So far we have argued that the main targets of the local authorities in the oil-rich regions have been non-Western sub-contracting companies, not foreign oil companies or Western sub-contractors and the like. That, however, began to change a few years after fixed quotas were introduced for the first time. The growing confidence on the part of the Kazakh authorities – which was brought about by the increase in oil prices, an influx of various sub-contracting companies, (chapter 5, section 2.3; chapter 6, section 2.1), and commitment of the foreign oil companies to Kazakhstan474 – resulted in spillovers of the regime’s strategy from exclusively non-Western sub-contractors to Western sub- contractors broadly understood, with one significant difference. In the case of non- Western sub-contractors, the idea was to get as many Kazakh citizens working in effectively low-skilled jobs. With regard to Western sub-contractors, however, the government not only wants them to employ local labour, but also to train Kazakh citizens
472Kazakhstan Television first channel, 26 October 2004.Source: BBC Monitoring Service, 26 October
2004.
473Bagila Bukharbayeva, ‘Kazakh oil workers clash with Turkish supervisors over alleged mistreatment,’
AP Worldstream, 12 April 2005.
474
Interview with a high-ranking foreign specialist working on major projects in Kazakhstan since mid 1990s: Almaty 21 October 2004.
so that they will obtain new skills, and in the long run will be able to replace Westerners and others altogether.475
At the same time as the Kazakh authorities have increased their demands towards Western sub-contractors, they have also steadily begun relaxing the fixed quota system, which foreigners see as a major obstacle and complain about, at central as well as local authority levels.476 In 2004, Kazakhstan allowed twice as many foreigners to work in the country than in 2000, and the total number had risen to 16,500. A foreign diplomat asserted that these strategies – on the one hand, the growing pressure on Western sub- contractors, and on the other hand, the changes in the government’s policy – have been elements of a carrot-and-stick approach that allows Nazarbayev’s regime simultaneously to portray itself as the champion of the foreign investors and also uphold its image as a defender of local labour.477 This admittedly clever strategy, however, yet again places responsibility on the outsiders, whose own goal is not to train Kazakh workers but, to put it crudely, to make money. Hence, the result is a rather mixed one.
A project manager working in the Kyzylorda region stated that in the last two years, members of the local administration had been often visiting his firm, invoking the government’s new guidelines, openly demanding of him that he employ Kazakh citizens, and on occasions even suggesting in a straightforward fashion to install some of themselves or their relatives, into managerial positions. These demands, however, have proven difficult to realise, since it was pointed out that the representatives of the local administration lacked the necessary work skills. Disputes ended in a sort of ‘compromise’, with the project manager agreeing to employ few workers and to pay them relatively high wages while referring them to low skilled jobs. The project manager pointed out that he favoured such settlements since it cost him less time and money than to train local workers from scratch.478 Another area manager of a foreign sub-contracting company, one that mainly operates in the the Aktyubinsk and Mangistau regions and specialises in drilling, argued that in principle his company did not have any problem with employing local labour, since they were after all cheaper than non-Kazakh labour. 475Interview with a foreign diplomat: Almaty 12 October 2004.
476Interview with an area manager of one of the world’s wide major drilling companies: Almaty 4 October
2004.
477
Ibid.
What constituted a problem, however, for the company was the low qualifications of the local labour or their unfamiliarity with Western equipment. Moreover, those who on paper seemed to be qualified for the job were not always so in reality:
All the people that come to me they have the right papers. They all come with their book in which it will say that they are qualified labour. For example lets take an assistant driller. The definition of the assistant driller in a Kazakh, Soviet industry is entirely different from the definition of the assistance driller in a Western oil business. An assistance driller on the North Sea, in the Far East can actually work as an assistant to the driller in the event that the driller is taken ill or has to go to the bathroom or something like that. The definition of the assistance driller here is someone that helps the driller and that can be anyone of the rig floor. But we do not have that, we define what a person is supposed to do. In our system an assistant to the driller is defined as assistant to the driller, a floor man is defined as floor man. Well you can say that it is a play on terminology but everyone that you ask here will tell you “Yes of course I am an assistant to the driller.479
Whereas the issue of who is a qualified driller in Kazakhstan and who is not should be left to those that are authorities on the subject, from the political point of view one thing is certain: the regime, in order to maintain its position as a defender of Kazakh interests, has to come across as constantly putting the pressure on foreigners. This strategy can easily work in relation to soft targets such as non-Western sub-contracting companies, but will require the considerable agreement of foreign oil companies if it is to be effective, as in the case of shifting the responsibility in the Atyrau region (section 1.3). However, since the latter approach demands active pacting with oil companies, which are difficult partners (discussed further in chapter 5, section 2.2), the regime will most likely look for additional soft targets to address the issue of unemployment in the oil-rich regions.480 For instance, in 2004 Atyrau’s local authorities argued that in recent years as many as 33,000 Uzbek citizens had arrived in the region, most of whom were in Kazakhstan illegally.481 Those Uzbek citizens were accused of destabilising the local labour market, i.e. of taking jobs from the locals. It was suggested that whereas in Atyrau the local workforce earned between 20,000 and 25,000 tenge per month [130–160 US 479 Interview with an area manager of one the worldwide major drilling companies: Almaty 4 October
2004.
480
Kazakhstan Television first channel, 20 January 2004.Source: BBC Monitoring Service 21 January 2004.
dollars], Uzbek citizens were willing to work for two or three time less – between 12,000 and 15,000 tenge [77–97 dollars], thus depressing the local labour market.482
In conclusion, the purpose of this chapter was to demonstrate the development of the co-operation between Nazarbayev’s regime and foreign oil companies that allowed the regime to address the problems which mounted in the oil-rich areas during the late 1990s. In the following chapter, we will see that the dissatisfaction of the local population was exploited by certain interest groups, which began demanding a greater share of the oil spoils that in their opinion, in a highly centralised system, were going solely to the people closest to the president. We will also see that the regime, in response to those demands, further strengthened its co-operation with the foreign oil companies, which in turn allowed it to successfully contain growing discontent.
482
Khabar Television,1 Feb 2003.Source: BBC Monitoring Service, 1 February 2003; It was also reported that behind such a large influx of outside labour are organised criminal gangs from the south of Kazakhstan (Interfax-Kazakhstan, 31 August 2005).