to be treated as the granary of the Soviet Union. They have no wish to repeat the mistakes of the past and are determined to build a market-based economy free from dependence on one commodity.
The bright managers have another reason to be happy. The country has just been given an investment-grade rating by Standard & Poor's. This acknowledges their skill in managing an economy that could by now have been swept towards disaster on a tide of inflation and consumerism created by its oil wealth.