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PROBLEMS OF COMPETITIVENESS OF AGRICULTURE IN THE REPUBLIC OF KAZAKHSTAN
Zhenisbek Suleimenov, Doctor of Economic Sciences
Kazakh National Agrarian University
The problems of Increasing the competitiveness of the agrarian Sector of the Republic of Kazakhstan are considered in article. The agrarian sector of the country has considerable non-realised potential which can be successfully used in competitive struggle.
Keywords: Agriculture, economic sectors, management, business ownership, farm population, natural, competitiveness
The agrarian sector occupies leading position in national economy of Kazakhstan. The first measure of its value is defined by the essential commodities the sector provides the nation’s population — food. Second, Kazakhstan has substantial land area suitable for agriculture which is an opportunity to develop a globally competitive agriculture/food sector. A third measure is the substantial impact agriculture has on the national society in which almost half of the country’s population is closely associated with rural territories (number of agricultural population – 7.3 million persons, or 47.2% from an aggregate number of the population of the country) .
The Republic of Kazakhstan, when initiating reforms in the 1990s, selected the economic sectors that were the least developed as a market economy. On the basis of a multi-structure economy, a variety of business ownership and management structures were formed .
In 2009, the value of agriculture gross output reached 1,640.2 billion tenge. Despite increase in volumes of output and stable development rates in agriculture, the sector’s share of gross domestic product (GDP) declined due to high economic growth rates in the extraction industries. Agriculture generated only 6.2% of Kazakhstan’s GDP in 2009 compared to 29.5% in 1990 (Figure 1).
Farm population and country/farm economy produced 73% of Kazakhstan’s agricultural output in 2009, but the percent produced by agricultural enterprises has generally been increasing since 2000 (Figure 2).
Total area of land used for agricultural production increased more than 32% from 2000 to 2009, but still represents only 61% of the land used for agricultural production in 1990. Area used for forage production in 2009 is less than the area used in both 1990 and 2000.Vegetable production and gardens use more land in 2009 than in 1990 or 2000. The area of land used by various agricultural enterprises for crop production increased 1.3 times from 2000 to 2009, due to consumer demand and commodity markets. In comparison, the area used for crop production by all categories of agricultural businesses between 1990 and 2000 declined 55%. For example, the area used for forage crops declined 75% and potato area declined by 22%.
The multi-structure economy radically changed the structure of crop production. In 1990, practically all grain and commercial crops had been concentrated in the agricultural enterprises. By 2009, production was distributed among a variety of enterprises. Cultivation of potato and vegetables shifted primarily to small enterprises, that is, the farm population.
Changes in the sizes and structure of the crop production areas under crops are reflected in the productivity and total harvest of agricultural crops.
Agrarian transformations in Kazakhstan have defined essential changes in animal industries as reflected by the quantity of livestock, production, and their distribution among the categories of the economy. The cattle-breeding branch has endured a difficult transformation. For 19 years, in all categories of economy 37.3% of the number of cattle reduced, sheep, goats on 51.2%, pigs 58% and a bird on 45% was reduced (table 3). Nevertheless since 2000, livestock in all categories of economy has increased. In the country/farm economy, cattle livestock in 2009 has increased 3.7 times compared to 2000. Sheep and goats increased by 5.3 times, horses increased 4.3 times and pigs increased 1.8 times during the same period.
Growth of a livestock of all kinds of cattle and in farm population proceeds: a horned cattle on 67%, cows on 47,8%, sheep and goats on 89%, pigs on 59%, horses on 96%, only a bird was reduced on 27.5%. The structural parity of a livestock of cattle between categories of economy has changed. During the years of reforms, the number of livestock held by the large agricultural enterprises declined (5.1% of horned cattle and 5.2% of sheep and goats) whereas the rate of livestock cattle in farm population economy has increased. In 2009, these economies had 5,034.6 thousand horned cattle (82.3%), 1,065.1 pigs (77.8%), 12,027 thousand sheep and goats (69.1%) and 998.2 thousand horses (70.3%) from their general livestock in the republic (table 1).
The farm population produces nearly half of the birds. In 2009, this category of the economy also produced 79% of the meat and 91.1% of the milk. Corporate-type businesses have not replaced family production of livestock.
The radical reform on agriculture transfer to market relations was spent on the basis of realization of large measures. As a result, a multi-structure economy has emerged and the private sector has become the prevailing form of management in agriculture. The transformed industry is the foundation for serving the market.
The agrarian sector of Kazakhstan has some advantages and considerable non-realized potential which can be successfully used to advance the global competitiveness of its agricultural industry. Priority should be placed on identifying ways to increase ways to produce and process more agricultural products and food than are needed for internal (domestic) consumption. The excess can then be exported. This practice, however, must consider natural-climatic zones, growth of capacities, employing innovative processing, and ecological cleanliness of domestic production.
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3. The Agency of Statistics of the Republic of Kazakhstan: http://www.eng.stat.kz/Pages/default.aspx