On August 23, Kazakhstan will maintain elections to its newly established unicameral parliament, the Kurultai, marking the most recent part of the political elite’s consolidation beneath President Kassym-Jomart Tokayev.
Final month, the Constitutional Court docket decided that Tokayev can legally stand for the presidency once more beneath the brand new fundamental legislation that entered pressure on July 1, leaving his earlier pledge to not search workplace once more – his present time period ends in 2029 – firmly within the steadiness.
Whether or not Tokayev decides to train that privilege or not, Kazakhstan’s enterprise elite is being recast in his picture, proper in time for a brand new electoral cycle.
Regardless of his criticisms of the “oligopolies” fashioned beneath predecessor Nursultan Nazarbayev, a number of the nation’s strongest corporations exterior of the oil sector are actually concentrated in even fewer palms, due to a sequence of megadeals first reported within the second half of final 12 months.
On the identical time there was a delicate shift, with the brand new captains of business visibly extra tethered to officialdom writ giant than the Nazarbayev-loyal oligarchs who preceded them.
One of many clearest examples of this pattern is Luxembourg-domiciled Eurasian Assets Group (ERG), a mining group whose important minerals output is globally vital, and whose contribution to the Kazakh economic system is estimated between 2 and 4 % of GDP.
Integra, ERG, and Enterprise ‘China-style’
In a sequence of clips posted to his official Instagram, Kudrat Shamiyev discusses Integra Building KZ, “the largest development firm in Kazakhstan,” with one other delegate at a world Taekwondo occasion.
“We do alternate… I personal mining firm. So, we take sources, we give sufficient,” begins Integra’s 36-year-old chairman, who can be Kazakhstan’s Taekwondo federation chief, talking in English. The clip is backed by Drake’s 2023 observe, that includes J. Cole, “First Individual Shooter.
“Just like China-style?” interjects the person seen within the clip. “It’s a good suggestion.”
“Sure,” replies Shamiyev. “It’s simpler for us, simpler for now.”
The total context of the pair’s alternate is unclear, as is the delegate’s id and the id of the mining firm that Shamiyev is referring to. The clips are spliced with footage of Integra initiatives.
At one level the delegate gives to introduce Shamiyev to his authorities to debate a proposal to construct a railway, Integra’s inventory and commerce.
However the “much like China-style” comment is on the nostril.
With its giant, built-in enterprise teams in strategic industries topic to robust political oversight, Kazakhstan’s big next-door neighbor rewrote the ebook on state capitalism.
And for all Tokayev’s lip-service to liberalization and privatization, Astana is embracing the state capitalism mannequin wholeheartedly, particularly within the mining sector.
By the point the third of three clips was posted in June, Shamiyev had added one other title to his listing: CEO of Eurasian Group LLP, the Kazakh division of Eurasian Assets Group (ERG).
Entities that the 36-year-old now oversees as a part of that position produce big portions of iron ore, bauxite, alumina, and ferrochrome, the form of industrial inputs on the coronary heart of geostrategic competitors between Beijing and the West.
ERG is moreover a significant producer of cobalt – important for battery manufacturing – though these property are primarily based within the Democratic Republic of Congo.
Shamiyev’s appointment at ERG got here after Integra’s proprietor, Shakhmurat Mutalip, dubbed Kazakhstan’s “youngest oligarch,” secured 39.3 % of the group in Could.
As The Diplomat reported in an investigation in April, Shamiyev is not only an worker of Mutalip’s, however his childhood pal, having attended the identical college in a village exterior Almaty.
Questions across the financing for Mutalip’s buy-in, its implications for ERG’s giant excellent loans to Russian banks sanctioned by Western governments, and the potential impression on provide chains have mixed to see the corporate previously often known as Eurasian Pure Assets Company (ENRC) reignite Western press curiosity.
However it’s also hanging how an organization as soon as inextricably related to its three founding members — post-Soviet oligarchs Aleksander Machkevitch, Alijan Ibragimov and Patokh Chodiev – seems to be edging additional and additional towards authorities management.
The Diplomat contacted Kudrat Shamiyev, Nature power options Ltd., ERG and the Kazakh presidential administration previous to the publication of this text. They declined to remark.
“Semi-nationalization”?
The Kazakh state’s stake in ERG grew from lower than 12 % to 40 % after the corporate delisted from the London Inventory Alternate in 2013, the place it was being pursued by the UK’s Severe Fraud Workplace (SFO) on the daybreak of an investigation that might final a decade and finish with the costly case being dropped with no costs introduced.
That elevated heft gave Astana the best to ship two representatives to the group’s five-member board.
In accordance with monetary analysts, the federal government had typically used ERG as a “pockets” previously, asking it to sponsor infrastructure initiatives not coated by the state finances.
