VZCZCXRO8491
RR RUEHLN RUEHVK RUEHYG
DE RUEHTA #0703/01 1011057
ZNR UUUUU ZZH
R 101057Z APR 08
FM AMEMBASSY ASTANA
TO RUEHC/SECSTATE WASHDC 2201
INFO RUCNCIS/CIS COLLECTIVE 0468
RUEHAST/USOFFICE ALMATY 0376

UNCLAS SECTION 01 OF 02 ASTANA 000703 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: SENV ECON ENRG EPET KZ
SUBJECT: KAZAKHSTAN ENVIRONMENT UPDATE, FEBRUARY-MARCH 2008 
 
ASTANA 00000703  001.2 OF 002 
 
 
¶1.  Summary:  This information is drawn primarily from the 
Kazakhstani press and has not been verified. 
 
-- Koksaray Water Reservoir To Be Built in South Kazakhstan 
-- Ecological Tax To Replace Pollution Fees 
-- Kazakhstan Expects Russia To Cut Toxic Rocket Fuel Use 
-- Science Funding To Soar By 2015 
-- Environment Minister Discusses Cooperation with EU 
-- Kazakhstani Government To Introduce Sturgeon Monopoly 
-- Health, Environment Issues at ArcelorMittal 
 
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Koksaray Water Reservoir To Be Built in South Kazakhstan 
---------------------- --------------------------------- 
 
¶2.  Prime Minister Masimov announced plans on March 18 to move 
forward in building the Koksaray water reservoir in South 
Kazakhstan.  This reservoir will be aimed at controlling water flow 
from the Syrdarya River.  Every spring, South Kazakhstan suffers 
from flooding because excessive water comes from the Syrdarya River, 
which the Shardaryinskoye water reservoir cannot store.  In summer, 
the situation is the opposite, with South Kazakhstan suffering from 
drought.  The new water reservoir will address both of these 
problems. Alongside construction of the Koksaray reservoir, 
Kazakhstan plans to press ahead with the Central Asian Water and 
Energy Consortium initiative to regulate water distribution in the 
Central Asia region.  On April 4, Express-K newspaper reported that 
Kazakhstani environmental protection experts were expressing 
discontent with constructing the Koksaray reservoir.  They fear that 
this project might hamper their efforts to restore the Aral Sea.  On 
April 8, President Nazarbayev effectively ended the debate by 
announcing that the Koksaray reservoir will, in fact, be built.  He 
noted that by protecting Southern Kazakhstan and Kyzylorda Oblasts 
from spring floods, the reservoir will save the government $100 
million annually in rescue and reconstruction costs. 
 
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Ecological Tax To Replace Pollution Fees 
------------------ --------------------- 
 
¶3.  Environmental Protection Minister Iskakov on February 5 
reaffirmed Kazakhstani government plans to introduce an ecological 
tax to replace pollution fees in accordance with the German 
experience.  This tax would aim to promote renewable sources of 
energy (wind, hydropower, solar energy, biofuels) and stimulate 
production of environmentally-friendly products.   On February 22, 
Iskakov said that the new ecological tax would be included in 
Kazakhstan's new tax code, which is being developed this year in 
accordance with President Nazarbayev's February state of the nation 
address.  Iskakov also announced that the government is developing a 
draft law on supporting alternative sources of energy, which he 
expects parliament will adopt this Fall.   In an April 1 interview 
given to Business and Vlast business weekly, Iskakov focused on the 
advantages of an ecological tax over existing pollution fees.  He 
noted that pollution fees currently bring in annual revenues of 30 
billion tenge (approximately $250 million), but only a small part of 
these revenues are used to fund environmental protection programs. 
 
