Swiss neutrality
Kazakhstan was the first of the former post-Soviet republics to publicly formulate its official position towards Putin's decision to recognize the Luhansk and DPR. The Foreign Ministry of Kazakhstan said yesterday: Kazakhstan does not recognize Donetsk and Luhansk republics, and hopes for a diplomatic solution to the situation in Ukraine.
Recall that 8 years ago, Kazakhstan did not recognize Crimea as Russian (and has not done so until now), however also expressed "understanding" of Russia's actions.
Will Kazakhstan fight for Russia?
Kazakhstan’s Foreign Ministry denies the possibility of sending the Collective Security Treaty Organization’s (CSTO) troops, thus involving Kazakhstan, Tajikistan, Kyrgyzstan, Belarus, and Armenia in the conflict between Russia and Ukraine. The CSTO charter strictly limits the use of military or peacekeeping forces. They can be used only within the CSTO area.
What will happen to tenge?
Kazakhstan's national currency is strongly correlated with the Russian ruble, due to the high share of trade turnover with Russia. Experts believe that while the entire package of sanctions against Russia is not known, in the near future the U.S. dollar will remain in the range of 431-433 tenge per 1 dollar. However, we should expect an increase in the risks of tenge devaluation in case of deterioration of the situation between Russia and Ukraine. As of today, the official rate of the dollar in the country is 437-439 tenge, while on February 21 the dollar opened at 426,5 tenge on the exchange.
Goods from Russia and Belarus will flood into Kazakhstan
Kazakhstan's share of trade with Russia is the largest. If the Russian market is significantly blocked in Europe, more Russian goods will flood into Kazakhstan. In case of escalation of the conflict, Belarus may be dragged into the conflict on the side of Russia. Accordingly, Belarus may also face sanctions and closure of access to the European markets. Thus more goods from Belarus will be transported to Kazakhstan. All this will adversely affect, first of all, Kazakhstan’s local producers whose market share will be significantly narrowed.
What's next?
Experts believe that much will depend on the scope and severity of the anti-Russian sanctions that the U.S. and its partners will impose. The crisis that is now erupting on the Russian-Ukrainian border, which has been going on since 2014, has not yet been exhausted. The key is what Russia will do next. If this escalates into an open military conflict, more severe sanctions from the West will follow. What will be the size of these sanctions and the damage from them - we have yet to find out.