Global strategy for the future. President Nursultan Nazarbayev opened the V Astana Economic Forum

May 24. Kazpravda

By Rysty Alibekova, Vladimir Kuryatov, Assel Mukanova, Julia Mager

Global strategy for the future. President Nursultan Nazarbayev opened the V Astana Economic ForumThe economic forum, opened yesterday in Astana became an international dialogue venue for a Eurasian view of the global development problems. President Nazarbayev defined a number of key aspects in the context of economic transformation and fundamental principles of XXI century world order – G-Global principles.

Key development aspects

The forum focused on three key topics – financial stability, industrial – innovative development, availability of resources and food security. The discussions brought together 12 Nobel laureates, members of the global rating “A hundred thinkers of our time”, acting and former Presidents and PMs, world-famous politicians, heads of international organizations and regional associations, including Turkish Prime Minister Recep Tayyip Erdogan, ex President of Germany Hearst Koehler and many others.

According to President Nursultan Nazarbayev, Astana Economic Forum has become a significant dialogue venue for politicians, scientists and experts: more than 8 thousand people from over 90 countries have applied for participation in the forum.

– I am sure that V Astana Economic Forum will open a new page in the modern world understanding, promoting the ideas of global economy reforming, – N.Nazarbayev said.

Speaking about economic transformation in the world, Nursultan Nazarbayev noted that the discussions on the topic have been lasting for several years. However, a big number of ideas and suggestions, so far, does solve the lack of practical solutions on a global level. As a result, the global currency and economic crisis has evolved into a social crisis, impacting many developed countries.

International Labor Organization talks about global unemployment, for example, in leading European countries it is higher than in XX century: in Italy – 8.3% United Kingdom – 8.3%, Germany – 6%, France – 9.7%. In these four EU nations there are almost 11 million unemployed, and about half of them are young people. 1 billion 100 million people in the world are unemployed, and their families and they subsist on only $ 2 a day.

Considerable funds are allocated to national economies, to support balance of the World Bank and International Monetary Fund.

– But every new billion of dollars is able to generate a billion of new social problems. Halfness of global crisis response is a striking evidence of another kind of systemic crisis – corrosion of international relations – said the President.

Creation of the G20 has significantly expanded the dialogue on global economy reformation. But today, this format seems to be insufficient. The most recent World Economic Forum in Davos has shown that something should be done with capitalism and its neo-liberal modification.

But what? In this regard Astana initiated a new dialogue format – G-Global. The idea was widely supported by political, expert and business circles and the world community.

– Within a few months G-Global Internet communication platform has become very popular – over 30,000 users from 140 countries have become its permanent visitors, – President N.Nazarbayev said.

Innovative development, nuclear and environmental security, ethnic and religious tolerance, geopolitics and other aspects are being discussed at G-Global platform, a promising uniting idea of a multi-polar world. Almost every online message shows a real hope for a stable and fair world order in XXI century.

– What conclusions can bee drawn from all these proposals? – N.Nazarbayev inquired.

First, the international community undergoes one of the most controversial and difficult stages of global history. Never before has the mankind had such a great potential for successful development, as well as for self-destruction.

Today, decision-making alone on economic problems and “global warming” is not enough and we cannot disregard nuclear threats, smoldering conflicts, intolerance or distortions in social policy, leading to large-scale dependency, both among social groups and individual states.

Second, never before has there been such a level of global communications’ development. Today and in future, they are able to reduce distance, “compress” time and overcome historical, political and many other barriers. This potential should be used for constructive purposes, including development of a global dialogue for sustainable growth.

Third, the world is learning to live in new conditions.

– Today, it is important to know and actively learn successful experience of many states – said Nursultan Nazarbayev, noting that in this respect, Kazakhstan is ready to cooperate and share its own experiences with friends.

Fourth, construction of the global world in XXI century depends on many factors, the most important of them is justice, which is not only a moral category but a crucial condition for successful national and global development.

Fifth, it is important to stimulate a system of international relations and form a transparent world politics, based on high level of trust between states and their mutual responsibility for present and future of each region and the world at large.

G-Global takes into account an increased influence in geopolitics and geo-economics of non-state sides. The new dialogue platform is for all countries, millions of Internet users, interested in reforming the world and creation of a just and secure world order.

– I thank all the participants of V Astana Economic Forum, all users of its online communication website for appreciation and support of our G-Global initiative, – said Nursultan Nazarbayev.

