PSCRP-BESA Reports No 246 (November 2, 2026)
Part II. Kazakhstan: transforming society
V. The Spatial Restructuring of the Economy: 4 Different Types of Regions
One of the important challenges facing Kazakhstani society is the highly uneven level of economic development across the country’s regions. Kazakhstan can be divided into four broad regional economic types. Three comprise relatively high-income regions:
- Almaty and Astana represent an emerging post-industrial urban economy, where prosperity is generated primarily by finance, public administration, IT, professional and business services, construction, and trade.
- Western Kazakhstan, particularly Atyrau and Mangystau regions, represents an industrial oil-and-gas economy, where high levels of output and income are driven primarily by the hydrocarbon sector.
- The Central and Eastern industrial belt — including Ulytau, Karaganda, Pavlodar, and East Kazakhstan — represents a predominantly resource-industrial economy inherited from the Soviet period but currently undergoing modernization, including through foreign investment. Its economic base includes copper, coal, steel, aluminum, zinc, titanium, uranium, power generation, and other capital-intensive industries.
At the lower end of the income distribution are predominantly the southern, agricultural, and less industrialized regions, including Turkistan, Zhambyl, Zhetisu, and several others. Kazakhstan’s agricultural modernization has so far been less extensive than that achieved before the war in southern Russia and southeastern Ukraine. Geography and logistics provide part of the explanation. Southern Russia and Ukraine had much easier access to major Black Sea ports and global markets. Kazakhstan, by contrast, is the world’s largest landlocked country. For commodities with a relatively low value-to-weight ratio (grain being the obvious example) transportation costs are a major constraint on international competitiveness.
This does not mean, however, that Kazakhstan’s agricultural sector as a whole is stagnant. The northern grain belt (Kostanay, North Kazakhstan, and Akmola regions) has relatively large-scale commercial agriculture, modern agricultural machinery, and considerable export potential. The poorer southern regions — particularly Turkistan and Zhambyl, and to some extent Zhetisu and Kyzylorda — have a rather different economic structure. Here, several problems more characteristic of Kazakhstan’s southern Central Asian neighbors tend to overlap: relatively small and low-income farms, water scarcity, insufficient agricultural processing and value added, and demographic pressure in the form of rural overpopulation.
The uneven development of Kazakhstan and the high degree of spatial concentration of economic activity are clearly visible in the contribution of different macro-regions to national GDP. The largest urban agglomerations generate approximately 35.2 percent of GDP, the western oil-and-gas macro-region around 22.5 percent, and the Central-Eastern industrial belt approximately 18.7 percent. This contrasts sharply with the contribution of predominantly agricultural regions: the South accounts for around 14.5 percent, and the North for approximately 9 percent.
The concentration becomes even more striking if we distinguish between two major centers of the “new economy” that have emerged or expanded dramatically since independence — the post-industrial metropolitan economy and the foreign-investment-driven oil-and-gas economy — and the older economic geography largely inherited from Soviet industrialization and agricultural development. Taken together, Almaty and Astana and the western oil-and-gas regions generate almost 58 percent of Kazakhstan’s GDP. The remainder of the country — still more strongly shaped by the Soviet-era industrial and agricultural economic structure — accounts for approximately 42 percent.
The regional distribution of small and medium-sized enterprises provides another particularly revealing indicator of this transformation. SMEs, which constitute an important element of Kazakhstan’s emerging post-industrial economic structure, account for dramatically different shares of regional output. Their contribution reaches approximately 65.9 percent in Astana, 59.8 percent in Almaty, and 56 percent in Shymkent, the country’s third major city. By contrast, SMEs account for only around 21.9 percent in the oil-producing Atyrau Region, 19.8 percent in Abai Region, and just 7.8 percent in the resource-industrial Ulytau Region.
The share of SMEs in regional output can therefore be treated as one useful indicator of the emergence of a new urban economic model. The contrast is not simply between rich and poor regions. Rather, Kazakhstan increasingly contains different types of economic modernity within the same national economy: post-industrial metropolitan centers dominated by services and private enterprise; wealthy but highly concentrated oil-and-gas regions; modernizing resource-industrial regions rooted in the Soviet economic legacy; and poorer agricultural regions facing both structural and demographic constraints.
VI. Kazakhstan Is Becoming a Predominantly Urban Society
One of the most fundamental features of contemporary Kazakhstan is its accelerating urbanization. Today, approximately 64 percent of the country’s population lives in urban areas. The global urbanization rate is around 55 percent, while the projected figure for 2050 is approximately 68 percent. Kazakhstan is therefore already relatively close to a level of urbanization that the world as a whole is expected to reach only several decades from now.
