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DE RUEHTA #0125/01 0161152
ZNY CCCCC ZZH
P 161152Z JAN 07
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC PRIORITY 8179
INFO RUCNCIS/CIS COLLECTIVE PRIORITY
RUEHIL/AMEMBASSY ISLAMABAD PRIORITY 2097
RUEHBUL/AMEMBASSY KABUL PRIORITY 0283
RUEHNE/AMEMBASSY NEW DELHI PRIORITY 0413
RHEHNSC/NSC WASHDC PRIORITY
RUEKJCS/SECDEF WASHDC PRIORITY
RUEHNO/USMISSION USNATO PRIORITY 2169
RUEHVEN/USMISSION USOSCE PRIORITY 1668

C O N F I D E N T I A L SECTION 01 OF 05 ASTANA 000125 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR SCA/CEN (M. O'MARA) 
 
E.O. 12958: DECL: 01/16/2017 
TAGS: PGOV PREL KDEM KZ
SUBJECT: KAZAKHSTAN:  NEW CABINET TO MAINTAIN POLICY COURSE 
 
REF: A. ASTANA 87 
 
     ¶B. ASTANA 96 
     ¶C. ASTANA 48 
 
Classified By: CDA Kevin Milas, reasons 1.4 (B) and (D). 
 
¶1. (C) Summary:  President Nazarbayev's early January cabinet 
reshuffle will not have a major impact on Kazakhstani 
government policy, but may offer insight into the struggle 
for influence between power groups and would-be successors. 
New Prime Minister Karim Masimov is expected to maintain the 
economic policy course that President Nazarbayev has long 
charted, focusing on economic diversification and 
competitiveness.  Familiar figures named to other key 
positions, including Marat Tazhin as the new Foreign Minister 
and Daniyal Akhmetov as Kazakhstan's first civilian defense 
minister, are also expected to continue Kazakhstan's 
multi-vector foreign policy and defense reform efforts.  The 
government shake-up is more significant for the insight it 
provides into competition between elite power groups based on 
Nazarbayev sons-in-law Timur Kulibayev and Rakhat Aliyev, and 
metals magnate Aleksandr Mashkevich.  With his allies 
installed as Prime Minister, Minister of Energy and Mineral 
Resources, and at KazMunaiGaz, Kulibayev appears to be the 
clear winner of the reshuffle.  End summary. 
 
---------------- 
What Has Changed 
---------------- 
 
¶2. (C) As reported in Refs A and B, President Nazarbayev 
appointed Karim Masimov as Prime Minister on January 10 and 
named his new cabinet on January 11.  Twelve ministers 
retained their positions, including Bakhtykozha Izmukhambetov 
in the key post of Minister of Energy and Mineral Resources. 
Nazarbayev made seven new cabinet appointments: 
 
-- Marat Tazhin, most recently secretary of the Security 
Council, was named Foreign Minister, replacing Kasymzhomart 
Tokayev.  On January 11 Nazarbayev introduced Tazhin to 
Foreign Ministry staff as his "main advisor on international 
issues" who would continue Kazakhstan's multi-vector foreign 
policy.  Known as a master of Kazakhstan's political system, 
Tazhin has until now held posts out of the public eye, 
including a brief stint as chairman of the Committee for 
National Security (KNB), where current Deputy Foreign 
Minister Rakhat Aliyev was his very troublesome deputy, and a 
long tenure as Deputy Head of the Presidential Administration 
(2002-2006).  Tazhin, a fluent English speaker, has never 
held a diplomatic post.  Tazhin's protege Nurlan Yermekbayev, 
head of the Foreign Policy Center of the Presidential 
Administration, was named Deputy Foreign Minister.  There has 
been no announcement of whom Yermekbayev is to replace, 
although it is rumored that Deputy Foreign Minister Aliyev 
may depart. 
 
--  Aslan Musin was appointed Deputy Prime Minister, while 
retaining the position of Minister of Economy and Budget 
Planning that he has held since last October.  Musin, who 
served as Akim of both the Aktobe and Atyrau oblasts, 
possesses extensive regional economic experience that is 
expected to complement Masimov's expertise in finance.  In 
his January 11 speech to Parliament, Nazarbayev challenged 
the cabinet to increase budget planning efficiency and to 
create a new system of center-regional budget relations -- 
areas in which Musin may be able to make a significant 
contribution.  Some post contacts maintain that Musin, whose 
limited experience in Astana makes him a somewhat surprising 
choice for the Deputy Prime Minister position, was chosen in 
order to maintain balance among the three main Kazakh clans 
("zhuz") at the top level of government.  (Note:  Musin is an 
influential representative of the "Younger" clan, dominant in 
western Kazakhstan, as is Tazhin. Nazarbayev and Tokayev are 
both from the "Elder" clan, from southeastern Kazakhstan. 
Mazhilis speaker Mukhamedzhanov represents the "Middle" clan, 
from the northeastern part of the country.  As an ethnic 
Uighur, Prime Minister Masimov is outside the clan system. 
End note.)  Other observers point to Musin's reported ties to 
Rakhat Aliyev and Dariga Nazarbayeva and see him as a 
counterweight to Masimov, known to be close to Timur 
Kulibayev. 
 
