Philip Leatherwood, Lecturer

Kazakhstan Institute of Management, Economics, and Strategic Planning

4 April, 2001

1. Results of Transformation
1. Industrial restructuring from the center has made little progress
2. Restitution laws have been a major obstacle to privatization and foreign investment
3. Authorities have been unable to impose financial discipline on firms
4. Excessive devaluation leads to cost push inflation and supply shock to import dependant firms—
5. --But also encourages first-time exports
6. Collapse of intra-CMEA trade lead to fall in output
2. Policies to Accelerate Transformation
1. Gradual move to currency convertibility
2. Gradual opening of trade
3. "Commercialize" big state firms
4. Recapitalize banks
5. Recreate lost Eastern trade