Taldykorgan: An Intermediate City Struggles for Growth

An Expert's View about Business Environment in Kazakhstan

Posted on: 28 Mar 2010

The authors, in this paper, look at what role can intermediate-sized cities like Taldykorgan play in urban/regional development policy in Kazakhstan in Central Asia.

Taldykorgan: An Intermediate City Struggles for Growth To be cited as Low KCP and Taylor, J (2009) Taldykorgan: An Intermediate City Struggles for Growth , Insights to a Changing World Journal, Volume 2009 Issue 1, p. 1 13. Prof. Dr. Patrick Low Kim Cheng Low (first name/ surname) Ph.D. & Chartered Marketer, Certified MBTI Administrator, & Certified Behavioral Consultant/ Universiti Brunei Darussalam, Associate, University of South Australia. and Dr John L. Taylor (jltaylr35@yahoo.com) an urban planning consultant and project manager now based in Jakarta, was the Associate Director in The Center for Sustainable Urban Futures (CSUF), KIMEP, Kazakhstan *The authors wish to express thanks and appreciation to Ms Aiman Kyrbassova for her initial comments and contributions. They would also like to thank Ms Assya Turmukhanova for her comments. About the Authors Prof. Dr. Patrick Low Kim Cheng, Ph.D. (South Australia), Chartered Marketer, Certified MBTI Administrator, & Certified Behavioral Consultant (IML, USA), brings with him more than 20 years of combined experience from sectors as diverse as the electronics, civil service, academia, banking, human resource development and consulting. His MNC and local corporate clients from ASEAN, Sri Lanka, Hong Kong, Bangladesh and Kazakhstan are in manufacturing, electronics, IT, retail, engineering services, hospitals, hotels, banks & financial institutions as well as the public sector. The once Visiting Professor, Graduate School of Business, Universiti of Malaya (Jan to Feb 2007), Dr. Low is currently Deputy Dean, Postgraduate Studies and Research Office in Universiti Brunei Darussalam, teaching MBA and undergraduate and his teaching subjects include Business & Society, Organizational Behavior and Organizational Development & Change. The former Associate Dean, Director of Career Services and Chair of the Management and Marketing Department of a University in Kazakhstan (2004 to 2006) focuses on human resource management, organizational behavior and behavioral skills training covering areas like negotiation/ influencing, leadership and behavioral modification. 1 An academician-practitioner, a prolific author (author of several books including bestsellers (Strategic Customer Management, 2006, 2002, 2000 one of Borders top ten in 200 1/2, Sales Success, 2006, 2003; Team Success, 2003 and The Power of Relationships, 2001) and a business coach, Dr. Low is the founder of BusinesscrAFT Consultancy. Previously served as an Examiner for University of South Australia s DBA and Ph.D. candidates (2003 to October 2006), he is presently appointed as the supervisor for its DBA candidates. Besides his experience in academia, training and consulting, Dr. Patrick Low has held positions in regional human resource development (HRD). He has been the Senior Training Manager (Asia Pacific Region) in Standard Chartered Bank where he was responsible for regional management training and development, marketing of HRD services and management succession. He can be contacted at patrick_low2003@yahoo.com Dr. John L. Taylor, Ph.D. (jltaylr35@yahoo.com) an urban planning consultant and project manager now based in Jakarta, was the Associate Director in The Center for Sustainable Urban Futures (CSUF), KIMEP, Kazakhstan after many years experience as a consultant and teacher in urban planning and infrastructure development in Southeast Asia, India and the United States. His Ph.D. is from the University of California at Los Angeles (UCLA), USA. Abstract: The authors, in this paper, look at what role can intermediate-sized cities like Taldykorgan play in urban/regional development policy in Kazakhstan in Central Asia. Connected to this is the issue of whether the city is experiencing limited growth, and the role(s) intermediate-sized cities such as Taldykorgan can play in urban/regional development policy in Kazakhstan. Several key urban revitalization strategies and ways to grow the city are recommended. Taldykorgan: An Intermediate City Struggles for Growth Key words: Kazakhstan. Taldykorgan, urban/regional development 1 Introduction Ranked as the ninth largest country in the