-- Daniyal Akhmetov, the former Prime Minister, was appointed 
 
ASTANA 00000125  002 OF 005 
 
 
as Kazakhstan's first civilian Defense Minister.  In 
announcing the appointment, Nazarbayev said that his decision 
conformed to the international practice of having civilians 
handle policy and management.  The former Defense Minister, 
Mukhtar Altynbayev, remains the senior uniformed member of 
the Armed Services while becoming First Deputy Defense 
Minister -- an appointment that many observers do not expect 
to last given the almost inevitable tension between the men 
and the fact that Altynbayev is nearing retirement age.  The 
press has suggested that Akhmetov, who has never been 
involved in any public corruption scandals, may undertake an 
anti-corruption crusade within the military.  Before serving 
as Prime Minister from 2003-2007, Akhmetov served as Akim of 
the Pavlodar (1993-1997 and 2001-2003) and North Kazakhstan 
(1997-1999) oblasts, as well as Deputy Prime Minister 
(1999-2000).  He was the highest-ranking representative of 
the "Middle" clan in the previous government, and is closely 
linked to metals magnate Aleksandr Mashkevich.  Post sees the 
appointment of a civilian as Defense Minister as an important 
milestone in Kazakhstan's defense reform efforts. 
 
-- Galym Orazbakov replaces Vladimir Shkolnik as Minister of 
Industry and Trade.  Orazbakov, only 42 years old, previously 
served as Deputy Minister of Economy and Trade (2001-2002) 
and of Industry and Trade (2002-2003), where he was head of 
Kazakhstan's WTO negotiation team.  Since 2003, he has worked 
as President of the private "Kazakhstan Engineering" firm. 
Orazbakov, a member of the "Elder" clan, is believed to be 
related to Abykayev.  It is not yet known whether Orazbakov 
will retain Deputy Minister Zhanar Aitzhanova, the lead 
negotiator on WTO accession.  (Shkolnik, a longtime 
Nazarbayev confidante, was appointed a deputy head of the 
Presidential Administration on January 12; his portfolio has 
not been announced.) 
 
-- Zhanseit Tuymebayev, formerly ambassador to Russia, 
replaces Berganym Aitimova as Minister of Education and 
Science.  Tuymebayev is a career diplomat, who served as 
Chief of Presidential Protocol prior to his February 2006 
appointment to Moscow.  A PhD in philology, Tuymebayev has 
conducted extensive research on the Kazakh language.  Media 
analysts have suggested that Aitimova may have lost her job 
due to her failure to effectively fight corruption in the 
universities.  Given the lack of significant criticism of 
Aitimova, it is more likely that Nazarbayev simply needed to 
free up a ministerial post for Tuymebayev in order to send 
former Senate speaker Nurtay Abykayev to Russia. 
 
-- Viktor Khrapunov replaces Shalbay Kulmakhanov as Minister 
of Emergency Situations.  Khrapunov, a member of the "Middle" 
clan, previously served as Akim of the East Kazakhstan Oblast 
(2004-2007), Akim of Almaty City (1997-2004), and Minister of 
Energy and Coal (1995-1997).  Nazarbayev's decision to 
"demote" Khrapunov from Almaty to East Kazakhstan in 2004 was 
widely seen as a sign that Khrapunov had not yet mastered the 
political game; he came in for particular criticism for crude 
violations during the 2004 parliamentary elections.  Given 
that the Ministry of Emergency Situations is seen as a 
political backwater, Khrapunov's latest appointment is likely 
a sign that his performance has not improved.  Many observers 
are puzzled as to how Khrapunov, who is known to be quite 
corrupt (industry sources tell post that as akim he directly 
solicited a bribe from a distributor in Ust-Kamenogorsk), has 
managed to stay in government.  His wife's reported close 
friendship with Dariga Nazarbayeva may be one explanation. 
 