The growth of the country’s largest cities is particularly striking. Over approximately a decade, Astana’s population increased from around 870,000 to 1.6 million, an expansion of more than 80 percent. Almaty grew from approximately 1.6 million to 2.3 million, an increase of around 44 percent. This represents an exceptionally rapid concentration of population in the country’s principal urban centers. At the same time, regional differences remain enormous. In Karaganda Region, the urbanization rate is approximately 82 percent, while in Almaty Region it is only around 19 percent.
Urbanization is much more than a statistical demographic shift. Once almost two-thirds of the population lives in cities, the character of society itself begins to change. Urbanization transforms family structures and household strategies. Raising children in Kazakhstan’s cities is more expensive than in the villages; housing costs are higher; education requires greater investment; women’s professional careers assume greater importance; marriage tends to occur later; and families tend to invest more resources in each child. One likely consequence is a gradual decline in fertility. At the same time, educational attainment and professional specialization tend to increase.
Employment patterns change as well. In the largest cities, most people work neither in agriculture nor in large industrial enterprises, but increasingly in services, trade, education, finance, technology, small and medium-sized businesses, and creative professions. Urbanization therefore reinforces the structural economic changes discussed above: the growth of cities, the expansion of the service economy, and the increasing importance of SMEs are interconnected components of the same transformation.
The relationship between citizens and the state also changes. In a predominantly rural society, the principal concerns may center on employment, basic infrastructure, stability, access to housing, and social transfers. In a complex urban society, these concerns remain important, but they are increasingly supplemented by demands for clean air, efficient public transportation, high-quality digital services, good schools and universities, accessible and effective healthcare, attractive public spaces, personal security, transparent governance, and opportunities to influence decisions that directly affect urban life.
Urbanization can therefore be understood as one of the principal mechanisms through which economic modernization is translated into social and cultural modernization. Major cities generally provide environments characterized by greater social and geographic mobility, weaker traditional social ties, a wider diversity of lifestyles, higher levels of education, access to a broader range of information sources, and stronger expectations regarding political representation and institutional quality. The rapid growth of Almaty and Astana is therefore significant not merely from an economic perspective. These cities are becoming major engines of social transformation, gradually reshaping the structure, expectations, and values of Kazakhstani society as a whole.
VII. Demographic Transition: Kazakhstan Remains a Growing Society but Is Beginning to Mature
Against the backdrop of rapid urbanization, Kazakhstan’s demographic dynamics are particularly revealing. On the one hand, Kazakhstan remains a growing society. In 2010, the country’s population was approximately 16.2 million; by 2025, it had reached around 20.28 million. This represents an increase of approximately 4.08 million people, or about 25 percent in just fifteen years — a substantial rate of population growth by global standards. Of particular importance for the evolution of Kazakhstan’s national identity is the fact that the country’s ethnic and linguistic composition has also changed: society has become increasingly ethnically Kazakh and Kazakh-speaking.
At the same time, Kazakhstan has experienced a remarkable increase in life expectancy. In 2010, life expectancy at birth was approximately 68.45 years; by 2025, it had risen to around 75.97 years — an increase of more than 7.5 years. This is one of the most striking social indicators of Kazakhstan’s modernization. Life expectancy is a particularly useful composite indicator because it reflects the combined effects of income, healthcare, sanitation, nutrition, infrastructure, education, personal security, and overall quality of life. An increase of more than seven years within a decade and a half therefore points to a profound improvement in the broader social environment.
Yet population growth is now being accompanied by a rapid decline in fertility. The crude birth rate stood at approximately 23.5 births per 1,000 inhabitants in 2021; by 2025, it had fallen to 16.4, a decline of around 30 percent in only four years. The total fertility rate provides an even clearer indication of the transition. It declined from approximately 3.3 children per woman in 2021 to around 2.57 in 2025, a decrease of about 22 percent.
Kazakhstan therefore occupies a particularly interesting demographic position. Fertility remains above the replacement level, conventionally estimated at around 2.1 children per woman. At the same time, the direction of change is unmistakable: fertility is declining relatively rapidly. Kazakhstan is thus gradually entering a new phase of its demographic transition.
Several processes are driving this transformation: urbanization, rising educational attainment, the increasing cost of raising children, changes in the social and economic position of women, longer life expectancy, and a shift from a quantitative toward a more qualitative model of family investment. In a traditional society, families could have larger numbers of children while investing relatively fewer resources in each child. In a modern urban society, parents increasingly seek to provide a smaller number of children with better education and healthcare, improved housing, extracurricular opportunities, international exposure, and access to digital technologies. In other words, there is a gradual shift from “more children” toward “greater investment in each child”.
