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Wednesday, January 05, 2022
Kazakhstan's Unrest may Trigger Series of Impacts
ANBOUND

The protests in Kazakhstan over the sharp rise in fuel gas prices are escalating, and this could very well evolve into a turmoil that affects the country’s political and social stability.

The rare large-scale protest that triggered the resignation of the Kazakhstan government broke out on January 2. As the government abolished price controls in 2022, the price of liquefied petroleum gas (LPG) rose rapidly after the new year. In Kazakhstan, LPG is the most important fuel for automobiles. The protests first broke out in Zhanaozen City in the southwestern Mangystau Region, and then spread to other areas. Local media reported that the price of LPG in the Mangystau Region soared to 120 tenge per liter from the previous 50-60 Kazakhstan tenge per liter on January 1.

In the following days, waves of protests swept through major cities in Kazakhstan, including Almaty, Taraz, Aktau, Atyrau and others, demanding a reduction in gas prices and the dissolution of the cabinet. Protests in some areas have further intensified, calling for Kazakhstan's first president Nursultan Nazarbayev to completely withdraw from politics. The protesters clashed with the police in many places, besieging and attacking the houses of local governments and officials. Several protesters were arrested in the capital, Nur-Sultan and the largest city, Almaty. Meanwhile, government buildings in the southern cities of Shymkent and Taraz were also assaulted. Both Almaty and the city of Aktobe in the southwest of the country saw large-scale protesters storming the city halls and local government buildings.

In view of the seriousness of the situation, President Kassym-Jomart Tokayev signed a decree earlier on January 5, declaring that the regions including Almaty and Mangystau will enter a state of emergency from now until January 19. During the state of emergency, there is a 11 p.m. to 7 a.m. curfew, movement restrictions, and a ban on mass gatherings

On January 5, the government of Kazakhstan made major concessions. Kazakhstan Tokayev accepted the resignation of the current government cabinet, and the current Prime Minister Askar Mamin has resigned as well. Tokayev has also sacked the current Secretary of State Krymbek Kusherbayev and the Assistant to the President Yerlan Karin became the new Secretary of State. Murat Nurtleu, Deputy Head of the President’s Administration, was appointed as the first deputy chair of the republic’s National Security Committee. On January 5, Tokayev announced the restoration of the price control of LPG, which was cancelled on January 1, 2022, and lowered its price to 50 tenge per liter. At the same time, a half-year price control on other important consumer products will be implemented. This price is even lower than the price of 60 tenge requested by the protesters. Furthermore, Tokayev announced that in addition to LPG, it will also implement price controls on gasoline, diesel and other "socially important consumer goods" for a period of six months.

However, even after these orders were issued, the situation in Kazakhstan on January 5 did not ease as the government hoped. According to information released by the Ministry of the Interior of Kazakhstan, a total of 95 police officers were injured in the conflicts. The police have detained more than 200 people, and there are no reports of deaths. On January 5, Netblocks monitoring system showed that internet communications throughout Kazakhstan had been interrupted, and many other media reported that local telephone communications were also cut off on a large scale.

At the economic meeting on January 5, Tokayev reiterated that the natural gas and energy industries have not been effectively reformed for many years, which is currently the main cause of social unrest. He also said that Kazakhstan's national energy industry cannot operate under conditions of long-term losses. In fact, Kazakhstan's domestic energy situation has been in a shaky state of tension for many years, which is unusual for a resource-rich energy exporting country. In the past few years, Kazakhstan has faced a double shortage of electricity and fuel in every winter. Two severe fuel crises broke out in 2014 and 2017. Because the government implements price controls and keeps fuel prices at a low level in order not to affect the people’s livelihoods, energy imports from abroad are not profitable in Kazakhstan. At the same time, its aging oil refining facilities have restricted the country’s domestic energy supply capacity. At the same time, electricity prices are also trapped in tight supply. In November 2021, electricity shortages and alternating power outages had occurred in many parts of Kazakhstan. The aging power supply lines caused the loss of transportation power as high as 15%-16% of the total electricity.

It is worth noting that the demands of the protesters in Kazakhstan are escalating, from lowering the price of LNG and improving the living standards of residents to political demands, targeting the current government of Kazakhstan and even former President Nazarbayev. Under such circumstances, there is the possibility that the situation in Kazakhstan may further deteriorate. According to RIA Novosti, the West may use the protests in Kazakhstan for its own interest, and that the activities of some foreign NGOs in Kazakhstan have affected the local situation. The reason why Kazakhstan has attracted the interest of Western intelligence agencies is because of its strategic geographical location. There is unconfirmed news that there are currently multiple planes from Kazakhstan arriving in Russia, and Russian planes are also entering Kazakhstan.

Social unrest in Kazakhstan may have an important impact on China. Geographically, Kazakhstan is a vital neighboring country in Western China, and it is also member of the Shanghai Cooperation Organization (SCO). If Kazakhstan falls into national turmoil, it may have an important geopolitical impact on the stability of Western China and Xinjiang. After the disintegration of the Soviet Union, China paid a huge price to maintain stability in Central Asia. If there is a major turmoil in Kazakhstan, it may bring huge pressure on the geo-security of the region. From the perspective of energy security, Kazakhstan is one of China's important channels for foreign oil imports, and it has a crucial impact on China's energy supply security. In recent years, the country has exported more than 10 million tons of oil to China annually. It is also one of the three main gas suppliers of the China-Central Asia natural gas pipeline. Kazakhstan plans to export 10 billion cubic meters of natural gas to China in 2021. This time, energy prices in Kazakhstan have caused social unrest. If the problem worsens, it is very likely to affect the oil and gas transmission to China and increase the pressure on China's energy security.

Final analysis conclusion:

The recent large-scale protests in Kazakhstan due to rising energy prices are evolving into social unrest and leading to the resignation of the Kazakhstan government. This is no good news for China. As China's important neighboring countries on the western side, the turmoil in Kazakhstan will not only affect its oil and gas imports and energy security, but also having a major impact on the geopolitics of Central Asia and Western China. China should therefore, pay close attention to the development of Kazakhstan’s situation.

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