Energy Showpiece Rises in the Western Desert
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by Joanna Lillis
3 November 2009 Near a giant new Caspian Sea project, some locals are seeing little trickle-down effect from Kazakhstan’s oil wealth. From EurasiaNet.
Kazakhstan’s port city of Aktau on the Caspian Sea has had some ups and downs in its short history. Founded just half a century ago, it thrived as a center of the Soviet uranium and chemical industries but then plunged into decline amid the economic chaos that accompanied the collapse of communism. The last decade has seen Aktau reinvent itself as an oil town, and it now figures prominently in President Nursultan Nazarbaev’s ambitious development strategy.
Kazakhstan’s oil regions have taken a hit from the global financial crisis, but Aktau is nevertheless proceeding with bold projects to propel regional development. However, there is a risk that the city may become an island of wealth in a sea of poverty. As Aktau thrives, surrounding towns in the desert are struggling.
Aktau, the capital of Mangystau Region, is to be the site of one of Kazakhstan’s most eye-catching developments: Aktau-City, a new $38 billion development project to be built alongside the existing city. Blueprints show Aktau-City as a glitzy business, tourism, and entertainment center which could house up to a million people after completion in 2020, an exponential boost to Aktau’s current population of 150,000.
Pride of place will be occupied by a tower in the shape of an oil derrick, and the plans also include a glass Crystal Bazaar of shops and entertainment facilities, an academic district with a new university, and luxury accommodation on small islands in the Caspian. Aktau-City will be the “pearl of Kazakhstan,” Nazarbaev said when laying the foundation stone in September 2007.
The project floundered for a while, with local officials blaming United Arab Emirates investors for delays, but they now say it is back on track. In late September builders were swarming over apartment blocks on the edge of the Aktau-City site, adding finishing touches. The academic showpiece – the Caspian State University of Technology and Engineering – opened its doors to its first students this year.
Just a few kilometers outside Aktau, the idea of a place with sparkling skyscrapers and centers of educational excellence seems like a world away. A woman could be seen foraging on a stinking garbage heap among rusting pipelines and empty chemical cans a hundred meters from a polluted tailing dump, where radioactive waste from Aktau’s disused mining and smelting complex has gathered.
“There’s radiation everywhere,” the woman, who declined to identify herself, said, gesturing wryly at signs containing a stark warning: “Radioactivity.” She said she was seeking fuel for a cooking fire, but many local people search the garbage heap and disused plants nearby for scrap metal – which may be radioactive – to sell. These scrap-metal sales go a long way toward making ends meet.
This woman moved to Aktau from southern Kazakhstan five years ago with her husband and three children to take advantage of the oil boom, but the financial crisis has now struck. After her husband lost his job on an oil rig, he found employment at a gas facility, but quit because he never got paid.
Many blue-collar workers in western Kazakhstan are suffering from the global credit crunch. Workers have been laid off, wages have been cut, and sometimes salaries are paid only after long delays, if at all.
In the town of Zhanaozen, three hours’ dusty drive across the Ustyurt Plateau from Aktau, hundreds of workers – 1,800 by some estimates – downed tools this spring in protest at firings and wage arrears at their plants, and some declared a hunger strike. “People rebelled,” a foreman at Zhanaozen’s Burgylau drilling company who took part in the protest told EurasiaNet on condition of anonymity. The company is now paying on time, he continued: “There are no complaints now. We receive [wages] every month at the beginning of the month, and bonuses too.”
Elsewhere, however, problems persist. In the middle of the working day, young men hang around Zhanaozen in groups, squatting on the floor and smoking. Some are oil sector shift workers on their days off, but many are unemployed.
Most have little chance of qualifying for the meager state assistance available, and they get by as best they can. “It’s really hard,” said one local, 22-year-old Artur Suleymenov. “I can’t find [permanent] work.” He lives in a two-bedroom flat with 15 young housemates, all former inmates of an orphanage who survive by picking up temporary jobs in the shadow economy. The group recently did a construction job, but was never paid the $530 it was collectively owed.
"Energy Showpiece Rises in the Western Desert"
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