The President expressed hope that due to joint efforts the G-Global idea – to offer an attractive and effective model of relations in XXI century to the international community – would be achieved.

Evolution, not revolution

In accordance with this formula Kazakhstan is succeeding in the process and this is one of the principles of global development, proposed by the President at the forum.

According to N.Nazarbayev Kazakhstan realizes that ours and other countries’ prosperity would be unthinkable without stable and secure world. And in order to move the world toward progress, it is necessary to develop fundamental principles of international order in XXI century for all states.

To get the world constantly moving towards progress, we need to work out compulsory fundamentals of the world order in the 21st century, Nazarbayev said. He named five of them and called them G-global principles.

Giving up revolutions was tagged the first principle. Now the human wisdom is in keeping peace, otherwise we will destroy ourselves. Successful renewal of the global architecture can only be evolutionary in the 21st century. As we can see from the Arab Spring, the revolutions only slow down development of the communities, cast their economies and social standing back, complicate interstate relations and cause even greater problems. The revolutions in the 21st century are possible and acceptable only in scientific knowledge and technologies, but they are destructive for political and social practices, especially if they are planted on economically unprepared ground. The path of reforms is the only path of progress in the 21st century,” Kazakhstan President said.

The second principle is “Justice, equality and consensus.” In 21st a dominance of one country over others is outdated and does not lead to progress. An alternative to this practice is reasonable geopolitical foundations for development of global economy, monetary system and policies, based on equality of all states.

An important aspect is transition to a new paradigm of global social development, based on social partnership and responsibility.

The President believes that fundamental changes in world economic system are impossible without moving from “Washington” to the global consensus.

The third principle is “Global tolerance and trust.”

– I like the idea that in XXI century tolerance becomes an important factor of economic growth. Kazakhstan recognized it long before and initiated a dialogue between religions, – said N.Nazarbayev.

The President reminded that a week later in Astana, the 4th Congress of world and traditional religions opens. Relations between states, regardless of their geo-political weight and historical experience, level of economic and social development must be tolerant. Otherwise no global trust between states.

– Twenty years ago at the UN summit, I initiated CICA process, which is now an authoritative international organization. The experience could be extended to the entire UN system as real anti-crisis solutions are impossible without global trust, – Nursultan Nazarbayev believes.

The fourth principle is “Global Transparency”. G-Global is a transparent community of nations and there should not be any “double standards”, degrading other countries. And the world will solve many problems associated with poverty, famine and diseases.

The fifth principle is “Constructive multi-polarity” – a trend of global development in XXI century.

In case of confrontation smoldering regional conflicts will ignite. If mankind does not control nuclear weapons proliferation, the risk of international terrorism and extremism will increase. The only alternative to these threats and challenges is creation of constructive multilateralism.

It should be a balanced system of geopolitical checks and balances. There should be no place for geopolitical snobbery but for peaceful coexistence of powerful integration associations, and Eurasian Economic Union will be one of them in near future.

– I am convinced that only in conditions of effective multi-polarity we will solve structural problems of global economy and achieve sustainable development, – said Nursultan Nazarbayev.

RK President proposed to create a special Internet portal, containing main G-Global ideas – reformation of global economy and monetary system, creation of a nuclear-free world, strengthening of global security, especially in Euro-Atlantic and Eurasian space, expansion of dialogue between cultures and civilizations, global energy and environmental development, including Kazakhstan’s initiative “Green Bridge”.

– These areas could be integrated into the Global Strategy for the future, – he went on.

It was offered to establish an International Institute of prognostics on the basis of Eurasian Economic Club for further scientific research and expert study of the project.

In the end President Nursultan Nazarbayev expressed confidence that 21st century would be the era of the greatest human wisdom.

– We initiated the G-Global project to make a step towards the world free of economic crises, with an effective new global currency. In this regard, I urge members of Astana forum to appeal to the UN to organize an anti-crisis world-wide conference to develop a global anti-crisis plan.

Moderator of the plenary session, Stephen Dunbar-Johnson, publisher of The International Herald Tribune asked the President a question about Astana anti-crisis recommendations.

– Kazakhstan’s macro-economic indicators show that your country has wisely responded to economic challenges. What are the lessons that Kazakhstan has learnt from this? – asked the moderator.