world by size, Kazakhstan is also the world s largest landlocked country, with a territory of some 2,727,300 square kilometers (which 2 is greater than the whole of Western Europe). Kazakhstan is located in Central Asia and the city in question is Taldykorgan; it is situated on the left bank of the Karatal River and in the western foothills of the Dzungarian Alatau Mountains. With its original name, popular castle , Taldykorgan grew up on the site o f Gavrilovka village, and founded in the second half of the 19th century. It is said that Taldykorgan particularly developed after the construction of a branch line from the Turk-Sib Railway in 1949 (http://aboutkazakhstan.com/Taldy-Kurgan_city.shtml). Geographically, Taldykorgan is well-located. It is the center of the Semirechye (Seven rivers) and carries a special geopolitical value for the country; the branched network of highways of national and regional importance lead to Almaty, Ust Kamenogorsk, Ushtobe, and the republics of Central Asia, Russia and China (http://www.kazakhstan.orexca.com/taldykorgan_kazakhstan.shtml). Figure 1: Map of Kazakhstan by Microsoft Encarta The map shows the location of Taldykorgan (Taldyqorghan), in the South-eastern part of Kazakhstan (source: http://www.advantour.com/kazakhstan/map.htm.) Accessed on 24 November 2008. 3 1.1 Major Focus of Paper As Kazakhstan s economy grows, some of its cities are also growing. In fact, Kazakhstan s 33 larger cities (see Table 1) can be assessed as being divided into three categories growing, stable and declining, and thi s is based on their relative population size during these years: 1979, 1999 and 2005. Table 1 shows that larger cities are generally experiencing greater population growth and smaller ones are stable or declining. The intermediate cities falling betwee n 50,000 and 200,000 are for the most part stable. Table 1: Population Trends in 33 Larger Cities 2005 Population Groups Growing Stable Declining 200,000 an over 8 67% 3 25% 1 8% 12 50,000 200,000 2 13% 10 67% 3 20% 15 Less than 50,000 0 0% 3 5% 3 50% 6 10 16 7 33 *Source: Census of Population, Republic of Kazakhstan; www.mongabay.com A city and administrative center of Almaty region (oblast) (http://aboutkazakhstan.com/Taldy-Kurgan_city.shtml), Taldykorgan is a good example of such a stable intermediate city. Based on data from the Census of Population, Republic of Kazakhstan, the town is only growing at 0.5% per year, from a population of 87,400 in 1979 to 101, 600 in 2005. Based on an analysis of urban population trends, it appears that cities in Kazakhstan require a threshold of at least 200,000 before th ey begin to experience sustainable growth. This leads us to the main focus of this paper on Taldykorgan: What role can intermediate-sized cities like Taldykorgan play in urban/regional development policy in Kazakhstan? And connected to this, why is the town only experiencing limited growth? What role do various factors economic, socio-cult ural and demographic, physical infrastructure, etc. play in this growth or lack thereof? 4 1.2 Research Methodology The research methodology is based on secondary literature, field visits and interviews with several Tadykorgan s residents during the period 1 Dec 2005 to 15 June 2006. 2 Economic Development The town s economic base consists primarily of the following activities: (i.) an auto/truck factory manufacturing batteries, going back to the Soviet era. (ii.) a public enterprise factory manufacturing uniforms for government officials on contract. (iii.) a cement factory. (iv.) a highly developed retail trade sector, befitting of a large market town. (v.) several institutions of higher education (including three universities). Other basic economic activities include large num bers of government officials, including personnel from the Ministry of Interior (police) and military. Bear in mind that the border with China is only about 100 km. from the town. Once an industrial center boasting large furniture, shoe, and battery factories, Taldykorgan has a staggering number of people who have found themselves without work; it has been said that the factories have been silent for many years (Runyan, 2001). Generally speaking, there appears to be a lack of economic diversification in the town, and this seems to be one of the factors which may account for the relatively slow growth of Taldykorgan s population. 