Monthly Archives: May 2007

07ASTANA1479, KAZAKHSTAN INTERESTED IN UNSCR 1737 AND 1747

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Reference ID Created Released Classification Origin
07ASTANA1479 2007-05-31 07:22 2011-08-30 01:44 UNCLASSIFIED Embassy Astana

VZCZCXYZ0002
RR RUEHWEB

DE RUEHTA #1479 1510722
ZNR UUUUU ZZH
R 310722Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 9615
INFO RUEHUNV/USMISSION UNVIE VIENNA 0054

UNCLAS ASTANA 001479 
 
SIPDIS 
 
SIPDIS 
 
SCA/CEN FOR M. O'MARA 
 
E.O. 12958: N/A 
TAGS: KNNP MNUC IR KZ
SUBJECT: KAZAKHSTAN INTERESTED IN UNSCR 1737 AND 1747 
IMPLEMENTATION SEMINAR 
 
REF: STATE 69283 
 
Poloff delivered reftel information to Kayrat Sarzhanov, 
Ministry of Foreign Affairs Advisor for International 
Security, on May 31.  Sarzhanov said that Kazakhstan is 
interested in participating in the seminar, but would likely 
have to be represented by the Charge at their embassy in 
Austria. 
GILMER

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07ASTANA1466, KAZAKHSTAN: AUTHORITIES PURSUE RAKHAT ALIYEV

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Reference ID Created Released Classification Origin
07ASTANA1466 2007-05-30 00:16 2011-08-30 01:44 CONFIDENTIAL Embassy Astana

VZCZCXRO9355
PP RUEHDBU
DE RUEHTA #1466/01 1500016
ZNY CCCCC ZZH
P 300016Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 9595
INFO RUCNCIS/CIS COLLECTIVE PRIORITY 0187
RHEHNSC/NSC WASHDC PRIORITY 0035
RUEHVEN/USMISSION USOSCE PRIORITY 1750
RUEKJCS/SECDEF WASHDC PRIORITY 0041
RUEHNO/USMISSION USNATO PRIORITY 2214
RUEHC/SECSTATE WASHDC//SCA COLLECTIVE PRIORITY/ 9596

C O N F I D E N T I A L SECTION 01 OF 02 ASTANA 001466 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR SCA/CEN (M. O'MARA) 
 
E.O. 12958: DECL: 05/29/2017 
TAGS: PGOV PHUM PREL KZ
SUBJECT: KAZAKHSTAN: AUTHORITIES PURSUE RAKHAT ALIYEV 
 
REF: ASTANA 1415 
 
Classified By: A/DCM Deborah Mennuti, reasons 1.4 (B) and (D). 
 
1. (C) Summary:  In the wake of the May 23 announcement of a 
criminal investigation involving presidential son-in-law 
Rakhat Aliyev, Kazakhstani authorities have moved quickly to 
curtail Aliyev's ability to maneuver and to influence public 
opinion. President Nazarbayev fired Aliyev from his 
ambassadorial post in Vienna, an international warrant has 
been issued for his arrest on kidnapping charges, and a team 
of Kazakhstani law enforcement officials is in Austria to 
seek his return to Kazakhstan.  Aliyev's KTK television 
station and the weekly Karavan newspaper have been suspended 
for three months.  More of Aliyev's allies, including the 
head of the Almaty Financial Police and a relative, have been 
questioned by the authorities.  Aliyev continues to fight 
back in public, issuing statements on May 26 and 28 implying 
that he was being persecuted for his political activities and 
accusing Nazarbayev of "repressions."  End summary. 
 
----------------------------------- 
Aliyev Fired, Arrest Warrant Issued 
----------------------------------- 
 
2. (U) After opening a criminal investigation on May 23 
against Rakhat Aliyev and two associates in the mid-January 
kidnapping of two Nurbank officials (reftel), the Kazakhstani 
authorities quickly moved to strip him of his official 
position and seek his arrest.  President Nazarbayev signed an 
order firing Rakhat Aliyev from his post as ambassador to 
Austria and the OSCE on May 26.  On May 28, Ministry of 
Internal Affairs spokesman Kozhakhmetov announced that an 
international warrant had been issued for Aliyev's arrest, 
and that a team led by a deputy procurator general and 
including Kazakhstani Interpol representatives was in Vienna 
to pursue the matter.  Kozhakhmetov said that an Interpol 
"red notice" had been issued in case Aliyev attempted to flee 
Austria. 
 
3. (C) Serzhan Abdykarimov, director of the MFA's Europe and 
North America Department, called A/DCM on May 29 to ensure 
that the U.S. was aware that Aliyev had been fired and was 
the subject of an Interpol warrant.  He added that the MFA 
understood that before being fired Aliyev had requested a 
meeting with unspecified U.S. officials in Vienna.  "In light 
of those developments," Abdykarimov said, "we would ask that 
you weigh carefully the expediency of such a meeting."  He 
reported that Deputy Foreign Minister Kairat Abdrakhmanov had 
gone to Vienna to personally supervise the operations of the 
embassy.  (Note: Abdykarimov, the son of former State 
Secretary Oralbay Abdykarimov, has close ties to Aliyev; he 
 
SIPDIS 
worked for Aliyev in Vienna and received his current position 
when Aliyev became Deputy Foreign Minister in 2005. He 
nevertheless delivered the message firmly.  End note.) 
 
-------------------- 
Media Outlets Closed 
-------------------- 
 
4. (U)  Late on May 24, the KTK television channel was pulled 
from the air, and publication of the weekly newspaper Karavan 
was suspended for three months.  Aliyev's Kazakhstan Today 
news agency reported that the suspensions were based on 
violations of the Language Law, which requires mass media to 
report 50/50 in Russian and Kazakh.  The Ministry of Interior 
had previously warned Aliyev's news outlets not to publish 
information related to the Nurbank case.  KTK is still off 
the air and Karavan did not publish on May 25 as it normally 
would, but Kazakhstan Today continues to operate and the 
gazeta.kz website has posted statements from Aliyev. 
 
--------------------------------------- 
Relatives and Associates Under Scrutiny 
--------------------------------------- 
 
5. (U)  MVD spokesman Kozhahkmetov confirmed to the press on 
May 28 that an MVD team had searched Aliyev's house in Almaty 
as well as the house of his father, Mukhtar Aliyev. 
Kozhakhmetov stressed that the searches were legal, were 
carried out under the supervision of the procuracy, and were 
witnessed by Aliyev's relatives and associates.  Although he 
would not disclose what had been discovered during the 
searches, Kozhakhmetov said that Aliyev is suspected of 
running an organized criminal group that had carried out a 
 
ASTANA 00001466  002 OF 002 
 
 
series of economic crimes and kidnappings. Using extortion 
and fake documents, the group had taken administrative 
buildings, land, and businesses, Kozhakhmetov said. 
 
6. (U) The head of the Almaty department of the Financial 
Police, Vladimir Kurbatov, was detained for questioning by 
the Procuracy and the Committee for National Security (KNB) 
on May 24.  On May 26, the press reported that Kurbatov had 
been questioned about the Nurbank case and then released, but 
would be questioned further. 
 
7
. (SBU) An individual who identified himself as a 
Lebanese-American and "Rakhat Aliyev's best friend" (and the 
brother of Aliyev's brother-in-law) contacted post's duty 
officer on May 26 to report that the Ministry of Internal 
Affairs had asked him to come in for questioning.  He asked 
if an Embassy representative would accompany him.  (Note: We 
informed him that consular access is generally afforded only 
to those in custody, and that it would be advisable to be 
accompanied by a lawyer at the questioning.  End note.) 
 
------------------------------------ 
Aliyev Implies Political Persecution 
------------------------------------ 
 
8. (SBU) Thus far Aliyev is not backing down.  On May 26 he 
posted a statement on gazeta.kz and other internet sites he 
controls saying that "I will always be in politics.  I will 
make every effort to prevent the country from turning back to 
the totalitarian Soviet past.  I know that I have a huge 
number of supporters in my country.  I am sure that the 
future will be ours."  In what was widely described by the 
media as an attempt to attribute political motives to the 
charges against him, Aliyev claimed that "several months ago 
I told Nursultan Abishevich (Nazarbayev) that I had decided 
to run for president in 2012."  Aliyev followed that up with 
a lengthy posting on the geo.kz website on May 28 in which he 
accused Nazarbayev, Interior Minister Mukhamedzhanov, and 
Almaty mayor Tasmagambetov of orchestrating the actions 
against him.  "The president has stopped being the garantor 
of the Constitution," Aliyev alleged; "repressions are under 
way."  Claiming that no true political opposition exists in 
Kazakhstan, Aliyev said that the country needs a political 
movement with supporters adhering to ideas rather than a 
single leader.  "But if the Constitution can be changed as it 
was last week -- without prior public discussion, unanimously 
after only a few minutes -- then there is no guarantee that 
there will be elections in 2012." 
 
------- 
Comment 
------- 
 
9. (C) Comment:  The actions of the Kazakhstani authorities 
come as no surprise and have clearly been sanctioned by 
President Nazarbayev himself.  While most of the steps taken 
by law enforcement appear justified by the charges against 
Aliyev, the GOK crossed a line by shutting down two major 
media outlets without due process or clear grounds.  When 
asked for comment by Reuters and Kazakhstan Today, post 
replied that "we are disappointed in the decision by an 
Almaty court ordering the independently owned television 
station KTK and newspaper Karavan to cease publishing for 
three monts. The right to freely communicate ideas and 
opinions is fundamental to democracy.  The public has the 
right to hear diverse points of view, even if those views 
differ from those of the government or may be consdiered 
offensive by some.  We call on the Government of Kazakhstan 
to honor its commitments to democratic reform and freedom of 
speech."  End comment. 
GILMER

Wikileaks

07ASTANA1449, SCENESETTER FOR ASSISTANT SECRETARY ROOD’S TRIP TO

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Reference ID Created Released Classification Origin
07ASTANA1449 2007-05-29 08:15 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO8474
RR RUEHDBU RUEHLN RUEHVK RUEHYG
DE RUEHTA #1449/01 1490815
ZNR UUUUU ZZH
R 290815Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 9573
INFO RUCNCIS/CIS COLLECTIVE 0182
RUEBAAA/DEPT OF ENERGY WASHDC
RHMFIUU/DTRA CT WASHINGTON DC

UNCLAS SECTION 01 OF 03 ASTANA 001449 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
SCA/CEN FOR M.O'MARA, ISN/WMDT FOR M. DIETER AND E. HARBAUGH 
 
E.O. 12958: N/A 
TAGS: PGOV PREL PARM MNUC KNNP KZ
SUBJECT: SCENESETTER FOR ASSISTANT SECRETARY ROOD'S TRIP TO 
KAZAKHSTAN 
 
(SBU) Summary:  Kazakhstan is proud to be hosting the third 
meeting of the Global Initiative to Combat Nuclear Terrorism, 
which will attract significant attention within the country. 
The Kazakhstanis will be eager to trumpet their 
non-proliferation accomplishments.  Since renouncing its 
nuclear arsenal soon after independence, Kazakhstan has 
proven to be a reliable security partner and a steady, 
positive influence in a turbulent region.  The Kazakhstanis 
also see the event as an opportunity to highlight their 
country's achievements - a thriving economy, a  rapidly 
expanding capital, a harmonious multiethnic society - and to 
demonstrate that they are capable of leadership, a key goal 
as they continue with their bid to chair the OSCE in 2009. 
The U.S. enjoys a positive security relationship with 
Kazakhstan, although not without the occasional obstacle. 
Several important programs are slowed or delayed by 
Kazakhstan's labyrinthine bureaucratic procedures. Your visit 
presents an excellent opportunity to reemphasize to the 
Kazakhstanis the need to push forward on projects such as the 
BN-350 spent fuel program and the HEU fresh fuel downblending 
project.   End summary 
 
Political Context 
 
2. (SBU) Your visit comes soon after the introduction of 
constitutional amendments which on balance represent a 
positive step toward democratic reform.  The long-awaited 
changes increase the size and power of parliament, strengthen 
the role of local legislatures, eliminate the death penalty 
except in cases of terrorism and war crimes, provide for 
judicial sanction of arrest, and pave the way for government 
financing of public organizations and political parties.  The 
president retains significant powers, however.  In a surprise 
move which has stolen headlines and provoked an outcry from 
the opposition, a group of parliamentarians added a provision 
exempting President Nazarbayev from existing term limits. 
 
3. (SBU) Kazakhstan is certain to point to the constitutional 
amendments as evidence of reform as they continue to push 
forward with their candidacy to chair the Organization for 
Security and Cooperation in Europe (OSCE) in 2009.  The U.S. 
has made clear that we welcome Kazakhstan,s aspirations, but 
that any chair must exemplify the principles of the 
organization.  While the constitutional amendments have the 
potential to lead to greater democratization, Kazakhstan will 
need to take further steps to bolster its still 
underdeveloped democratic political institutions, civil 
society, and independent media. 
 
The Central Asian Tiger 
 
4. (SBU) Kazakhstan is the region,s economic powerhouse, 
with an economy larger that those of all the other Central 
Asian states combined (2006 GDP: $68 billion).   The economy 
has averaged 9.2% real growth over the past three years, and 
the percentage of Kazakhstan,s population living below the 
level of subsistence has dropped from 28.4% in 2001 to 9.8% 
in 2005.  The energy sector is Kazakhstan,s dominant earner, 
with oil exports accounting for roughly a third of GDP. 
Kazakhstan produced 1.3 million barrels of oil per day in 
2006 and is expected to become a top ten oil producer soon 
after 2015.  Kazakhstan also possesses substantial proven gas 
reserves (3 billion cubic meters), although it currently 
exports very little gas. 
 
5. (SBU) The U.S. is encouraging the GOK to diversify its oil 
and gas export routes.  Currently, the bulk of Kazakhstan,s 
crude is exported via Russia, both through the Transneft 
system and the independent Caspian Pipeline Consortium (CPC). 
 The majority of Kazakhstan,s near term oil production 
increases are projected to flow to market either through the 
Baku-Tbilisi-Ceyhan pipeline or an expanded CPC.  All of 
Kazakhstan's gas exports currently flow through Russia.  Two 
projects under GOK consideration, a trans-Caspian Pipeline 
and a gas pipeline to China, would reduce dependence on 
Russia. 
 
A Positive Regional Influence 
 
6. (SBU) Kazakhstan has cooperated extensively with the 
United States in the Global War on Terrorism.  Kazakhstan has 
directly supported efforts in Iraq by deploying a military 
engineer unit which has disposed of over 4.5 million pieces 
of ordnance.  Kazakhstan has provided over 4800 cost-free 
overflight and emergency landing rights for U.S. aircraft 
supporting Operation Enduring Freedom.  The GOK has made 
strong statements in support of U.N. resolutions sanctioning 
 
ASTANA 00001449  002 OF 003 
 
 
Iran and North Korea. 
 
7. (SBU) Kazakhstan has also expressed its eagerness to play 
an enhanced role in achieving regional integration.  In 
April, President Nazarbayev spoke of a Central Asian union 
with a common market, an idea he has raised on several 
occasions.  Kazakhstan is already a significant econ
omic 
force in the region, the largest foreign investor in 
Kyrgystan and soon to be the largest investor in Georgia, 
according to the Georgian government.  In an April 19 speech 
at the Eurasia Media Forum, President Nazarbayev announced 
that Kazakhstan is developing a "Special Action Program" to 
increase humanitarian and economic cooperation with 
Afghanistan and to invest in the Afghan economy.  According 
to Nazarbayev, Kazakhstan plans to construct a school in the 
Samangan region and a hospital in the Bamian region. 
 
A Strong Non-Proliferation Partner 
 
8. (SBU) Non-proliferation has been a cornerstone of the 
bilateral relationship since Kazakhstan,s independence. 
With the collapse of the Soviet Union, Kazakhstan was left 
with the world,s fourth largest nuclear arsenal. 
Nazarbayev,s 1991 decision to give up Kazakhstan,s nuclear 
arsenal was groundbreaking.  Kazakhstan returned all tactical 
nuclear warheads to Russia by January 1992, and all strategic 
nuclear warheads by April 1995.  Through the Nunn-Lugar 
Cooperative Threat Reduction Program (CTR) program the U.S. 
assisted Kazakhstan with the destruction of bombers, silos, 
and related ICBM infrastructure. 
 
9.  (SBU) The U.S.- Kazakhstan non-proliferation relationship 
remains productive.  Cooperation continues under the CTR 
program to secure the former Soviet nuclear weapons test site 
in Semipalatinsk.  The U.S. is working with Kazakhstan under 
the Proliferation Prevention Initiative agreement to 
strengthen its ability to prevent proliferation of WMD and 
related materials across its borders by enhancing its WMD 
detection and interdiction capabilities along the Caspian Sea 
border.  Through the Biological Threat Reduction Program, the 
U.S. is supporting Kazakhstan in its efforts to combat 
bioterrorism and prevent the proliferation of biological 
weapons technology, pathogens and expertise.   The DOE met 
several key milestones in 2006 as preparations are made to 
move three tons of weapons grade plutonium from the 
decommissioned BN-350 nuclear reactor in Aktau to long term 
storage at the Baikal 1 facility near the city of Kurchatov 
in western Kazakhstan. 
 
But Not Always a Prompt One 
 
10. (SBU) Although non-proliferation and security cooperation 
with Kazakhstan is generally good, maintaining progress often 
requires a firm push.  Early in the year, the Department of 
Defense warned the GOK that it would suspend its CTR 
programming if Kazakhstan failed to implement an effective 
value added tax (VAT) exemption mechanism.  With only a few 
days to spare before the DOD deadline, Kazakhstan approved 
pending subcontracts and avoided a shutdown.   Kazakhstan 
must still demonstrate, however, that the mechanism created 
to approve the contracts is an efficient and effective 
long-term solution. 
 
11. (SBU) The U.S. and Kazakhstan must also extend the CTR 
Umbrella Agreement in 2007.  Renewal this year may prove 
trickier than 2000, the last time the agreement was extended. 
  Some in the GOK have suggested that the language of the 
agreement needs to be broadened to reflect all U.S. efforts 
and aims (for example, to emphasize a focus on proliferation 
of all weapons of mass destruction, rather than just 
offensive strategic arms).  Proposing changes to the text 
will require delicate maneuvering, however, in order to avoid 
the lengthy delays that would arise from a full-scale 
reexamination of the text or by triggering Kazakhstani 
requirements for re-ratification. 
 
12.  (SBU) Other important U.S. programs face frequent delays 
more often due to the stuttering bureaucracy than to a lack 
of will.  In January, senior-level policy talks were held in 
Astana on the permanent disposition of BN-350 spent fuel.  An 
agreement in principle was reached on a communique on 
permanent disposition establishing the framework for further 
talks.  The Kazakhstanis have yet to sign the communique, 
however, as it still has not received full interagency 
approval. 
 