The corporate furthermore needed to alter on the hoof to Nazarbayev hanging enterprise offers throughout his journeys overseas, sources aware of the corporate instructed The Diplomat.
However a privileged relationship with Nazarbayev – Machkevitch was reportedly significantly near the previous president – allowed boardroom technique to stay largely inside the orbit of the group often known as the “Troika,” or Trio, and their kin
For a lot of critics, they turned the final word image of a footloose, yacht-owning elite that raked in income from Kazakhstan’s pure sources with out paying an excessive amount of for the privilege.
Of the three, solely Chodiev, an Uzbekistan-born Belgian citizen, is now alive.
He and the heirs of Machkevitch, a Kyrgyzstan-born Israeli nationwide who died final 12 months, offered their shares of 18.6 % and 20.7 % respectively to Mutalip’s Nature power options Ltd. for undisclosed sums.
The Ibragimov household has not offered its shares.
Alijan Ibragimov’s son Shukhrat, a Kazakh citizen, turned the group’s chairman in 2024, fulfilling an ambition that first stirred throughout a childhood spent partly within the firm’s workplaces together with his father.
Final 12 months, Ibragimov noticed his personal bid to safe a majority stake within the firm “gatecrashed” by Mutalip, as per the Monetary Instances.
Now the board is a four-person affair, with Ibragimov the final remaining member boasting any blood ties to the founding Trio.
In March, Roman Sklyar, Kazakhstan’s then famously hands-on first deputy prime minister, changed Serik Zhumangarin, a lower-ranking deputy prime minister, as one of many authorities’s representatives to ERG.
In Could, Sklyar turned Tokayev’s chief of employees.
That position in command of the presidential administration is arguably probably the most highly effective in Kazakh politics in addition to the presidency, and one sometimes not mixed with boardroom positions.
Simply days after his promotion, the FT reported that ERG confronted “semi-nationalization,” with Sklyar poised to switch Ibragimov as CEO in a “boardroom showdown.”
Loyalty and Leverage
That has not but come to move, with ERG stating on the time that it could not touch upon rumors.
However the addition to ERG’s board of Nurlan Zhakupov, CEO of Kazakhstan’s sovereign wealth fund, Samruk-Kazyna, reported by Kazakh media in June, has solely bolstered the impression that the state goes to utilize its standing as the most important shareholder.
Zhakupov’s day-to-day duties embody overseeing Samruk-Kazyna’s portfolio of state-owned corporations, together with the nationwide rail operator, Kazakhstan Temir Zholy (KTZ) — Mutalip and Shamiyev’s most vital shopper at Integra Building.
On August 6, Samruk-Kazyna confirmed that it had taken over the federal government’s stake in ERG, beforehand held by the Ministry of Finance.
The connection between Samruk and Integra is only one of a number of indicators that the fourth member of the board – Mutalip himself – is more likely to be a extremely cooperative determine for the federal government.
The corporate by means of which Mutalip acquired his stake in ERG, Nature power options Ltd, contains amongst its administrators a person named Bauyrzhan Bishenov.
This seems to be the identical Bishenov, who a minimum of as just lately as April 2025 was serving as an official in Tokayev’s administration, now overseen by Sklyar. Whereas it’s unclear if Bishenov has any particular position at ERG, he was in 2024 referenced in Integra’s social media posts as a member of that firm’s supervisory board. His earlier administration positions included a stint as deputy chairman of the nationwide freeway operator KazAvtoZhol (2017-18), and earlier than that as managing director of KazAgroFinance, one other state firm that gives finance to farmers, the place he overlapped with Tokayev’s nephew, Kanysh Izbastin (board chairman from 2015 to 2021).
Mutalip and Shamiyev, for his or her half, are each members of Kazakhstan’s new super-party, Adilet, which appears more likely to sweep elections to the Kurultai later this week.
Adilet is headed up by Sklyar’s predecessor as chief of employees, Aibek Dadebay.
Shamiyev’s LinkedIn profile furthermore reveals that he’s the recipient of a medal for “contribution to nationwide safety,” awarded to him by the Committee for Nationwide Safety, Kazakhstan’s independence-era successor to the Soviet KGB.
In July, Bloomberg reported on personal discussions over a plan to separate up ERG’s domestically-based and worldwide companies, whereas dividing the corporate’s multi-billion greenback debt pile throughout the shareholders.
The plan would depart all Kazakh operations beneath the unique possession of Mutalip and the federal government and “enable Ibragimov…to give attention to the booming mining sector in Congo,” the enterprise wire prompt.
Kazakhstan’s authorities said that it had not been knowledgeable of any proposals as of July 20.
