Vladimir Putin’s Russia deserves the full brunt of every economic sanction that can be levied against it; all weapons of economic statecraft should be wielded to make the Kremlin abandon its shameful invasion of Ukraine. However, these weapons should be designed to minimize the collateral damage on Russia’s neighbors who have spoken out against Moscow’s aggression, voiced sympathy for Kyiv, and are valued U.S. partners.
Given Russia’s role as a major economic partner for its former colonies, a primary transportation corridor, and a destination for regional migrant workers, some indirect economic harm to its neighbors will be inevitable. The hardest hit will be countries in land-locked Central Asia that are reliant on Russian pipeline, rail, and port access to bring their goods to the global market.
Alternative routes through Iran and Afghanistan are problematic, leaving China as the most viable option. Justified freezes on Russian financial institutions will have secondary effects on key trade partners. The absence of Russian wheat, which feeds much of the Middle East, North Africa, and the Caucasus, will be felt around the world. Combine this with rising global inflation and skyrocketing energy prices, and Russia’s neighbors are facing a perfect storm for which they are not responsible. In fact, Georgia, Kazakhstan, Moldova, Uzbekistan, and others distanced themselves from Moscow’s invasion of Ukraine by abstaining from United Nations’ (UN) votes and issuing high-level declarations.
Take Kazakhstan, for example. Recently, Nur-Sultan stated that it will not help Russia evade sanctions and that it will not recognize the independence of parts of Ukraine controlled by pro-Russian separatists. Speaking to reporters in Brussels recently, Timur Suleimenov, the first deputy chief of staff to Kazakh president Kassym-Jomart Tokayev, said his country would not “be a tool to circumvent the sanctions on Russia by the US and the EU” and that it would continue to respect the territorial integrity and sovereignty of Ukraine. In a sign that Nur-Sultan is concerned about the spillover effects of Western sanctions, he added that while Kazakhstan is, along with several other neighboring former Soviet states, in the Eurasian Economic Union with Russia, “we are also part of the international community. Therefore, the last thing we want is secondary sanctions of the US and the EU to be applied to Kazakhstan.”
The Kazakhs are walking a fine line along their almost 4,700-mile border with the Russian Federation. The landlocked country is heavily reliant on east-west and north-south Soviet-era transit routes. Russia is one of its largest trade partners, second only to the European Union.
Having voluntarily given up its arsenal of 1,400 nuclear weapons after the dissolution of the Soviet Union, Kazakhstan has no real prospect of defending itself against any Russian military threat. Even so, Kazakhstan has matched its words with actions, delivering humanitarian assistance to Ukraine, including medical supplies.
Moreover, although the Kazakh government requested military assistance through the Russian-led Collective Security Treaty Organizations (CSTO) in January, and received more than 2,000 Russian peacekeeping forces to help Tokayev weather violent domestic protests, Nur-Sultan refused to send troops to Ukraine at Moscow’s request.
Kazakhstan also abstained in the vote for resolutions condemning Russia’s invasion of Ukraine in the UN General Assembly. As a country caught in a geographical vice between Russia and China, and close to India and Turkey, Kazakhstan strives to portray itself as a neutral forum for peacemaking. Having previously hosted negotiations on the Iranian nuclear deal and the Syrian Civil War as part of its peace-seeking “Astana Process,” Kazakhstan also offered to host peace negotiations between Russia and Ukraine in 2018 and 2022.
But its multi-vector approach to diplomacy will not insulate it from a Russian economic implosion. Kazakhstan’s European trade routes transit primarily through Russia, and now that those routes have been blocked, Kazakhstan is left with costly and complex Trans-Caspian routes as its only option to facilitate westbound trade.
Had the U.S. Department of Treasury not excluded the export of Kazakh crude oil through Russia from the current sanctions, Nur-Sultan would have been dealt a major blow. An overly aggressive application of sanctions will raise concerns related to Tokayev’s recently announced package of democratic and humanitarian reforms that aim to tackle corruption and income inequality and will be financed in part by state oil revenues.
Those reforms are much needed. Kazakhstan has known only two leaders in its thirty years of independence since the Soviet Union’s collapse. So-called “political stagnation,” stemming from gaping income inequality and tolerance for corruption, was the sociopolitical powder keg that exploded in January after a massive fuel price spike.
After the protests, Tokayev promised a more balanced use of presidential power, a competitive political party system, decentralized governance, stronger courts, human rights protections, and greater media freedom. The implementation of these reforms in a challenging geostrategic environment will be the country’s greatest test.
Kazakhstan finds itself in a pivotal moment. Implementing the political and economic opening Tokayev has promised will be harder if Kazakhstan enters a recession. It is crucial for Kazakhstan to mitigate the economic impact of sanctions on Russia to embark on a path toward liberalization.
The policy of the United States and its allies must be to support, not punish, its strategic partners in Eurasia and encourage countries in the region to take a more independent path. This must include crafting economic sanctions against Moscow that avoid or minimize their indirect effects on former Soviet states that are resisting pressure from a resurgent Russia. Expanding investment and economic ties with Eurasia would be in U.S. national interests.
James Bacchus is an adjunct scholar at the Cato Institute, a former member of Congress, and a former chief judge for the World Trade Organization.
Ariel Cohen, Ph.D., is a non-resident senior fellow at the Atlantic Council, a member of the Council of Foreign Relations, and the author of Russian Imperialism: Development and Crisis.