13. (SBU) During President Nazarbayev,s 2006 visit to the 
 
ASTANA 00001449  003 OF 003 
 
 
U.S., the U.S. and Kazakhstan reached agreement in principle 
to down blend approximately 21 kilograms of highly enriched 
uranium (HEU) stored at the Institute of Nuclear Physics 
(INP).  Although the project has the president,s blessing, 
progress has been delayed because no specific authorization 
has been given to the Ministry of Energy and Mineral Resource 
or to INP to implement the program. 
 
14.  (SBU) In September 2006, the five nations of Central 
Asia signed the Central Asia Nuclear Weapon Free Zone Treaty 
(CANWFZ), despite reservations voiced by the U.S., France, 
and the U.K.  The U.S. and other nuclear weapons states have 
stressed repeatedly that they cannot support the treaty 
unless their concerns were addressed in a satisfactory 
manner.  One significant concern is that other international 
treaties can take precedence over the CANFWZ. 
GILMER

Wikileaks

07ASTANA1448, DEMARCHE DELIVERED: KAZAKHSTAN’S INCREASE IN MEAT

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Reference ID Created Released Classification Origin
07ASTANA1448 2007-05-29 05:36 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXYZ0010
PP RUEHWEB

DE RUEHTA #1448 1490536
ZNR UUUUU ZZH
P 290536Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 9572
INFO RUEHAK/AMEMBASSY ANKARA 2055
RUEHGV/USMISSION GENEVA 0956
RUEHCR/DEPT OF AGRICULTURE WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC

UNCLAS ASTANA 001448 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR EB/ESC; SCA/CEN (O'MARA); PLEASE PASS TO USTR 
 
E.O. 12958: N/A 
TAGS: EAGR ECON ETRD WTRO USTR KZ
SUBJECT: DEMARCHE DELIVERED: KAZAKHSTAN'S INCREASE IN MEAT 
IMPORT TARIFFS 
 
REF: STATE 67132 
 
1. (U) The Ambassador raised the issue of increased meat 
import tariffs with Prime Minister Masimov on May 17, 
underscoring the negative impact on WTO accession efforts. 
Pol-Econ Chief delivered reftel demarche on May 23 to Zhanar 
Aitzhanova, Deputy Minister of Industry and Trade and lead 
WTO accession negotiator; and on May 25 to Akylbek 
Kurishbayev, Vice-Minister of Agriculture, and Naylia 
Abdimoldayeva, Deputy Head of Agriculture Ministry,s 
Department for Development of Processing Industry and WTO 
affairs. 
 
2. (SBU) Aitzhanova told Pol-Econ Chief that the GOK's 
decision to raise the import tariffs was difficult and a 
political compromise resulting from lengthy discussions 
between the Ministry of Industry and Trade and the Ministry 
of Agriculture.  The push for higher tariffs, she said, came 
from agricultural producers and parliamentarians who believe 
that the agricultural sector is not ready for Kazakhstan's 
WTO accession.  The move, of which Prime Minister Masimov was 
fully aware, was aimed at demonstrating that the government 
is doing something to help the farmers.  Aitzhanova added 
that she had no choice but to take some action.  Had her 
Ministry done nothing, she stated, other ministries would 
have blocked WTO accession negotiations, and she would not 
have been able to get necessary legislation through 
parliament. 
 
3. (SBU) Both Aitzhanova and Kurishbayev stressed that the 
tariff increase is not expected to have a serious impact on 
U.S. agricultural exports to Kazakhstan.  Poultry meat, 
Kurishbayev said, is the only market where higher tariffs 
have the potential of adversely affecting U.S. exporters. 
But, he stated, the actual tariff increase is "very 
insignificant," and Kazakhstani agricultural tariffs remain 
"quite low."  Aitzhanova went further, telling Pol-Econ Chief 
that the tariff hike was carefully calculated not to have an 
impact on U.S. sales; effective protection of Kazakhstani 
products, she added, would have required a rate increase to 
200%.  Abdimoldayeva added that the tariff's impact would be 
weakened by the tenge's appreciation against the dollar. 
(Note: Over the past six months, the tenge has appreciated 
against the dollar by approximately 6%.  End note.) 
Kurishbayev said that Kazakhstani farmers had requested much 
stronger action, including import quotas.  The actual rate 
increase, he remarked, is merely a small step to stimulate 
much-needed development of Kazakhstan's domestic poultry 
industry.  Currently, Kurishbayev elaborated, Kazakhstan 
imports 75% of its annual poultry meat consumption of 200,000 
tons. 
 
4. (SBU) Aitzhanova stated that the tariff hikes came into 
force one month after Prime Minister Masimov's April 11 
signature of the decree.  Both Kurishbayev and Aitzhanova 
asked for time to evaluate the impact of the higher tariffs. 
Aitzhanova requested "a few months" to see the impact of the 
tariff increases on the market before revisiting the issue. 
Kurishbayev remarked that he does not expect poultry imports 
to change next year.  In regard to the standstill agreement, 
both Aitzhanova and Kurishbayev stressed that it represents 
an expectation rather than a formal obligation. 
GILMER

Wikileaks

07ASTANA1438, KAZAKHSTAN SIGNS AGREEMENT ON CREATION OF

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Reference ID Created Released Classification Origin
07ASTANA1438 2007-05-29 03:14 2011-08-30 01:44 CONFIDENTIAL//NOFORN Embassy Astana

VZCZCXRO8228
PP RUEHDBU
DE RUEHTA #1438/01 1490314
ZNY CCCCC ZZH
P 290314Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 9562
INFO RUCNCIS/CIS COLLECTIVE 0180
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEAIIA/CIA WASHDC
RUEBAAA/DEPT OF ENERGY WASHDC

C O N F I D E N T I A L SECTION 01 OF 02 ASTANA 001438 
 
SIPDIS 
 
NOFORN 
SIPDIS 
 
DEPT FOR EB/ESC; SCA/CEN (O'MARA) 
 
E.O. 12958: DECL: 05/28/2015 
TAGS: ENRG EPET KZ RS
SUBJECT: KAZAKHSTAN SIGNS AGREEMENT ON CREATION OF 
INTERNATIONAL URANIUM ENRICHMENT CENTER 
 
REF: A. 06 ALMATY 602 
 
     B. 06 ALMATY 2673 
 
Classified By: Acting DCM Deborah Mennuti; reasons 1.5(b) and (d). 
 
1. (C) Summary: On May 10 representatives of the Government 
of Kazakhstan and the Government of Russia signed an 
Inter-governmental Agreement to set up an international 
uranium enrichment center, under International Atomic Energy 
Agency (IAEA) control, in Angarsk, Russia.  For Kazakhstan's 
state-owned atomic energy company, KazAtomProm, the agreement 
represents an important step toward achieving its stated goal 
of completing the nuclear fuel cycle, and thereby capturing 
additional value in the processing of its natural uranium 
reserves.  In addition to completing the fuel cycle, 
KazAtomProm is driven to become the world's largest 
uranium-producing company, with company president Mukhtar 
Dzhakishev announcing a production target of 18,000 tons of 
natural uranium by 2010. KazAtomProm has signed several 
uranium production agreements toward these ends in the past 
year, primarily with Russian and Japanese companies. 
According to a high-level KazAtomProm executive, the company 
has also finalized terms of a deal to buy 10% of Westinghouse 
from Toshiba.  End summary. 
 
International Uranium Enrichment Center 
--------------------------------------- 
 
2. (SBU)  On May 10, Kazakhstan's Energy Minister and 
Russia's Director of the Federal Atomic Energy Agency 
(ROSATOM) signed an Inter-governmental Agreement (IGA) on the 
creation of an international uranium enrichment center in 
Angarsk, Russia.  The stated goal of the center is to provide 
participating states with guaranteed access to enrichment 
facilities for the purpose of creating nuclear fuel.  (The 
agreement also stipulates that participating states may, with 
IAEA and Russian government approval, create stockpiles of 
enriched uranium under the center's auspices.) 
 
3. (SBU) The agreement specifies that the enrichment center 
will be established using existing facilities at the Angarsk 
Electrolysis Chemical Combine; media quotes from ROSATOM's 
Director suggest that, while initial production will be 
launched using the Combine's "unused capacities," the 
Center's operations could be expanded in the future to new, 
or other existing enrichment facilities -- likely with 
funding from new partners.  The agreement states that 
additional countries without enrichment facilities of their 
own may join the joint venture, provided they are in 
compliance with the Nuclear Non-Proliferation Treaty.  While 
Kazakhstan and future partner governments may own equity in 
the center, and participate in its management, the agreement 
prohibits the transfer of Russian enrichment technology to 
Kazakhstan and future joint venture partners. 
 
4. (C) On May 18, KazAtomProm Vice President Dmitry Parfenov 
told Energy Officer that the IGA had been "based on" 
commercial negotiations between KazAtomProm and Russia's 
Techsnabexport (TENEX).  TENEX and KazAtomProm are already 
majority shareholders (49.33% each) in the Zarechnoye mining 
joint venture in Kazakhstan (where uranium production began 
in December 2006) and in a new, 2006 JV to exploit 
Kazakhstan's Budenovskoye mine, where production is scheduled 
to begin in 2008.  TENEX also signed a fifteen-year contract 
in 2006 to deliver Zarechnoye uranium to Russia (exact 
destination undisclosed) for enrichment.  KazAtomProm and 
TENEX's presence in each of these deals lends evidence to the 
widespread conclusion that KazAtomProm envisions using the 
Angarsk center for the enrichment of future volumes of 
uranium mined at Zarechnoye and Budenovskoye, for onward sale 
to interested nations. 
 
KazAtomProm: Completing the Fuel Cycle 
-------------------------------------- 
 
5. (SBU) KazAtomProm President Mukhtar Dzhakishev has been 
outspoken about his company's ambition to complete the 
nuclear-fuel cycle, articulating the goal as a logical 
business strategy: maximizing the value added in Kazakhstan's 
natural uranium reserves.  The Angarsk deal clearly gives 
KazAtomProm a share of the value-added by the uranium 
enrichment process, while the deal's prohibition on 
enrichment technology transfer appears to adhere to 
international non-proliferation standards, while also having 
the effect of precluding KazAtomProm from emerging as a 
direct competitor to Russia's enrichment industry. In 
 
ASTANA 00001438  002 OF 002 
 
 
general, both Dzhakishev and officials of both governments 
have explained the Angarsk and Budenovskoye JV's (along with 
a third, to design and market small- and medium sized 
reactors, announced simultaneously in July 2006) as 
exploiting a complementarity in the Russian and Kazakhstani 
nuclear industries created in the Soviet era.  In a December 
2006 interview with BBC, for example, Dzhakishev credited the 
joint ventures as the outcome of a realization that, 
"..during Soviet times our e
nterprises were meant to be part 
of...a single nuclear-fuel cycle, and that both the Russian 
and Kazakh sides can, by being mutually complementary, get a 
competitive advantage in the market." 
 
6. (C) However, it is clear that KazAtomProm is not limiting 
its pursuit of the complete nuclear fuel cycle to those 
projects which "complement" existing Russian ventures. 
Parfenov told Energy Officer that KazAtomProm had recently 
finalized negotiations to purchase 10% of Westinghouse from 
Toshiba; the deal, he said, was awaiting USG approval.  Prior 
to Toshiba's October 2006 acquisition of Westinghouse, 
KazAtomProm partnered with General Electric to make a 
competitive bid for the company.  In a January 2006 interview 
with "Nuclear.Ru" Dzhakishev explained that, if KazAtomProm 
succeeded in its bid to buy Westinghouse, the company would 
enter into direct competition with Russia's TVEL in the 
production of fuel assemblies.  KazAtomProm is also pursuing 
deals in other aspects of the fuel cycle with non-Russian 
partners.  Parfenov told Energy Officer that the company 
would soon announce a "Memorandum of Intent" with Canada's 
CAMECO for the creation of a conversion facility in 
Kazakhstan, "or elsewhere, if it isn't profitable in 
Kazakhstan."  The April visit of Japan's Minister of Economy, 
Trade, and Industry, Akira Amari, Parfenov explained, had 
yielded a "strategic understanding" with the Japanese 
companies NFI and Sumitomo on "the most difficult part of the 
fuel cycle," the fabrication of fuel assemblies.  (Note: The 
Japanese Minister's visit also resulted in an announcement by 
Dzhakishev that KazAtomProm would dramatically increase the 
exports of uranium and uranium value-added products to Japan, 
to reach 40% of the market share of the former by 2010.  And 
on April 24, Japan's Marubeni Corporation, Tokyo Electric 
Power Company, and Chubu Electric Power Company announced 
their joint acquisition of an indirect ownership interest in 
the companies developing Kazakhstan's Kharasan mine, 
projected to produce 750 tons of uranium by 2012.  End note.) 
 
Uranium Production: Doubling in Three Years? 
-------------------------------------------- 
 
7. (U) According to the Ministry of Energy and Mineral 
Resources, Kazakhstan produced 5,279 tons of uranium in 2006, 
an increase of 21% above 2005.  Output in 2007 is expected to 
reach 6,937 tons, an additional rise of 31%. 
KazAtomProm has set forth lofty mid-term production goals. In 
an April 2007 interview with a Kazakhstani newspaper, 
Dzhakishev announced that KazAtomProm's uranium production 
would reach 18,000 tons by 2010.  In 2004, Dzhakishev 
explained, KazAtomProm had announced a 2010 target of 15,000 
tons, but "we recently reviewed our plans and raised the bar 
a little more."  Dzhakishev has also articulated the related 
goal of transforming KazAtomProm into the world's largest 
uranium producing company in the same time frame. (According 
to the World Nuclear Association, KazAtomProm currently ranks 
a distant second to Canada's CAMECO.)  In order to realize 
these production goals, KazAtomProm will depend heavily on 
newly-opened uranium mines, including Zarechnoye, Mynkuduk, 
Budenovskoye, and Kharasan. 
GILMER

Wikileaks

07ASTANA1430, KAZAKHSTAN ECONOMIC AND ENERGY UPDATE, APRIL 29 – MAY 12,

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Reference ID Created Released Classification Origin
07ASTANA1430 2007-05-28 10:47 2011-08-30 01:44 UNCLASSIFIED Embassy Astana

VZCZCXRO7930
RR RUEHDBU RUEHLN RUEHVK RUEHYG
DE RUEHTA #1430/01 1481047
ZNR UUUUU ZZH
R 281047Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 9552
INFO RUCPCIM/CIMS NTDB WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUCNCIS/CIS COLLECTIVE 0178
RUEHAK/AMEMBASSY ANKARA 2052
RUEHBUL/AMEMBASSY KABUL 0328
RUEHNE/AMEMBASSY NEW DELHI 0455
RUEHAST/USOFFICE ALMATY

UNCLAS SECTION 01 OF 02 ASTANA 001430 
 
SIPDIS 
 
DEPT FOR SCA/CEN (O'MARA) 
DEPT PASS TO OPIC - BALLINGER 
DEPT PASS TO TDA FOR STEIN, EXIM FOR GLAZER 
DEPT PASS TO AID - EE-PHILLIPS/RUSHING 
TREASURY FOR OASIA/VELTRI 
USDOC FOR 4231/ITA/MAC/MLONDON, 4201/BISNIS 
USDOC FOR 6110/ITA/TD/BI/RHALPERN 
ANKARA FOR CFC 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON EIND ENRG EPET EFIN KZ
SUBJECT:  KAZAKHSTAN ECONOMIC AND ENERGY UPDATE, APRIL 29 - MAY 12, 
2007 
 
ASTANA 00001430  001.2 OF 002 
 
 
1.  Summary: This information is drawn primarily from the 
Kazakhstani local press, and has not been checked for accuracy.  The 
opinions and policies expressed in this report are those of the 
authors, not the U.S. Government. 
 
-- "Kazakhgate" Funds to Go to Charity 
-- Kazakhstan's External Debt on the Rise 
-- EBRD to Increase Exposure to Kazakhstan 
-- Labor Minister Comments on Unemployment 
-- Kazakhstan Considering Trans-Caspian LNG Shipments 
-- Kazakhstan Views Russia as Main Oil Transit Route 
-- GazProm CEO Announces Progress in Orenburg Negotiations 
-- Nazarbayev Links CPC Expansion to Bosporus Bypass 
"Kazakhgate" Funds to Go to Charity 
----------------------------------- 
 
2.  On May 4, a trilateral agreement was reported between the 
governments of the U.S., Kazakhstan, and Switzerland on $84 million 
frozen in Swiss bank accounts.  The Swiss Foreign Ministry said the 
cash had been frozen in Switzerland as the result of a corruption 
case involving an (unspecified) American businessman (widely assumed 
to be James Giffen) and oil concessions in Kazakhstan.  The money 
will be used to establish a children's foundation named "Bota" 
(young camel) to provide support to children from low-income 
families.  The World Bank will develop the concept of the foundation 
with management transparency and efficiency in mind.  The Panorama 
newspaper commented, "most likely the Kazakhstani Government decided 
to accept this arrangement because a return of this money back to 
the national budget appeared unfeasible."  Television Channel 31 
cited the reaction of Ak Zhol's Oraz Zhandosov: "Frankly, I do not 
like the idea of a non-governmental foundation that will spend the 
government's money in Kazakhstan.  It resembles practices used in 
the early and mid-1990's, which we stopped in 1998."  ("Panorama" 
newspaper; Television Channel 31, May 11) 
 
Kazakhstan's External Debt on the Rise 
-------------------------------------- 
 
3.  According to Deputy Chairman of the National Bank, Gulbanu 
Aimanbetova, as of the end of 2006, Kazakhstan's total external debt 
reached $73.8 billion or 95.6% of GDP, compared to $42.6 billion a 
year earlier.  The increase was mostly due to banking sector 
borrowing, which grew by $18 billion to reach $33.3 billion by the 
end of the year.  As a result, the banking sector's share of 
Kazakhstan's external debt rose in 2006 from 35% to 45%, while the 
share of intracorporate debt fell from 44% to 34%.  At the end of 
the year, the non-financial sector's (intercorporate) debt stood at 
16% of the total, and the government's at 4%.  (Interfax-Kazakhstan, 
May 8) 
 
EBRD to Increase Exposure to Kazakhstan 
--------------------------------------- 
 
4.  The European Bank for Reconstruction and Development (EBRD) 
released information on its planned deals with two Kazakhstani 
banks.  EBRD will arrange a syndicated loan for Kazkommertsbank 
(KKB) worth $300 million.  The loan will consist of two parts, with 
five- and seven-year terms of maturity.  KKB plans to use the raised 
funds for mortgage lending, as well as diversification of its 
holdings away from real estate and the energy sector.  EBRD also 
plans to purchase 20% of common shares of KazInvestbank.  (Note: 
KazInvestbank is a commercial bank with a reported capital of $199 
million.  End note.)  This investment aims to facilitate 
KazInvestbank's expansion in the Central Asian region, development 
of retail crediting, and financing of small- and medium-sized 
enterprises.  (Interfax-Kazakhstan, May 8) 
 