The age structure is beginning to change accordingly. Young people (between 14–35 years) still account for roughly 31 percent of Kazakhstan’s population, representing an important source of human capital. This figure is worth comparing with those of Kazakhstan’s northern and southern neighbours. In Russia, which is experiencing demographic difficulties, people in this age group account for around 25% of the population; in Uzbekistan, which is undergoing rapid demographic growth, they comprise approximately 34%. In both cases we also use the same definition of youth (between 14–35 years). At the same time, in Kazakhstan the relative weight of middle-aged groups is gradually increasing, while the base of the population pyramid is beginning to narrow. Kazakhstan therefore currently combines features of two demographic models. It remains a young, growing, and demographically dynamic country, while simultaneously becoming a more urbanized, longer-lived, lower-fertility, and gradually maturing society.
There is also an important temporal dimension to this transformation. Kazakhstan’s relatively young age structure currently provides a potential demographic window of opportunity — or demographic dividend. A large working-age population can create significant advantages for economic development. But a favorable age structure does not generate a demographic dividend automatically. Its potential can be realized only if the country provides high-quality education, sufficient productive employment, opportunities for social mobility and entrepreneurship, and effective institutions. Without these conditions, a demographic resource can instead become a source of social pressure. The challenge is therefore not simply to have a large young population, but to transform that population into productive and adaptable human capital. This is precisely why human-capital development is becoming one of the central challenges of the next stage of Kazakhstan’s modernization.
VIII. From Demand for Basic Development to Demand for Quality of Life
All the processes discussed above (economic growth, the expansion of SMEs, urbanization, rising life expectancy, higher levels of education, digitalization, and demographic transition) are gradually changing the nature of social expectations themselves. This may be one of the most important consequences of modernization, although it is difficult to capture through any single statistical indicator.
At earlier stages of development, the population’s principal demands tend to be relatively straightforward and material: employment, stable income, housing, roads, schools, hospitals, and security. As at least some of these basic needs are increasingly met, however, the structure of expectations changes. Citizens begin to evaluate not simply whether a service exists, but how good it is.
Below are education and digital-sector statistics based on data from the A. Baitursynuly National Center for Education Research and Evaluation “Taldau”. Education provides a particularly clear example. Kazakhstan has largely succeeded in resolving the fundamental problem of basic access. Preschool enrollment has reached approximately 95.9 percent, while school enrollment is close to universal. Almost all schools — around 99 percent —are connected to the internet, and approximately 97.8 percent are equipped with video-surveillance systems. As Kazakhstan already has universal access to basic education, public expectations are naturally shifting from quantity to quality — toward the quality of schools and teaching, access to higher education, and the internationalization of the education system.
A similar transition is occurring in the digital sphere. Approximately 97.5 percent of households have internet access, making connectivity an ordinary feature of everyday life rather than a scarce resource. Social expectations have consequently shifted toward the speed and reliability of connectivity, the quality of digital services, cybersecurity, e-government, access to artificial intelligence, and the quality of digital education. 43.6 percent of Kazakhstanis already use modern AI-based tools in their work, while 60.7 percent support the active integration of artificial intelligence into key areas of the country’s development, a process that is also being promoted through government programs.
These are characteristics of a society beginning to enter a new technological phase. Digital transformation is explicitly understood by both government and policy experts as part of what might be described as Kazakhstan’s second, post-industrial modernization. Experts frequently point out that in some areas — particularly the digitalization of public services, banking, and commerce — Kazakhstan has already developed practical digital infrastructure comparable to, and in some respects more advanced than, that found in a number of wealthier countries, including some European states.
Yet improving living standards produces another important consequence: expectations toward institutions rise as well. This creates one of the central paradoxes of successful modernization. The more effectively the state addresses the basic developmental needs of society, the more demanding the society it ultimately creates. Once citizens become wealthier, more urban, better educated, more digitally connected, and more economically autonomous, their expectations increasingly extend beyond material provision toward quality of governance, institutional effectiveness, accountability, participation, and the ability to influence decisions affecting their lives.
In this respect, contemporary Kazakhstan bears some resemblance to the transformation that Russian society was undergoing by approximately 2010. There is, however, an important difference. In Russia, this process of social change was subsequently constrained and increasingly interrupted by political developments; in Kazakhstan, the underlying socioeconomic and demographic forces driving the transformation have so far continued to develop. The result is an increasingly complex society whose expectations are evolving alongside the economy itself.
