Kazakhstan is located in the heart of Asia, bordered on the north and west by Russia, on the east by China, and on the south by Turkmenistan, Uzbekistan, and the Kyrgyz Republic. Per capita GDP in 1995 was US $1,330. It is a vast country of over 2.7 million square kilometers with a population of around 16.5 million. Population density is among the lowest in the world and has declined further since independence, largely as a result of emigration. Kazakhs are the largest ethnic group (48 percent) with Russians forming a large minority (34 percent). The country is divided into fourteen provinces (oblasts). The national capital till 1998 was Almaty, its largest city, located in the south-east of the country. Its new capital, Astana, lies to the north. The north of the country is its major grain bowl as well as its industrial heartland. The south is mostly agricultural, with some light industry. The major mineral resource of the country, oil, is located in the west. Poverty, in the sense of low or inadequate income, is not a new phenomenon in Kazakhstan. 1 However, during the Soviet period, the severity of poverty was limited by state action. Low administered prices for a range of key goods and services (food, rent, utilities) kept the cost of living strictly under control. Guaranteed employment, and a relatively generous system of pensions, family allowances, sick pay and maternity benefits insulated households from major income shocks. Subsidies to child-care helped maintain a fairly high level of participation among women. Access to education and healthcare was universal. This system of social provision underlies the strong achievements in the field of human development that is characteristic of the countries of the former Soviet Union (FSU). At independence, most human development indicators were higher in Kazakhstan than in countries with comparable levels of in