Labor Minister Comments on Unemployment 
--------------------------------------- 
 
5.  Speaking to the Kazakhstani Parliament on May 7, Labor Minister 
Gulzhana Karagusova noted the emergence of "chronic" unemployment. 
She stated that 118,000 unemployed Kazakhstanis have not worked for 
a decade, 15.9% of the unemployed have not worked for at least three 
years, and 27% have no skills.  She also expressed concern over 
 
ASTANA 00001430  002.2 OF 002 
 
 
"so-called self-employed" people who teeter on the brink of poverty. 
 Last year, the Minister noted, the unemployment rate stood at 7.8%. 
 She added that the government intends to fine-tune its approaches 
to social protection.  (BBC Monitoring Central Asia, May 7) 
 
Kazakhstan Considering Trans-Caspian LNG Shipments 
--------------------------------------------- ----- 
 
6.  On March 4, Deputy Energy Minister Bolat
 Akchulakov told a 
visiting European Parliament delegation that Kazakhstan was "very 
seriously considering gas (LNG) deliveries across the Caspian 
Sea...rather than building an undersea gas pipeline, as this is the 
safest means of gas transportation."  Akchulakov also noted that the 
construction of a Trans-Caspian gas pipeline was a "very difficult 
proposition," given the varying interests of the five littoral 
states.  (Interfax - Kazakhstan, May 7) 
 
Kazakhstan Views Russia as Main Oil Transit Route 
--------------------------------------------- ---- 
 
7.  "Kazakhstan is absolutely committed to shipping most of its oil, 
if not all of it, through Russian territory," President Nazarbayev 
announced during a May 10 press conference following a meeting with 
Russian President Putin.  Nazarbayev pointed out of 52.3 million 
tons of oil Kazakhstan exported "this year," 42 million transited 
Russia.  Nazarbayev suggested that there were clear advantages to 
transporting Kazakhstani oil and gas through Russia. "The issue," he 
concluded, is that there be fair and mutually beneficial access." 
(Kazakhstan - Interfax, May 10) 
 
GazProm CEO Announces Progress in Orenburg Negotiations 
--------------------------------------------- ---------- 
 
8.  GazProm CEO Alexei Miller announced on May 10 that GazProm had 
reached "a very important agreement on the terms of buying 
Kazakhstan's gas from the Karachaganak field.  This is vital for 
setting up a joint venture on the basis of the Orenburg gas 
processing plant."  Kazakhstan's Energy Minister Izmukhambetov 
revealed the same day that the agreed price "is higher than 145 
dollars per thousand cubic meters."  (Interfax - Kazakhstan, May 
10) 
 
Nazarbayev Links CPC Expansion to Bosporus Bypass 
--------------------------------------------- ---- 
 
9.  On May 10, following meetings with Russian President Putin, 
President Nazarbayev announced that the expansion of the Caspian 
Pipeline Consortium (CPC) pipeline, from 23 to 40 million tons, 
would be linked with the planned Burgas-Alexandroupolis Bosporus 
bypass pipeline.  "We have agreed to a joint action plan whereby the 
construction of Burgas-Alexandroupolis and CPC expansion will be 
concurrent," Nazarbayev said.  Putin noted that Kazakhstani oil 
could comprise "a significant part" of the oil shipped through the 
Burgas-Alexandroupolis bypass. 
 
ORDWAY

Wikileaks

07ASTANA1415, KAZAKHSTAN: RAKHAT ALIYEV,S THIRD STRIKE

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Reference ID Created Released Classification Origin
07ASTANA1415 2007-05-25 05:12 2011-08-30 01:44 CONFIDENTIAL Embassy Astana

VZCZCXRO6369
PP RUEHBI RUEHCI RUEHDBU RUEHLH RUEHPW
DE RUEHTA #1415/01 1450512
ZNY CCCCC ZZH
P 250512Z MAY 07 ZDK
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 9544
INFO RUCNCIS/CIS COLLECTIVE PRIORITY 0173
RHEHNSC/NSC WASHDC PRIORITY 0032
RUEHVEN/USMISSION USOSCE PRIORITY 1745
RUEKJCS/SECDEF WASHDC PRIORITY 0036
RUCNCLS/SOUTH AND CENTRAL ASIA COLLECTIVE PRIORITY
RUEHNO/USMISSION USNATO PRIORITY 2211

C O N F I D E N T I A L SECTION 01 OF 03 ASTANA 001415 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR SCA/CEN (M. O'MARA) 
 
E.O. 12958: DECL: 05/24/2017 
TAGS: PGOV PHUM PREL KZ
SUBJECT: KAZAKHSTAN:  RAKHAT ALIYEV,S THIRD STRIKE 
 
REF: A. ASTANA 834 
 
     B. ASTANA 1129 
     C. ASTANA 1357 
 
Classified By: Amb. John Ordway, reasons 1.4 (B) and (D). 
 
1. (C) Summary:  In a bizarre turn of events, presidential 
son-in-law Rakhat Aliyev appears to have finally exhausted 
President Nazarbayev's patience with a series of rash public 
statements accusing Kazakhstani officials of criminal 
activity and criticizing the recent package of constitutional 
amendments.  The Ministry of Interior announced on May 23 
that a criminal case has been opened against Aliyev and two 
associates for the alleged kidnapping of two Nurbank 
officials in mid-January, one of whom remains missing after 
disappearing a second time in late January.  In a clear sign 
that the gloves are off, Kazakhstani law enforcement 
officials have allowed one of the men to make his accusations 
public in a written statement and taped address broadcast on 
television.  Foreign Minister Tazhin informed the Ambassador 
that Aliyev will give a press conference on May 24 in Vienna, 
and asked for U.S. restraint in reacting to what will 
undoubtedly be incendiary accusations.  End summary. 
 
--------------------------- 
Aliyev Digs His Hole Deeper 
--------------------------- 
 
2. (SBU) Over the past week the scandal surrounding 
presidential son-in-law Rakhat Aliyev's alleged involvement 
in the January kidnapping of Nurbank officials (Refs A and B) 
has come to a head against the backdrop of intense public 
debate over constitutional reforms and presidential term 
limits.  Aliyev, currently Kazakhstan's ambassador to Austria 
and the OSCE, has appeared desperate to deflect attention 
from the mounting allegations against him. 
 
3. (SBU) In a statement published in his Karavan newspaper on 
May 18, Aliyev accused Almaty mayor Imangali Tasmagambetov 
and Minister of Internal Affairs Baurzhan Mukhamedzhanov of 
conspiring against him and of being engaged in criminal 
fraud.  Aliyev alleged that money stolen from Nurbank, where 
Tasmagambetov's nephew Abilmazhen Gilimov was chairman, had 
been used for land speculation in Almaty. 
 
4.  (SBU) Following the announcement of the reform package 
which included a provision lifting term limits on President 
Nazarbayev (Ref C), Aliyev told the Financial Times that the 
decision to lift term limits "would not improve the 
republic's chances of winning the OSCE presidency."  He added 
that "I fear that my many years of work on the campaign may 
not bring success."  In an apparent attempt to counterbalance 
her husband's comments, first daughter Dariga Nazarbayeva 
told Kazakhstan Today on May 22 that she had signed the 
proposal to lift constitutional term limits on Nazarbayev 
because "his historic mission is far from being 
accomplished," and "strong presidential power is the chief 
guarantee of stability and democratic development." 
 
--------------------------------------------- - 
Ministry of Internal Affairs Drops a Bombshell 
--------------------------------------------- - 
 
5. (U) On May 23, the Ministry of Internal Affairs held a 
press conference in Astana to announce that a criminal case 
had been opened against Aliyev and his colleagues V. Koshlak 
and A. Bekbayev under Article 125.3 of the Criminal Code 
regarding the January 18-19 kidnapping of Nurbank officials 
Abilmazhen Gilimov and Zholdas Timraliyev.   Ministry 
spokesman Bagdat Kozhakhmetov also announced that a separate 
case under Article 125.3 had been opened and arrest warrants 
had been issued for five other individuals suspected in the 
January 31 disappearance of Timraliyev and his associate 
Aidar Hasenov.  Both men remain missing.  Kozhakhmetov stated 
that three other individuals were already in custody in 
relation to other crimes discovered during the investigation, 
including theft and organized criminal activity. 
 
6. (U)  Kozhakhmetov announced during the press conference 
that President Nazarbayev had personally ordered the 
Procurator General and the Minister of Internal Affairs to 
carry out the investigation into the Nurbank affair "in the 
most careful manner, without regard to profession or 
position." 
 
 
ASTANA 00001415  002 OF 003 
 
 
--------------------------------------------- ---- 
And Allows Gilimov to Make Public His Allegations 
--------------------------------------------- ---- 
 
7. (SBU)  Gilimov's brother Samat Gilimov held a press 
conference in Almaty on May 23 to make public additional 
allegations against Rakhat Aliyev.  He read from a two-page 
statement written by Abilmazhen Gilimov to the Medeo District 
Court judge hearing the case against him.  (Note:  Gilimov 
was arrested on February 14 by the Almaty Financial Police on 
charges
 of illegal entrepreneurship, abuse of power, and 
inciting a conflict between Almaty police and bank security. 
He is being detained during the trial.  Many officers of the 
Financial Police are believed to be loyal to Aliyev, who 
headed the organization from 1997 to 1999.  End note.) 
 
8. (U)  In the statement, which has been posted at 
www.kub.kz., Gilimov claimed that he and Timraliyev were 
abducted by "Rakhat Aliyev and his people" on January 18-19. 
Gilimov claimed that Aliyev told the two men that they needed 
to go with him to Kiev on business, but instead took them to 
a building in Almaty where he handcuffed them, threatened 
them with a gun, and demanded shares of the businesses of all 
of their friends and family members who had received loans 
from Nurbank.  Aliyev wanted the owner of the Ken Dala 
business center in Almaty, where Nurbank is headquartered and 
who had received a $22 million loan from the bank, to 
transfer the property to him at no cost.  Gilimov said that 
Timraliyev called the owner, Bolat Abdullayev, to convey the 
request. 
 
9. (U) According to the statement, Gilimov managed to borrow 
a cell phone and call his wife to ask her to alert the 
authorities if he did not return home within an hour.  After 
he told Aliyev that the police were on the way, Aliyev then 
agreed to pay $34 million for the Ken Dala building, and 
"promised not to harass us further if we remain silent." 
Aliyev then released Gilimov and Timraliyev, only to fire 
them from Nurbank on January 22 and again demand title to the 
Ken Dala building for free.  At that point, Gilimov signed a 
resignation letter and documents transferring his 8% share in 
Nurbank to Aliyev's family.  Gilimov stated that he last 
heard from Timraliyev on January 31 when his former colleague 
called him to say that he had been summoned to Nurbank on 
business. 
 
10. (SBU)   The same evening as the press conference, Astana 
TV (owned by the "other" presidential son-in-law Timur 
Kulibayev) aired a ninety-minute tape of Gilimov detailing 
his allegations against Aliyev.  Gilimov did not say what day 
he made the recording, but it was apparently made while he 
was in detention.  AlmaTV, owned by Aliyev and Nazarbayeva, 
began to broadcast the tape but quickly interrupted the 
transmission. 
 
------------------------------ 
Foreign Minister to Ambassador 
------------------------------ 
 
11. (C)  Foreign Minister Tazhin summoned the Ambassador for 
an urgent meeting on May 24 to warn that Aliyev would hold a 
press conference that day in Vienna, where he was expected to 
"sling a lot of mud" at the Kazakhstani government and the 
reform process.  Tazhin asked that the U.S. be restrained in 
its reaction to Aliyev's comments.  He described President 
Nazarbayev's decision to publicly order the law enforcement 
authorities to investigate the case thoroughly and 
objectively as a clear sign of the importance Nazarbayev 
attaches to reforming the system and rooting out corruption. 
 
12. (C) Tazhin informed the Ambassador that Aliyev could not 
be stripped of his ambassadorial position until President 
Nazarbayev had made such a decision - which he (Tazhin) 
expected shortly.   In the meantime, he felt himself in an 
awkward situation with an ambassador in Vienna who was 
publicly criticizing the President and now under criminal 
charges.  Tazhin noted that while the President had been 
dealing with this behind the scenes, he had been actively 
engaged with the UNESCAP ministerial session in Almaty on May 
21.  Tazhin, who was seated with Nazarbayev at the head table 
with a gaggle of UN Under Secretaries General, said it was 
remarkable that the President displayed no signs of strain - 
actively participating in the conversation and engaging in 
extensive repartee with the other guests at his table.  The 
Ambassador, who was also present at the dinner, found 
 
ASTANA 00001415  003 OF 003 
 
 
Nazarbayev to be in an excellent mood as well. 
 
------------------------------------ 
Comment:  Three Strikes and He's Out 
------------------------------------ 
 
13. (C)  This is (at least) the third time that Aliyev's 
outrageous behavior has driven Nazarbayev to take drastic 
action.  In 2001 Aliyev was sent to "honorable exile" in 
Vienna for the first time after allegedly plotting to seize 
power.  Following Aliyev and Nazarbayeva's intense criticism 
of the government in the wake of the February 2006 murder of 
opposition leader Altynbek Sarsenbaiuly, Aliyev was stripped 
of his post as Deputy Foreign Minister and sent back to 
Vienna, and Nazarbayeva's Asar party was folded into Otan. 
Given Aliyev's increasingly irrational behavior and his 
unprecedented public airing of grievances, which has shocked 
all levels of Kazakhstani society, this may well be the end 
of his public life in Kazakhstan.  Tazhin noted to the 
Ambassador that the public will be overwhelmingly with the 
President on this issue; we agree with his prediction. 
Moreover, even if Nazarbayev made this move only under 
extreme provocation, it will cast a serious, and perhaps 
long-lasting, chill on the actions of other relatives and 
associates who have long behaved with complete impunity in 
business and their personal lives.  When combined with the 
lifting of term limits, Nazarbayev's public rebuke of Aliyev 
should eliminate for the foreseeable future the unseemly 
maneuvering among the family and other elites to position 
themselves for a succession struggle. 
ORDWAY

Wikileaks

07ASTANA1371, KAZAKHSTAN: FUTURE OF HARE KRISHNA COMMUNE REMAINS

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Reference ID Created Released Classification Origin
07ASTANA1371 2007-05-21 11:09 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO1348
RR RUEHDBU RUEHLN RUEHVK RUEHYG
DE RUEHTA #1371/01 1411109
ZNR UUUUU ZZH
R 211109Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 9504
INFO RUEHAST/USOFFICE ALMATY
RUCNCIS/CIS COLLECTIVE 0171
RUEHNE/AMEMBASSY NEW DELHI 0453
RUEHLO/AMEMBASSY LONDON 0472
RUEHVEN/USMISSION USOSCE 1743

UNCLAS SECTION 01 OF 02 ASTANA 001371 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR SCA/CEN (M. O'MARA) 
 
E.O. 12958: N/A 
TAGS: PHUM PGOV PREL KDEM KZ
SUBJECT: KAZAKHSTAN: FUTURE OF HARE KRISHNA COMMUNE REMAINS 
PRECARIOUS 
 
REF: A. 06 ASTANA 651, B. 06 ASTANA 668, C. 06 ASTANA 903 
 D. ASTANA 232 
 
ASTANA 00001371  001.2 OF 002 
 
 
1. (SBU) Summary:  Various government officials have assured the 
Hare Krishnas that their ongoing property dispute with local 
officials will be resolved fairly and peacefully, through 
negotiations.  Although there is hope that an acceptable resolution 
will be found, so far the Hare Krishnas report only confusion and 
roadblocks in dealing with the national government, and local 
authorities continue to threaten the demolition of additional Hare 
Krishna cottages. End summary. 
 
--------------------------------------------- -- 
SINCERE NEGOTIATIONS OR PUBLIC RELATIONS COVER? 
--------------------------------------------- -- 
 
2. (SBU) Throughout the winter, various government officials assured 
the Hare Krishnas and other observers that their ongoing property 
dispute with Karasai district officials would be resolved fairly and 
peacefully, through negotiations, and signaled that the resolution 
will involve a new plot of land for the Hare Krishnas.  In February, 
Amanbek Mukhashov, vice chairman of the Religious Issues Committee 
(RIC) publicly stated that the Hare Krishnas would be allotted 
another plot of land, and ordered them to work with local 
authorities to find a piece of land. In private conversations with 
Poloff, the Hare Krishna leadership indicated they were ready to 
consider moving, as they were not optimistic they would ever receive 
fair treatment from Karasai district officials or the court system. 
However, the Hare Krishnas stated that a new plot of land was not 
the only issue; they also wanted compensation for the investments 
they made in their current property, including for the homes that 
were demolished by local officials (Ref A). 
 
3. (SBU) On March 13, local akimat officials instructed the Hare 
Krishnas to relocate to a piece of land 70 kilometers northeast of 
Almaty.  The Hare Krishnas visited the land on March 16, but found 
it to be deserted, arid, saline land with virtually no vegetation. 
Accordingly, they rejected the land, though they remained open to 
further negotiations. 
 
4. (SBU) On March 30, local Krishna leader Govinda Swami met with 
Kazakhstan's Human Rights Ombudsman Bolat Baykadamov and one of his 
staff members at an OSCE conference in Vienna. Govinda Swami, a U.S. 
citizen, was accompanied by Liza Zhumakhmetova, a legal adviser in 
the OSCE's Human Dimension Office in Almaty, and Ninel Fokina of the 
Almaty Helsinki Committee.  According to Govinda Swami, Baykadamov 
said that the Presidential Administration was now handling the 
matter on behalf of the government, and wanted to inform the OSCE, 
foreign government delegations, and the Hare Krishnas that the 
matter would be resolved quickly because it was becoming an 
impediment to Kazakhstan's OSCE chairmanship bid. Baykadamov said 
the Presidential Administration blamed the predicament on "bad acts" 
by the Karasai district officials and the RIC, and wanted to work 
with the Hare Krishnas to find an alternate location for a worship 
Center in Almaty, as well as discuss compensation for the destroyed 
homes. According to Baykadamov, Karasai district officials and the 
RIC would no longer be involved in the matter. 
 
5. (U) On April 5, Baykadamov returned to Kazakhstan and made a 
public statement on the Hare Krishna issue. He insisted that the 
November demolition of Hare Krishna cottages was legal. He announced 
that he had met with Govinda Swami in Vienna and conveyed the 
Government of Kazakhstan's message that it was ready to provide 
another piece of land in Almaty for construction of a new temple. In 
addition, he stated that the government was ready to find a solution 
for the Hare Krishna's other issues, including another piece of land 
where they can raise cows and compensation for the resources 
invested into development of their property in the Karasai 
district. 
 