3 Urban Infrastructure As far as we could tell from our field visit to Taldykorgan, there appear to be no visible signs of deterioration in the condition of physical infrastructure. This includes such facilities as water, sanitation, drainage, roads and traffic. This is in contrast to Almaty where infrastructure problems are evident. We shall comment briefly on each of these facilities. 5 3.1 Water Supply The quality and quantity of clean water supplies is among the best of any town in Kazakhstan. One can drink directly from the tap. Hot water is currently available on a year-around basis, whereas previously it was only provided in winter. 3.2 Sanitation This includes both piped sewage and solid waste management. As with water supplies, the quality of sewage and solid waste management also appears to be good. 3.2 Town Roads and Traffic We noticed that roads were in good condition and that there was little or no apparent traffic congestion in the town. The mayor (akim) immediately before the current one was really involved in improving the roads, including introduction of pedestrian streets and a one-way street system. He is now Minister of Emergency Services. Street and traffic conditions have been allowed to deteriorate slightly under the present mayor. 3.4 Drainage The condition of the town s drainage also appears to be good. At least there are no obvious signs of deterioration and poor maintenance. However, the real test would come during times of heavy rain and potential flooding. 3.5 Parks At least in the central area of town, there was a generous amount of attractive park space. The city is indeed dotted with lush parks and gardens. Environmentally friendly, such green lungs are always welcome and are pleasant to the visitors eyes. 4 Civic and Cultural Facilities There are several civic and cultural facilities which give Taldykorgan a very pleasant appearance. We shall comment on each of these facilities in turn. 4.1 Central Square / town hall In the center of town is a very pleasant central square in front of the town hall , a modern building for the akimat (Town Council). People were strolling about taking in the sunshine when we visited. Opposite the town hall on the square is the house of culture which contains two theatres and classes in painting, dance and other arts. 4.2 Regional Museum 6 Within a short walk of the central square is a very good regional museum. The exhibits in the museum were excellent, reflecting a public policy decision at some level to really use the museum as an instrument of social propaganda in a good way. Nearby is also a music school featuring Kazakh music; Kazakh culture is thus showcased. 5 Entertainment / Night Life The town has a new complex which includes a night club, restaurant, theatre and bowling alley. (We actually went bowling in the evening.) It reflects a substantial investment, and shows a concern that Taldykorgan should have more places for nighttime entertainment. However, in general, the town appears to be pretty quiet at night. We noticed very little traffic in town after 10:00 p.m. 6 Strength Weakness Opportunity Threat: SWOT Analysis To shed light on Taldykorgan s characteristics, we have carried out SWOT analysis on the town. 6.1 Strengths  The general ambience of the town is very pleasant, with the nearby Karatal River and mountains not far away.  Physical infrastructure is in good condition.  The town has a large number of civic and cultural amenities. 6.2 Weaknesses  There is a lack of employment opportunities, especially for young people with a good education.  There is also a lack of sufficient night-time entertainment, a weakness which particularly affects young people.  Classes in the house of culture are considered to be too expensive for the average family. 6.3 Opportunities  If economic opportunities can be further developed, Taldykorgan could have a lot of potential. 6.4 Threats  Fire can be a real hazard, especially in the downtown commercial area. In fact, a serious fire took place in this area on March 8th 2006, ruining many small shops. 7 7 Back to the Key Focus & Growing the City s Future Based on this analysis, what seem to be the major problems or deficiencies that inhibit urban growth in Taldykorgan? There appear to be at least the following three factors:  Lack of employment opportunities nearly all of th e economic activities are relatively old and dominated by the public sector.  Lack of bright lights or stimulating nightlife, e specially for older teens and people in their 20s.  