The Business of Government: The State as Obstacle and Facilitator for Private Investment in Central Asia

Abstract

This article deals with the question on how the Central Asian governments have dealt with transition as a whole and the emergence of private business in particular. Our focus is on the politically and economically most important countries in the region, Kazakhstan and Uzbekistan. We investigate the specific role(s) that the Kazakh and Uzbek states assume within their respective economies and its impact on the environment for both foreign and domestic private business. Furthermore, the institutions at the interface between government and private economic actors, which together form the government-business-nexus, are analyzed. Drawing on more than 300 interviews with different stakeholder groups we find notable differences in the transition strategies of these countries. Nevertheless, they both achieved remarkable economic growth rates over the past decade that are projected to continue for the next years.