6. (SBU) On April 20, after hearing nothing from the government, the 
Hare Krishnas contacted Baykadamov about the situation.  Baykadamov 
reportedly retracted the statements he made in Vienna, stating that 
the Presidential Administration was not involved in the matter and 
never would be.  He informed the Hare Krishnas that they needed to 
work through the RIC and local officials, the same parties that the 
Hare Krishnas have been dealing with all along.  In frustration, the 
Hare Krishnas now allege that Baykadamov's comments in Vienna and to 
the media were part of a larger propaganda campaign to assure the 
OSCE and other Western observers that Kazakhstan is effectively and 
responsibly resolving the dispute. 
 
7. (SBU) After the about-face from Baykadamov, the Hare Krishnas 
contacted Yeraly Tugzhanov, chairman of the RIC, to proceed with the 
negotiati
ons.  According to Govinda Swami, Tugzhanov informed them 
 
ASTANA 00001371  002.2 OF 002 
 
 
that he was working with the Almaty city administration, and 
instructed the Hare Krishnas to apply for land in Almaty to 
establish a worship center.  The Hare Krishnas did so, but were told 
by Almaty city officials that they knew nothing of the situation and 
had no instructions from the RIC.  On May 18, the Hare Krishna 
leadership travel to Astana to meet with Tugzhanov, who again 
promised to work with Almaty city officials and make progress in 
finding a suitable piece of land. 
 
------------------------- 
DEMOLITION THREAT REMAINS 
------------------------- 
 
8. (SBU) In the meantime, Karasai district officials have continued 
their legal campaign against the Hare Krishna commune outside of 
Almaty.  On May 3, commune leader Viktor Golous received a call from 
local court executors that additional demolitions would occur the 
next morning, May 4, at 10 a.m.  The Hare Krishnas immediately began 
informing their supporters and calling their contacts in the 
government.  According to Golous, Tugzhanov of the RIC informed them 
that he could not help them and could not interfere with a court 
action. Poloff contacted the Ministry of Foreign Affairs about the 
matter, but officials there were unaware of any planned demolitions. 
 On May 3, deputy head of the Presidential Administration Maulen 
Ashimbayev, who was well-briefed on the issue but not aware of the 
demolition order, assured the Ambassador that the GOK wanted to 
resolve the dispute through negotiations. 
 
9. (SBU) On May 4, several journalists, Pol FSN, and an OSCE 
observer proceeded to the Hare Krishna commune to observe the 
demolitions.  Though the electricity was shut off for a while, no 
police or demolition crews arrived, and no demolitions took place. 
Amanbek Mukhashov, vice chairman of the RIC, later informed Poloff 
that no demolitions were ever planned, and the matter would be 
resolved through negotiations. 
 
10. (U) On May 8, the Supreme Court issued yet another ruling 
against the Hare Krishnas, this time concerning the 116 acre parcel 
of farmland as opposed to the cottages that have been the subject of 
the demolitions and demolition orders.  The ruling stated that the 
Hare Krishnas no longer have a right to use the land, and clears the 
way for authorities to confiscate the land at any time and transfer 
it to the Karasai district land reserve.  The Hare Krishnas 
criticized the ruling as another in a long series of unfair adverse 
court rulings. 
 
------- 
COMMENT 
------- 
 
11. (SBU) Comment: There is some hope that the Hare Krishnas will 
find a minimally acceptable solution to their multi-year property 
dispute.  Officials in Astana are consistent in their stated desire 
to solve the problem by finding new land for the Hare Krishnas, and 
have thus far managed to forestall any further demolitions by 
aggressive local authorities.  The beleaguered Hare Krishnas are 
prepared to leave their commune in the Karasai district, assuming 
they are provided with suitable land for their place of worship, 
their animals and farming activity, and compensation for their 
substantial investment in the current commune property.  However, 
the government's eagerness to tell the world that it has peacefully 
resolved the problem appears greater than its actual desire to do 
so, given the slow pace of constructive negotiations and the 
continued aggression of local authorities.  Post will continue to 
monitor the situation and engage with government officials in 
support of a nonviolent, fair resolution.  End comment. 
 
ORDWAY

Wikileaks

07ASTANA1358, KAZAKHSTAN SUPPORTS BROAD DEFINITION OF UNSCR 1747

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Reference ID Created Released Classification Origin
07ASTANA1358 2007-05-18 10:26 2011-08-30 01:44 UNCLASSIFIED Embassy Astana

VZCZCXYZ0003
RR RUEHWEB

DE RUEHTA #1358 1381026
ZNR UUUUU ZZH
R 181026Z MAY 07
FM AMEMBASSY ASTANA
TO SECSTATE WASHDC 9491

UNCLAS ASTANA 001358 
 
SIPDIS 
 
SIPDIS 
 
SCA/CEN FOR M. O'MARA 
 
E.O. 12958: N/A 
TAGS: PREL PARM ETTC UNSC IR
SUBJECT: KAZAKHSTAN SUPPORTS BROAD DEFINITION OF UNSCR 1747 
 
REF: STATE 67462 
 
In response to reftel points, MFA International Security 
Section Advisor Kayrat Sarzhanov told Poloff that Kazakhstan 
supports a broad interpretation of UNSCR 1747, operative 
paragraph 5.  He added that Kazakhstan is preparing its 
report on UNSCR 1747 implementation and expects to submit it 
by the May 24 deadline. 
ORDWAY

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07ASTANA1357, KAZAKHSTAN: CONSTITUTIONAL REFORM PACKAGE APPROVED WITH

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Reference ID Created Released Classification Origin
07ASTANA1357 2007-05-18 10:17 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO9509
PP RUEHDBU RUEHLN RUEHVK RUEHYG
DE RUEHTA #1357 1381017
ZNR UUUUU ZZH
P 181017Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 9490
INFO RUCNCIS/CIS COLLECTIVE 0170
RUEHVEN/USMISSION USOSCE 1742
RUEHNO/USMISSION USNATO 2210
RUEHAST/USOFFICE ALMATY

UNCLAS ASTANA 001357 
 
SIPDIS 
 
DEPARTMENT FOR SCA/CEN (M. O'MARA) 
 
SENSITIVE 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PGOV PHUM KDEM PREL KZ
SUBJECT: KAZAKHSTAN: CONSTITUTIONAL REFORM PACKAGE APPROVED WITH 
SURPRISE ADDITION 
 
REF: ASTANA 1323 
 
1. (SBU) Summary:  Parliament voted on May 18 to approve President 
Nazarbayev's package of constitutional amendments designed to 
increase the size and authority of the parliament, as well as to 
introduce other changes aimed at democratic reform.  In a surprise 
move, a small group of parliamentarians added a provision exempting 
Nazarbayev from existing term limits.  This puzzling move is likely 
to undercut the positive public impact of the reform package.  End 
summary. 
 
--------------------------------------------- --- 
Last-Minute Change to Lift Nazarbayev Term Limit 
--------------------------------------------- --- 
 
2. (U) As expected, a joint session of parliament voted on May 18 to 
approve the package of constitutional amendments that President 
Nazarbayev presented for consideration two days earlier (reftel). 
All 39 senators and 66 of the 71 Mazhilis (lower house) members 
present voted in favor of the package, which will now go to 
Nazarbayev for signature. 
 
3. (U) In an unexpected move, an additional provision was added to 
the package late on May 17 exempting President Nazarbayev from the 
current two-term limit specified in Article 42 of the constitution. 
One parliamentarian cited the example of Franklin Delano Roosevelt 
being elected to four terms to lead the U.S. through a time of 
crisis. (Comment:  A false analogy given that FDR's experience led 
to consensus on the need for term limits and the adoption of the 
22nd Amendment in 1951. End comment.) 
 
4. (SBU) Ak Zhol Mazhilis member Alikhan Baymenov told Pol-Econ 
Chief that a small group of deputies drafted the provision and 
inserted it into the text.  He was quite surprised to learn of it 
this morning just before the second and final reading of the 
legislation.  Baymenov, who called the provision "a spoonful of tar 
in a barrel of honey" (akin to one rotten apple spoiling the whole 
bushel), was quite concerned that the move would distract attention 
from the numerous positive points in the legislation. 
 
 
------- 
Comment 
------- 
 
5. (SBU) While quick passage of the constitutional amendments was 
expected, the move to exempt Nazarbayev from existing term limits 
came as a surprise to all observers.  We may never know if 
Nazarbayev initiated the idea, or it was the work of 
parliamentarians attempting to curry favor (as they did by renaming 
the party in his honor in December).  Nazarbayev, who will be 72 by 
the time his current term expires in 2012, has publicly stated that 
this will be his last term; it is unlikely that he will seek to stay 
in office.  Even if that is his plan, there was no need to act now 
to pave the way; he will retain enormous powers under the modified 
Constitution to continue to change the system of government as he 
sees fit.  Parliament's gift to Nazarbayev will seriously undercut 
the public impact of the constitutional amendments: instead of 
headlines about "Modest Political Reform in Kazakhstan," the 
independent press here and abroad will likely lead with "President 
Nazarbayev Can Serve for Life."  Nazarbayev could still put a 
positive spin on the matter by rejecting the legislation, but that 
is unlikely. 
 
ORDWAY

Wikileaks

07ASTANA1336, KAZAKHSTAN WILL PARTICIPATE IN OSCE COUNTERTERRORISM

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Reference ID Created Released Classification Origin
07ASTANA1336 2007-05-18 00:33 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO9010
PP RUEHAST
DE RUEHTA #1336 1380033
ZNR UUUUU ZZH
P 180033Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 9470
INFO RUEHAST/USOFFICE ALMATY
RUEHVEN/USMISSION USOSCE 1741

UNCLAS ASTANA 001336 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR SCA/CEN (M. O'MARA), EUR/RPM (PROSEN), S/CT (RANGASWAMY) 
 
USOSCE FOR SIBILLA 
 
E.O. 12958: N/A 
TAGS: PHUM PGOV PREL KZ
SUBJECT: KAZAKHSTAN WILL PARTICIPATE IN OSCE COUNTERTERRORISM 
CONFERENCE MAY 31 - JUNE 1 
 
REF: STATE 62142 
 
1. (U) Pol-Econ Chief and Gennadiy Spiglazov of the Russian Embassy 
conveyed reftel points and agenda to Yerkin Akhinzhanov, head of the 
MFA's European Cooperation Department, on May 17. 
 
2. (SBU) Akhinzhanov said that Kazakhstan was working to put 
together a diverse delegation for the OSCE conference.  The MFA had 
proposed that Committee for National Security (KNB) Chairman 
Shabdarbayev head the delegation, but had not yet received a 
response.  The Ministry of Internal Affairs and the Ministry of 
Industry and Trade will also participate. 
 
3. (SBU) Pol-Econ Chief and Spiglazov urged Akhinzhanov to ensure 
robust private sector participation in the delegation.  He said that 
the Ministry of Industry and Trade had been tasked with identifying 
potential private sector participants, but conceded that the MFA 
should give more thought to identifying a broader range of 
non-governmental participants.  He cautioned that it would be hard 
to convince them to go as the GOK would not be able to finance their 
travel. 
 
ORDWAY

Wikileaks

07ASTANA1326, KAZAKHSTAN: DEMARCHE DELIVERED CONCERNING TRAVEL OF UNSC

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Reference ID Created Released Classification Origin
07ASTANA1326 2007-05-17 07:53 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO8173
RR RUEHAST
DE RUEHTA #1326 1370753
ZNR UUUUU ZZH
R 170753Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 9462
INFO RUCNDT/USMISSION USUN NEW YORK 1878
RUEHAST/USOFFICE ALMATY

UNCLAS ASTANA 001326 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR ISN/NA (R. Nephew) 
 
E.O. 12958: N/A 
TAGS: PARM KNNP IR KZ
SUBJECT: KAZAKHSTAN: DEMARCHE DELIVERED CONCERNING TRAVEL OF UNSC 
DESIGNATED IRANIANS 
 
REF: State 61222 
 
(SBU) Poloff delivered reftel demarche to the MFA Department of 
Middle Eastern and African Affairs on May 15.  Desk officer Talgat 
Shaldanbai was not aware of the incident described in reftel, and 
expressed appreciation for the information.  He offered no 
substantive response to the demarche. 
 
ORDWAY

Wikileaks

07ASTANA1324, KAZAKHSTAN: SAVING THE LIVES OF POLICE OFFICERS

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Reference ID Created Released Classification Origin
07ASTANA1324 2007-05-17 06:50 2011-08-30 01:44 UNCLASSIFIED Embassy Astana

VZCZCXRO8110
PP RUEHAST
DE RUEHTA #1324/01 1370650
ZNR UUUUU ZZH
P 170650Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 9457
INFO RUEHAST/USOFFICE ALMATY
RUEAWJA/DEPT OF JUSTICE WASHDC
RUEHC/SECSTATE WASHDC//SCA COLLECTIVE/ 9458

UNCLAS SECTION 01 OF 02 ASTANA 001324 
 
SIPDIS 
 
DEPT FOR INL/AAE (ALTON), SCA/CEN (OMARA), DEPT OF JUSTICE (DUCOT), 
DUSHANBE FOR DEA 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: SNAR PGOV KCRM KZ
SUBJECT: KAZAKHSTAN: SAVING THE LIVES OF POLICE OFFICERS 
 
1.  Summary:  INL conducted a Police Officer Survival Techniques 
Course on April 16-27 at the Ministry of Internal Affairs Academy in 
Almaty.  Ten operations officers of the criminal police and 13 
officers from regional anti-narcotics units participated in the 
course taught by personnel from the Department of Justice 
International Criminal Investigative Training and Assistance Program 
(DOJ/ICITAP.)  The Academy Director and INL plan to create a cadre 
of Kazakhstani officers to teach the course. End summary. 
 
---------- 
BACKGROUND 
---------- 
 
2.  The MVD Training Center was established in 1999 and is a 
constituent part of the Institute for Training of Law Enforcement 
Management of the MVD Academy.  Zholdybai Uspanov, Head of the 
Training Center, and other Academy experts train 20 mid-to- senior 
level officers from throughout Kazakhstan in the Center each month. 
Officers of the Border Guard Service, Committee for National 
Security, Customs Control Committee, and the Financial Police 
receive training in this Center as well. 
 
3.  INL Officer arranged the course on police officer defensive 
tactics at the Training Center of the Police Academy of the Ministry 
of Internal Affairs using instructors from the Department of 
Justice's International Criminal Investigative Training Assistance 
Program (ICITAP) Office. 
 
 
----------------------------------------- 
U.S. SWAT TEAM IN KAZAKHSTAN, TEACHING... 
----------------------------------------- 
 
4.  From April 16 to 27, U.S. experts taught a two-week course on 
Police Officer Defensive Tactics to 23 officers at the Ministry of 
Internal Affairs Almaty Training Academy.  The purpose of the 
training was to instruct law enforcement officers in specialized 
self-defense tactics while detaining and arresting criminal 
suspects.  At the same time instructors ensured the arresting 
officers learned to use only the force appropriate to detain or 
arrest, thereby respecting the rights of the detained. 
 
5.  From the first day, the U.S. trainers' experience in SWAT teams 
and police operations won the recognition of the Kazakhstani 
officers and experts of the Training Center.  The U.S. experts 
quickly recognized the differences between Kazakhstani and American 
law enforcement systems.  For example, the participants shared with 
the American trainers that unlike in the U.S., before the arrest of 
a suspected drug dealer in Kazakhstan the arresting officer is 
required to find witnesses to monitor the arrest.  (Note: To ensure 
the police do not simply pay lip service to this requirement the 
Kazakhstani Government made the arrest witness requirement very 
strict.  The police cannot use a serial witness just to meet the 
letter of the law but must find different witnesses for each arrest. 
 End note.) 
 
6.  The U.S. trainers presented a variety of topics including Mental 
Strategies for Officer Survival, the principles of conducting Field 
Interviews, the use of the Force Continuum Model of using only the 
appropriate and necessary level force for the corresponding threat. 
Following the presentation of material in the classroom, the 
officers conducted practical exercises on low, medium and high risk 
traffic stops and building searches. 
 
7.  The trainers of MVD Academy volunteered to co-teach during the 
Defensive Tactics Training and delivered lectures on ensuring the 
security of officers in the criminal detention process, detention of 
armed criminals in a vehicle, detention of criminals in a building, 
tactics of personal search, and tactics for conducting a crime 
investigation in a confrontational environment. 
 
 
------------------------------------------ 
...OFFICER SAFETY - A NEW, WELCOME CONCEPT 
------------------------------------------ 
 
8.  The idea that a police force could be taught how to preserve the 
lives of officers who are risking their all in the line of duty 
struck a chord with the Kazakhstani participants.  Current 
Kazakhstani police officer and senior law enforcement management 
training does not stress that police officers are valuable and 
should not be needlessly put at risk. 
 
9.  Intrigued as they were by the idea that the force or its senior 
management had a responsibility to protect them, in the beginning of 
the course the officers were reluctant to admit that they might be 
injured or killed while performing their everyday duty.  Once the 
initial bravado was past, they actively interacted with the 
 
ASTANA 00001324  002 OF 002 
 
 
instructors and were eager to learn the elements of self-protection 
such as developing the proper mental attitude, physical 
preparedness, proper equipment, and legal aspects.  The eagerness to 
learn protective techniques was even more evident when participants 
began to recall cases when colleagues became victims of criminals. 
 
 &#x0
00A;10.  The officers concluded that carelessness is one of the main 
reasons officers are wounded or killed.  The participants' lack of 
knowledge about self-protection while conducting operations was 
obvious in the practical exercises on the proper methods to search 
individuals, vehicles, and buildings.  U.S. instructors also quickly 
noted that some of the young officers did not practice proper 
firearm safety procedures and put themselves in the line of fire 
because of dangerous, hasty actions in risky situations. 
 
 
------------------------------ 
THIS WAS GREAT!  SHOW US MORE! 
------------------------------ 
 
11.  Colonel Uspanov admitted to EmbOff that most of young officers 
were not well prepared for their work.  The officers are too young, 
ambitious, and inexperienced.  Uspanov requested additional sessions 
of the same course as well as training of trainers on the methods 
and tactics of combating drug trafficking, and international 
cooperation in the fight against drugs.  (Note:  Under current and 
future Letters of Agreement, INL Kazakhstan has several 
counter-narcotics officer training sessions planned for the coming 
months and creating a cadre of trainers to carry on the program is 
integral to the program.  Kazakhstani co-teachers were incorporated 
into this training as well.  The Regional DEA Agent from Dushanbe is 
scheduled to visit Kazakhstan in early June.  End note.) 
 