 -- Yerbol Orynbayev was named Chief of the Prime Minister's 
chancery, the only non-ministerial cabinet position. 
Orynbayev replaces Altay Tleuberdin in the relatively 
low-profile job.  Orynbayev, born in 1971 in Shymkent and 
thus a representative of the "Elder" clan, holds a law degree 
from Moscow State University (1993) and a Master's in 
international development from Duke (2002).  He previously 
served as Deputy Minister of Economy and Budget Planning 
(2002-2003), chairman of the board of directors of the Center 
of Marketing and Analytical Studies (2003-2004), and in 
positions of increasing responsibility in the Presidential 
Administration, most recently as Deputy Head with 
responsibility for economic policy (2006-2007).  Orynbayev 
worked closely with Masimov on the international board of 
advisors for the Almaty Financial Center and on the 
government working group on administrative reform, and is 
thus expected to focus on economic and administrative reform 
 
ASTANA 00000125  003 OF 005 
 
 
issues. 
 
¶3. (C) In perhaps the most surprising move, Nazarbayev 
appointed former Minister of Foreign Affairs Kasymzhomart 
Tokayev to replace Nurtay Abykayev as Speaker of the Senate. 
(Under the Constitution, Nazarbayev can appoint up to seven 
senators.  The Speaker is first in line of presidential 
succession.)  Some media analysts have claimed that Tokayev 
is an ally of Rakhat Aliyev and thus intended as a 
counterweight to the Masimov-Kulibayev camp.  Given the 
obvious tensions between Tokayev and Aliyev during their 
coexistence at the MFA, however, that theory holds no water. 
Tokayev is known as a smart, honest, and relatively 
politically unambitious figure whom Nazarbayev can therefore 
trust to be a heartbeat away from the presidency.  Abykayev's 
transfer to Moscow is widely seen as punishment for his 
failure to prevent his staffer Yerzhan Utembayev from 
ordering the February 2006 murder of opposition leader 
Altynbek Sarsenbaiuly and bringing international criticism on 
the Kazakhstani government. 
 
¶4. (C) Confusion and controversy surrounded Nazarbayev's 
appointment of Berik Imashev, formerly the deputy head of the 
Presidential Administration for legal affairs, to replace 
Tazhin as chairman of the Security Council.  On January 11, a 
decree was posted on the Presidential Administration website 
naming current Ambassador to the U.S. Kanat Saudabayev to 
that position, and numerous news outlets reported the story 
as fact.  On January 12, with no explanation, the original 
decree was replaced with one naming Imashev to the post. 
Imashev, 46, holds a law degree from Moscow State University 
(1982).  He worked his way up through the procuracy and later 
the Financial Police before working in the private sector 
during the mid-1990s.  Imashev served as deputy secretary of 
the Security Council (2003-2005) before moving to his most 
recent job at the Presidential Administration. Imashev is a 
stern individual whose department is thought to have drafted 
much of the legislation considered damaging to human rights 
in the past two years.  His daughter Aida (born 1984) is 
married to Rakhat Aliyev and Dariga Nazarbayev's son Nuraly 
(born 1985), making Imashev the grandfather of President 
Nazarbayev's great-grandson Alan (born 2005). 
 
-------------------- 
What Has Not Changed 
-------------------- 
 
¶5. (U) Twelve ministers retained their positions: 
Bakhtykozha Izmukhambetov, Energy and Mineral Resources; 
Baurzhan Mukhamedzhanov, Internal Affairs; Yermukhamet 
Yertysbayev, Culture and Information; Natalya Korzhova, 
Finance; Zagipa Baliyeva, Justice; Anatoliy Dernovoy, Health; 
Akhmetzhan Yesimov, Agriculture; Gulzhana Karagusova, Labor 
and Social Protection; Serik Akhmetov, Transportation and 
Communications; Nurlan Iskakov, Environment and Natural 
Resources; Temirkhan Dosmukhanbetov, Tourism and Sports; and 
Musin at Economy and Budget Planning. 
 
¶6. (U) There were no changes at the top of the key agencies 
and committees.  Head of the Presidential Administration 
Adylbek Dzhaksybekov, KNB Chairman Amangeldy Shabdarbayev, 
Financial Police head Sarybay Kalmurzayev, Chairman of the 
Financial Supervision Agency Arman Dunayev, and Civil Service 
Agency head Zautbek Turisbekov all retained their positions. 
Procurator General Rashid Tusupbekov and Supreme Court Chief 
Justice Kairat Mamy are appointed by Parliament and thus were 
not affected by the cabinet reshuffle. 
 
