Tourism

Main article: Tourism in Kazakhstan

Lake Burabay, view from Mount Bolectau

Shymbulak ski resort in Almaty

Kazakhstan is the ninth-largest country by area and the largest landlocked country in the
world. As of 2014, tourism accounted for 0.3 percent of Kazakhstan's GDP, but the
government had plans to increase it to 3 percent by 2020.[182][183] According to the World
Economic Forum's Travel and Tourism Competitiveness Report of 2017, travel and tourism
industry GDP in Kazakhstan was $3.08 billion or only 1.6 percent of total GDP. The WEF
ranked Kazakhstan 80th in its 2019 report.[184]
In 2017, Kazakhstan ranked 43rd in the number of tourist arrivals. In 2014, The
Guardian described tourism in Kazakhstan as "hugely underdeveloped", despite the
country's mountain, lake and desert landscapes.[185] Factors hampering an increase in
tourism were said to include high prices, "shabby infrastructure", "poor service" and the
difficulties of travel in a large underdeveloped country.[185] Even for Kazakhs, going for a
holiday abroad may cost only half the price of taking a holiday in Kazakhstan.[185]
The Kazakh Government, long characterised as authoritarian with a history of human rights
abuses and suppression of political opposition,[16] in 2015 issued a "Tourism Industry
Development Plan 2020." It aimed to establish five tourism clusters in
Kazakhstan: Astana city, Almaty city, East Kazakhstan, South Kazakhstan, and West
Kazakhstan Oblasts. It also sought investment of $4 billion and the creation of 300,000 new
jobs in the tourism industry by 2020.[186][185]
Kazakhstan has offered a permanent visa-free regime for up to 90 days to citizens
of Armenia, Azerbaijan, Belarus, Georgia, Moldova, Kyrgyzstan, Mongolia, Russia
and Ukraine, and for up to 30 days to citizens of Argentina, Brazil, Ecuador, Serbia, South
Korea, Tajikistan, Turkey, UAE and Uzbekistan. It also established a visa-free regime for
citizens of 54 countries, including the European Union and OECD member states,
the U.S., Japan, Mexico, Australia and New Zealand.[187][188]
Foreign direct investment
Kazakhstan has attracted $330 billion in foreign direct investment (FDI) from more than 120
countries since its independence (1991).[189] In 2015, the U.S. State Department said
Kazakhstan was widely considered to have the best investment climate in the region.[190] In
2014, President Nazarbayev signed into law tax concessions to promote foreign direct
investment which included a 10-year exemption from corporation tax, an eight-year
exemption from property tax, and a 10-year freeze on most other taxes.[191] Other incentives
include a refund on capital investments of up to 30 percent once a production facility is in
operation.[191] In 2012, Kazakhstan attracted $14 billion of foreign direct investment inflows
into the country at a 7 percent growth rate.[192] In 2018, $24 billion of FDI was directed into
Kazakhstan, a significant increase since 2012.[193]
In 2014, the European Bank of Reconstruction and Development (EBRD) and Kazakhstan
created the partnership for Re-Energizing the Reform Process in Kazakhstan to work with
international financial institutions to channel US$2.7 billion provided by the Kazakh
government into important sectors of Kazakhstan's economy.[194] As of May 2014,
Kazakhstan had attracted $190 billion in gross foreign investments since its independence
in 1991 and it led the CIS countries in terms of FDI attracted per capita.[195] The OECD 2017
Investment Policy Review noted that "great strides" had been made to open up
opportunities to foreign investors and improve policy to attract FDI.[196] China is one of the
main economic and trade partners of Kazakhstan. In 2013, China launched the Belt and
Road Initiative (BRI) in which Kazakhstan functions as a transit hub.[197]
Banking
The banking industry of Kazakhstan went through a boom-and-bust cycle in the early 21st
century. After several years of rapid expansion in the mid-2000s, the banking industry
collapsed in 2008. Several large banking groups, including BTA Bank J.S.C. and Alliance
Bank, defaulted soon thereafter. The industry shrank and was restructured, with system-
wide loans dropping from 59 percent of GDP in 2007 to 39 percent in 2011. The Kazakh
National Bank introduced deposit insurance in a campaign to strengthen the banking
sector. Several major foreign banks had branches in Kazakhstan, including RBS, Citibank,
and HSBC. Kookmin and UniCredit both entered Kazakhstan's financial services market
through acquisitions and stake-building. [citation needed]
Economic competitiveness
According to the 2010–11 World Economic Forum in Global Competitiveness Report,
Kazakhstan was ranked 72nd in the world in economic competitiveness.[198] One year later,
the Global Competitiveness Report ranked Kazakhstan 50th in most competitive
markets.[199]
In the 2020 Doing Business Report by the World Bank, Kazakhstan ranked 25th globally
and as the number one best country globally for protecting minority investors'
rights.[200] Kazakhstan achieved its goal of entering the top 50 most competitive countries in
2013 and has maintained its position in the 2014–2015 World Economic Forum Global
Competitiveness Report that was published at the beginning of September
2014.[201] Kazakhstan is ahead of other states in the CIS in almost all of the report's pillars of
competitiveness, including institutions, infrastructure, macroeconomic environment, higher
education and training, goods market efficiency, labour market development, financial
market development, technological readiness, market size, business sophistication and
innovation, lagging behind only in the category of health and primary education.[201] The
Global Competitiveness Index gives a score from 1 to 7 in each of these pillars, and
Kazakhstan earned an overall score of 4.4.[201]
Corruption
In 2005, the World Bank listed Kazakhstan as a corruption hotspot, on a par
with Angola, Bolivia, Kenya, Libya and Pakistan.[202] In 2012, Kazakhstan ranked low in an
index of the least corrupt countries[203] and the World Economic Forum listed corruption as
the biggest problem in doing business in the country.[203] A 2017 OECD report on
Kazakhstan indicated that Kazakhstan has reformed laws with regard to the civil service,
judiciary, instruments to prevent corruption, access to information, and prosecuting
corruption.[204] Kazakhstan has implemented anticorruption reforms that have been
recognised by organizations like Transparency International.[205]