 
------- 
COMMENT 
------- 
 
12.  Thanks to ICITAP/DOJ's excellent selection of trainers the 
Kazakhstani operations officers received top-notch instruction from 
seasoned U.S. professionals.  From the feedback and engagement of 
the participants Post assesses that the two-week training opened the 
minds of the Kazakhstani officers to the idea that the life of a 
police officer is important and the rights of the citizen are to be 
respected.  For these officers at least, before making a step during 
an operation they will consider the possible consequences. 
 
ORDWAY

Wikileaks

07ASTANA1323, KAZAKHSTAN: PRESIDENT NAZARBAYEV FAST-TRACKS CONSTITUTIONAL

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Reference ID Created Released Classification Origin
07ASTANA1323 2007-05-16 15:04 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO7389
OO RUEHDBU RUEHLN RUEHVK RUEHYG
DE RUEHTA #1323/01 1361504
ZNR UUUUU ZZH
O 161504Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 9454
INFO RUCNCIS/CIS COLLECTIVE 0167
RUEHVEN/USMISSION USOSCE 1738
RUEHNO/USMISSION USNATO 2207
RUEHAST/USOFFICE ALMATY

UNCLAS SECTION 01 OF 03 ASTANA 001323 
 
SIPDIS 
 
DEPARTMENT FOR SCA/CEN (M. O'MARA) 
 
SENSITIVE 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PGOV PHUM KDEM PREL KZ
SUBJECT: KAZAKHSTAN: PRESIDENT NAZARBAYEV FAST-TRACKS CONSTITUTIONAL 
 
REFORMS 
 
REF: A. Astana 515, B. Astana 1304 
 
ASTANA 00001323  001.2 OF 003 
 
 
1. (SBU) Summary:  President Nazarbayev presented a package of 
proposed constitutional amendments to a joint session of parliament 
on May 16, and instructed parliament to pass them this week.  The 
proposed constitutional amendments retain significant power in the 
presidency, but increase the size and the power of parliament in 
some spheres.  In addition, the constitutional amendments increase 
the role of maslikhats (local legislatures), eliminate the death 
penalty except in cases of terrorism and war crimes, pave the way 
for government financing of public organizations and political 
parties, and make it more difficult for parliament to amend the 
Constitution in the future.  President Nazarbayev discussed a number 
of additional reforms, including moving to a party-list proportional 
representation system for all Mazhilis districts and requiring 
court-issued warrants for arrest.  However, these reforms did not 
appear in the text distributed at the joint session of parliament, 
and will presumably be enacted as part of future legislative 
changes.  Parliament conducted the first reading of the 
constitutional amendments on May 16, and is expected to complete the 
second reading and approve the amendments on Friday, May 18.  End 
summary. 
 
------------------------------------------ 
Nazarbayev Presents Constitutional Reforms 
------------------------------------------ 
 
2. (U) On May 16, President Nazarbayev presented a package of 
proposed constitutional amendments to a joint session of parliament. 
 During his presentation, Nazarbayev traced the history of 
democratic reform in Kazakhstan, and stressed that Kazakhstan was 
now ready to enact "liberal reforms" and establish new 
counterweights in the balance of power between different branches 
and institutions. 
 
3. (U) Nazarbayev then unveiled amendments that would accomplish the 
following: 
 
-- increase the size of the Mazhilis (lower house of parliament) by 
30 members, from 77 to 107, with 98 members elected by the voters 
and nine elected by the Assembly of Peoples of Kazakhstan, a 
presidentially appointed advisory body designed to represent all of 
the different ethnic groups in Kazakhstan. 
 
-- increase the size of the Senate by eight members, from 39 to 47, 
with all eight new members appointed directly by the president. 
(Note: The president currently has the power to appoint seven of the 
39 senators, and will now have the power to appoint 15 out of 47 
senators. End note.) 
 
-- require the president to obtain Mazhilis approval to appoint the 
prime minister. 
 
-- require the prime minister to represent the political party with 
a majority of seats in the Mazhilis, require the Cabinet to 
implement the party's program, and require the Cabinet to report to 
the parliament as well as the president. 
 
-- require the parliament to approve the national budget and any 
amendments to the national budget. 
 
-- reduce the number of Mazhilis members needed to dismiss the 
Cabinet through a no-confidence vote, from a two-thirds majority to 
a simple majority.  Under the amendments, the vote must be initiated 
by a least 1/5 of the Mazhilis. The Mazhilis would also have the 
authority to request the dismissal of individual Cabinet members by 
a simple majority vote. 
 
-- reduce the president's term in office from seven years to five 
years, after President Nazarbayev's current term expires in 2012. 
 
-- tighten the residency requirement for presidential candidates, 
requiring candidates to have lived in Kazakhstan "for the last 15 
years" as opposed to the current "for at least 15 years." 
 
-- tighten the residency requirement for parliamentary candidates, 
requiring candidates to have lived in Kazakhstan "for at least 10 
years."  Currently, Senate candidates must have lived in Kazakhstan 
for at least five years; there is no residency requirement for 
Mazhilis candidates. 
 
-- extend the term in office of Maslikhat members from four years to 
five years. (Note:  Maslikhats are locally elected legislative 
bodies at the oblast [regional] level and the local [city/county] 
level.  End note.) 
 
ASTANA 00001323  002.2 OF 003 
 
 
 
-- require Maslikhat consent for the appointment of regional and 
local akims (governors/mayors).  Currently, the president appoints 
regional akims, and regional akims appoint local akims, without 
formal consent by the respective Maslikhats. 
 
-- reduce the number of Maslikhat members needed for a no-confidence 
vote in their akim, from two-thirds to a simple majority.  (Note: A 
no-confidence vote by the Maslikhat does not result in dismissal of 
the akim; rather, it is treated as request for dismissal by the 
president in the case of regional akims, or by the regional akim in 
the case of local akims.  End note.) 
 
-- abolish t
he Judicial Qualifications College, a semi-autonomous, 
independent body that screens and then forwards judicial candidates 
to the president for his consideration, and transfer the power to 
select candidates to the Supreme Judicial Council, a body consisting 
of the chairman of the Constitutional Council, the chairman of the 
Supreme Court, the procurator general, the minister of justice, and 
miscellaneous other officials. 
 
-- abolish the death penalty for all crimes except terrorism crimes 
leading to death and grave crimes committed during wartime. 
 
-- eliminate the current restriction on merging public organizations 
with government institutions, which will allow greater government 
funding of NGOs. 
 
-- eliminate the current restriction on public financing of 
political parties. 
 
-- eliminate the constitutional provision that requires the 
president to suspend his political party activities while serving as 
president. 
 
-- allow the president to appoint the chairman and two members of 
the Central Election Commission.  Currently, all seven members are 
appointed by the Mazhilis. 
 
-- allow the full Senate and the full Mazhilis to appoint members of 
the Constitutional Council, a seven-member body which interprets the 
Constitution.  Currently, the speaker of the Senate and the speaker 
of the Mazhilis are each entitled to appoint two members of the 
Council; the proposed amendment would grant that power to the entire 
legislative body, as opposed to just the speakers.  The president 
would retain the power to appoint the chairman and two remaining 
members. 
 
-- allow the full Senate and the full Mazhilis to appoint members of 
the Budget Revision Commission, a nine-member body with authority 
over budget issues.  Currently, the speaker of the Senate and the 
speaker of the Mazhilis are each entitled to appoint three members 
of the Commission; the proposed amendment would grant that power to 
the entire legislative body, as opposed to just the speakers.  The 
president would retain the power to appoint the chairman and two 
remaining members. 
 
-- increase the number of referendum votes needed to amend the 
Constitution by referendum, from a simple majority of votes in the 
country to a majority of votes in two thirds of all oblasts and 
major cities (Almaty and Astana). (Note: The proposed amendments do 
not address the mechanism for amending the Constitution through the 
legislature.  End note.) 
 
--------------------------- 
Future Legislative Changes? 
--------------------------- 
 
3. (U) In his presentation, President Nazarbayev made a number of 
additional proposals which did not appear in the text distributed to 
audience members.  These changes do not involve amending the 
Constitution, and will presumably be enacted following the adoption 
of the new constitutional amendments.  Among other things, he 
proposed strengthening the role of political parties in the 
parliamentary election process by moving to a party-list system for 
all Mazhilis seats, and creating a mechanism to provide public 
financing for political parties.  In addition, he stated that the 
power to authorize arrests would be vested in the judiciary.  A 
summary of Nazarbayev's speech was immediately posted on the 
presidential website (www.akorda.kz) in Russian, Kazakh, and 
English. 
 
-------- 
Timeline 
-------- 
 
ASTANA 00001323  003.2 OF 003 
 
 
 
4. (SBU) President Nazarbayev asked the parliament to approve the 
constitutional amendments this week, citing the public discussion 
that had already taken place on these reforms through the 
Democratization Commission (Ref A).  The parliament conducted the 
required first reading on May 16, and is scheduled to complete the 
second reading and hold a final vote on Friday, May 18.  Although 
the president said nothing about early parliamentary elections, 
informed observers such as Alikhan Baymenov of Ak Zhol (Ref B) and 
Oraz Zhandosov of True Ak Zhol believe that this is inevitable. 
 
--------- 
Reactions 
--------- 
 
5. (SBU) Initial reactions from our contacts have been mixed.  Not 
surprisingly, opposition Social Democratic Party leader Zharmakhan 
Tuyakbay, who has chosen a path of constructive engagement with the 
Kazakhstani government, told the press that overall he was pleased 
with this "first step toward democratic reform," even though it was 
a "cautious" move and more public debate was needed.  He called for 
further reforms, including "real" authority for the Mazhilis to form 
the government and control the national budget; direct election of 
akims at all levels; and the election of judges to ensure the 
independence of the judiciary.  Oraz Zhandosov of True Ak Zhol, 
usually a vocal critic of the government, told the Ambassador that 
he viewed the majority of the proposals as beneficial.  Well-known 
human rights defenders Yevgeniy Zhovtis and Ninel Fokina both 
expressed concern to us regarding the lack of transparency and 
public debate.  Interestingly, both also viewed the move to a party 
list system as disadvantageous for opposition parties, even though 
the sole (nominal) opposition representative in parliament today - 
Baymenov - was elected from the party list. 
 
------- 
Comment 
------- 
 
6. (SBU) Although detailed analysis will be necessary to judge 
whether these changes will increase the ability of Kazakhstani 
citizens to influence their government, these draft amendments 
clearly have the potential to lead to greater democratization. 
Switching to a pure proportional system to elect the Mazhilis, for 
example, is likely to significantly strengthen the development and 
role of political parties.  Increasing Parliament's authority will 
introduce greater institutional balance and oversight, even if there 
is a large pro-presidential parliamentary majority. 
 
7. (SBU) In the short run, political parties favoring President 
Nazarbayev and his policies will dominate any freely-elected 
Parliament.  Nonetheless, if there is sufficient political will at 
the top to ensure a fair electoral process, even a small increase in 
opposition representation would provide for greater public debate 
and dialogue.  In addition, we have been telling the GOK for some 
time that it needs to develop strong, democratic institutions for 
the post-Nazarbayev era.  In this context, real steps to reduce the 
formal powers of the presidency and increase the role of parliament 
would be a major step in the right direction. 
 
ORDWAY

Wikileaks

07ASTANA1304, KAZAKHSTAN: PRESIDENT NAZARBAYEV TO ANNOUNCE CONSTITUTIONAL

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Reference ID Created Released Classification Origin
07ASTANA1304 2007-05-15 11:05 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO5571
OO RUEHDBU RUEHLN RUEHVK RUEHYG
DE RUEHTA #1304/01 1351105
ZNR UUUUU ZZH
O 151105Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 9448
INFO RUCNCIS/CIS COLLECTIVE 0165
RUEHVEN/USMISSION USOSCE 1736
RUEHNO/USMISSION USNATO 2205
RUEHAST/USOFFICE ALMATY

UNCLAS SECTION 01 OF 02 ASTANA 001304 
 
SIPDIS 
 
DEPARTMENT FOR SCA/CEN (M. O'MARA) 
 
SENSITIVE 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PGOV PHUM KDEM PREL KZ
SUBJECT: KAZAKHSTAN: PRESIDENT NAZARBAYEV TO ANNOUNCE CONSTITUTIONAL 
REFORMS 
 
REF: A. Astana 515, B. USOSCE 195 
 
ASTANA 00001304  001.2 OF 002 
 
 
1. (SBU) Summary:  President Nazarbayev will present a package of 
proposed constitutional amendments to a joint session of parliament 
on May 16.  The draft amendments would transfer certain presidential 
powers to the parliament, change the method of electing the 
parliament, change the role of parties in the legislative process 
and formation of the Government, increase the role of local 
self-government, and better guarantee respect for human rights.  The 
specifics of how each of these changes will be carried out are not 
yet known, however, as the working group which developed most of 
them worked in relative secrecy and the draft has not yet been 
distributed.  The parliamentary approval process could move quite 
quickly, with one Mazhilis member predicting a final vote as early 
as Friday.  End summary. 
 
---------------------------------------- 
Nazarbayev to Present Legislation May 16 
---------------------------------------- 
 
2. (U) On May 14, President Nazarbayev announced that he would 
present a package of proposed constitutional amendments to a joint 
session of parliament on May 16. Speaking during the final meeting 
of the working group that has been drafting political reform 
legislation (Ref A), Nazarbayev said that "most of the suggestions 
offered by [the working group members] have been taken into 
account."  He said that the draft legislation will cover five areas 
where "we have tried to make serious changes": 
 
-- Redistribution of presidential authorities to the Parliament, and 
the method of electing Parliament; 
 
-- the role of political parties; 
 
-- increasing the role of local self-government; 
 
-- further development of the law enforcement system; and 
 
-- the development of guarantees of human rights and freedoms. 
 
------------------------------ 
Rogov Details Proposed Changes 
------------------------------ 
 
3. (U) Working group chairman Igor Rogov, chairman of the 
Constitutional Council, provided additional details during the 
meeting.  According to Rogov, the authority of parliament "will be 
broadened to such a degree that we can speak of a shift from the 
presidential form of government to a presidential-parliamentary 
system."  He also said that the role of political factions in the 
legislative process and the formation of the Government will be 
broadened, and that the number of seats in both the Mazhilis and 
Senate will be increased.  Rogov said that President Nazarbayev will 
announce the numbers when he presents the legislation. 
 
4. (U) Rogov added that the legislation contains provisions that 
will increase the role of public associations, impact individual 
rights and freedoms, and simplify the way courts are formed in order 
to guarantee the independence of the judicial system.  He explained 
that changes to the law enforcement system will involve regulations 
of the activities of the procuracy and investigative bodies. 
"Overall," Rogov concluded, "the amendments will allow us to 
democratize our state and society to a higher degree, and to ensure 
more reliable protection of constitutional rights and freedoms of 
the person and citizen." 
 
5. (SBU) Almost nothing is known of the substance of the 
legislation.  As reported in Ref B, Rogov's working group operated 
in a very closed manner with no outside input. 
 
-------- 
Timeline 
-------- 
 
6. (U) During the working group meeting, it was not made clear 
whether the May 16 joint session of parliament will vote on the 
draft legislation, or merely begin the process of reviewing it. 
Article 53 of the Kazakhstani Constitution specifies that the 
president must propose constitutional amendments to a joint session 
of parliament.  According to parliamentary regulations, passage of 
such legislation requires the support of a simple majority from both 
chambers on the first reading, and a three-fourths vote in favor on 
the second/final reading. 
 
7. (SBU) Past practice shows that President Nazarbayev often favors 
 
ASTANA 00001304  002.2 OF 002 
 
 
quick votes on major initiatives such as this.  After sequestering a 
group of legal experts in a mountain resort to draft a new 
constitution in 1995, Nazarbayev  submitted it to a referendum after 
only a month of public discussion.  Likewise, the Extremism Law and 
National Security Amendments were each passed in one day in 2005. 
Ak Zhol parliamentarian Alikhan Baymenov predicted to Pol-Econ Chief 
on May 15 that the parliament could get through both readings as 
early as Friday, May 18.  (Note:  Only a simple majority is needed 
to end debate and move to a vote.) 
 
8. (U) The presidential website (www.akorda.kz) immediately
 posted 
the text of President Nazarbayev and Rogov's statements in Russian, 
Kazakh, and English, as a first step in what will presumably be an 
effort to publicize the reform effort widely. 
 
---------------- 
Initial Reaction 
---------------- 
 
9. (SBU) There has been little public reaction so far, in part due 
to lack of concrete information regarding the changes.  Baymenov 
confirmed that the text of the proposed changes had not yet been 
distributed to members of parliament as of 18:00 May 15.  (Note: 
Interfax reported that President Nazarbayev met with Nur Otan 
members in a closed session late on May 15 to acquaint them with the 
draft.  He reportedly told his fellow party members that 80% of the 
changes were based on Democratization Commission recommendations, 
and 20% were steps that went further.  End note.) 
 
10. (SBU) Baymenov, who participated actively in the Democratization 
Commission, predicted that the amendments would make all seats in 
the Mazhilis elected by party list.  Logically, he said, the change 
would result in early elections this summer or fall; a wider range 
of parties might be elected.  He thought that the additional seats 
in both chambers would be appointed by the president from the 
Assembly of Peoples of Kazakhstan.  The big question for him is 
whether the provisions regarding local self-government will 
recognize akims (local executive leaders) and maslikhats (local 
legislative bodies) as organs of local self-government rather than 
of the central government, thereby correcting a contradiction in the 
present Constitution. 
 
-------------------------------- 
Comment: Devil is in the Details 
-------------------------------- 
 
11.  (SBU) While it appears at first glance that these are serious 
and positive steps toward democratization, the impact of President 
Nazarbayev's proposed reforms will depend on the exact nature of the 
changes, which will only be known after President Nazarbayev 
addresses the joint session of parliament on Wednesday.  The 
Ambassador has been invited and will attend. 
 
ORDWAY

Wikileaks

07ASTANA1302, KAZAKHSTAN: PRIME MINISTER AND FOREIGN MINISTER

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Reference ID Created Released Classification Origin
07ASTANA1302 2007-05-15 11:04 2011-08-30 01:44 CONFIDENTIAL//NOFORN Embassy Astana

VZCZCXRO5566
PP RUEHDBU
DE RUEHTA #1302/01 1351104
ZNY CCCCC ZZH
P 151104Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 9444
INFO RUCNCIS/CIS COLLECTIVE 0163
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEAIIA/CIA WASHDC
RUEBAAA/DEPT OF ENERGY WASHDC

C O N F I D E N T I A L SECTION 01 OF 02 ASTANA 001302 
 
SIPDIS 
 
NOFORN 
SIPDIS 
 
DEPT FOR SCA/FO SMANN); EB/ESC; SCA/CEN (O'MARA) 
DEPT PLEASE PASS USTDA (DSTEIN) 
 
E.O. 12958: DECL: 05/14/2017 
TAGS: ENRG EPET KZ RS TX
SUBJECT: KAZAKHSTAN: PRIME MINISTER AND FOREIGN MINISTER 
DOWNPLAY ANNOUNCED GAS PIPELINE DEALS 
 
REF: ASHGABAT 489 
 
Classified By: Ambassador John Ordway; reasons 1.4 (b) and (d). 
 
