This ETF assessment was prepared in 2019 on behalf of national authorities in Kazakhstan using a standardised framework questionnaire for national reporting (national reporting framework).

The assessment process included an extensive phase of desk research based on information provided by Kazakhstan in its national Torino Process report, and the preparation of an Issues Paper with an overview of themes to be discussed in the present report. These were then finalised in consultation with the ETF country and thematic teams responsible for Kazakhstan at the ETF. An advanced draft of the ETF assessment was circulated to national stakeholders and international partners and discussed at a consultation meeting in Nur-Sultan on 10 December 2019 to verify the findings and recommendations.

Like other ETF assessments, this paper is not meant to be exhaustive. The national Torino Process report of Kazakhstan covers a broad selection of problems around human capital development and use, while the focus here is on challenges which the ETF recommends addressing as a matter of priority.

The main question this report intends to answer is whether the long-standing, considerable financial and political investment made by Kazakhstan in the area of human capital development and VET, as well as its achievements in relation to reform in this area, are wide-reaching and deep enough to bring the country closer to its ambitious, long-term goal of becoming one of the most competitive economies in the world by 2050. While there is ample evidence to suggest that Kazakhstan is on track to achieve this, this assessment also draws attention to three major challenges and numerous policy-related gaps around each challenge, which may create risks further down the road by slowing down the pace of positive change and undermining its sustainability and impact.

These challenges include the ineffective distribution and use of state-sponsored opportunities for human capital development through VET (discussed in Section 3.1[7] The report may use “Section” and “Chapter” interchangeably.
); the unsatisfactory quality and limited relevance of teaching and learning in VET, which hampers the anticipated contribution of VET to the strategic development of the country (Section 3.2); and deficiencies in workforce development caused by a lack of adult education (Section 3.3).

Before that, in Section 2, the ETF assessment provides an overview of basic human capital development indicators (Section 2.1) and highlights three more, closely associated challenges. These include gaps in migration and labour market policy leading to brain drain (Section 2.2); risks in the cultivation of ICT talent due to human resource shortages (Section 2.3); and a shortage of VET specialists as an impediment to human capital development (Section 2.4).

Section 4 concludes the assessment and is followed by annexes summarising the policy recommendations (Annex 1) and offering a short overview of the education and training system (Annex 2).

Kazakhstan is located in Central Asia. With a territory covering 2 724 900 square kilometres it is the ninth-largest country in the world by land surface. Kazakhstan is neighboured by Russia, China, Kyrgyzstan, Uzbekistan and Turkmenistan, and has access to the Caspian Sea.

The country declared independence in 1991 and today its constitution describes it as a democratic, secular republic with a separation of powers between the legislative, judiciary and executive branches of government. Kazakhstan's political landscape is dominated by the ruling Nur-Otan party, which is also the largest and strongest political force in the country.

Kazakhstan is divided into 14 regions (Kazakh: облыстар, oblıstar) and 177 districts (Kazakh: аудандар, awdandar)[8] The city of Almaty and the capital Nur-Sultan have a special status and do not belong to any province.
. The provinces vary considerably in population size and level of economic development, and most of the job opportunities are concentrated in the two major cities, Almaty and the capital Nur-Sultan. These two cities, as well as the city of Shymkent, do not belong to any region. At the beginning of 2019, some 58% of the population of Kazakhstan lived in urban areas.

Until recently, the extraction of natural resources fuelled a rapid expansion of the economy, with gross domestic product (GDP) growth of well over 7% in some years. Between 2015 and 2018 there was also a steady increase in per capita GDP (9.7%). With GDP per capita of USD 27 873 in 2018 (Table 1)[9] Adjusted for purchasing power parity; current international USD.
, Kazakhstan today is an upper-middle-income country. However, despite the continuing efforts of authorities to diversify the economy and reduce its dependence on natural resources, the socio-economic development of the country is still vulnerable to shifts in global commodity prices. Table 1 shows that the economy has slowed down in the past few years, and GDP has been growing by about 4% per year. The net inflow of foreign direct investment dropped considerably as well. This also led to a slowdown in efforts to reduce poverty and to a weakening of labour market outcomes (World Bank, 2020). Gaps in income and standard of living between urban and rural areas persist as well. In 2015, poverty – as measured by the proportion of people living below the national poverty line – was more than three times higher in rural than in urban areas[10] See indicators SI.POV.RUHC and SI.POV.URHC in the World Bank's Open DataBank at https://databank.worldbank.org/home.aspxk
.