IX. Social Well-Being as Reflected in Public Opinion Surveys
The public opinion surveys presented by government-affiliated experts paint a generally positive picture. Admittedly, anyone familiar with opinion polling in post-Soviet societies is aware of the potentially significant role of socially desirable responses, which may not always fully reflect respondents’ actual views. At the same time, the survey findings are broadly consistent with the macroeconomic and social indicators confirmed by international institutions discussed above. The figures below derive from Kazakhstan Institute for Public Development face-to-face national surveys conducted in July 2026, with samples of 2,400 respondents. These results were presented during the National Think Tank Forum on August 21, 2026. Approximately 84.6 percent of respondents report feeling completely or generally safe where they live. Around 88.6 percent describe themselves as happy or rather happy, while 85.8 percent are satisfied with their lives. Some 84.1 percent assess the current situation as prosperous and stable, and 88.5 percent characterize their general mood as either very good or calm and stable. These are exceptionally high indicators of subjective well-being.
It is particularly interesting to compare these assessments of the present with expectations about the future. Here, a more cautious assessment becomes visible. This uncertainty has only partly domestic origins and may be also attributed to the broader international environment: conflicts and wars across Eurasia — including in Eastern Europe, Afghanistan, and the Middle East — as well as instability in the global economy. Approximately 60 percent expect positive changes over the coming year. Thus, while positive assessments of the present generally fall within the 84–89 percent range, confidence in further improvement is considerably lower. Most respondents regard the current situation as favorable, but a significantly smaller proportion assume that the future will automatically be better still.
One particularly important indicator concerns intergenerational comparison: 61.5 percent of Kazakhstanis believe that they are living better than their parents did at the same age. This is one of the most meaningful subjective indicators of modernization. Individuals are comparing their circumstances not with an abstract ideal, or even necessarily with conditions in other countries, but with the lived experience of the preceding generation. If a majority perceives genuine intergenerational progress — and this perception is broadly consistent with the economic and social statistics — it suggests a strong sense of upward social mobility over historical time: the country has changed, and these changes have made my life better than that of my parents’ generation. Such a perception can constitute an important source of political stability.
At the same time, however, the expectation of progress also creates pressure on the government to sustain that progress. Contemporary Kazakhstan can therefore be characterized by a somewhat unusual combination of attitudes. It is a society that is, on the whole, relatively satisfied with the present, feels reasonably secure, evaluates its own living conditions positively, and perceives substantial progress compared with the previous generation. Yet it is simultaneously becoming more urban, better educated, more digitally connected, more economically autonomous, and less exclusively dependent on state-centered employment structures. As a result, it is gradually becoming more demanding.
This, in my view, represents the central transitional point. Contemporary Kazakhstan is no longer primarily a society defined by demands for basic modernization. It is gradually becoming a society whose expectations increasingly concern the quality of education and healthcare, the urban environment, economic opportunities, public administration, and possibilities for individual self-realization.
X. Conclusion
Taken together, Kazakhstan’s socioeconomic statistics and public opinion data form a broadly coherent picture. A relatively liberal model of economic development by post-Soviet standards, with its emphasis on foreign investment and market mechanisms, has contributed to sustained economic growth. At the same time, the economy is gradually becoming more complex. The resource-based model has not disappeared, but it is evolving into a more sophisticated resource-industrial system with emerging post-industrial elements. The role of SMEs is expanding rapidly, and with it the social stratum of people whose livelihoods are increasingly connected to markets, entrepreneurship, and the private sector. As with other major episodes of modernization in human history, however, rapid development is inevitably accompanied by social tensions and unevenly distributed benefits.
Economic and social development is also becoming increasingly concentrated geographically, particularly in the country’s largest urban agglomerations. Population follows economic opportunity, and Kazakhstan is becoming a predominantly urban society. Urbanization, in turn, is transforming family structures and contributing to the rapid decline in fertility. At the same time, the country’s population continues to grow and life expectancy has increased substantially. The result is a society that remains young and demographically dynamic but is simultaneously becoming more urban and gradually more mature. Overall, it also appears to regard its present circumstances as relatively stable and prosperous.
Yet this social transformation is beginning to alter the structure of public expectations. As modernization advances, expectations rise. Kazakhstan’s modernization is gradually moving beyond the task of providing basic material goods and infrastructure toward the considerably more difficult challenge of responding to demands for quality of life, human-capital development, opportunities for individual advancement, and effective institutions.
This leads to a broader conclusion. The modernization of Kazakhstan’s economy is itself generating powerful pressures for the modernization of society and the state. Economic development produces a more urban, educated, entrepreneurial, digitally connected, and socially mobile population; that population, in turn, develops increasingly sophisticated expectations toward institutions and governance. In this sense, economic and social modernization are not separate processes. They increasingly reinforce one another, making institutional and political modernization a logical next stage in Kazakhstan’s broader transformation.