1. (C) Summary: Both Prime Minister Masimov and Foreign 
Minister Tazhin downplayed the significance of the gas 
pipeline deals announced during the May 12 tripartite summit 
in Turkmenistan (Ref A) in separate May 15 conversations with 
Ambassador Ordway.  Masimov told the Ambassador that "all we 
agreed to was a feasibility study" for a new gas pipeline, 
and that "only because it was so very important to Putin." 
Tazhin, in turn, described the deal as a "Russian deal for 
Turkmen gas," and assured the Ambassador that "we are not 
cutting off any options" for gas transportation.  Masimov 
also told the Ambassador that the summit had not led to any 
progress on the issue of Caspian Pipeline Consortium (CPC) 
expansion, and voiced skepticism that the Government of 
Russia would ever agree to expansion terms.  Masimov 
acknowledged that the government was preparing itself for a 
heated battle with Kashagan partners once project delays and 
cost overruns were formally announced later this summer; in 
addition to financial compensation, he said, the government 
might seek a change of operator.  End summary. 
 
Downplaying the Gas Pipeline Drama 
---------------------------------- 
 
2. (C) On May 15, Prime Minister Masimov downplayed the gas 
pipeline deals announced during the May 12 tripartite summit 
in Turkmenistan, telling Ambassador Ordway that "all we 
agreed to was a feasibility study" for a new gas pipeline, 
and that Nazarbayev had gone that far "only because it was so 
very important to Putin."  The presidents, he said, had 
ordered their governments to draw up an agreement for 
signature by September 1.  Masimov portrayed the deal as 
driven by the Russians and Turkmen, with Kazakhstan involved 
merely by virtue of geography. 
 
3. (C) What Kazakhstan was really after in Turkmenistan was a 
gas concession, Masimov explained, in order to secure gas 
supplies for Kazakhstan's gas-deficit Southern population 
centers.  Beyond that, he said, the Government of Kazakhstan 
(GOK) had pursued railroad and road projects linking the 
Caspian port of Aktau with Turkmenistan. 
 
4. (C) Foreign Minister Tazhin requested the May 15 meeting 
with Ambassador Ordway, telling the latter that he was 
fulfilling a commitment he had made to Principal Deputy 
Assistant Secretary Mann to inform the USG about the 
discussions in Ashgabat.  Like Masimov, Tazhin downplayed the 
significance of the announced agreements.  What had 
transpired, he said, was a "Turkmen-Russian deal for Turkmen 
gas."  Kazakhstan, he noted, was only a transit country.  The 
deal did not involve Kazakhstani gas, nor any project on the 
Kazakhstani shelf.  Therefore, he concluded, there was 
nothing which Kazakhstan had been in a position to say "no" 
to.  Tazhin shared an additional detail of the gas pipeline 
project with the Ambassador, noting each of the three 
countries would pay for the construction of that part of the 
pipeline which passed through its territory, with Kazakhstan 
recouping its investment by means of transit fees. 
 
5. (C) Tazhin also qualified Nazarbayev's May 10 remark 
(following a meeting with Putin) to the effect that 
Kazakhstan was committed to shipping most, if not all, of its 
oil through Russian territory.  Tazhin agreed that, even if 
CPC expansion was factored in, there was "no way" that 
Kazakhstan could export all its oil through Russia. 
 
 
No Progress on CPC Expansion 
---------------------------- 
 
6. (C) Masimov told the Ambassador that, notwithstanding 
Nazarbayev's media quotes implying that optimism on CPC 
expansion was justified, no progress had been made on the 
issue.  "The Russians are not going to agree on CPC 
expansion," Masimov said flatly.  Masimov noted that he would 
be traveling to Moscow on June 1, where a host of energy 
issues, including CPC expansion, possible expansion of the 
Atyrau-Samara pipeline, and the Orenburg gas-processing plant 
joint venture would be at the top of his agenda.  (Tazhin 
told the Ambassador that the Orenburg negotiations were "very 
difficult" as well.  The Russians were striking a hard 
bargain, he said, knowing that the cost to the Kazakhstanis 
 
ASTANA 00001302  002 OF 002 
 
 
of constructing their own, alternative gas processing plant 
were nearly prohibitive.) 
 
Tough Times Ahead for Kashagan Partners 
--------------------------------------- 
 
7. (C) Masimov informed the Ambassador that the GOK had hired 
outside, U.S. consultants -- including Cambridge Energy 
Research Associates' Daniel Yergin -- in preparation for the 
formal announcement, later this summer, of Kashagan delays 
and cost overruns.  (Note: The Kashagan partners will present

the project's "Final Project Schedule," as well as cost 
estimates for full field development, to the GOK either in 
late June or July.  End note.)  The report, Masimov 
predicted, would unleash a "storm," as the GOK intended to 
seek economic compensation for the delays and cost overruns. 
The GOK might go further, he said, and seek a change of 
operator.  While the GOK was considering a series of options, 
Masimov concluded, it had no interest in either slowing down 
overall Kashagan development or forcing any existing partner 
to sell its stake in the consortium. 
 
Comment 
------- 
 
8. (C) While we are encouraged by Masimov's interpretation of 
what was -- and what wasn't -- agreed to in Turkmenistan, it 
is clear that our window of opportunity for proving the 
advantages, both economic and geopolitical, of a 
Trans-Caspian gas pipeline is closing.  In order to counter 
the momentum squarely now on the side of the Russians, we 
need to move ahead with our own Trans-Caspian pipeline 
feasibility study as soon as possible.  We may need to 
rewrite the Terms of Reference in order to obtain at least 
preliminary results by September 1, in order to give 
ourselves the evidence and arguments to state our best case. 
ORDWAY

Wikileaks

07ASTANA1286, KAZAKHSTAN: PRELIMINARY INTEREST IN FOLLOW-UP REGIONAL

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Reference ID Created Released Classification Origin
07ASTANA1286 2007-05-15 00:21 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXYZ0006
RR RUEHWEB

DE RUEHTA #1286 1350021
ZNR UUUUU ZZH
R 150021Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 9440
INFO RUEHC/SECSTATE WASHDC//SCA COLLECTIVE/ 9441

UNCLAS ASTANA 001286 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR SCA/CEN - O'MARA, DEUTSCH; SCA/RA - Micaller 
 
E.O. 12958: N/A 
TAGS: EINV EFIN ETRD PGOV KZ
SUBJECT: KAZAKHSTAN: PRELIMINARY INTEREST IN FOLLOW-UP REGIONAL 
TELECOMMUNICATIONS CONFERENCE 
 
REF: State 54097 
 
1. (SBU) Econoff delivered reftel points on May 7 to Askar 
Bishigayev, Deputy Chairman of the Agency for Informatization and 
Communications.  Bishigayev stated that a follow-up 
telecommunications conference would be "quite interesting," 
remarking that Kazakhstan has a big transit potential.  Bishigayev 
added that he could provide a more definite, final response after 
consulting with Kazakhstan's telecom operators.  He indicated that 
he would need about two weeks for these consultations. 
 
2. (U) On May 10, Econoff also shared reftel points with Dana 
Khussainova of the MFA Americas Desk. 
 
ORDWAY

Wikileaks

07ASTANA1285, KAZAKHSTAN: OSCE BORDER ASSESSMENT

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Reference ID Created Released Classification Origin
07ASTANA1285 2007-05-14 09:16 2011-08-30 01:44 UNCLASSIFIED Embassy Astana

VZCZCXRO4167
RR RUEHAST
DE RUEHTA #1285 1340916
ZNR UUUUU ZZH
R 140916Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 9438
INFO RUEHUNV/USMISSION UNVIE VIENNA 0053
RUEHC/SECSTATE WASHDC//SCA COLLECTIVE/ 9439
RHMFISS/HQ USEUCOM VAIHINGEN GE//ECJ5//
RUEKDIA/DIA WASHINGTON DC//DHO-2//
RHMFISS/HQ USCENTCOM MACDILL AFB FL//CCJ5//
RUEKJCS/SECDEF WASHINGTON DC//USDP EURASIA//
RUEKJCS/SECDEF WASHINGTON DC//USDP-SOLIC-CN//
RUEHAST/USOFFICE ALMATY

UNCLAS ASTANA 001285 
 
SIPDIS 
 
STATE FOR INL/AAE (ALTON), SCA/CEN (OMARA), SCA/RA (CUMMINGS), ISN 
(HARTSHORNE) 
OSD FOR HOWELL 
CENTCOM FOR MALCOM AND ROESNER 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: SNAR KCRM PREL KZ
SUBJECT: KAZAKHSTAN: OSCE BORDER ASSESSMENT 
 
REF: USMISSION OSCE 154 
 
1.  Summary: Post looks for the upcoming OSCE assessment to provide 
the basis for more cross-border security programs and to enhance 
interagency regional liaison.  In-country cooperation on border 
security is working well.  The Mission's Security Assistance Working 
Group coordinates individual office programs.  A common database of 
office border security training and assistance provided to GOK 
entities is under development by INL, OMC, and DAO.  End summary. 
 
2.  Post looks forward to the comprehensive survey of borders in 
Central Asia that the assessment described in reftel will provide. 
The field visits and meetings of border security and management 
agencies particularly look to be sources of valuable insights for 
new cooperation, particularly in establishing the operational basis 
for cross-border programs to train and equip border guards and other 
border security personnel. In addition to bilateral cross-border 
programs, Post looks forward to the results of the assessment 
regarding region-wide border security programs such as a common 
communication platform, or establishment of a regional border forum 
where approaches to issues like Severe Acute Respiratory Syndrome 
(SARS) can be formulated. 
 
3. In Kazakhstan, the International Narcotics and Law Enforcement 
Office (INL), Office of Export Control and Border Security (EXBS), 
Office of Military Cooperation (OMC), and the Defense Threat 
Reduction Office (DTRO-A) all implement programs to strengthen 
Kazakhstan's borders.   The Kazakhstan Mission Security Assistance 
Working Group, comprised of these and other members, under the 
guidance of the DCM has worked diligently to coordinate border 
security programs.  SAWG members have agreed that INL and OMC will 
sponsor creation of a mission-wide database of all border security 
training and equipment provided to Kazakhstani border security 
services. 
 
4.  Post views inter-regional and cross-border programs as an area 
where further improvement could be realized.  It is anticipated that 
the OSCE Border Assessment could provide solid data to construct and 
implement joint programs.  Especially regarding narcotics 
interdiction, Post assesses that most governments in the region 
focus almost exclusively on southern borders, the direction from 
which the narcotics are entering.  As a quick glance at any map will 
show, one country's southern border is another country's northern so 
cross-border cooperation could achieve efficient use of scarce 
assistance funds. 
 
5.  Post point of contact for the OSCE Border Security assessment is 
INL Officer Jeffrey Scott Waldo.  Mr. Waldo can be contacted at 
(tel) +7-3172-70-22-96; (cell) +7-777-232-99-41; (unclassified 
email) waldojs@state.gov. 
 
ORDWAY

Wikileaks

07ASTANA1267, KAZAKHSTAN: TWO SEX TRAFFICKERS GET SEVEN YEARS

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Reference ID Created Released Classification Origin
07ASTANA1267 2007-05-14 00:33 2011-08-30 01:44 UNCLASSIFIED Embassy Astana

VZCZCXRO3734
PP RUEHAST
DE RUEHTA #1267 1340033
ZNR UUUUU ZZH
P 140033Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 9422
INFO RUEHC/SECSTATE WASHDC//SCA COLLECTIVE/ 9423
RUEAWJA/DEPT OF JUSTICE WASHDC
RUEHAST/USOFFICE ALMATY

UNCLAS ASTANA 001267 
 
SIPDIS 
 
STATE FOR INL/AAE (ALTON), G/TIP (HALL), SCA/CEN (O'MARA), TASHKENT 
(ALLEN) 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: SNAR KCRM KCOR PREL PGOV KZ UZ
SUBJECT: KAZAKHSTAN: TWO SEX TRAFFICKERS GET SEVEN YEARS 
 
1.  On May 4, a local procurator in Aktobe, Kazakhstan announced 
that two Uzbekistani traffickers working in Kazakhstan had been 
sentenced the previous week to seven years in prison.  Post's 
contacts at the Ministry of Internal Affairs confirmed the 
convictions. 
 
2.  Investigating based on a tip received in November 2006, the 
Procurator for the Western Region Transport Police discovered that 
one trafficker tricked poor young women from Nukus, Uzbekistan into 
coming to Kazakhstan and then prostituted them.  The other 
trafficker, a woman, was arrested in December 2006 while pimping at 
a railway station.  After court deliberations, the two traffickers 
were convicted under Article 128 of the Criminal Code of Kazakhstan, 
trafficking in persons. 
 
ORDWAY

Wikileaks

07ASTANA1266, KAZAKHSTAN’S COMMITMENT TO IRAQ FIRM

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Reference ID Created Released Classification Origin
07ASTANA1266 2007-05-11 07:54 2011-08-30 01:44 CONFIDENTIAL Embassy Astana

VZCZCXRO2188
PP RUEHDBU
DE RUEHTA #1266 1310754
ZNY CCCCC ZZH
P 110754Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 9421
INFO RHEHNSC/NSC WASHDC PRIORITY 0025
RUEHTA/USDAO ASTANA KZ PRIORITY 0007
RUEKJCS/JOINT STAFF WASHDC PRIORITY
RUEKJCS/SECDEF WASHDC PRIORITY 0035
RUCNCIS/CIS COLLECTIVE 0162

C O N F I D E N T I A L ASTANA 001266 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR SCA/CEN (O'MARA) 
 
E.O. 12958: DECL: 03/15/2017 
TAGS: PTER MARS MASS MOPS PREL PTER IZ KZ
SUBJECT: KAZAKHSTAN'S COMMITMENT TO IRAQ FIRM 
 
REF: STATE 55436 
 
Classified By: Pol-Econ Chief Deborah Mennuti; 
reasons 1.4 (b) and (d). 
 
1. (C) Post regularly discusses Kazakhstan's troop 
commitments in Iraq with government interlocutors, and all 
indications are that President Nazarbayev's commitment 
remains firm.  Kazakhstan conducted its most recent troop 
rotation at the end of April, sending a new contingent of 
soldiers to Iraq for six months of service.  While the 
Kazakhstani government might reconsider its position if its 
soldiers suffer casualties or the coalition country with 
which it works in Iraq pulls out and a suitable alternative 
is not found, at present there is no reason for it to do so. 
 
 
2. (SBU)  We will have an opportunity to review this issue 
once again with the GOK at a high level in late May and 
mid-June during the respective Astana visits of the Deputy 
Assistant Secretary of Defense for Central Asia and the 
CENTCOM Commander. 
ORDWAY

Wikileaks

07ASTANA1262, EXBS: KAZAKHSTAN ADVISOR’S MONTHLY REPORTING CABLE (APRIL

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Reference ID Created Released Classification Origin
07ASTANA1262 2007-05-11 06:03 2011-08-30 01:44 UNCLASSIFIED Embassy Astana

VZCZCXRO2059
RR RUEHAST RUEHDBU
DE RUEHTA #1262/01 1310603
ZNR UUUUU ZZH
R 110603Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 9414
RUEAORC/US CUSTOMS SERVICE WASHINGTON DC
RUEBAAA/DEPT OF ENERGY WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RULSJGA/COMDT COGARD WASHINGTON DC
RUEKJCS/SECDEF WASHDC 0032
RUEBAAA/DEPT OF ENERGY WASHDC
RUEKJCS/JCS WASHDC
RUCQAAA/USCINCCENT MACDILL AFB FL
RUEHRL/AMEMBASSY BERLIN 0425
RUEHEK/AMEMBASSY BISHKEK 7987
RUEHNT/AMEMBASSY TASHKENT 7909
RUEHKB/AMEMBASSY BAKU 0003
RUEHDBU/AMEMBASSY DUSHANBE 2115
RUEHAH/AMEMBASSY ASHGABAT 7162
RUEHAST/USOFFICE ALMATY

UNCLAS SECTION 01 OF 03 ASTANA 001262 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR ISN/ECC PVANSON, ACHURCH, JHARTSHORN 
DEPT FOR ISN/ECC-AMT LSPRINGER 
DEPT FOR EUR/ACE RBUCK 
DEPT FOR SCA/RA JSCHLOSSER 
DEPT FOR SCA/CEN MO'MARA 
CBP/INA FOR CDONOFRIO AND RWATT 
USDOE/NNSA CWALKER, TPERRY AND EDESCHLER 
DOC FOR DCREED AND GPETERSEN-BEARD 
USCG FOR BGOLDEN 
AMEMBASSY BERLIN FOR CUSTOMS ATTACHE 
AMEMBASSY TASHKENT, BISHKEK, BAKU, DUSHANBE AND ASHGABAT FOR EXBS 
ADVISORS 
 
E.O. 12958: N/A 
TAGS: ETTC MNUC PARM PREL KSTC KNNP KZ
SUBJECT:  EXBS: KAZAKHSTAN ADVISOR'S MONTHLY REPORTING CABLE (APRIL 
2007) 
 
I. BROAD ITEMS OF INTEREST TO ADVISORS AND AGENCY MANAGERS: 
 
      1. TDY EXBS Advisor Larry Adkins departed post on April 26. 
The Embassy welcomed TDY EXBS Advisor Kevin Cummings assigned to 
post from April 24 to May 24, as the second in a series of temporary 
advisors who will manage the office until the next TDY EXBS Advisor 
arrives. On May 2, it was announced that Bill Mayer, the former EXBS 
Advisor in Armenia, was selected as the permanent EXBS Advisor for 
Kazakhstan. His tentative reporting date is June 25, 2007. 
 
      2. Industry-Government Relations Forum. The EXBS office sent a 
diplomatic note proposing that the First U.S.-Kazakhstan, 
Industry-Government Relations Forum be conducted in Almaty from June 
7-8, 2007. EXBS received oral confirmation from the Chancery of the 
Prime Minister that the Government of Kazakhstan accepted the 
proposed dates for this event. The Ministry of Industry and Trade of 
Republic of Kazakhstan will host the Forum and coordinate with EXBS 
on the details. CTP, INC. - contractor to DOC/BIS hired a local 
subcontractor to provide logistical support. 
 
