2. Address remaining digital quality and connectivity gaps

Since the early 2000s, successive national connectivity plans have succeeded in developing a fairly advanced network of ICT infrastructure providing affordable and quality access to internet in most of Kazakhstan’s urban centres. In terms of access, nearly universal mobile coverage has been in place since 2015 at least, with the population covered by 2G or higher networks reaching 98% in 2019, while access to broadband internet remains more modest (ITU, 2022[1]). Internet access has also become widely affordable across the country, with fixed and mobile subscription costs falling in recent years; they are now well below the UNESCO’s affordability target of 2% of Gross National Income (GNI) per capita. Fixed subscription costs stood at 0.85% of GNI per capita in 2020, compared to a 2.3% average for the Commonwealth of Independent States (CIS), while mobile subscriptions costs are among the lowest in the world at 0.33% of GNI per capita, compared to 1.0% in CIS countries and 2.6% globally (ITU, 2022[1]; ITU, 2021[2]; Cable, 2022[3]). Improvements have also been made on the quality front, with about three quarters of the population covered by 4G internet in 2021, while the download and upload speeds of broadband lines have doubled on average since 2017 (EIU, 2022[4]). Digital connectivity at large has also progressed in Kazakhstan, with a significant reduction in the rural-urban connectivity gap1, with 89% of the rural and 91% of the urban population having access to broadband networks in 2019 (ITU, 2022[5]).

While fixed internet is a key driver for SME digitalisation, broadband uptake in Kazakhstan remains low compared to OECD countries. Broadband subscriptions per 100 households rose only slightly, from 13.1 in 2015 to 13.8 in 2021, compared to 33 on average in high-income countries (ITU, 2022[5]; OECD, n.d.[6]). Though there are no data available on small businesses specifically, only 7.8% of medium and large enterprises reported having access to fixed broadband internet in 2020 (Figure 2.1), while 48% of small business indicated having a website in the latest World Bank Enterprise survey, compared to almost 90% for large businesses (World Bank, 2021[7]). Access to fixed broadband internet varies widely among regions, ranging from 4.3% in Aktobe Region to 15.2% in neighbouring Atyrau. In 2019, the number was even lower (5.9%), with the recent increase being presumably at least partially due to the effects of COVID-19. As a result, only 11% of medium and large enterprises reported using digital technologies in 2020, and while no data is available for SMEs, OECD interviews suggest that the numbers could be even lower for the latter (National Statistics Office, 2022[8]).

This trend might suggest persistent gaps in broadband quality and access. One reason might be a persistent urban-rural network quality divide: while high-quality fixed broadband subscriptions have an average upload and download speed of at least 206.6 Mbps, the remaining 46% of subscribers have access to less than 10 Mbps (EIU, 2022[4]; ITU, 2022[5]). Since existing telecom infrastructure is primarily located along main highways and in densely populated urban areas, high-quality fixed broadband is concentrated in very large urban areas, leaving the rest of the country to work with lower quality internet (UNESCAP, 2020[9]). However, even within large urban centres, OECD interviews indicated that internet speeds can remain below the levels required for business usage (FCC, 2022[10]).

As a result, OECD interviews confirmed that mobile hotspots and linked mobile devices have become the primary source of internet access for the majority of the population and of small businesses. However, doing so constrains the ability of firms to further advance their digital uptake, as mobile internet is less adapted to the levels of data and digital technology usage associated with business operations (FCC, 2022[10]). In addition, progress in improving mobile network quality has stalled since 2019, with the 2021 mobile up- and down-load speeds slightly deteriorating on average compared to 2019 (Figure 2.1), indicating increasing strain on the mobile sector which could further impede small firms’ digital uptake.

Despite substantial efforts to build a large network of ICT infrastructure, firms, especially the smallest among them, remain marginal users of internet and digital services. Kazakhstan has started to address these issues, but could do more to bridge the connectivity gap. In particular, the regional and local public sector (e.g. Akimats or Maslikhats at the oblasts or district level) could be mobilised to develop (i) an evaluation process for digital infrastructure needs, rollout and quality, and, where needed, (ii) high-speed “municipal networks”, in co-operation with other public or private actors.

