Economic Development in Kazakhstan: The Role of Large Enterprises and Foreign Investment

By Anne E. Peck | Go to book overview

3

RESTORATION AND RECONSTRUCTION OF KAZAKHSTAN’S LARGE ENTERPRISES IN THE NEW SOVIET STATE, 1920-40

Beginning in 1916 and continuing through the 1917 Revolution and the ensuing years of struggle for control between the Bolsheviks and the White Army, economies collapsed throughout the former Russian Empire. By 1920, total industrial output had declined by nearly 80 percent to only 20.4 percent of levels achieved in 1913; output declines at the large enterprises were even greater, with production in 1920 amounting to just 12.8 percent of 1913 levels (Baykov 1947:8). In Kazakhstan, the decline in total industrial output from 1913 to 1920 was more moderate, amounting to only 54.1 percent (Alampiev 1959:127). Undoubtedly, the industrial decline was less because only a limited amount of Kazakhstan’s total industrial output was non-agricultural. Indeed, output from Kazakhstan’s industries “producing the means of production, ” as the resource enterprises would have been classified, declined 78 percent, a decline similar to that experienced throughout Russia. In all events, the industrial economy was itself a comparatively small proportion of the Kazakh economy in 1913, at just 15 percent of the total. By 1920, this proportion had shrunk to only 6.3 percent.

The industrial collapse was accompanied by severe agricultural shortages as grain and livestock were requisitioned for the war effort and, from then on looted by the advancing and retreating Red and White armies during the long period of struggle for control of the countryside after the Revolution. Not surprisingly, Soviet crop production in 1920 was only 60 percent of that in 1916; livestock numbers had declined 30 percent, from 162.3 million horses, cattle and sheep to just 114.3 million (Baykov 1947:23). In Kazakhstan, the agricultural situation worsened further when 1921 saw both poor crops and the worst hard winter in decades when thousands more animals were lost in a severe joot. Operations at the large resource based enterprises throughout Russia also were affected seriously. The experiences of the enterprises in Kazakhstan - at Ekibastuz, Ridder, Karaganda,

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