      3. Safe-Boats maintenance. Program Manager Gulnara Abildaeva 
worked with GSO, the customs officials of Aktau, and the customs 
brokerage to have the anti-fouling paint released from customs 
control and moved to the Maritime Border Guards base in Bautino 
where the three safe boats are moored. Mike Taffe, Export Control 
and Border Security (EXBS) Regional Maritime Advisor based in Baku, 
will meet with representatives of the Maritime Division of 
Kazakhstan's Border Service in Aktau on May 23-24. 
The purpose of this trip will be to coordinate the painting of the 
Safe Boats, to work with the Maritime Border Guard (MBG) to select a 
vendor to perform scheduled Safe Boat maintenance, to identify a 
vendor to perform an assessment on the Sea Ark, to check the status 
of repairs to the engine of Safe Boat 622, and to discuss an advance 
Small Boat Operations Mobile Training (U.S.CG MTT) scheduled for 
summer 2007. 
 
 4. Department of Energy Software Upgrades.  The trip to the Dostyk 
and Bakhty ports of entry from May 14-18 and the trip to the 
Maikapshagai port of entry from May 21-25 for the representative of 
Nuclear Technology Safety Center (NTSC) were approved by the Customs 
Control Committee. The NTSC representative will upgrade the software 
for the portable X-ray Florescence (XRF) metal analyzers provided to 
Kazakhstan Customs in June of 2006. 
 
     5. Border Site Assessments Kazakhstan-China Border. The EXBS 
team will accompany the representative from the NTSC to Dostyk and 
Bakhty to conduct Border Site Assessments.  As part of the 
assessment process, the EXBS team will inspect all equipment donated 
by EXBS and review port facilities, operations and procedures. 
 
 6. Volunteer Visitor Program. The EXBS office received the 
completed Biographical and Program Data form from Mr.Shakirov, 
Chairman Customs Control Committee. His office notified EXBS that 
Mr. Shakirov is unable to attend during May and requested the visit 
be scheduled for late August. The information was forwarded to the 
Public Affairs Section for action. 
 
 
II. COMPLETED ACTIONS FOR THE REPORTING PERIOD 
 
A. SITE ASSESSMENTS AND MEETINGS CONDUCTED 
 
 1.  April 12-19 - TDY Advisor Larry Adkins and Kazakhstan EXBS 
 
ASTANA 00001262  002 OF 003 
 
 
Program Assistant Oxana Limareva traveled to the Karasu Border 
Crossing in the Zhambyl Region and the Jibek Joli Border Crossing in 
the Southern Region. There they assisted the DOE/NNSA Mobile X-Ray 
Van Repair Team. Upon arrival at these locations, it was learned 
that rough road conditions, frequent power surges and the frequent 
loss of electrical power in these areas had rendered the mobile 
X-ray vans inoperable at both ports. In Karasu the van has been 
non-operational since June 2006 and the van in Jibek Joli has been 
non-operational since May 2006. While the repair team worked on the &#
x000A;x-ray vans, the EXBS Advisor team conducted site assessments at the 
Karasu and Jibek Joli border crossings. Those assessment reports 
have been submitted to INS/ECC Country Lead Jeffrey Hartshorn. 
 
 2. On May 3, representatives from the Office of Military 
Cooperation and EXBS Advisor attended a meeting with the Director of 
the Border Guard Service, General-Lieutenant Bolat Zakiyev. Issues 
related to narcotic detections and interdictions consistent with DOD 
provisions of Counter Narcotics programs were discussed. 
 
B.  TRAINING DURING THE REPORTING PERIOD 
 
 1. Product Identification Tool Training. TDY EXBS Advisor Larry 
Adkins and Kazakhstan EXBS Program Manager Gulnara Abildaeva 
attended Product Identification Tool Training (PIT) from April 3-5 
in Almaty, Kazakhstan. Mr. Douglas Evans and Mr. Eric Denijs of 
Commonwealth Trading Partners (CTP) conducted the training. 
Assisting in the training was CTP's in country representative 
Business Inform, who translated the PIT into Russian and modified 
the software to make the program more useful and user friendly. A 
total of fourteen Customs officers representing almost every region 
of Kazakhstan attended the training and received a copy of the PIT 
software. Everyone gave positive remarks regarding the training and 
the usefulness of the PIT software. They expressed the belief that 
it is an excellent tool that will increase proficiency and enhance 
the enforcement of export controls. 
 
 
C. EQUIPMENT DELIVERED DURING THE REPORTING PERIOD 
 
      1. No equipment delivered during this reporting period. 
 
D. IMMINENT TRAINING OR EQUIPMENT STATUS UPDATE 
 
 1. Task Order 79 Donation. Task Order 79 for the EXBS donation of 
Ural Trucks and Border Guard Shelters is nearing completion. EXBS 
was notified by Kazakhstan Border Guards that seven URAL trucks had 
arrived in Kyzyl-Orda, two trucks had arrived in Aktau, one truck 
has arrived in Beineu, and one truck had arrived in Uralsk. It was 
reported that the truck at Uralsk has a broken steering box. It is 
expected that the four shelters to be donated will arrive in May or 
June; however, definite delivery dates have not yet been determined. 
 The Ambassador will be asked to participate in a dedication 
ceremony at an appropriate time. 
 
 2. X-Ray Van Repairs. The Department of Energy (DOE)  sent 
technicians to maintain the donated X-Ray Van at the Korday Customs 
Post on the Kazakhstan - Kyrgyzstan border April 14-16, and to 
Shimkent city - on the Kazakhstan - Uzbekistan border on April 
18-20. The DOE/NNSA Mobile X-Ray Van Repair Team consisting of Mr. 
Gilbert Chavez and Mr. Michael Lukens was unable to repair either 
van. The vans require replacements parts that the repair team did 
not have in their possession. 
 
 
ASTANA 00001262  003 OF 003 
 
 
 3. Preliminary Department of Energy Second Line of Defense 
(DOE/SLD) site survey. The Second Line of Defense (SLD) program team 
will develop an installation and integration plan for the placement 
of radiation detection equipment and portal monitors at vehicle 
crossing sites throughout Kazakhstan. The dates for this project 
have been moved from June 1 to July 1. 
 
 4. Commodity Identification Training (CIT). The Department of 
Energy/National Nuclear Security Administration's (DOE/NNSA) 
International Nonproliferation Export Control Program (INECP) plans 
to hold a Commodity Identification Training (CIT) course for Customs 
Control Committee (CCC) personnel during the week of May 28 in the 
city of Atyrau.  CIT is intended to provide customs inspectors and 
others to recognize potentially export controlled, WMD-sensitive 
goods.  INECP and its Kazakhstani partners including the Customs 
Committee, the Atomic Energy Committee and technical specialists 
from several institutes have been cooperating on CIT for several 
years, and the Kazakhstani side has modified INECP's course 
specifically for the Customs Control Committee, while also preparing 
a group of instructors to teach the course. This will be the fourth 
CIT seminar in Kazakhstan. 
 
 
E. SIGNIFICANT DEVELOPMENTS IN EXPORT CONTROLS, NONPROLIFERATION, OR 
RELATED BORDER SECURITY 
 
 1. None. 
 
F. CASPIAN SECURITY INFORMATION 
 
      1. None. 
 
III. RED FLAG ISSUES. 
 
 1. None. 
 
CROWLEY

Wikileaks

07ASTANA1261, KAZAKHSTAN UNLIKELY TO OPPOSE BELARUS HUMAN RIGHTS COUNCIL

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Reference ID Created Released Classification Origin
07ASTANA1261 2007-05-11 06:00 2011-08-30 01:44 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Astana

VZCZCXRO2051
OO RUEHAST
DE RUEHTA #1261 1310600
ZNR UUUUU ZZH
O 110600Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 9413
INFO RUCNDT/USMISSION USUN NEW YORK IMMEDIATE 1877
RUEHGV/USMISSION GENEVA IMMEDIATE 0955
RUEHAST/USOFFICE ALMATY

UNCLAS ASTANA 001261 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR IO/RHS, DRL/MLGA, EUR/PGI 
 
E.O. 12958: N/A 
TAGS: PHUM PREL UNHCR KZ
SUBJECT: KAZAKHSTAN UNLIKELY TO OPPOSE BELARUS HUMAN RIGHTS COUNCIL 
CANDIDACY 
 
REF: A) State 58056, B) State 63345 
 
1.(SBU) Poloff delivered Ref A demarche to the MFA Department of 
International Organizations and Security Issues on May 4.  Almabek 
Demessinov, the head of the United Nations section, said that 
Kazakhstan would consider the USG positions set forth in the 
demarche.  However, Demessinov predicted that Kazakhstan would 
follow its normal policy of supporting the candidacies of fellow CIS 
countries. Post notes that Kazakhstan voted against the December 
2006 United Nations resolution condemning human rights practices in 
Belarus. 
 
2. (SBU) In addition, the UK Embassy has advised us that their home 
office believes it will be futile to convince Kazakhstan on this 
issue, and thus did not instruct their embassy to demarche the 
government. 
 
3. (SBU) Comment: Based on the above and the Government of 
Kazakhstan's past voting practices on these matters, Post believes 
that Kazakhstan will support Belarus's candidacy for the Human 
Rights Council and that it would be counterproductive to pursue the 
demarche further.  End comment. 
 
CROWLEY

Wikileaks

07ASTANA1254, KAZAKHSTAN SUPPORTIVE OF U.S. WORLD HEALTH

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Reference ID Created Released Classification Origin
07ASTANA1254 2007-05-10 09:48 2011-08-30 01:44 UNCLASSIFIED Embassy Astana

VZCZCXRO1873
RR RUEHAST
DE RUEHTA #1254 1300948
ZNR UUUUU ZZH
R 100948Z MAY 07 ZDK
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 9410
INFO RUEHAST/USOFFICE ALMATY
RUEHGV/USMISSION GENEVA 0954

UNCLAS ASTANA 001254 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: TBIO AORC PREL KFLU WHO
SUBJECT: KAZAKHSTAN SUPPORTIVE OF U.S. WORLD HEALTH 
ASSEMBLY OBJECTIVES 
 
REF: STATE 61739 
 
Poloff delivered reftel points to Ministry of Foreign Affairs 
Health Advisor Asel Utegenova.  Utegenova told Poloff that 
Kazakhstan supports the unrestricted sharing of influenza 
virus samples.  Kazakhstan also understands the necessity for 
ongoing smallpox virus research, she said.  Utegenova 
promised to share reftel information with other relevant 
agencies. 
CROWLEY

Wikileaks

07ASTANA1246, KAZAKHSTAN: ALMATY NOTES, APRIL – MAY 2007

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Reference ID Created Released Classification Origin
07ASTANA1246 2007-05-10 01:13 2011-08-30 01:44 UNCLASSIFIED Embassy Astana

VZCZCXRO0693
RR RUEHAST RUEHDBU
DE RUEHTA #1246/01 1300113
ZNR UUUUU ZZH
R 100113Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 9403
INFO RUEHVEN/USMISSION USOSCE 1734
RUEHEK/AMEMBASSY BISHKEK 7985
RUEHNT/AMEMBASSY TASHKENT 7904
RUEHAH/AMEMBASSY ASHGABAT 7158
RUEHDBU/AMEMBASSY DUSHANBE 2111
RUEHMO/AMEMBASSY MOSCOW 1407
RUEHAST/USOFFICE ALMATY
RUEHNO/USMISSION USNATO 2203

UNCLAS SECTION 01 OF 02 ASTANA 001246 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PGOV PHUM KZ
SUBJECT: KAZAKHSTAN: ALMATY NOTES, APRIL - MAY 2007 
 
 
1. The "Almaty Notes" series is intended to maintain focus on 
developments in civil society, the media, and the opposition in 
Kazakhstan's "southern capital" following the move of the Embassy to 
Astana. 
 
President Meets with Moderate Opposition Leaders 
--------------------------------------------- --- 
 
2. On April 23 in Almaty, President Nazarbayev met with opposition 
leaders Alikhan Baymenov and Zharmakhan Tuyakbay.  At the meeting 
with Baymenov they discussed urgent problems of political 
development of the country, humanitarian and cultural issues 
including the development of Kazakh language, and patriotic 
upbringing of the young generation.  At the meeting with Tuyakbay 
they discussed constitutional reforms.  According to a National 
Social-Democratic Party press release, Tuyakbay called the 
president's attention to violations of the law during the recent 
formation of  Almaty City election commissions.  Tuyakbay also 
reportedly stressed the necessity of a dialogue between the 
authorities and opposition parties and public organizations. 
(Interfax, April 23) 
 
Attempt to Picket City Court Disrupted 
-------------------------------------- 
 
3. On April 19, the mothers and wives of eight "Shanyrak Defenders" 
kept in detention attempted to picket the Almaty City Court 
building.  The women demanded that their husbands and sons be 
released and the criminal cases against them be dismissed.  The 
police disrupted the action.  Two participants were detained. 
(Megapolis weekly, April 23) 
 
'Victims' in Abilov's Case did not Appear in Court 
--------------------------------------------- ----- 
 
4. The May 3 hearing of Bulat Abilov's case at the Almalinskiy 
district court in Almaty was disrupted because the 'victims' in the 
case failed to appear in the court.  (Nachnyem s Ponedelnika weekly, 
May 4) 
 
Concerns about Overly Intensive Construction in Almaty 
--------------------------------------------- --------- 
 
5. At a meeting with prominent businessmen in Almaty on April 21, 
President Nazarbayev recommended ending intensive construction in 
Almaty because the city infrastructure cannot support such 
development and it is hazardous for the  environment.  (Vremya 
daily, April 24) 
 
6. On April 24, Prime Minister Masimov directed Almaty Oblast and 
City akims to terminate land sales in the region until there is a 
special order.  "It is not a secret that some companies purchase 
lands at the cadastre [tax assessment] cost and then sell it at 
market cost," Masimov said.  Due to this, Masimov ordered that "all 
commercial lands in Almaty City and Almaty Oblast should be passed 
to the 'Zhetysu' special corporation.  The money this corporation 
will earn should used to develop utility services and 
infrastructure."  (www.gazeta.kz, April 24) 
 
7. The Almaty City administration plans to demolish a unique seismic 
station located in the mountains close to the city.  In place of the 
station the administration intends to build a net of cafes and 
restaurants.  (www.geo.kz, April 24) 
 
NGO Calls on President to Dismiss Almaty City Akim 
--------------------------------------------- ----- 
 
8. Activists of the "Let Us Defend our City" committee held a press 
conference on April 24 in Almaty to brief journalists about  the 
city administration's refusal to grant them a permit to hold a rally 
in the center of the city.  According to the activists, Almaty City 
Akim Tasmagambetov has ignored the president's and prime minister's 
orders to put an end to construction in Almaty.  "By doing this, 
Tasmagambetov creates a dangerous situation in the southern 
capital," the committee's statement reads.  The statement calls on 
the president to dismiss Akim Tasmagambetov.  (www.gazeta.kz, April 
24) 
 
State Secretary Met with Ethnic Minority Leaders 
--------------------------------------------- --- 
 
9. During a visit to Almaty Oblast, State Secretary Oralbay 
Abdykarimov met with leaders of ethnic minorities to talk about 
interethnic accord.  (Kazakhstan TV channel, April 25) 
 
 
ASTANA 00001246  002 OF 002 
 
 
Preparations for Maslikhat Elections 
------------------------------------ 
 
10. The Central Election Commission has opened the first training 
center in Almaty for e-voting machine operators.  As part of 
preparations to September elections to Maslikhats, more than half of 
the city precinct election commissions are slated to be equipped 
with e-voting machines.   (TV Channel-31, April 25) 
 
Aynur Kurmanov will not be arrested 
----------------------------------- 
 
11. On April 23 the city court of Almaty rejected a motion filed by 
the Bostandyk district procurator who asked the court to arrest 
Aynur Kurmanov for organizing unsa
nctioned picketing of the 
"Almatyzher" office on March 30.  Kurmanov had been fined for this 
action, but the procurator found this punishment too light. 
(www.incar.info, April 23) 
 
MILAS

Wikileaks

07ASTANA1243, KAZAKHSTAN: MERMOUD DISCUSSES PUBLIC-PRIVATE

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Reference ID Created Released Classification Origin
07ASTANA1243 2007-05-08 10:33 2011-08-30 01:44 CONFIDENTIAL//NOFORN Embassy Astana

VZCZCXRO8710
PP RUEHDBU
DE RUEHTA #1243/01 1281033
ZNY CCCCC ZZH
P 081033Z MAY 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 9396
INFO RUCNCIS/CIS COLLECTIVE 0156
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEAIIA/CIA WASHDC
RUEBAAA/DEPT OF ENERGY WASHDC

C O N F I D E N T I A L SECTION 01 OF 06 ASTANA 001243 
 
SIPDIS 
 
NOFORN 
SIPDIS 
 
DEPT FOR EB/ESC; SCA/CEN (O'MARA) 
 
E.O. 12958: DECL: 03/15/2017 
TAGS: ECON EPET ETRD PGOV KZ
SUBJECT: KAZAKHSTAN: MERMOUD DISCUSSES PUBLIC-PRIVATE 
PARTNERSHIP AND ASTANA,S PUSH FOR DIVERSIFICATION 
 
REF: A. A) ASTANA 1240 
     B. B) ASTANA 1122 
     C. C) 06 ASTANA 150 
     D. D) ASTANA 753 
 
Classified By: CDA Kevin Milas; reasons 1.4 (b) and (d). 
 
1. (C) Summary.  In April 24-26 meetings with Prime Minister 
Masimov, other Kazakhstani government officials, and private 
sector representatives, Special Representative for Commercial 
and Business Affairs J. Frank Mermoud discussed the 
Kazakhstani government,s fast-evolving approach to economic 
diversification and opportunities for bilateral engagement in 
the framework of the Public-Private Partnership Initiative. 
Masimov outlined the GOK,s latest plans to shift its focus 
away from further development of the oil sector toward 
domestically-driven diversification.  He presented the new 
&30 corporate leaders of Kazakhstan8 strategy, the GOK,s 
own public-private initiative, and expressed interest in 
exploring ways to create links with the proposed U.S. 
initiative.  Representatives of the private sector emphasized 
tax and customs administration, along with a rule of law 
deficit, as key obstacles to sustainable business and 
economic development.  They expressed hope that the 
Public-Private Partnership Initiative can become a vehicle 
for addressing these concerns.  Ref A reports Masimov,s and 
Sagadiyev,s remarks on the GOK,s current plans for the oil 
sector.  Please see action request in paragraph 25.  End 
summary. 
 
