Today, on the 17th of May, Astana is hosting the Astana Economic Forum 2018, Eurasia’s leading conference on economic matters . This year the AEF 2018 has transformed into a new format, Global Challenges Summit. It well demonstrates Kazakhstan's new status in the international discourse on the opportunities and risks presented by planetary development. The Global Challenges Summit is bringing together hundreds of speakers drawn from the ranks of the most prominent politicians, businessmen and scholars, along with the thousands of experts taking part in the forum.
The AEF 2018 has been opened by the plenary session with the participation of President of Kazakhstan Nursultan Nazarbayev themed “World of Global Challenges”.
“Dear forum’s participants, dear friends, welcome to Astana! For many of those presenting here, for our citizens, the participation in the Astana Economic Forum has become a good tradition. And I’d like to thank you for this”, the President of Kazakhstan started in his welcoming speech.
Since last year's forum, the world witnessed tremendous changes. There were new confrontations. It became more difficult to agree among the states. This became a difficult period for the world. Therefore, according to Nursultan Nazarbayev, it is very important to objectively discuss the issues related to these difficulties, important for humanity.
“In this regard, this forum is aimed at finding the effectiveness of responses to global challenges. The world's most famous experts gathered here for this”, N. Nazarbayev said.
Today the world is changing very fast. The observed processes are objective and are caused by global changes. Their character can be described through five major megatrends of the planet's development presented by the Head of State. And here digitalization is the first megatrend of all aspects of human activity.
“A new model of economy is rapidly emerging before our eyes, in which not only business but the whole life of society is digitized. Achieving a critical mass of new technologies is changing the basic factors that previously determined the competitiveness of countries. Self-learning electronic systems that control and improve production have become commonplace. By 2030 artificial intelligence will increase the world economy by 16 trillion dollars”, N. Nazarbayev noted.
The Head of State also added that the phenomenon of crypto-currency and blocking technologies is likely to entail drastic changes for the financial market, including banks.
“According to experts, 200 of 500 largest companies will disappear in the coming decades. At the same time, digitalization is accompanied by the growth of cybercrime. In 2017 it was recognized as the most serious threat to business. Although a year ago it was only on the fifth placement. Undoubtedly, these and other factors determine the desire of countries not to be in the digital province. But we are adapting to this new reality: the “Digital Kazakhstan” program has been launched. Its implementation will ensure the development of digital infrastructure”, N. Nazarbayev emphasized.
“The IT ecosystem in the country, the digital literacy of the Kazakh population will exceed 85%. Using new technologies we are planning to increase labor productivity in the manufacturing sector by 1,5 times in 5 years”, the President added.
The second megatrend - the energy revolution of the world's movement towards clean energy.
“In 30 years the amount of energy received from renewable energy sources has increased 15 times. The cost of solar panels in the past five years has fallen almost 2 times. There is a boom in electric vehicles manufacturing. As experts say, the replacement of the entire vehicle fleet by electric cars will lead to cleaning of the air to the level of 200 years ago”, Nursultan Nazarbayev said.
The President of Kazakhstan also noted that natural resources stop becoming key advantages and sources of super profits for the countries that have them.
“We see that almost all the major players in the traditional energy markets, corporations, countries have engaged in large-scale investments in new source of energy. Kazakhstan also does not stand aside from this process. The international exhibition “EXPO-2017” devoted to the “Future Energy” successfully held by us became the basis for the system development of the “green” economy in the country. In general, by 2030 the share of alternative energy resources in our energy balance will be brought up to 30%”, the Head of State assured.
The third megatrend - the rapid growth of the planet's population. According to the Head of State, the achievement of scientific and technological progress allowed to increase the average life expectancy.
“The achievement of scientific and technological progress in the last 10 years allowed to significantly increase the average life expectancy. Over the past 70 years, it has increased by 23 years - from 48 to 71 years. In Kazakhstan, this indicator increased over the years of independence by 7 years - from 65 to 72.5 years. The industry of longevity is becoming an important part of the world economy. However, rapid demographic changes require the solution of many related problems. In order to feed 10 billion people in the middle of the century it’s necessary to produce food by 60% more than today. And this is not an easy task”, N. Nazarbayev said.
The President of Kazakhstan named the fourth megatrend. It’s a change in the pace and nature of urbanization. N. Nazarbayev noted that according to the UN estimates by the middle of the century the number of people living in cities will make up 7 billion people, while the hyper concentration of the population in the largest agglomerations will continue.
“The era of megacities is coming and there will be competitions between them, which are fighting for investments, the best minds and technologies, creating all necessary conditions for this. This is important for the economy of ideas and knowledge. Taking this into account, Kazakhstan has started implementing the agglomeration development strategy. Previously we have had only one city with a population more than one million people (Almaty). Now Astana, Shymkent have been added. This process will continue, so it is no coincidence that one of the events within the framework of the 20th anniversary of our capital Astana, which we will celebrate literally on July 5, will be the holding of a forum of major cities, countries located on the Silk Road”, Nursultan Nazarbayev said.
Finally, the fifth megatrend, Nursultan Nazarbayev called the transformation of the global labor market. According to the Head of State, predictable physical labor in the coming years can be replaced by robotic systems by 80%. For modern enterprises, it becomes important not for the cheapness of the labor force but for the availability of qualified employees.
“Economic feasibility appears to place production in developed countries, transferring them back from developing, which we are now observing. It is a challenge for national economies and social systems. The main answer here is the reform of the education sphere. It implies a transition from the practice of transfer of knowledge to the formation of skills of creative thinking, the ability to find the right information and use it correctly. The speed of the technical process requires a modern person to be willing to change several professions in life and follow the principle of education throughout life. Here, Kazakhstan also carries out consistent work, we prepared for this and are preparing, changing the training programs at all levels”, the Head of State said.
The President of Kazakhstan also noted the “Bolashak” program and free vocational education for young people.
“We launched the “Bolashak” program to train our youth at the best universities in the world. For 25 years, almost 13 thousand Kazakhstanis have been able to learn with the help of this program at the best universities of the world at the expense of the state. Now 70 thousand Kazakhstani youth are studying outside the country. In parallel, we created our own universities of a high world level, and they are recognized: Nazarbayev University, Kazakh-British Technical University, Kazakhstan Institute of Management, Economics and Planning, International University of Information Technology. They also train cadres of high, modern level. The state increases the number of grants, improves the living conditions of the student youth. Since last year, we launched a program - free vocational education for young people, to get the first working profession in life”, Nursultan Nazarbayev explained.
Nursultan Nazarbayev emphasized that these five global trends became the main factors of the instability observed in the world.
“Geopolitical tensions, mutual sanctions, the revision of trade relations between major players, contrary to the WTO rules, are all attempts by the countries to actually level the field of the game in order to maintain their leadership. However, the main feature of the ongoing transformation is that for the first time it is really happening in the global world. Problems in outsider countries carry increasing risks for the well-being of successful countries. I think that this must be remembered. This happens through migration, extremism, terrorism, ecological catastrophes that do not recognize state borders. In this regard, it becomes important to reduce the gap between the income of the poor and the rich, as one of the main sources of social contradictions”, Nursultan Nazarbayev emphasized.
We remind that the AEF 2018 Global Challenges Summit will be held within 3 days. Over 6000 people representing 111 countries are participating at the AEF 2018.
Photo by Bauyrzhan Zhuasbayev