---------------------- ------------------------------- 
Kazakhstan Expects Russia To Cut Toxic Rocket Fuel Use 
---------------------- ------------------------------- 
 
¶4. Interfax reported on February 18 that the Kazakhstani government 
will approve a plan for Russian Proton rocket launches from the 
Baikonur space center for the second half of 2008 only after the 
Russian Space Agency (Roskosmos) offers proposals on gradually 
reducing rocket launches that use unsymmetrical dimethylhydrazine 
(UDMH) as a propellant.  Kazakhstani National Space Agency chief 
Talgat Musabayev said that Kazakhstan had not yet received the 
proposals promised by Roskosmos.  Russia and Kazakhstan signed an 
intergovernmental agreement in 2004, one of the provisions of which 
implies a gradual reduction in the number of rocket launches from 
Baikonur using the highly-toxic UDMH propellant. 
 
------------------------------- 
Science Funding To Soar By 2015 
------------------------------- 
 
¶5.  On March 17, Interfax reported that the Ministry of Education 
and Science plans a 10-fold increase in science funding by 2015, 
from 0.26 percent of GDP at present to 2.5 percent of GDP. 
Education and Science Minister Tuimebayev told the Majilis (i.e., 
the lower house of parliament) that current science funding was 
inadequate and well below the levels of developed countries. 
Quoting data from independent experts, Tuymebaev argued that if a 
country's research and development expenditures do not exceed 1 
percent of GDP for 5-7 years, an irreversible decline in scientific 
potential may occur. 
 
---------------------- --------------------------- 
Environment Minister Discusses Cooperation with EU 
---------------------- --------------------------- 
 
ASTANA 00000703  002.2 OF 002 
 
 
 
¶6.  On February 26, Environmental Protection Minister Iskakov met EC 
Head of Delegation to Kazakhstan Adriaan van der Meer and a European 
Commission delegation to discuss cooperation in environmental 
protection.  Iskakov asked for EU assistance in developing renewable 
energy sources in accordance with EU standards, establishing a solar 
center, and introducing ecological taxes based on German experience. 
 Van der Meer informed Iskakov about the intention of the German, 
Norwegian, and Dutch governments to act as co-founders of a regional 
ecological center in Central Asia, and expressed hope for 
Kazakhstan's support for the initiative. 
 
----------------------- ----------------------------- 
Kazakhstani Government To Introduce Sturgeon Monopoly 
----------------------- ----------------------------- 
 
¶7.  Interfax reported on March 13 that the Kazakhstani government 
had presented parliament a draft law on the fishing industry, which 
includes provisions for establishing a state monopoly on purchase of 
sturgeon, as well as processing and sale of caviar.  Implementation 
of the law will require 6.3 billion tenge (approximately $52.5 
million) in budget funding.  According to Deputy Agriculture 
Minister Kurishbaev, a state monopoly will enhance control over 
sturgeon reproduction, sturgeon farm operations, and sturgeon 
resources.  It will also ensure supply of the domestic market with 
fish products in line with world standards. 
 
¶8.  It was reported on March 7 that a new sturgeon plant will be 
built in west Kazakhstan to preserve sturgeon in the Ural-Caspian 
basin and organize commercial sturgeon breeding. According to Kanat 
Suleimenov, the chairman of the Agricultural Ministry's Fisheries 
Committee, the plant will also breed and preserve young sturgeon. 
Its capacity will be 15-20 million young sturgeon a year.  Today 
there is only one sturgeon plant in west Kazakhstan. 
 
---------------------- -------------------- 
Health, Environment Issues at ArcelorMittal 
---------------------- -------------------- 
 
¶9.  Interfax reported on February 22 that the Karaganda sanitary 
control department had revealed violations of labor health standards 
at eight coal mines operated by ArcelorMittal Temirtau. 
Arcelor-Mittal was fined 78,624 tenge (approx $650) for failure to 
meet workplace health standards.  Environmental Protection Minister 
Iskakov met on February 26 with ArcelorMittal senior management to 
discuss the company's pollution permit for 2008.  The company was 
notified about the time period within which it must improve its 
environmental protection efforts. 
 
ORDWAY