Following in the footsteps of Tony Blair: Kazakhstan has been lucrative for UK businessmen since the former PM cultivated its President

 

Nick Kochan
Wednesday 30 April 2014 01:55
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The cafés and market stalls on the streets of Almaty are rather bleak affairs. Many have just a few goods on display and, with the exception of outstanding cheesecake, what they do show off rarely looks that appetising.

Their décor is not helped by the black and white photograph on the wall of President Nursultan Nazarbayev, the heavy-set brow and unforgiving stare sets a tone that even the best cheesecake cannot lift. Kazakhstan would like you to believe that it has moved on from the Soviet era, with a decade-long modernisation programme that British businesses have been in the vanguard of, but a lot of the past remains.

The influence of Mr Nazarbayev is felt in every part of the economy, from the highest business elites to the meanest market stalls. A businessman can become immensely rich in a short time if he moves in the President's circle. The small-scale entrepreneur gives suitable favours if he wants to stay in business.

As a representative of émigré Kazakh politician Akezhan Kazhegeldin says: "Everyone gives and everyone takes." What does he mean? "Governmental corruption is the worst example. Officials send out the signal that they are corrupt. Corruption works through communication and you cannot be uncorrupted in the system, because no one will trust you."

Mr Nazarbayev learnt his trade in the latter days of the Soviet Union and was in power when it collapsed in 1991. Today he is very close to Russia's Vladimir Putin – Kremlinologists note he sat just two seats away from Mr Putin at the opening to the Sochi Winter Olympics.

But despite his communist leanings, Mr Nazarbayev, 73, has also looked to the West to help modernise the country. Tony Blair Associates was recruited in 2011 on a two-year contract worth £13m, with the brief of improving governance in Mr Nazarbayev's cabinet.

Tony Blair is understood to have known the Kazakh leader since 2001. The relationship with the former British Prime Minister was clinched when he allowed the President to hold his then baby son, Leo, say Downing Street sources.

Shortly afterwards, Mr Blair introduced Mr Nazarbayev to Sir Dick Evans, the former boss of BAE, when he was looking for someone to get Air Astana off the ground in 2003. Sir Dick now sits on the board of the country's sovereign wealth fund. One observer noted: "Dick tells it like it is. The President appreciates straight speaking, while also understanding the importance of influence in high places."

Alistair Campbell, Mr Blair's former spin doctor who now works with the PR firm Portland, has also been spotted in the country, while Mr Nazarbayev's authorised biography was written by Jonathan Aitken, the former Conservative Minister of Defence and friend of Sir Dick from ministerial days.

Sir Dick is also understood to have kept the President informed about the UK machinations of the board of the scandal-struck Eurasian Natural Resources Corporation (ENRC), which left such a stain on the country's reputation.

Progress in Mr Nazarbayev's country is made "through connections, not cash", said one local banker. "They prefer to use relationships to get their own way."

So when the President was seeking a businessman to take the troubled BTA bank off his hands, he turned to Kenges Rakishev, an entrepreneur, aged 34, for support and funding. BTA Bank claims it was defrauded by Mukhtar Ablyazov, the fugitive former Kazakh minister of finance and bank chairman, who now sits in a French prison, awaiting extradition to Russia.

Mr Rakishev, the Oxford-educated son-in-law of one of the President's favourite businessmen, Imangali Tasmagambetov, the mayor of the capital, Astana, is talked about as a possible acquirer for ENRC's Kazakh interests. One local analyst, asked whether Mr Rakishev might be interested, said: "Why not? He is the new generation, he is Kazakh and he is close to our President."

The signals as to who is in favour and who not, come down from the President. A commentator adds: "He is a chess player. He has a consummate understanding of power, he moves the pieces around regularly to maintain his position."

Timur Kulibayev, the owner of local banks and numerous industrial businesses, whose net worth has been estimated at $15bn (£9bn) was seen as a possible successor to the ageing autocrat, whose daughter Dinara he married. But the President removed him from the helm of Kazakhstan's sovereign wealth fund at the end of 2011 after police opened fire on demonstrators in Zhanaozen, killing 14, amid protests about pay and conditions at a state oil company.

Other clouds haunt Mr Kulibayev as a presidential candidate. For example, he fathered a child, Adam, to the London socialite Goga Ashkenazi, while he was married to the President's daughter. Also, his purchase of Prince Andrew's mansion at a price considerably in advance of the market continues to attract curiosity.

The third group of Kazakh commercial elites is headed by Bulat Utemuratov, the billionaire owner of mineral and banking interests, including a 1.33 per cent stake in Glencore Xstrata, through his Verny conglomerate. Glencore is considered a likely buyer of ENRC assets, as disclosed in Tuesday's Independent.

The likely next face to appear on the photographs in the cafés and shops of Almaty is a secret, carefully guarded by the President alone. The President could yet pull one last surprise out of the hat for the Brits seeking their fortune in this resource-rich state.

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