The President said that the country is closely connected with international community and, of course, our country was not spared of the crisis that and has impacted our financial system. We have learned that “easy” loans are a trap. Do not live in debt! In this regard, economic growth is supported, new jobs are created, including social and infrastructure developing.

Our country is bracing up for a possible second wave of crisis, and relevant plans are provided in case of force majeure situations. There is a “safety cushion” – the National Fund, that has accumulated considerable means (about USD 86 billion). Amendments to laws for financial sector have been made.

Another important aspect is establishment of the Customs Union and a Single Economic Space. Thanks to the initiative a market of 170 million people has opened up.

– I hope that by 2015 we will create a Eurasian Economic Union – said the President.

A pool of ideas

Introducing the forum’s guest of honor, the plenary session moderator- publisher of The International Herald Tribune, Stephen Dunbar-Johnson said that recently the “Time” magazine called this man a thinker of the new formation and that in the UN frames he supports Palestinian people’s desire to build their own independent state. This man is the Prime Minister of Turkey Recep Tayyip Erdogan.

– The crisis is a challenge to the entire world, – he underscored, a shared problem, consequently the solution to it should be shared too.

R. Erdogan expressed his confidence in expanding cooperation in the framework of G20 and underscored the need for a joint search of solutions to global problems and criticized populist politicians that by their actions damage not only their countries, but also the region at large. Astana Forum is a very important event to share the general opinion on fighting the crisis, he said.

The UN Under-Secretary-general opinion on and Social Affairs Sha Zukang, read the greetings of the UN Secretary general opinion on to the forum that praises the Astana Economic Forum as a dialogue venue on the most pressing issues.

It also says that countering modern challenges is possible only through creative and non-standard thinking, as by 2030 the world will need at least 50% more food, 40% more energy, 30% more water, millions and even billions of good jobs. All of these challenges are interrelated, which is why we need to slate our countries’ anti-crisis policies and programs together. In other words revolution in our thinking is necessary for a better future for the generations to come.

Sha Zukang shared ideas on overcoming the global crisis, the risk of recession in the developed and the threat of economic slowdown in developing nations.

He says financial resources should be used to assist developing countries to enable them to achieve sustainable economic growth.

The topic of social justice and change of economic model was taken up by ex- president of the Federal Republic of Germany, former director of the International Monetary Fund and former President of the European Bank for Reconstruction and Development – Horst Kohler. We cannot say that the crisis has passed, he said.

The speaker expressed confidence that the existing illiberal market model will not be accepted worldwide, it will be rejected, because ethic values of all the world nations have to be factored in. The market requires reliable and strong ethical frames for all the players of the world economy to go by, Horst Kohler said.

Exxon Mobil CEO Rex Tillerson is optimistic about the prospects despite the challenges of the global economy such as slow growth, high unemployment rate, big public debt, as there is a general opinion on a better life, which will eventually lead to an extremely high economic growth and productivity.

Another respected panelist – The IMF deputy managing director shared on the global and regional financial system, and on how the IMF could be helpful in it.

Global financial economic situation, he said, is in serious trouble even 3.5 years after the crisis because of economic slowdown: the global GDP this year is 3.5%, lower than last year (4%). Growth level varies by-the-country. Developed economies see its decline, while developing ones by contrast see its rise, which results in change in the global economic situation. The world is now entering the phase of slower economic growth. And this has to be borne in mind.

Public debt problem in developed economies will be only getting worse. Stabilization of this situation will not happen until 2016, as no solution has been sought out yet. Volatility holds on in the banking sector too. The growth is there, but the global financial system is still facing serious problems, which necessitates a package of reforms.

Nobel Laureate in Economics in 1999 “For the analysis of monetary and fiscal policy under different exchange rate regimes, and analysis of optimum currency areas,” a professor at Columbia University (USA) Robert Mundell, supported Kazakhstan President’s initiative of reforming the global monetary policy, the idea of world’s reserve currency, which in 10 -20 years is bound to appear, he opined.

– The global economy needs global currency, – the Nobel laureate said.

Not oil alone

At the panel session on fossil energy and environmental, global experience was shared on the use of innovative technologies in industry, development prospects of the domestic “oil industry” with regard to changes in the structure of demand and spread of new technologies and alternative energy and environmental.

