VZCZCXRO1276
RR RUEHLN RUEHVK RUEHYG
DE RUEHTA #0614/01 0811003
ZNR UUUUU ZZH
R 211003Z MAR 08
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 2110
INFO RUCNCIS/CIS COLLECTIVE 0446

UNCLAS SECTION 01 OF 02 ASTANA 000614 
 
SIPDIS 
 
DEPARTMENT FOR OES/STC, SCA/RA, AND SCA/CEN 
 
SENSITIVE 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: TSPL PREL PGOV KSCA KZ
SUBJECT:  KAZAKHSTAN - SCIENCE AND TECHNOLOGY COOPERATION OVERVIEW 
 
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Summary 
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¶1. (SBU) EST Officer's January 20 - February 19 TDY visit to 
Kazakhstan provided a timely opportunity to discuss the Kazakhstani 
government's science and technology (S&T) infrastructure, 
particularly in light of continued negotiations on a bilateral 
Science and Technology Agreement.  Kazakhstani officials expressed a 
strong desire to continue and expand cooperation with the U.S. on 
S&T issues.  Kazakhstan is interested in cooperating with the U.S. 
on fundamental sciences as well as applied areas, including 
information technology and communications (ITC), oil and gas, 
biotechnology, nanotechnology, atomic and nuclear research, space, 
health, and metallurgy and mining.  The Kazakhstanis appear to be 
strongest in the biotechnology, oil and gas, and nuclear fields as 
these receive broad government support.  Kazakhstani officials made 
it clear they would be interested in broad U.S. representation when 
the first Joint Committee Meeting (JCM) is held to clarify the 
mechanisms on how to make a bilateral S&T agreement work to its 
fullest potential.  This cable is the first of a series of four 
cables summarizing EST officer's meetings in Kazakhstan.  End 
Summary. 
 
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Bilateral S&T Agreement 
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¶2. (SBU) The U.S. and Kazakhstan have been discussing a bilateral 
Science and Technology Agreement since late 2003.  The two sides 
largely agreed some time ago on the text of the S&T Agreement; 
however, the Kazakhstanis refused to accept tax exemption language, 
as required by U.S. law, which prohibits the taxation of foreign 
assistance.  In preparation for Prime Minister Masimov's March visit 
to Washington (which was ultimately cancelled), the Ministry of 
Foreign Affairs appeared to have persuaded the other relevant 
ministries to reverse course and agree to incorporate a tax 
exemption into the S&T Agreement.  The Kazakhstanis are optimistic 
that the S&T Agreement will thus be ready for signature by the 
Summer of 2008. 
 
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R&D Policy in Kazakhstan 
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¶3. (SBU) Kazakhstani research and development (R&D) goals include 
the diversification of Kazakhstan's economy, the development of high 
tech basic industry, and an increase in research expertise.  Basic 
research areas of focus include mathematics, physics, biology, and 
chemistry.  Kazakhstani officials hope to increase the number of 
students attending U.S. universities as part of the country's effort 
to strengthen its basic research sector.  The Kazakhstani government 
established the Bolashak (Future) Program in the 1990's which 
currently sends 3000 students per year to study abroad at foreign 
universities.  A large percentage of Bolashak students go to the 
U.S., where they study a wide range of topics, from the sciences to 
finance. Approximately two percent of the national budget has been 
committed to R&D. 
 
¶4. (SBU) Kazakhstan has established a Science Development Program 
for 2007-2012. The aims of the program include: upgrading research 
infrastructure; training highly qualified research and engineering 
personnel; increased R&D funding, including private investment; 
improvement of the regulatory framework for R&D activities; and 
building an information environment favorable for R&D. 
 
¶5. (SBU) In order to upgrade infrastructure, a network of five 
national research labs for collective use and 15 engineering labs 
will be set up at local universities.  They will be fully equipped 
and meet best international standards.  Universities will set up and 
develop advisory centers for small- and medium-sized enterprises 
(SME's), centers of advanced research, technology transfer 
departments, student development labs, and small innovation 
enterprises to produce new types of products.  By 2012, the 
government plans to upgrade material and technical resources of all 
state research centers and research institutes. 
 
¶6. (SBU) Another important aspect in Kazakhstan's Science and 
Technology Development Program is the training of highly qualified 
research and engineering personnel. Kazakhstan's aim is to train 
young people in research and engineering professions that are in 
line with national priorities in R&D and industrial and innovation 
development.  Kazakhstan also hopes to recruit local and foreign 
research and engineering personnel to work in new national research 
labs and design and development bureaus. An additional facet of 
Kazakhstan's S&T development includes retraining and continued 
professional development of specialists in a number of new 
functional directions and research areas, including 
commercialization of research products. 
 
ASTANA 00000614  002 OF 002 
 
 
 
¶7. (SBU) The government will provide targeted and selective funding 
for promising research projects which will be administered by the 
Ministry of Education and Science, which will support fundamental 
and applied research, and the Science Fund, which will support 
initiative and abstract applied research. The national research 
system, which has been mainly funded by the government, is be 
diversified through private co-financing. To attract private 
investments, the Science Fund, or the Ministry of Education as 
national budget program administrator, will call for proposals from 
local enterprises interested in research products.  The winning 
company will provide 50 percent funding for the project chosen. The 
Science Fund's share of all governmental budget allocations for 
development will be increased up to 25 percent by 2010. The total 
budget of the Science Development Program in 2007-2012 is KZT 44 
billion ($361.5 million). 
 
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Comment 
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¶8. (SBU) Kazakhstan has invested a significant amount of money into 
the development of a strong S&T infrastructure and has plans to 
increase investment in the near future. It was readily apparent in a 
number of meetings that Kazakhstani officials have a strong desire 
to use the petro-dollar windfall to diversify Kazakhstan's economy 
by strengthening its science and technology sector. In many ways, 
however, there is still a strong disconnect between education and 
research, a legacy of the USSR.  Upon independence, Kazakhstan did 
inherit strong agro-biotechnology and nuclear industries. These 
areas are where Kazakhstan shows the greatest potential for 
international cooperation, not only because of their strong funding, 
but also because of the large number of Soviet trained specialists 
who work in these centers.  Because of Kazakhstan's long term goals, 
the fields of ITC, oil and gas, nanotechnology, space, health, and 
metallurgy and mining will also play important roles and may be 
other avenues for future S&T cooperation.  End Comment. 
 
ORDWAY