Defying expectations, independent Kazakhstan has done better than its neighbors

When an authoritarian ruler builds a gigantic dark globe, he should not be surprised that people call it the "Death Star."

But whereas the Death Star from "Star Wars" was a tool for wiping places off the map, the Kazakh pavilion at Expo 2017, which opened in June in Astana, Kazakhstan's capital, is supposed to put the Central Asian country of 18 million on the map — especially for investors.

The Death Star celebrates traditional forms of Kazakh hospitality, such as giving guests a warm coat or a sheep's head for supper. A shopping mall named after the old Silk Road offers fancy souvenirs.

Kazakhstan is at a crossroads, literally and figuratively. Geographically, it is sandwiched between Russia, China and the Middle East, astride once and future trade routes. The president, Nursultan Nazarbayev, is eager to turn this location to Kazakhstan's advantage by joining China's "Belt and Road" program of new transport links between Asia, Europe and Africa.

Over the past two years, Chinese cash has created a massive freight-rail hub at Khorgos, spanning the border between the two countries. Xi Jinping, China's president, visited the Expo on June 8 and purred that the two countries should be "partners forever."

The other crossroads is historical. Kazakhstan has a choice: open up or stagnate. This is not easy, given how much the country has suffered from foreign domination. The Soviets forced nomadic Kazakhs into collective farms at gunpoint, wiping out a quarter of the population. They used Kazakh territory both as a gulag and a nuclear testing ground, deliberately exposing children to radiation to measure its effects.

Few expected an independent Kazakhstan to thrive, but it has done better than any of its Central Asian neighbors. That is thanks mainly to gushers of hydrocarbons. Oil and gas accounted for 58 percent of exports last year; the mammoth Kashagan oil field is one of the biggest discoveries in the world in recent decades. But reasonably competent government has also played a part. Real output per person rose from $1,600 in 1990 to $14,000 in 2013.

In the past three years the oil price has crashed and Kazakh belts have tightened; economic growth has fallen from 6 percent in 2013 to 1.1 percent last year, though the IMF expects it to recover somewhat this year and next. The government dipped into the national pension fund to cover some of the costs of the Expo, infuriating many.

When the Expo is over, the site will become home to the Astana International Financial Centre, a would-be regional stock market and financial hub. Firms operating there will be subject to rules based on English common law, enforced by independent courts, the government promises. The aim is to reassure investors, who might otherwise be nervous about sinking money into a country that scores as badly as Russia on Transparency International's corruption league table.

All this sounds good. But Kazakhstan has been promising big privatizations for seven years, yet has delivered only small ones. The banking system is rickety. Oligarchs labor mightily to block reforms that harm their interests.

Another problem is that, for most Kazakhs, free enterprise is a novel concept. No one can remember a time when the state did not dominate the economy. But this may turn out to be a reassuring factor as the emerging nation sheds its old ways.