Interview of the World Bank Managing Director Ms. Ngozi Okonjo-Iweala to the Press Service of the Prime Minister of the Republic of Kazakhstan

Question 1: Mrs. Okonjo-Iweala, how do you assess Kazakhstan's response to the global economic and financial crisis?

I think that Kazakhstan responded very well, with the right instruments. And I want to commend the Government for the way it has managed the crisis. Putting in place the fiscal stimulus and trying to cushion the impact of crisis on the poor, was a good approach. And, finally, the way that banking and financial crisis was managed – was a very good balancing act.

I know that there are still issues with non-performing loans (NPLs) that have to be cleaned out from the banking system, but I think the Government made a good start, making sure that there was an equal sharing of burden in terms of the NPLs. And now, the next stage is to finally deal with them. It will be very important to ensure that the financial sector is able to resume its role as provider of financing to the private sector over the coming period.

Question 2: How do you assess Kazakhstan's efforts to diversify and modernize its economy?

First of all, I think that the Government have a good strategy going forward and looks carefully at the problem. The OECD has been commissioned to give input, and the World Bank is also assisting. The areas that are being looked at for diversification include agriculture, agribusiness, agroprocessing, and petrochemicals linked to your oil and gas industry as well as services, telecommunications and so on. I think these are the areas that Kazakhstan has some comparative advantage and sources of non-oil sector growth would come from these areas. So, it’s a good effort; I think, you actually need to move now specifically to implement the strategy of diversifying into those areas.

And again, I would like to emphasize the way that education and skills is being looked at by the Government in order to feed into diversification as a key step. Like any oil-rich country, Kazakhstan needs to look at how new jobs can be created, because the oil sector does not create too many jobs. So, I think, that the Government is on the right path.

And there are deeper challenges. Diversifying will require going beyond narrow economic goals to encompass institutions that ensure that today’s youth will have a voice in how Kazakhstan deals with its challenges. It is both economic freedom and transparent governance that ultimately solve the puzzle on how to diversify and promote broad growth.

Question 3: Mrs. Okonjo-Iweala, you have huge experience working in oil-producing countries, having worked in Nigeria and the Middle East. Does Kazakhstan's economic model differ from those countries?

Kazakhstan has the characteristics of many oil-rich countries with the concentration of economic activity in the oil sector. But, I’m very glad to see that Kazakhstan is making progress in branching out in a good way. And not many oil-rich countries have succeeded in this.

You have recognized the problem, you are studying which sectors you need to go into, and now complementing this with a strategy to underpin the skills that will be needed. So, I think, that in this regard, Kazakhstan is making progress that will make it somewhat different and, hopefully, more successful than other oil-rich economies that have tried to diversify.

It is important to manage these investments well and make sure that they deliver high social and economic returns. Education and health spending in Kazakhstan still make up a lower share than in many middle-income and advanced countries. So, here I see an important agenda ahead. And this agenda is not limited to spending, but extends to the efficient and transparent use of that spending.

Question 4: How do you assess Kazakhstan's efforts to promote and develop women entrepreneurship? What advice can you give to Kazakhstan?

First of all, let me say that I was absolutely delighted to meet female-ministers and MPs in the cabinet and interact with them. They told me so much about what Kazakhstan is doing in the social sphere and towards gender equality. These efforts have been recognized in the World Economic Forum rankings with Kazakhstan placed in the top 50 nations in 2010 on gender equality indicators. I really want to commend you.

Of course, there are areas where the Government has to do more. I think that now you need to move towards more empowerment of women in the political sphere, you need more women-ministers, more women in political positions. I know you have many of your businesses now led by a woman, that’s really commendable. I understand that the Government strategy from now to 2015 is reaching a target of 30 percent of women in managerial positions and you have a strategy to empower women even more. I see a very good beginning and I think you should just push forward.