The global investment situation is currently marked by heightened uncertainty. Trade disputes, fiscal policy shifts, and geopolitical tensions have contributed to market volatility, with the United States implementing tariffs on major trading partners such as Canada, Mexico, and China. The potential for a U.S. recession has further complicated the outlook, prompting investors and businesses to seek opportunities in emerging markets that offer stability and growth.
Despite these challenges, certain emerging economies continue to attract international attention. For instance, Kazakhstan, Central Asia’s largest economy, recorded a growth rate of 5.1 percent in 2024, highlighting its resilience amid global headwinds. Investors from China, the Middle East, Europe, the United States, and Russia are showing significant interest, drawn by the country’s strategic location and economic potential. Yet, beyond its position as a Eurasian trade hub, Kazakhstan has taken important steps to improve its governance through institutional reforms, which has positively impacted its business climate.
Since independence in 1991, Kazakhstan has pursued economic liberalization and foreign investment, but concerns over governance and legal transparency have at times affected investor confidence. Marking exactly three years since the constitutional reforms and political modernisation efforts initiated in 2022, the country has made strides in strengthening the rule of law, reinforcing judicial independence, enhancing political openness, and establishing clearer legal protections. These changes provide a more stable foundation for long-term investment and economic growth, positioning Kazakhstan as a reliable destination for global capital.
Reinforcing the Rule of Law and Legal Stability
For investors, legal and political certainty is as important as economic opportunity. The ability to operate within a transparent, predictable, and well-regulated political system is a key determinant in capital allocation decisions. Kazakhstan’s 2022 constitutional reforms introduced the Constitutional Court, a significant step in ensuring that all laws and government decisions align with constitutional principles. The Constitutional Court conducts preliminary constitutional review, verifying legal acts before they are adopted or signed. In addition to ensuring the constitutionality of existing laws, this institutional safeguard reduces the likelihood of arbitrary legal and regulatory changes that could disrupt business operations or undermine investment security.
One of the most notable aspects of the reforms is that citizens now have direct access to constitutional justice. More than 9,000 appeals have been reviewed by the Constitutional Court, demonstrating a growing public trust in legal oversight. For businesses, this mechanism serves as an additional layer of protection against regulatory overreach or sudden policy shifts. It reinforces investor confidence by ensuring that disputes can be addressed within a legal framework that prioritizes constitutional compliance.
The reforms also strengthened Kazakhstan’s system of checks and balances by reducing presidential powers and limiting the head of state to a single seven-year term. This measure prevents excessive centralization of power and facilitates smoother political transitions, a key concern for investors assessing long-term stability. At the legislative level, the Mazhilis, the lower house of Parliament, is now elected through a mixed system, enhancing political representation and accountability. At the 2023 parliamentary election, 70% of deputies were chosen via party lists (proportional representation), while 30% were elected through single-member districts (majoritarian system). This change increased opportunities for independent candidates, enhancing diversity in the legislature. Moreover, the threshold for political parties to enter Parliament was reduced from 7% to 5%, which allowed smaller parties to compete more effectively, promoting pluralism. As a result, opposition parties and independent candidates gained representation, improving political inclusivity. Voters were also given the option to vote against all candidates, strengthening electoral transparency. Following this election, the executive branch is subject to greater parliamentary oversight, further ensuring that economic and regulatory policies undergo rigorous scrutiny before implementation.
These measures contribute to a more predictable business environment, reducing uncertainty surrounding tax policies, trade regulations, and investment laws. The decentralization of governance, including the direct election of regional akims (mayors), has also empowered local communities, improving transparency in economic decision-making. For companies operating outside major urban centres like Astana and Almaty, this shift provides clearer and more accountable frameworks for local governance, reducing bureaucratic inefficiencies.
Investor Protections and Judicial Independence
In addition to liberalizing the political system, Kazakhstan’s constitutional reforms have reinforced property rights, contract enforcement, and judicial independence. One of the biggest risks in emerging markets is regulatory unpredictability, where governments alter policies without due process, potentially harming investors and businesses that have made long-term commitments. The constitutional reforms address this concern by limiting executive influence over the judiciary, ensuring that courts remain impartial when adjudicating commercial disputes.
The abolition of the death penalty and the explicit prohibition of torture, while primarily human rights advancements, also signal broader improvements in Kazakhstan’s legal system. These reforms strengthen fundamental protections for citizens, ensuring that justice is administered fairly and that human dignity is upheld. By reinforcing the rule of law, they enhance public trust in legal institutions, reduce the risk of judicial errors, and create a more just society where individuals are safeguarded against abuse. The institutionalization of these protections aligns Kazakhstan with international human rights standards, fostering a legal environment that prioritizes accountability, fairness, and the rights of all citizens.
While the constitutional reforms have laid a strong foundation for an improved governance and political system, continued progress is necessary to ensure their full implementation. Regulatory agencies must consistently apply new legal standards to reinforce investor confidence.
Kazakhstan’s reforms have already had a tangible impact, not only by reducing risks associated with political uncertainty, regulatory unpredictability, and legal vulnerabilities but also by strengthening the country’s overall governance framework. By reinforcing judicial independence and expanding legal protections, the reforms have fostered greater accountability within state institutions, ensuring that laws are applied consistently and fairly. Increased transparency and enhanced checks and balances contribute to a more responsive political system, where decision-making is subject to greater oversight. These improvements create a more stable and predictable environment, benefiting both Kazakh society and the broader investment climate. A governance system rooted in the rule of law provides citizens with stronger rights protections while also offering businesses the legal certainty necessary for long-term planning and economic engagement.
As global investors seek new markets amid economic volatility, the country’s institutional advancements provide a compelling case for Kazakhstan as a destination where businesses can operate with confidence.
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