------------------------ 
What It Means for Policy 
------------------------ 
 
¶7. (C) In Kazakhstan, the Prime Minister is primarily 
responsible for coordinating economic policy.  On paper, all 
ministers report to him.  In reality, however, ministers 
dealing with foreign policy and security issues work directly 
with the Presidential Administration.  Even in the economic 
realm the Prime Minister, because he is appointed by the 
president and has no electoral legitimacy of his own, has no 
authority to chart his own policy course.  Masimov, an ethnic 
Uighur, underscored his loyalty to Nazarbayev and his 
policies during the January 10 joint session of parliament 
when he placed his hand over his heart and stated "You showed 
 
ASTANA 00000125  004 OF 005 
 
 
great trust in me when you named me your aide.  I want to say 
that I was, am, and will remain your loyal assistant."  In a 
conversation with Pol-Econ Chief, True Ak Zhol co-chairman 
Tulegen Zhukeyev, himself a former chairman of the Security 
Council, described the gesture with disgust as that of a 
"slave," something that "a Kazakh would never do." 
 
¶8. (SBU) Masimov's authority will thus be limited to the 
economic realm, within the policy limits set by Nazarbayev 
and the Presidential Administration.  Although Masimov is 
well known to post as a liberal, reform-oriented individual 
with a positive attitude toward the West, it is not realistic 
to expect his influence to extend to the political realm or 
questions of democratic reform.  Other cabinet-level changes 
are not likely to have either a positive or negative impact 
on the reform process, as it is being orchestrated by the 
Presidential Administration  (Ref C).  Likewise, most 
observers do not expect significant changes in the country's 
economic policy as a result of the switch, as Nazarbayev's 
decision to replace former Prime Minister Akhmetov is seen as 
a routine change after 3.5 years rather than a condemnation 
of his performance.   During the January 11 parliamentary 
session, Nazarbayev set out a familiar list of priorities for 
the new government, including pursuing Kazakhstan's objective 
to be among the 50 most competitive countries in the world, 
the need to improve state planning and development programs, 
support for regional development based on "centers of 
economic growth," economic diversification, affordable 
housing, fair rules for land sales, creation of a pilot 
program of civic-oriented entrepreneurial corporations, 
increased efficacy in budget planning, improving education 
and health care, strengthening the pension system, and job 
creation. 
 
-------------------------- 
What It Means for Politics 
-------------------------- 
 
¶9. (C) The cabinet changes have touched off a great deal of 
debate about the battle for succession.  While Nazarbayev's 
decision to appoint Karim Masimov as Prime Minister is a 
clear vote of confidence in his political and managerial 
skills, it does not necessarily augur a bright political 
future for Masimov beyond his current posting.  It is highly 
unlikely that anyone other than an ethnic Kazakh could be 
chosen as Nazarbayev's successor.  (There has already been 
criticism in the parliament of the fact that Masimov does not 
speak fluent Kazakh.)  Masimov's appointment thus says more 
about the ascendant position of his main backer, first 
son-in-law Timur Kulibayev, than it does about his own 
prospects.  Kulibayev himself controls the giant Samruk 
holding company -- which includes KazMunaiGaz -- and his 
allies now hold the key revenue-controlling positions of 
Prime Minister and Minister of Energy and Mineral Resources. 
 
¶10. (C) Kulibayev's primary rival, Dariga Nazarbayeva's 
husband Rakhat Aliyev, appears to have come out on the losing 
end of the reshuffle.  While he has some allies in key 
positions, namely Deputy Prime Minister Musin and Security 
Council chairman Imashev, he has also seen rivals such as 
Tazhin and Tokayev retain positions of great influence. 
Aliyev, who has been First Deputy Foreign Minister since 
2005, is rumored to be on his way back to "honorable exile" 
in Vienna where Nazarbayev sent him in 2002 following 
accusations that Aliyev was plotting to seize power.  Some 
believe he is being punished for mismanaging Kazakhstan's bid 
to chair the OSCE; others see the changes as delayed 
retribution for his rumored involvement in the Sarsenbaiuly 
murder. 
 
------- 
Comment 
------- 
 
¶11. (C) Comment:  Kazakhstani politics are particularly 
opaque due to the closed nature of the clan system, the tight 
family relationships among the elite, and the shortage of 
political analysts and investigative journalists with any 
first-hand knowledge of events.  The maneuverings that are 
visible to outsiders are merely the surface ripples of an 
enormous struggle that takes place far beyond the public eye. 
 Nevertheless, a few things are clear:  the Kazakhstani elite 
are beginning to maneuver into position to succeed 
 
ASTANA 00000125  005 OF 005 
 
 
Nazarbayev, and -- for now -- the Kulibayev camp appears to 
be playing the game most successfully. 
MILAS