Is it possible and is it necessary to sell agricultural land in Kazakhstan, which includes foreigners?

     I believe that it is possible and necessary.


     Firstly, because the land is now mostly used by peasants, which means that it can be withdrawn by the state. Such unstable situation in any waydoes not contribute to a careful treatment to the land and its cultivation with an eye towards many years, but on the contrary stimulates taking advantage of itquickly and exhaust it. Only private ownership of land will encourage it to make long-term investments in it.

     Secondly, private ownership of land will allow to involve this resource in a full-fledged financial rotation. Private land can be pledged to the bank and receive loan for it. Such pledge will be much more attractive than a pledge of long-term lease rights. Banks will be more willing to lend money to the peasants.

     Thirdly, the opening of the land market will attract foreign investors to the agribusiness of Kazakhstan, which will positively affect the situation in this sector of the economy, will attract new technologies, and facilitate transparent legal regulation of land relations.

     Why do many Kazakhstanis oppose the sale of agricultural land to private ownership, especially foreigners?

     Most often the following arguments are mentioned:

     1. With the sale of farmland, Kazakhstanis will lose their main national resource – land.

      I do not quite understand this argument. What does “lose” mean? Can a foreigner take the land abroad? No. What he can do with it? If he has already invested money in it, and this land has a strictly designated purpose, then he has nothing left to do but plow on it and, roughly speaking, feed us all through taxes and through a salary to the local wage-workers. In this situation, does anyone care who owns this particular land: Kazakhstani –Vasily Samoilovich Rozinov, a Russian – Elena Baturina or some Dutchman – Guus Hiddink? Whoever the owner is of the land, if it is used for the intended purpose, is cultivated in compliance with technology and gives a surplus product to the economy of the country, then essentially we do not need to know anything about the owner. Both Kazakhstaniand a foreigner can take the net profit from agribusiness abroad and buy there their own villa. From this point of view, there is no difference between them. This has long been understood in all developed countries. Any governor of the German land or of the Swiss canton will welcome a Kazakh, American or Chinese investorwith open arms, if he says he wants to buy land and grow agricultural products on it. “Please come, buy, and work … for us,” he says, smiling slyly. And we, on the contrary, drive away the foreigners who came to us with a bag of money.

     2. Selling the land to foreign investors can lead to an influx of foreigners and the erosion of indigenous nationality.

     Of course, as a Kazakh such perspective is not fine with me at all. Let’s call things by their names, we are talking about the Chinese. Indeed, moving just one hundredth of the population of this neighboring country is enough to assimilate the entire nation of Kazakhstan.

     However, let’s think a little, is there a cause-and-effect relation here?

     It seems to me that many people confuse two concepts: investing in the economy and attracting foreign labor. These two things are separated in the law and should be perceived by us separately. When a Chinese investor buys a piece of land – this is called investment and in every way we are open for them, because money from outside our country goes into our economy, therefore, make us all a little richer. When the same Chinese investor tries to import Chinese workers to work on his own land, this is called attracting foreign labor. This process is regulated by Chapter 7 of the Law of the Republic of Kazakhstan “On Employment of Population”, Chapter 6 of the Law “On Migration” and the applicable regulations of the Criminal and Administrative Code. To put it simply, a land purchase by a foreign investor does not give him automatic right to attract citizens of his country to Kazakhstan to work on this land. He will, like any other subject, apply to the local commission on employment to engage every worker. And there, everything depends on our state bodies, how to regulate the process of foreigners’ influx into our country.

     3. Agricultural products will be sold abroad.

     Some Kazakhstanis express their fears that a foreign land owner will take, produced agricultural products abroad and thereby create a deficit in our country, which will lead to an increase in prices. I think that this argument is not backed by economic logic. No foreign businessman will export grain abroad and sell it for $140, if in Kazakhstan the market price was set around $150. Naturally, he will sell it here at a higher price. And the other way round, not a single Kazakh businessman will sell wheat for patriotic reasons here, in Kazakhstan for $140, if he can get $150 abroad. This is happening now by the way. We just do not know about it or do not think about it. All agricultural products in our country freely cross the border and are sold where the price is higher by its owners. Therefore, fears of exporting food abroad with the sale of land to foreigners are groundless.  

     Moreover, the export of goods abroad has always been considered and is considered to be a positive factor for the country’s balance of payments and, therefore, for the economy as a whole. Last year, we were worried that we did not know how to produce and export anything other than oil, so we are now in trouble. The more we will sell more diverse products for export, the more foreign currency will flow into the country, which means that our national currency and the economy as a whole will be stronger. Therefore, we must in every way welcome and encourage the production of agricultural products to the maximum extent possible, so that it will be enough for us and some left for export.

     4. Foreigners will oppress local residents.

     I had to hear this kind of an argument: foreigners will buy out all the land around villages and will not allow local residents to step on their own native land. I believe that this argument is more colored in emotional tone, rather than has a reasonable ground.

     In accordance with the Land Code of the Republic of Kazakhstan in regards of the lands of any owner: Kazakhstani or foreign, an easement can be used. That means the right to use this land by other people for passage, transit, cattle driving, communication line laying, etc., if there is no other way or it is difficult. The cases of providing easement are clearly spelled out in Article 69 of the Code. There are no exceptions for foreigners. Then why are we afraid that there will be problems with getting the cattle through the land of foreign owner, but there will be no problems with the Kazakh one? I think that there are some stereotypes that are not based on regulatory or other grounds.

     Based on the abovementioned, I think that it should be allowed to sale the agricultural land to foreigners in Kazakhstan.

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