The town has no major deficiencies (physical infrastructure is in fact quite good), but neither does it have any major attractions that draw people to it and keep them there. If we return to the question posed in section 1 of this paper, what role can intermediate- sized cities like Taldykorgan play in urban/regional development policy in Kazakhstan? It seems to us that there is a legitimate role for public policy-makers here: the government can offer tax and other incentives to encourage private economic activity to locate in Taldykorgan. If urbanization can be stimulated in such intermediate-sized cities, the Republic will have a more balanced pattern of urban and regional development, and the largest cities (for example, Almaty and Astana) will not grow too large (or have urban growth without sprawl). Taldykorgan can shine in more ways than one. The city can encourage smart growth initiatives and actions. To begin with, it can promote mix land uses, while supporting the vibrant city centers. The town council (akimat) can promote distinctive, attractive communities with a strong sense of place. It should create a range of housing opportunities and choices. The town s regional museum and its attractions should also be promoted. Here, much publicity should be given to Taldykorgan s regional museum; its key display items can also be highlighted. Other historic buildings too need to be identified, rehabilitated and used. As pointed out by Taylor and Low (2006) for Almaty, the same can also be applied to Taldykorgan when highlighting historical spots in Taldykorgan, plaques can also be installed to indicate interesting details of these places. To most Western visitors, visiting the bazaars can also be a unique cultural experience. Bazaars are also interesting places to go to get a sampling of the daily local buying and 8 selling activities. The bazaar building, as such, needs to be renovated with proper fire exits to promote safety in the bazaars. The cleanliness and the maintenance of the bazaar too need to be looked in. The authorities may also act by proactively providing a variety of transportation choices. Bearing in mind that Taldykorgan particularly developed after the construction of a branch line from the Turk-Sib Railway in 1949, the authorities can further develop and promote it as a transport hub. Here, we reckon there is much potential. Besides, Taldykorgan s airport has its own local aircraft, and may accept and serve planes of the 3rd and 4th classes with a take-off weight up to 70 tons (www.kazakhstan.orexca.com/taldykorgan_kazakhstan.shtml). Flights depart from here to more than 10 cities of Kazakhstan and Russia. Besides, the railway station has an outlet to Central Kazakhstan, Central Asia, Russia, the Baltic states and China. Interestingly, based on UN-HABITAT analysis of 245 cities, cities that are experiencing the fastest growth in the developing world shows very clearly that spatial influences of macroeconomic and industrial policies and related investments (or economic development), are the main drivers of city growth in 78 per cent of the cities analyzed. Investments in transport infrastructure such as roads, ports, airports were by and large the most important contributor to city growth. Forty per cent of the cities analyzed experienced high growth rates as a direct result of the diversification, expansion or improvement of regional or urban transport infrastructure (dgCommunities Urban Development, 2008). Next, to stimulate employment and economic activities, micro-financing should be promoted (Runyan, 2001). It is noted that urban growth, more often than not, is positive, and there is a clear relationship between a high rate of urbanization and a good economy (SIDA: 2007). But the problems which arise when growth is too rapid or even slow are often serious and affect the poorest people most severely. Viewed from this angle, micro credit can be applied to grow businesses and entrepreneurships, and small businesses the principal source of jobs can be encouraged an d promoted among the neglected groups like women and the poor. 9 Micro credit can be distributed with the loan-takers setting up all kinds of shops including mum s and pop s shops, and ranging from cyber cafes , sports shops to handicrafts and food/ ethnic stalls in the night bazaar. [Micro-credit programs are popular development tools around the world, but for Central Asia it is