Table 1. Selected country context indicators, Kazakhstan

Source: ETF database.

Despite these challenges, the unemployment rate has remained low (4.9% in 2018), the share of young people not in employment, education or training (NEET) is by far the lowest in the region (6%), and per capita income has continued to increase despite the setbacks caused by various economic challenges and the global context (Table 1). Kazakhstan has also maintained its level of financial commitment to education and training in line with its prioritisation of the sector, although at 2.8% of GDP (2017), government spending on education is low when compared internationally.

Natural and man-made conditions have an influence on both the provision and cost of education and training in the country (OECD, 2015). Extreme weather conditions, a school network which is spread over vast areas that are difficult to access and which includes many ungraded (incomplete) schools (malokomplektnie shkoli) and schools in areas affected by environmental risks all create challenges for the planning, implementation and funding of education and training policies. Another significant factor in this respect is the rich diversity of the school population in terms of ethnicity, religion and language: this population comprises students from 23 different ethnicities (OECD, 2014).

The overarching, long-term strategic framework for the development of Kazakhstan is Development Strategy 2050[11] See https://kfm.gov.kz/ru/activity/strategy-and-program/strategy-kazakhstan-2050/.
, which envisages the realisation of seven long-term priorities. One of them refers to knowledge and skills as the main anchors of the modern system of education and human capital development to which the country aspires. Some of the more ambitious goals therein are to double the share of highly skilled graduates and to increase the educational attainment of the adult population.

The realisation of this long-term vision is described in the medium-term Strategic Plan for the Development of Kazakhstan until 2025[12] Presidential Decision No. 636 of 15 February 2018: Strategic Plan for the Development of the Republic of Kazakhstan until 2025.
, which aims at promoting economic development and prosperity for the population to levels that are on a par with those of OECD member countries and in line with the Sustainable Development Goals (SDGs). Developing human capital and boosting 21st century skills in the population is thereby one of only seven top priorities.

At an education and VET sector level, the strategic actions and aspirations are described in the State Programme of Education Development 2016–2019[13] Government Decision No. 460 of 24 July 2018: State Programme for Education Development 2016–2019.
. At the time of finalising this ETF assessment, this state programme was replaced by another one that is scheduled to run until 2025[14] Government Decision No. 988 of 27 December 2019: State Programme for Education Development 2020–2025.
. Both the old and the new state programmes retain their focus on teachers, quality and equity; the elimination of regional and urban-rural disparities; the development of quality assurance systems, ICT and digitalisation; a transition from a system of formal education to a system of lifelong learning; and research. Some of the measures and goals are more specific to VET and include the further development of dual education, the digitalisation of VET, the revision of curricula and study content and the specialisation of VET colleges. The strategic documents also attribute to VET a strong remedial role for the socio-economic integration of young people and young people at risk[15] National report of Kazakhstan, 2020: A.3.4.
.

All strategic plans for education and VET include a set of key performance indicators, which are tracked and reported on at regular intervals. Many of them are aligned with or based on the results and areas covered in large-scale international studies such as TIMSS, PIRLS and the OECD's PISA, TALIS and PIAAC programmes. Overall, the OECD's and EU's insights regarding performance and policy in education continue to be a major orientation point for designing reforms and monitoring progress of their implementation.

Furthermore, Kazakhstan is an active participant and partner in a number of international initiatives and projects. In the area of VET, the national Torino Process report describes partnerships with the ETF, the World Bank, the EU, GIZ (a German development agency) and the OECD[16] National report of Kazakhstan, 2020: A.3.5.
. It also refers to the country's active engagement in the World Skills franchise and competition. A major EU initiative in support of informed decision making in education and in the area of regional cooperation is also the Central Asian Education Platform.