Since the collapse of the Former Soviet Union in 1991 and subsequent gain of
independence, Kazakhstan has undertaken an impressive development journey. Years of
economic turmoil and uncertainty in the early transition period have been followed by
double digit economic growth and the rising living standards of the population in more
recent years. Extensive supplies of natural resources and relatively well-managed
macroeconomic policies have advanced Kazakhstan to the rank of successful transition
economies. The remarkable rate of economic growth achieved in recent years has raised
optimistic expectations among some experts and decision makers about continual economic
progress in the long-term perspective. Nonetheless, the country’s economic growth
remains highly dependent on the export of oil and volatile oil prices. It is unclear whether
the spillover effects generated by the oil sector are sufficient to be alternative driving forces
of growth. This question is further complicated by the existence of striking inconsistencies
in depicting the oil sector in the national statistics. While most experts agree that the real
appreciation of the national currency is inevitable, how much of a challenge it poses to
Kazakhstan’s industry, the so-called Dutch Disease, is less clear. A rapid expansion of the
oil sector could lead to the overdependence of the economy on the extraction of natural
resources, exposing the country to all the risks associated with such a concentration of
activity. On the other hand, it could provide a sustained demand for domestic producers of
goods and services with potential prospects for these tertiary industries to expand abroad
once they accumulated expertise and gained competitiveness.