A DECADE AGO, Kazakhstan looked like a classic basket case, with inflation at 2,000% a year darkening a landscape replete with shuttered factories and fallow farmland.
Today, growth has totalled some 40% over the past four years – the fastest expansion in the world after Equatorial Guinea, which is in the midst of its own oil boom. Inflation is 6%, the budget surplus was 2% in 2003 and this vast country stretching from Europe to China is a net creditor to the world. Last year, Moody's upgraded the sovereign to investment-grade Baa3.
At independence in 1991, Kazakhstan had a per-capita GDP that was 40% of Russia's. It has now caught up with its neighbour to the north, which colonized it for nearly two centuries, and expects to exceed it on a GDP-per-capita basis in 2004.
Though crude oil sales account for only 18% of GDP, petroleum is the locomotive of the economy. Production has risen past 1 million barrels a day and is expected to triple in 15 years or so – the fastest increase expected of any country, at a time when oil prices are nearly double what they were as recently as the late 1990s.