Bridging connectivity gaps is a matter of access, affordability and quality. If the two former have been addressed rather successfully in Kazakhstan, the quality of connections remains variable and sometimes below the speeds required for business applications. The same is true for mobile internet. The government could develop an integrated evaluation process to assess digital infrastructure rollout and quality. First, this would require defining key performance indicators (KPIs) to set a minimum level of digital coverage and quality. The indicators should be user-needs based, and combine a qualitative and quantitative approach. Once these are defined, and regularly reviewed, data should be collected on a regular basis, from both operators and end-users (households and businesses), and analysed by the competent authorities at the regional and central level to adapt policies where needed (Box 2.1). For instance, the Ministry of Digital Development, Innovation and Aerospace Industry (MDDIAI) and Atameken, the National Chamber of Entrepreneurs, could review, on a quarterly or semi-annual basis, internet quality gaps and related business needs and challenges. Given that rural and small urban areas usually have a unique set of issues associated with their low density and distance to core network facilities, the KPIs could be adapted regionally, requiring close co-operation and co-ordination between the central, regional, and municipal levels of government.

In Kazakhstan, as in many OECD countries, beyond network quality, a coverage gap persists mostly between urban and small urban and rural areas. Narrowing this gap is critical to strengthening the overall economic development of these regions and the competitiveness of their small firms and entrepreneurs. Since the “last-mile” connectivity initiative has not been successful so far in connecting these regions, their municipal or regional governments, in co-operation with local interest groups and citizen-led initiatives could facilitate, build, operate or finance high-speed networks, compensating for the absence of operators. Across the OECD area, such municipal networks have been successful in extending connectivity in regions where deployment by national communication companies was lacking or deemed unprofitable; they have contributed to increased competition, and therefore lower prices, in areas where coverage was partially provided by national operators (Mölleryd, 2015[15]) (Box 2.2). However, institutional framework conditions, in particular open competition in the telecom market, have proved an important enabler of such bottom-up initiatives in OECD countries such as Mexico, Sweden, the UK, and the US (OECD, 2021[13]).

Over recent years, Kazakhstan has increasingly turned towards data-driven policies, especially to improve the quality and coverage of digital infrastructure networks. For instance, under the NDS, citizen-reporting platforms have been created as a monitoring tool for minimum internet speed requirements imposed on operators in remote rural and small urban areas (Government of Kazakhstan, 2017[16]). The online platform gathers complaints about internet quality and is linked to the Interdepartmental Commission on Radio Frequencies and local state telecom authorities. It verifies connection quality and fines telecom operators immediately should quality fall below the minimum threshold.2 OECD interviews indicate that the system has enabled the improvement of internet connection quality, especially in Kazakhstan’s border areas, which face the lowest quality. OECD interviews further find that the MIID also developed monthly public-private dialogue (PPD) with the Council of Operators since 2020, where the owners of main telecommunication infrastructure and towers and large business associations discuss infrastructure bottlenecks and challenges. However, neither regional governments nor small last-mile operators are part of such meetings, which limits their effectiveness in gathering the relevant actors – national and local operators, regional authorities, and the private sector – to address often highly localised issues.

In addition, one of the main objectives of the current NDS, DigitEL, is the development of data-driven government by 2025. The “attentive and effective state” initiative aims at creating a unified data collection process to ground policy decisions, including the development of user feedback for public services, and more importantly the automatic collection and treatment of data relevant for policy-making. However, in its current state, the initiative only targets industrial data to be monitored by the public revenue committee (Government of Kazakhstan, 2021[17]). If proven effective, the initiative could be expanded in the coming years to new sectors, where it could thereby serve as an important tool for gathering data about the digital needs and use of businesses.

