Aug 7, 2014 | 14:16 GMT

3 mins read

Kazakh Government Reshuffle Aims for Balance and Reform

Kazakh Government Reshuffle Consolidates Control

Kazakh President Nursultan Nazarbayev announced a large-scale government reshuffle Aug. 6, citing the need to increase the government's efficiency. Kazakhstan is confronting a notable economic slowdown and its leadership is in the process of planning for Nazarbayev to step down. The reorganization offers some interesting clues about shifting power balances among Kazakhstan's elite and about Kazakhstan's relationship with Russia.

Kazakhstan's reshuffle includes structural changes to the government, which will downsize it from 17 ministries to 12, and from 54 federal committees to 30. Most of the previous ministers have remained in the top levels of government and many have become deputy ministers under the new structures.

Kazakhstan New and Liquidated Ministries

This government reshuffle was organized not by Nazarbayev, but by the recently reinstated Prime Minister Karim Massimov. Stratfor sources noted that Nazarbayev even went on holiday while Massimov managed the reorganization, and that this testifies to the power being entrusted to the reinstated prime minister. Massimov was re-appointed prime minister in April as the Kazakh economy slowed amid stagnating energy production, skyrocketing debts and exposure to Russia’s declining economy. Massimov, who among other posts was previously minister of economy and budget planning, is seen as one of few leaders among the Kazakh elite capable of bringing in foreign investment and enacting a plan to address the country's economic strains, while simultaneously balancing Kazakhstan's multiple political factions.

The restructuring of government ministries is Massimov's first significant move. Massimov hopes to put in position the people that will enable him to control entire political processes, allowing him to make decisions that address all of Kazakhstan's economic troubles rather than making changes piecemeal, as the Kazakh government often has done in the past.

Nazarbayev has his own reasons for placing Massimov in control of the changes. If Massimov's leadership fails to strengthen the country, then it will be Massimov who takes the blame — as Massimov well knows from the experience of his previous dismissal. In 2011, Massimov took partial blame for riots in Zhanaozen, and Moscow saw him as too closely connected to Beijing.

All of Massimov’s decisions seem to fall in line with the interests of a new grouping of Kazakh elites, mostly in Nazarbayev’s family, which will manage the succession to Nazarbayev. Two specific moves within the reshuffle suggest that Massimov is trying to enact a smooth transition — one that satisfies the needs of powerful players outside of Nazarbayev's inner circle.

One of the agencies liquidated was the Agency to Fight Against Economic and Corrupt Crimes, essentially Kazakhstan's financial police. The new organization that replaces it, the Agency for the Affairs of Public Service and Counteracting Corruption, will be as powerful as its predecessor and will be led by Kayrat Kozhamzharov, who was previously the Secretary of the Security Council. Kozhamzharov is a leading member of the Southern Clan, the second most powerful group in Kazakhstan outside of Nazarbayev’s family and its nascent coalition. This nod by Massimov is meant to maintain some sort of balance between the groups and seeks to avoid drawing the enmity of the Southern Clan.

Massimov's other notable decision was to name Vladimir Shkolnik as head of the new Energy Ministry. Shkolnik is known for lobbying heavily on behalf of Moscow, and this could be Massimov’s way of showing Russia that he does not favor China over Russia's interests.

The downsizing of the ministries is the first step in Massimov's attempt to create a more efficient government while balancing Kazakhstan's competing political factions. Now Massimov has to decide how to tackle the country’s economic decline at a time when Kazakhstan’s main economic partner — Russia — is facing economic problems of its own that are only set to get worse.

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