Introduction Перевод на русский язык Spatial inequality is everywhere. Often driven by agglomeration and globalization forces, the concentration of economic activity in large urban areas and the rise in regional disparities place a country’s economic potential at risk. These territorial divides are growing to a point where they can no longer be ignored and present a serious threat to economic prosperity, and social and political stability. In Kazakhstan, regional inequalities are rising rapidly. A study by the Asian Development Bank (ADB) introduced innovative indices to review the multidimensionality of the country’s spatial differences and show the particularities of territorial imbalances. It identified the polarization within the country in terms of economic growth, employment, productivity, and competitiveness, and indicated that some regions in the country may be at risk of falling into a development trap. Kazakhstan’s Regional Situation While gross domestic product (GDP) per capita has increased in Kazakhstan over the past 20 years, the additional wealth linked to this economic growth has been distributed unevenly and concentrated in a limited number of regions. At the same time, deviation from the country mean has widened. Figure 1: Gross Regional Product (GRP) Per Capita, 1998–2020 (‘000 Kazakhstani Tenge) Note: GRP per capita in current prices. Country values are calculated as the arithmetic average of regional values. Source: Kazakhstan Statistical Department. Kazakhstan’s regional inequalities are significantly higher than those of most developed countries, a factor that may be a future obstacle for the aspirations of the country to join the ranks of the most developed economies. Empirical evidence suggests that recent rises in territorial inequalities have widened the gap between better- and less well-off regions to levels that are higher than those found in other developing countries in Central Asia and elsewhere. Spatial analysis techniques reveal two parallel trends. First, the difference in GRP per capita, productivity and poverty levels between the western and some northern regions, and southern and some eastern regions is large and growing. Western regions (e.g., Atyrau) display exceptionally high levels of wealth with the presence of major natural resource reserves, while southern regions outside big cities (e.g., Turkestan) lag far behind and struggle to benefit from greater innovation which characterizes parts of Kazakhstan’s economy. Second, a similar divide can be detected between urban centers such as Almaty and Nur Sultan, and the more remote and rural areas of the country. On average, urban agglomerations display higher levels of wealth and productivity and substantially lower poverty rates. While preliminary evidence on economic dynamics in the early phases of the coronavirus disease (COVID-19) pandemic show a reduction of spatial inequalities among regions, this effect is likely to be short-lived. This is largely driven by the greater economic downturn experienced by urban centers rather than improvements in the economic dynamism of the lagging regions. Restricting the focus of analysis to a snapshot of regional divides, however, only captures a fraction of the picture. Regional differences evolve over time and is a function of the intertwined relationship between a myriad of variables. The ADB study introduced innovative indices to measure territorial inequalities in Kazakhstan to take into account the dynamic nature of spatial imbalances. The Development Trap Index identified patterns of economic stagnation across Kazakh regions. A high score on the index implies high risk of economic stagnation and a poor socioeconomic regional performance vis-à-vis past economic dynamism and the national average. The computed index for Kazakhstan shows a high risk of stagnation and falling into an economic trap. For example, the risk for Atyrau is considerable and reflects the region’s struggle to diversify its economy and ignite greater dynamism within its regional business ecosystem. Other regions, such as Turkestan, are at low levels of development and yet still at a relatively high risk of falling into a trapped status. Against this backdrop, growth slowdowns in the less-developed regions may contribute to widening the gap between the more virtuous regions and rural and remote areas. The Regional Competitiveness and Cohesion Index provided a more comprehensive and multidimensional measure of regional economic performance. It indicated a highly uneven picture when it studied the performance of Kazakh regions across several dimensions (education, health, innovation, labor markets and technological readiness). Some regions have been capable of dynamizing their economies by creating pro-business ecosystems for firms and individuals to thrive and develop their full potential. In contrast, other regions are struggling. Even the more advanced regions showed weak performance in some competitiveness dimensions such as Atyrau in the case of basic health. Addressing Inequalities Dealing with regional inequalities requires a concerted, whole-of-government effort, tailored to the specific needs of individual regions. In Kazakhstan, facilitating catching-up processes for less developed territories will help the government reach more ambitious socioeconomic targets as all regions will be able to contribute to the country’s economic development. In addition, this can address the emergence of social unrest and discontent of having a highly unbalanced territorial distribution of resources and wealth. This phenomenon could be seen both in developed countries such as the United States, and in developing countries such as Brazil and the People’s Republic of China. For all these reasons, territorial inequalities cannot be considered an unavoidable phase in the development trajectory of the country and deserve the greatest attention from the government and central authorities. Place-sensitive development strategies, which aim to close the gap between regions by tapping into their full potential, are most suited to bring about greater dynamism, innovation and knowledge in a wider group of regions. Blanket policies and piecemeal strategies are unlikely to revitalize Kazakhstan’s regional economies characterized by poor performance in areas as diverse as innovation capabilities and health standards. Also, no off-the-shelf policy intervention will be able to acknowledge and integrate regional specificities, even in regions at similar stages of development. Resources A. Pike, A. Rodríguez-Pose, and J. Tomaney. 2016. Local and Regional Development. London: Routledge. A. Rodríguez-Pose and F. Bartalucci. 2021. The Republic of Kazakhstan: Joint Government of Kazakhstan and the Asian Development Bank Knowledge and Experience Exchange Program, Phase 4: Regional Inequality Study for Kazakhstan. Consultant’s report. Asian Development Bank. Manila (TA 6623-KAZ). A. Rodríguez-Pose and T. Ketterer. 2019. Institutional Change and the Development of Lagging Regions in Europe. Regional Studies. 54 (7). M. Storper. 2018. Separate Worlds? Explaining the Current Wave of Regional Economic Polarisation. Journal of Economic Geography. 18 (2). pp. 247–270. Ask the Experts Andrés Rodríguez-Pose Princesa de Asturias Chair and Professor of Economic Geography, London School of Economics Andrés Rodríguez-Pose is also the director of the Cañada Blanch Centre and a visiting professor at the University of Stavanger Centre for Innovation Research in Norway. He has a long track record of research in regional growth and inequality, fiscal and political decentralization, institutions, regional innovation, migration, and development policies and strategies. He ranked first in the field of urban and regional planning in the 2021 Stanford/Elsevier list of the 2% most cited scientists. Federico Bartalucci Economic Development Consultant Federico Bartalucci is an economist who holds degrees from the University of Exeter and an MSc in Local Economic Development from the London School of Economics. He has participated in numerous assignments for international organizations, including the drafting of the UNCTAD Handbook for Special Economic Zones in Africa, UNDP post-COVID development strategy for Turkey, and the ADB measurement of regional inequalities in Kazakhstan. Asian Development Bank (ADB) The Asian Development Bank is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region. Its main instruments for helping its developing member countries are policy dialogue, loans, equity investments, guarantees, grants, and technical assistance. Follow Asian Development Bank (ADB) on Leave your question or comment in the section below: View the discussion thread.