new territory and should be logically tapped.] Basically, the principles of micro-lending involve offering a unique combination of approaches to alleviate poverty, develop small business, and provide basic business training. This fills a gap where commercial banking services are absent. Because of small loan sizes and inevitable operations costs, commercial banks do not seek clients in this market. As such, these loans are vital, however, as many small businesses and entrepreneurs would not be able to find other sources of capital. What appears to be illuminating from some of these interviews is the point that micro loans seem to be good on paper. Accordingly, the interviewees voiced out what seem to be the answer. For micro loans to really work and be successful, they should be given in the form of a total package, and that it should include the loan provider s 1. sharing or growing the business ideas with the loan-takers 2. giving the loan takers planning assistance 3. training the micro loan-takers in fundamental business organizing skills 4. supplying or lending technical support 5. ensuring supervisory controls over the spending of the loan monies as well as the overall running of the business. [Most interviewees indeed expressed that many of such loan takers may spend their monies indiscriminately or even on unintended and unnecessary items other than the intended busines s essentials such as machinery, equipment and others. In August 1999, the Eurasia Foundation Almaty Regional Office provided the Kazakhstan Community Loan Fund: KCLF with $150,000 in badly needed loan capital, allowing them to expand the loan portfolio to a greater area and keep the program solvent.] Restoring economic vitality to neglected areas takes a concerted community effort, but it can be done. A declining neighborhood in Taldykorgan, may perhaps reverse its fortunes by networking (through Kazakh clans and contacts) and working with national retailers, local activists, and 10 government/ non government and nonprofit agencies to bring back stores, jobs, services, and well-built affordable homes. The stores and construction companies made commitments to hire people from the neighborhood for decent-paying jobs. The authorities can also help facilitate the formation of joint neighborhood action groups and cooperatives, and cooperatives such as women cooperatives can also be formed. This authors overall agree with Runyan (2001) who at the time of writing was encouraging micro-lending. In fact, non-government agencies and cooperatives, while providing good business ideas, can also help out in this direction. In this aspect, the Eurasia Foundation has been assisting, and of heightened interest, Runyan (2001) has also pointed out several success cases, including a bakery and a startup cafe. Additionally, the authorities can take advantage of existing community assets stressing on the joint use of amenities. The authorities can also invest in establishing more parks, child play areas, rock climbing sites and landscaping the city. The setting up of green lungs in the city, in fact, helps beautify Taldykorgan and can make it more attractive not only to the locals within Kazakhstan, but also to the foreign visitors. The green lungs can promote tourism as well as tourism-related employment. More recently, the Central Culture and Rest Park of Taldykorgan was redeveloped and re-opened. Serik Umbetov, Almaty region akim or governor and Saken Zhylkaydarov, Taldykorgan mayor participated in the opening ceremony (The Times of Central Asia, 2008). Over 240 million tenge had been allocated from the local budget on park reconstruction and landscaping. More than 900 coniferous trees and 800 hardwood trees were planted based on the park s landscaping plan. Certainly, this is a positive development, a good akimat s (province) initiative, and in fact, more of such developments should be encouraged to increase the attractiveness of Taldykorgan. And perhaps Taldykorgan can be as green and as attractive as Almaty (Taylor and Low, 2006) in the summer months. Some respondents had also suggested that the town authorities could persuade the Government to invest money in developing ski resorts in the Dzhungarskiy Alatau mountains, and at the same time, develop the banks of Karatal River perhaps with some stalls, barbecue points, jogging and cycling lanes and even fishing spots. Feasibility should be looked into, see if water sports can be a do-able and encouraged as leisure activities. 