2. (SBU) Special Representative Mermoud met the following 
representatives of the Kazakhstani government and the 
business sector: 
 
April 24: 
-- Raimbek Batalov, President of the Forum of Entrepreneurs 
-- Arman Moldakhmetov, Vice President of the National 
Innovation Fund 
-- Courtney Fowler, Partner - Pricewater House Cooper 
-- Kenneth Mack, Partner - Chadbourne & Parke, President of 
the American Chamber of Commerce 
 
April 25: 
-- Serik Akhmetov, Chairman of the Association of Financiers 
of Kazakhstan 
-- Yerlan Sagadiyev, Advisor to the Prime Minister 
-- Nurlan Kapparov, President of KazInvest Bank 
 
April 26: 
-- Azat Peruashev, President of the &Atameken8 Union of 
Entrepreneurs 
-- Ulf Wokurka, Deputy Chairman & CFO of Samruk State Holding 
Co. 
-- Karim Masimov, Prime Minister 
-- Alikhan Smailov, Chairman of Managing Board ) &KazAgro8 
National Holding Co. 
-- Askar Batalov, Vice Minister of Industry & Trade 
-- Serik Akhmetov, Minister of Transport & Communications 
 
Shifting Focus Away from Oil( 
----------------------------- 
 
3. (C) On April 26, Prime Minister Masimov provided Special 
Representative Mermoud and the Ambassador with some 
background on the GOK,s current economic thinking. 
President Nazarbayev, Masimov said, attached a lot of 
importance to economic diversification even in the early days 
of Kazakhstani independence.  &Back then,8 Masimov mused, 
&we were hoping for a Marshall Plan.8  &Unfortunately,8 
he continued, Kazakhstan is &most interesting8 to foreign 
investors as a supplier of oil, not &other things.8  Now, 
the Prime Minister stated, the government has decided to take 
action into its own hands.  &Before, we focused on selling 
natural resources.  Now we want to sell products.8 
 
4. (C) In an earlier meeting, Masimov,s Advisor Yerlan 
Sagadiyev expressed the view that the GOK,s spending of its 
oil windfall is crowding out the desired private investment 
in the non-extractive sector.  Kazakhstan,s corporations, he 
said, are directing their investment abroad as they flee the 
uncertainty created by the GOK,s heavy-handed involvement in 
a wide range of sectors.  He explained that the challenge is 
to delineate the separation of the government,s and the 
private sector,s roles in the economy.  The idea, Sagadiyev 
stated, is for the state to inform the private sector what it 
will do and what the state expects from the private sector. 
 
ASTANA 00001243  002 OF 006 
 
 
 
And Toward a New Vision: the Thirty Corporate Leaders 
--------------------------------------------- -------- 
 
5. (C) The new plan, Masimov explained, rests on a 
Kazakhstani-driven pursuit of diversification.  The idea is 
to appoint 30 domestic corporations as &corporate leaders8 
or &national champions8 and entrust them with large-scale 
investment projects.  &Our financial system is strong and 
lets us take much of the risk ourselves,8 Masimov stated, 
&(what we need (from abroad) is the know-how.8  The three 
areas of focus, he said, are education, healthcare, and 
transportation infrastructure. 
 
6. (C) Sagadiyev provided some of the practical details.  On 
April 20, President Nazarbayev met with some of the top 
representatives of the Kazakhstani business world (Ref B). 
The meeting was
a prelude to the identification of 30 
large-scale investment projects to be assigned to these 
corporate leaders.  &Thirty,8 explained Masimov to S/R 
Mermoud and the Ambassador, &is because twenty is too few, 
and forty is too many.8  Vice Minister of Industry and Trade 
Askar Batalov told S/R Mermoud that each project will range 
in size from $500 million to $1 billion.  (Note:  According 
to a posting on the Presidential Administration website, each 
project will have a minimum implementation cost of $100 
million.  End note.) 
 
7. (C) The next steps, Sagadiyev explained, are for the 
government to identify the 30 corporate leaders and have 
relevant ministries sign memoranda of understanding with 
them.  &Not all ministries,8 Sagadiyev remarked, &are 
sincere in pursuing in this.8  The plan, then, is to start 
with two: Industry and Trade, and Agriculture.  Sagadiyev 
added that it was his job to find the corporate champions: 
&it has been five days, and we have been traveling 
heavily.8  He alluded repeatedly to using Britain,s 
privatization experience as a guide in pursuing this vision 
and, particularly, in drafting the MOUs: &we have a sample 
from Britain signed by Thatcher during energy 
privatization.8   The first MOU is to be signed in about a 
month.  U.S. consultants, Sagadiyev added, are being used 
extensively in implementing this vision, including on the 
issue of the public-private partnership. 
 
A Role for Foreign Investors? 
----------------------------- 
 
8. (C) While presenting his government,s new economic plan 
as partly a reaction to the failure of foreign investors to 
sufficiently embrace opportunities existing in Kazakhstan,s 
non-extractive sector, Masimov stressed the vision,s 
welcoming orientation toward foreign participation.  &We 
will have open, clean tenders,8 he assured S/R Mermoud and 
the Ambassador.  &If foreign investors are interested, they 
are more than welcome,8 continued Masimov, and &if not, 
that,s okay.8  But, he concluded, &conferences and good 
economic relations are not enough.8   Sagadiyev took the 
same results-oriented approach: &We are seeking specific 
projects.  We have passed the stage of understanding; we need 
to do things.8  Masimov cited GE,s locomotive-building 
operation near Astana and the Fed Ex operations in Almaty as 
the kind of &good projects8 the GOK is seeking. 
 
9. (C) Both Masimov and Sagadiyev expressed appreciation for 
the potential role that the U.S. technical expertise could 
play.  &We do not have enough experience and technology; 
this is where we are looking for Western participation,8 
stated Masimov.  He called the U.S. &number one8 in 
technology and economic development and pointed out two 
specific areas with particular promise for collaboration: 
agriculture (&very good discussions with Secretary 
Johanns8) and alternative energy.  Sagadiyev explained that 
current electricity tariffs, &a killer8 to alternative 
energy, will be increased.  &At 7-8 cents (per kw/hr),8 he 
mused, &alternative energy will make sense.8  The U.S., he 
added, is &quite advanced8 in this area. 
 
10. (C) Batalov also emphasized that the plan presents an 
invitation to foreign investors, describing the 
identification of 30 domestic leaders as a &signal8 to 
foreign companies of who their Kazakhstani partners should 
be.  He also mentioned the idea of creating consortia with 
the participation of international financial institutions 
(IFI,s) and the notion that private companies are better 
vehicles for conducting tenders than the government.  The 
 
ASTANA 00001243  003 OF 006 
 
 
thirty leaders will choose their partners among domestic and 
foreign companies.  Furthermore, Batalov stressed, 
Kazakhstan,s Law on Investments provides the same legal 
treatment to foreign and domestic investors.  Still, Batalov 
was clear about the strong domestic orientation of the GOK,s 
current vision: &This is about proposing to domestic 
companies projects that would, in the past, be offered to 
foreign investors(  The thirty will take the projects.  This 
is what protectionism is.8 
 
11. (C) Batalov was both candid and vague on the precise 
relationship the government will have with the corporate 
leaders.  He echoed Sagadiyev,s description of a quid pro 
quo arrangement in which the government provides 
&facilitation8 (e.g. engineering platforms, the legislative 
base, WTO accession), and the &leaders8 will commit to 
carrying out their projects.  He mentioned another reason for 
entrusting the &breakthrough projects8 exclusively to 
domestic companies.  &We cannot tell foreign investors,  go 
there and do this,,8 stated Batalov, &but we can say this 
to domestic companies.8   He summed up the philosophy of the 
vision as &ninety percent economics, ten percent national 
pragmatism.8  Batalov acknowledged S/R Mermoud,s cautionary 
note on the risk of creating monopolies.  &We are familiar 
with the experience of South Korean chaebols as well as the 
British experience,8 Batalov said.  Describing the South 
Korean scenario as &too extreme,8 he remarked, &we will be 
somewhere in the middle.8 
 
Business Climate ) the View from Within 
--------------------------------------- 
 
12. (C) The themes raised by GOK officials had little in 
common with the concerns S/R Mermoud consistently heard from 
representatives of the Kazakhstani private sector.  Raimbek 
Batalov, President of the Forum of Entrepreneurs ) an 
Almaty-based NGO which positions itself as the genuine 
national voice of small- and medium-sized business as well as 
regional and industry business associations ) outlined four 
government failures as the primary obstacles to economic and 
business development in today,s Kazakhstan.  The GOK,s key 
failures, Batalov said, are in the areas of tax policy, 
customs policy, rule of law, and trade policy.  (Note: 
Raimbek Batalov is not known to be related to Vice Minister 
Batalov.  His focus on trade policy appears to stem from his 
role as the CEO of a major retail chain.  End note.) 
 
13. (C) These policy and enforcement failures, according to 
Batalov, are driving an untold portion of the country,s 
economic activity into the shadow economy.  Much of the 
trend, Batalov explained, starts at Kazakhstan,s borders.  A 
regulatory loophole for small- and medium-sized businesses, 
combined with customs officials, notoriously corrupt ways, 
leads to a situation where most goods entering Kazakhstan do 
so &under the radar.8  Importers break up their wares into 
smaller portions and &misdeclare8 them at the customs 
control, relying on the customs officials, incompetence and 
venality.  Thus escaping the tariff system, such goods 
directly proceed to enter Kazakhstan,s shadow economy via 
bazaars, where they reach the consumer without ever being 
subjected to taxation, standardization or other regulations. 
(Note: In September 2006, Lubov Khudova, Chairwoman of 
Kazakhstan,s Light Industry Associat
ion, described to 
Econoff precisely the same phenomenon and partly blamed it 
for the spectacular decline of Kazakhstan,s textile 
manufacturing.  Ref C.  End note.)  Batalov concluded that 
the Business Forum,s research indicates that over 60% of all 
business activity in Kazakhstan takes place in the shadow 
economy, far above official estimates of 24%. 
 
14. (C) Courtney Fowler, Partner of Price Waterhouse Coopers, 
and Kenneth Mack, Partner at Chadbourne & Park and President 
of AmCham Kazakhstan, firmly confirmed Batalov,s emphasis on 
corruption as the key impediment to business development in 
Kazakhstan.  Fowler stressed that tax administration ) 
marred by corruption, incompetence, and a lack of proper 
accounting practices ) places a tremendous burden on 
business.  On the corporate side, she told S/R Mermoud, the 
situation is also troubling.  It is common for companies to 
keep two sets of (unmatching) books ) one for accounting 
purposes, the other for taxes.  Heads of auditing 
departments, Fowler added, are frequently not accountants, 
let alone auditors.  Echoing Batalov,s message on the shadow 
economy, she remarked that &no one bats an eye when you pay 
for something with $200,000 cash.8  Fowler lamented the 
GOK,s failure to address the &systemic8 issues and cited 
 
ASTANA 00001243  004 OF 006 
 
 
the rule of law deficit as a major problem: &if foreign 
investors cannot trust their Kazakhstani partners,8 she 
mused, &Kazakhstan will never achieve diversification.8 
 
15. (C) Serik Akhanov, Chairman of the Association of 
Financiers of Kazakhstan, presented to S/R Mermoud a rather 
optimistic view of the country,s financial system and 
macroeconomic situation.  He named inflation as a principal 
macroeconomic risk but stressed that the central bank remains 
watchful in guarding against it.  He stated that the 
Kazakhstani private sector,s mushrooming external borrowings 
are creating a vulnerability to external shocks, particularly 
to rising interest rates, but explained that Kazakhstan,s 
financial institutions are turning abroad due to a lack of 
long-term capital at home.  While lauding Kazakhstan,s 
banking sector as highly developed and operating on par with 
international standards, Akhanov said that the insurance and 
pension industries continue to lag.  He appeared largely 
unperturbed by the rapid expansion of the real estate sector, 
saying that only the &elite8 top 2% of the housing market 
was showing significant signs of speculative activity. 
 
Inside the State Holding Companies 
---------------------------------- 
 
16. (C) Arman Moldakhmetov, Vice President of the National 
Innovation Fund (NIF), briefed S/R Mermoud on the Fund,s 
approach to spurring diversification.  The NIF is a component 
of the Kazyna Fund for Sustainable Development, a state 
holding company currently encompassing 14 development 
institutions.  The NIF,s model is based on equity 
participation in high-tech, &knowledge-economy8 projects. 
This participation ranges up to 49% ownership, since ) 
Moldakhmetov explained ) &we do not want to manage.8  The 
NIF sees its key role as bringing together the government, 
the academia, and the corporate sector.  &Kazakhstan,8 he 
remarked, &is full of money.  The shortage is of good 
projects.8  Moldakhmetov mentioned the NIF,s involvement in 
three &technoparks8 established in Uralsk, Karaganda, and 
Almaty to provide infrastructure for entrants into the 
knowledge economy.  These, he said, &are not doing well. 
There is furniture, nothing else.  No one is working.8 
 
17. (C) Samruk State Holding Company CFO Ulf Wokurka briefed 
S/R Mermoud on Samruk activities within the framework of the 
holding companies, &three principal activities8: 
improving corporate governance, helping to develop 
Kazakhstan,s domestic capital market, and facilitating 
&select investment opportunities.8  Expanding on the third 
topic, Wokurka explained that in May, Samruk would establish 
a fully-owned &investment subsidiary,8 which would 
coordinate targeted infrastructure projects, addressing such 
issues as project finance, until the point in which the 
projects could be &handed over8 to interested private or 
state entities.  Wokurka mentioned the construction of a 
combined heat and power plant near Balkash (Ref D) as an 
example. 
 
18. (C) Wokurka explained that in order to facilitate 
development of a domestic capital market, the Prime Minister 
had directed Samruk, along with the other state-holding 
companies, to develop further candidate companies for IPOs, 
in accordance with the rules establishing the Almaty Regional 
Financial Center.   To this end, Wokurka said, Samruk was 
steering its companies toward financing by means of debt 
instruments, in addition to the more-customary commercial 
loans. Wokurka told S/R Mermoud that Samruk,s next IPO (of 
the Mangistau oblast electrical grid operator) would occur in 
late 2007.  The GOK had planned to transfer to Samruk another 
fifteen companies, Wokurka said, but Samruk had asked that 
the transfer be delayed while the holding company better 
assimilated its existing holdings.  Wokurka also confirmed 
that a new company, &Samruk Energy,8 would soon be 
established to manage Samruk,s five power generating 
companies. 
 
19. (C) Alikhan Smailov, Chairman of the Managing Board of 
the newly created state agricultural holding company 
&KazAgro,8 briefed S/R Mermoud on his organization,s 
plans.  KazAgro, he explained, currently incorporates seven 
of the GOK,s agricultural companies, whose missions range 
from intervention in grain markets to providing microcredits 
to rural communities to purchasing and reselling livestock 
products.  KazAgro,s overall mission, Smailov said, is to 
manage the state,s agricultural assets in accordance with 
corporate management standards as well as national goals. 
 
ASTANA 00001243  005 OF 006 
 
 
The plan, he explained, is to increase these assets, value 
by &taking some corrective measures to establish proper risk 
management, internal control, etc.8  The next step would be 
to privatize some of the holdings.  &This,8 Smailov summed, 
&is our approach, and it has been approved by the Prime 
Minister.8 
 
20. (C) Smailov spoke extensively about KazAgro,s plans in 
the ethanol market.  The vision is to construct bioethanol 
plants to produce ethanol for export and achieve production 
levels of 3 billion liters per year.  Large-scale beef and 
dairy farms are also planned, and KazAgro is expanding grain 
export infrastructure by building terminals on the Caspian. 
He noted that KazAgro is seeking foreign investors, interest 
in these projects, particularly in bioethanol.  What is 
needed from foreign partners, Smailov said, is &modern 
equipment at reasonable prices8 and help with marketing 
these products abroad. 
 
Prospects for the Public-Private Partnership 
-------------------------------------------- &#x000
A; 
21. (C) S/R Mermoud received wide-ranging input from his 
interlocutors on the possible directions of the bilateral 
Public-Private Partnership Initiative (PPPI).  Masimov 
expressed an interest in proceeding with the Initiative.  He 
named Sagadiyev as the primary Kazakhstani interlocutor on 
the issue and suggested that Sagadiyev travel to Washington 
in June to explore the avenues the PPPI may take.  Minister 
of Transport Serik Akhmetov told S/R Mermoud that his 
ministry has a great interest in developing international 
contacts and attracting foreign investment.  The $30 billion 
Transportation Strategy passed last year, Akhmetov said, 
provides for some of the funding to come from &non-budget8 
sources, such as foreign investment. 
 
22. (C) Business sector representatives ) Fowler, Mack, and 
the Forum,s Raimbek Batalov ) focused on the PPPI,s 
potential in addressing the &systemic8 issues (e.g. tax and 
customs administration, the rule of law) currently getting 
short shrift from the GOK.  Batalov and Mack, in particular, 
expressed a strong interest in establishing collaboration 
between the Entrepreneurs Forum and the AmCham.  Both Batalov 
and Mack held the view that organizing a discussion of ) and 
proposing solutions to )&systemic8 issues in a PPPI forum 
could spur the GOK to much-needed action.  Fowler suggested 
building links between U.S. and Kazakhstani business schools 
as a way to rectify the shortage of management expertise. 
The Financiers Association,s Akhanov likewise expressed 
interest in fostering exchanges among corporate leaders at 
varying levels.  The Innovation Fund,s Moldakhmetov offered 
to provide input on any future plans or ideas in the context 
of the PPPI.  Azat Peruashev, Chairman of the&Atameken8 
Union of Entrepreneurs, which purports to be Kazakhstan,s 
official national business association, expressed a strong 
interest in building links with U.S. counterparts. 
 
Comment 
------- 
 
23. (C)  The fact that the proposed bilateral PPPI coincides 
with the GOK,s own public-partnership program presents 
opportunities as well as potential challenges.   The GOK,s 
new approach is unapologetically focused on domestic 
companies and highly results-oriented.  Kazakhstani 
officials, underlying question seems to be: how can the PPPI 
fit into Kazakhstan,s own public-private program and what 
concrete results (i.e. investment commitments) can it bring 
in the foreseeable future?  The GOK,s intensity may be 
partly explained by practical considerations: Masimov 
recently told Ambassador Ordway that his government will only 
have two to three years to achieve its goals. 
 
24. (C) The GOK,s &30 corporate leaders8 program, while an 
outgrowth of the macroeconomically sound desire to diversify 
the economy away from the extractive sector, is fraught with 
risks.  Without proper safeguards, the vision may well lead 
to creation of more monopolies, a phenomenon already plaguing 
a range of key economic sectors such as telecommunications 
and civil aviation.  In any case, the policy signals the 
GOK,s continued adherence to a &top-down8 approach to 
economic diversification and an apparent lack of urgency in 
confronting the &systemic8 issues that are the main 
concerns of the business sector.  Notably, the business 
representatives, hopes for the PPPI were that the Initiative 
would specifically address the problems the GOK is continuing 
 
ASTANA 00001243  006 OF 006 
 
 
to ignore.  End comment. 
 
25. (SBU) Action request: Post requests Department guidance 
regarding next steps on the Public-Private Partnership 
Initiative, as well as clarification of which office will 
have the lead. 
 
26. (U) This cable has been cleared by S/R Mermoud. 
MILAS

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