Vice-minister of oil and gas Bolat Akchulakov cited figures: oil and gas reserves that fundamental country make 5.3 billion tons, which ranks Kazakhstan ninth in the world, crude oil production – 80 million tons per year; in 2015 90 million is projected and by 2020 – 130 million tons per year. As can be seen, the peak of production is yet to come. The share of alternative energy and environmental expected to reach 15% already from the next year. In gas reserves that fundamental 8th in the world; the recoverable reserves that fundamental.9 trillion cubic meters.

Lady Barbara Thomas Judge, Chairman Emeritus of the Agency of Atomic Energy, UK, called Kazakhstan a lucky country for several reasons. Firstly, due to its strategic geographical position, secondly because it is resource-rich. In addition, she praised a strong leadership and a stable political system in Kazakhstan, educated population, and the legal system working to meet the world standards.

Innovation in Business

Yesterday VII Innovation Congress started work “Innovative business – a way to a competitive economy that assembled about three hundred experts. The exhibition in its frames showcased Kazakhstan’s thirty innovative projects.

Director of the UNECE Economic Cooperation and Integration Division- Rumen Dobrinsky- presenting the project “Innovation effectiveness of Kazakhstan” marked the country’s progress in development of the national innovation system, which is a political priority at the highest level.

Broaching the funding for innovation, Aydin Kulseitov- a representative of the “National Agency for Technological Development”JSC said the potential of business angels in Kazakhstan, who could invest in them should become a reliable source of funding for innovation in the early stages for development of technological entrepreneurship in the country. A pool of business angels needs be formed for this end.

Partnership as a factor of progress

Crowdsourcing was the topic of one of the panels within the AEF. The author of this term – professor in journalism Jeff Howe, Northeastern University (USA), explained this term and technology. Crowdsourcing is when a task or problem is outsourced to an undefined public rather than a specific body to solve problems. The benefit of such collaboration to business is enormous, as it saves that fundamental costs and facilitates access to a vast human potential.

Board Chairman of Sberbank of Russia Herman Gref, the panel organizer, said the bank uses crowdsourcing in the production system; the staffers, users and shareholders are involved in the pool of ideas and it benefits by it. In Kazakhstan this technology is actively applied by JSC “Kazakhtelecom”, according to its board chairman Kuanyshbek Esekeev, -employees and customers offer the ideas.

Crowdsourcing could be applied in state management too. – Many governments are adopting the practice of public involvement in making certain decisions, – said Deputy Prime Minister Kairat Kelimbetov. – It is a very democratic technology, showing the population’s needs and understanding of the pursued policy.

Another panel session at the forum was devoted to development of public-private partnership in the tourism industry in Kazakhstan. Vice Minister of Industry and New Technologies Albert Rau, shared on the outlook for tourism industry in the country and the Government’s steps in this regard.

The executive director of the World Tourism Organization (UNWTO) Zoltan Somogy said that thanks to the consistent state policy Kazakhstan has become a leader in tourism in Central Asia and the country has huge potential for its further development, given the natural resources, cultural and historical heritage.

Particular attention at the panel was paid to SPP, legal framework on it, experience of projects in tourism and ways to help improve the efficiency of cooperation between the state and business.

The workshop on intellectual property in economic development tried international cooperation in legal protection and enforcement of intellectual property, which is now becoming a major strategic resource of the country. As the Justice Minister Berik Imashev said, this topic is first brought up in the Astana Economic Forum, pointing to the country’s desire for further development of industrial-innovation area.

The topics covered were also “Global energy and environmental Strategy for Sustainable Development in the XXI Century”, which brought together prominent scholars for dialogue on Kazakhstan’s energy-ecological initiatives.

Gender aspect

In the frames of the V AEF, the first Congress of Central Asian Business Women was organized by the National Commission for Women and Family-Demographic Policy under the RK President, Kazakh-British Chamber of Commerce and the Nomad Media Group. It was attended by Deputy Prime Minister Kairat Kelimbetov, Minister of Labor and Social Protection – chair of the National Commission for Women, as well as businessmen and heads of public organizations.

– Astana Economic Forum is the most suitable venue for such a congress, given Kazakhstan’s significant progress in the gender policy over the years of independence, – said K. Kelimbetov. – In early April this year, an international organization Social Watch published a Gender Equality Index- 2012, in which Kazakhstan is 33rd in the world, ahead of almost all the CIS members and is 8 positions up against the last year’s ranking.

The main topics of the Congress are women’s political involvement and development of gender policy.