Kazakhstan’s digital strategies have succeeded in creating a wide and effective network of e-government services and the conditions for developing data-driven government. However, during the interviews conducted by the OECD, the lack of systematic and comprehensive data collection about the needs and challenges of businesses in relation to their digital uptake, beginning with access to quality and affordable ICT infrastructure, was repeatedly mentioned.

Atameken and other business associations gather some qualitative data on business digital needs and challenges, but Kazakhstan has no systematic and comprehensive data collection on firms’ access to and use of the internet. The Statistical Office collects some data on internet use of medium and large-sized industrial enterprises, without collecting information on businesses active in other sectors or from SMEs. Digital indicators are mainly collected for individuals, leaving aside important information such as business subscriptions to mobile and fixed internet (National Statistics Office, 2022[8]). Similarly, the digital one-stop-shop (OSS) “Government for Business” launched early this year aims at creating a direct interaction channel between the government and SMEs (Government of Kazakhstan, 2021[17]). The portal provides entrepreneurs with access to public services and support measures of government entities, such as Atameken or DAMU, and access to digital commercial systems, though it does not provide an opportunity for businesses to report and seek advice on the barriers or challenges they might face in their digital transformation.

In addition, beyond the monthly gatherings between the MIID and large operators on infrastructure challenges mentioned above, no public-private dialogue mechanisms exist involving all stakeholders in the digital infrastructure sphere. Consequently, a gaps assessment at the regional or national level is missing. Where it does exist, it is ad hoc and generally through the lens of operators. This represents a significant limitation on efforts to foster the digital uptake of firms, as on the demand side businesses lack an important channel to discuss and report issues to business associations and local and central governments, while the public sector has a hard time analysing precise evolutions and determining best policy actions to support firms in their digital journey.

In order to address the remaining digital quality and connectivity gaps, Kazakhstan could (i) regularly and systematically collect data on firms’ use of digital infrastructure and services and the barriers they face; (ii) develop regular public-private dialogue (PPD) mechanisms at national and regional level to discuss the state of digital infrastructure; and (iii) generalise the use of data-driven public sector approaches to support the digital transformation of firms.

Accurate data are essential to effective policy-making. National statistical offices (NSOs) in OECD and partner countries regularly collect (on a quarterly and annual basis) data pertaining to the basic access to and use of internet and digital tools by businesses, including as access to the internet, mobile and broadband subscriptions, and use of digital tools. In addition, they provide detailed data by firm size, sector of activity and location, allowing for the detection of connectivity and digital uptake gaps between small, medium and large enterprises. Kazakhstan’s NSO could develop similar systematic data collection, to supplement its data on digital and SME topics. Atameken or other business associations could also build on their existing networks to conduct regular surveys of firms, especially SMEs, to gather qualitative data on their use of digital infrastructure and services as well as their experience and the barriers they face in doing so. The introduction of regular PPD mechanisms, at both national and regional levels, would complement such an approach, by offering a regular platform for exchange between central, regional, and municipal authorities, large operators on the supply side, and end-user private sector representatives on the demand-side. For instance, Atameken could head such an initiative and liaise with the Akimats or Maslikhats at the oblasts or district level, the MDDIAI, and the Association of National Telecom Operators. Such a systematic dialogue mechanism would ensure the government is up to date on the needs of the private sector and can adapt its policies accordingly.

Once developed, comprehensive data collection on business use and needs in relation to the digital transformation could inform policy-making and monitoring to support infrastructure rollout and the digital transformation of firms. Kazakhstan could expand the data-driven public sector strategy laid out in the DigitEl programme to telecom infrastructure, while defining a data governance model fitting the specific needs of both the sector and of small firms (Government of Kazakhstan, 2021[17]).


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[12] Bureau of National Statistics (2022), Small and Medium Enterprises (database), https://stat.gov.kz/official/industry/139/statistic/6 (accessed on 29 April 2022).

[3] Cable (2022), Worldwide mobile data pricing 2021, https://www.cable.co.uk/mobiles/worldwide-data-pricing/ (accessed on 28 April 2022).

[11] DAMU (2020), