BAKU, Azerbaijan, October 19. Kazakhstan has
become the first country in Central Asia to join the World Bank
Group's global Metals and Minerals Compact initiative. The
Compact's strategy, developed by Kazakhstan's Ministry of Industry
and Construction and the Agency for Strategic Planning and Reforms
in cooperation with the World Bank, aims to help mobilize around
$20 billion in investment by 2031. Achieving this target will
depend on preparing specific projects, creating favorable
conditions for investors, and developing the necessary
infrastructure.
The scale of the task reflects the importance of the mining and
metals sector to Kazakhstan's economy. Mining remains the largest
single block of Kazakhstan’s industry. According to the Bureau of
National Statistics, industrial output in January–September 2026
totaled 51.9 trillion tenge (about $109.3 billion). Mining and
quarrying, which in official statistics includes oil and gas,
accounted for 24.4 trillion tenge ($51.3 billion), or 46.9%
The mining sector's substantial share of industrial output
reflects its role in Kazakhstan's economy. However, the economic
returns from mineral resources depend not only on extraction
volumes but also on how much raw material is processed domestically
and how much value this processing generates. Ore beneficiation,
deeper processing, and the production of higher-value-added goods
can help develop new manufacturing activities, create demand for
equipment, engineering and transport services, and expand
opportunities for local suppliers.
Developing domestic processing requires not only investment but
also favorable conditions for implementing projects. Industrial
facilities need reliable energy supplies, transport infrastructure,
modern technologies, and skilled workers. Reliable geological data,
transparent licensing procedures, and predictable regulation are
equally important. When information about mineral reserves is
insufficient, investors find it more difficult to assess the
prospects of deposits. Uncertainty over the rules governing
operations can also increase risks and extend project
timelines.
Cooperation with the World Bank could help Kazakhstan identify
the necessary reforms, improve conditions for investors, and
prepare projects to attract capital. However, the outcome will
depend on the extent to which the proposed measures translate into
concrete regulatory changes and better conditions for implementing
investment projects.
The development of critical mineral processing is also being
pursued through individual investment projects in Kazakhstan. One
example is a tungsten processing plant project worth more than $1.1
billion involving US-based Cove Capital in the Karaganda region. It
illustrates interest in establishing facilities focused on
processing mineral raw materials. However, the actual economic
impact will depend on the project's implementation, its production
capacity, and its ability to manufacture competitive products.
At the same time, expanding extraction and processing entails
environmental and social risks. Industrial facilities may consume
significant amounts of water and electricity, place additional
pressure on the environment, and affect local communities.
Environmental and social requirements therefore need to be taken
into account at the project preparation stage. This is important
not only for sustainable development but also for assessing risks
that could affect implementation timelines and financing terms.
The effectiveness of the World's Bank Metals and Minerals
Compact should be assessed by the volume of investment actually
mobilized, the launch of new processing facilities, and an increase
in the share of higher-value-added products in exports. The
creation of skilled jobs and the development of local supply chains
are equally important.
Ultimately, the success of the partnership will depend not only
on whether Kazakhstan manages to attract the targeted $20 billion
by 2031, but also on whether this investment leads to new
production facilities, expanded processing capacity, and a higher
share of value-added products in exports. These outcomes will show
whether the country can generate greater economic returns from its
mineral resources and strengthen its position in international
production chains.