11 One more vital point is that icons or unique structures are necessary for cities so that people, the locals and foreigners can remember well or have fond memories of the city. Similar to Astana, a unique structure cam be built in Taldykorgan. It was reported that in Astana, a giant transparent tent was to be built, and it was to contain an indoor city that would reflect the national character while providing all year entertainment especially during the cold winter months. The 150m-high (500ft) dome, designed by UK architect Norman Foster, would be built in just over a year. (BBC, 2006, cited in Low and Taylor, 2007). At the time of writing this paper, the structure is still under construction. Yes, such icon or unique structure would be an ambitious project and a nice-to- have, but essentially, the must-have, stimulating the economy with jobs for the people through businesses, cooperatives, networking and micro loans must primarily be in place. How true, such an icon would be fondly etched in the minds and hearts of the locals and tourists alike; however, the authorities need to consider creating distinctive indoor and outdoor spaces suited to the climate and the people s choices and preferences. That will further bond the local residents to the city, rather not getting attracted or migrating to Kazakhstan s big cities such as Astana or Almaty. 8 Conclusion Along with its natural assets the nearby mountain s and river, the trees, greeneries and parks can indeed enhance the beauty of this transport hub city. The city s historic buildings can also be rehabilitated, and with concerted community effort, installing a strong sense of place and pride, the city can attract both local visitors and tourists. Also, by stimulating the economy, setting up cooperatives, having more businesses and enterprises established through micro credit, Taldykorgan can indeed provide jobs and employment to its residents. The city can grow. References:  Badcock, Blair (2002) Making Sense of Cities, London: Arnold.  dgCommunities Urban Development (2008) How governments are propelling urban growth dgCommuinities Urban Development. 17 November 2008. Website: http://urban.developmentgateway.org/Content-item-view.10976+M5f35b238993.0.html. Accessed on 22 November 2008.  Census of Population (1999, 1979), Census of Population: Republic of Kazakhstan (1979 and 1999 urban population data).  Hall, Peter (2002) Cities of Tomorrow, Blackwell: Oxford.  Levy, John (2003) Contemporary Urban Planning, Saddle River, N.I: Prentice Hall. 12  Low Kim Cheng Patrick and Taylor, John L. (2007) Trends in Retail Trade Patterns in Transitional Economies: The Almaty Case Study , Insights to A Changing World Quarterly Journal, Vol. 2007 Issue 3, p. 44 57..  Low Kim Cheng, Patrick, Indira Tabyldy and John L. Taylor (2006) Rural and Urban Developments, Its Differences and Synergies A Kaz akhstan Perspective , 5th Annual KIMEP International Research Conference, Almaty, 6 - 8 October 2005, p. 24.  Runyan, Chris (2001) The Kazakhstan Community Loan Fund: Microcredit in Kazakhstan Finds a Way to Help the Beginners, The Eurasia Foundation. Web-site: http://www.eurasia.org/documents/Sucess%20Stories/Aug2000Success.html. 23 Nov 2008 and 16 Dec 2008.  SIDA: Swedish International Development Cooperation Agency (2007) Urban development - urban growth is a mixed blessing, Swedish International Development Cooperation Agency. Web-site: http://sida.se/sida/jsp/sida.jsp?d=668&a=4455&language=en_US. Accessed on 26 November 2008.  Taylor John and Low Kim Cheng, Patrick (2006). The Branding of Almaty, the Oasis of Central Asia , The Central Asia Business Journal. Volume 1. (2), pp. 8-22.  The Times of Central Asia (2008) Taldykorgan Culture and Rest Park opens again. , The Times of Central Asia, 14 November 2008.. Web-site: europe.com/index.php%3Foption%3Dcom_content%26task%3Dview%26id%3D192173%26 Itemid%3D7+taldykorgan&hl=ms&ct=clnk&cd=8&gl=bn&client=firefox-a. Accessed on 21 Nov 2008. Websites  http://aboutkazakhstan.com/Taldy-Kurgan_city.shtml. Accessed on 17 Nov 2008.  www.mongabay.com (website with 2005 urban population data).  http://www.kazakhstan.orexca.com/taldykorgan_kazakhstan.shtml. Accessed on 17 Nov 2008.  http://kazakhstaneconomy.blogspot.com/2008/08/kazakhstans-sudden-stop.html. Accessed on 25 Nov 2008. 13
Posted: 28 March 2010

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