As I reported earlier, Russia is building a new cosmodrome and in the future will only use Baikonur for about 11% of its space flight. One wonders what they will do in the Kazakh launch pad to deserve a large majority stake which would allow them to outvote other shareholders.

I realize that there is a world food price crisis right now, but every since I arrived here 5 years ago there has been inflation in food prices at a rate visible to the consumer.

The government is taking measures to combat inflation in food prices (one participant at the meeting with Massimov told me that it was reported to the Prime Minister that potatoes from Pavlodar cost more in Pavlodar itself than they do in Almaty!). But they are mainly targeting food producers, and the food producers blame the stores. But of course the smaller stores and sellers at markets and bazaars feel that they can’t cut into their profits anymore.

Personally, I suspect that the speed with which prices grow indicates that it is the supermarkets that are to blame. Even if a producer or distributor hiked its prices, it would take time for that to trickle down to the consumer. However I’m not an economist. I do hope the government will conduct some detailed research into where the mark-ups on food is coming from.

The Ministry of Agriculture is also proposing government sales of food, for the state to stockpile food and sell it off at below-market prices. However this seems like a stop-gap measure at best. For it to be sustainable, the government would have to buy food at the same price they are selling it at, and that would ultimately hurt the food producers.

Frankly, it seems to me that inefficiency is a major problem. I was amazed today to watch a woman at the supermarket cutting up price tag signs from a sheet of A4 paper. And early on a weekend morning, when the store was practically empty, there were nevertheless 3 security guards standing at the cashiers, ready to watch over every purchase, if one happened to occur. Not to mention, all the counter women who are busy wrapping and labeling cheese and salads and meat-but won’t stop for 5 seconds to help a customer. In a lot of cases, the cheese or meat or whatever is already packaged, and labeled, but the customer still has to ask someone to give it to them because it’s closed away in a case.

If I were a businessman, I would certainly introduce the idea of shifts, hourly wages, and more self-service to Kazakhstani businesses.

And yes, I often don’t buy things because I have to wait for help. I also don’t buy a lot of meat anymore. Ironically, Kazakhstan has taught me to be a vegetarian.

1. In Kazakhstan, it’s not uncommon to have a ten minute phone call to set up a time for a meeting that lasts five minutes. Email and telephones are still not considered to be reliable or formal forms of communication. More and more in the West, people are using technology to avoid meetings. But here face-to-face meetings are still valued even if there are more efficient ways to transmit information. Interestingly, a number of expats I know prefer to communicate by email or at least text message because of the language barrier. If something is written down in Russian or Kazakh or bad English, they have time to analyse it and double check it, whereas in a phone conversation or face-to-face meeting you don’t always realize that you have misunderstood something.
2. It is not rude or pushy in Kazakhstan to call someone to tell them you are emailing something, then calling them a minute later to ask if they got the email, and calling a third time 5 minutes later to ask if they have replied. Some of this behavior has to do with the fact that the Internet is not as reliable here as it is in the West (and yes, in the US the Internet does go out sometimes too). Some of it I suspect is due to the mistrust of a new technology since it especially seems to be older people who do this. I also think it points to a difference in prioritizing tasks.
3. I did this thought experiment about priorities at work. What order would you do the following tasks in?
   1. email a client with a one sentence answer to a question
   2. edit a 2 page document for a peer that you have already been working on for 2 days
   3. Call a partner organization to let them know that the time and place of a meeting you have tomorrow with them have changed.
   4. Prepare for that meeting
   5. start a 10 page analysis that the head of the company has asked you to do.

   These are basically in the order that I would do these tasks. Get the quick (1 and 2) and urgent (3 and 4) tasks out of the way before dealing with a big task (5). However, many Kazakhstani at the meeting put task 5 first because the boss ordered it. They felt that preparing for a meeting tomorrow was not an urgent task at all. And a report for your peers had low priority. Many did say they would write the client first because it would take so little time. So one major area of miscommunication might be in agreeing on the priority of tasks. Your colleague who is bugging you to answer his email may feel that his task is important and should be finished immediately.

4. A final issue that comes up frequently is the lack of negotiation on the part of local staff. Many expats feel that the Kazakhstan side never compromises or negotiates, but expects compromises. When Kazakhs are told, “We can’t do that,” or, “We don’t want to do that,” these are not taken as serious excuses. Foreign consultants and freelancers often cite a feeling that local businesses think they work directly for them and can be given any amount or range of work outside the original agreement. Local companies rarely try to negotiate or convince workers to take on extra work by offering more money, or easier working hours or any other benefits. Overall the idea of what constitutes a reasonable workload, a reasonable salary, and reasonable demands on workers seem to be very different.

So those are a few of the issues that came up frequently and that seemed to resonate well with the Kazakh managers. A lot of people told me they had never thought of this behavior as strange or unreasonable.

At the risk of ending up with lots of comments just complaining about Kazakhstan, what do you readers find hard about working here? And to be fair, what do local people think is weird, rude or unreasonable about foreign workers?

Who says it’s just the Chinese that are into copyright violation and trying to trick customers? These boxers are made right here in the Republic of Kazakhstan and they aren’t too badly made. They are definitely competitive. But just to make sure, the marketers hoped you might think they were made by Calvin Klein. Of course, Mr. Cailvein Klcevin might be a real guy, from North Zhakembiel oblast presumably.

Interestingly, just Friday, BTA denied rumors that it would nationalize part of its assets, the Temir bank subsidiary. At the same time, they confirmed the original bailout deal, that the government would buy 25% of shares in BTA.

The chairman of the board of BTA and a former opposition leader, Mukhtar Abylazov, was ousted by the government today “because his ‘actions were found to be inconsistent with the interests of depositors and creditors and with current law,’ the government said on its Web site.” Abylazov has visited the government several times over the past month, but both he and the government have denied that the government was planning to buy a controlling share.

According to Renaissance Capital, the government may try to make a profit on the sale by selling the assets to Sberbank, a Russian bank with a presence in Kazakstan. German Gref, the head of Sberbank had meetings with Samruk-Kazyna and with Prime Minister Masimov a few weeks ago to discuss the financial crisis and possibly the sale of BTA banks assets.

Alliance Bank, which has been plagued by rumors that it would soon collapse, also vigorously denied recently that it would be bought out by the government, claiming that it would only sell 25% of its shares to the state and seek another investor. However it looks like the government may buy 76 percent of the Bank for 100 tenge ($0.83 ) total. Alliance is the nation’s fourth- largest bank and traded on the London Stock Exchange. The government will deposit $200 billion into the bank’s coffers.

According to the New York Times article on the subject, the acquisition of shares is only temporary:”‘This measure is not nationalization, it is temporary according to existing Kazakh legislation which stipulates that the government will eventually exit its shareholder base,’ the government statement said.”

In related news, Kazkommerts Bank will hold an extraordinary general meeting of shareholders next month to discuss the sale of 25% of its assets to the government. We will see if there are any surprises in there.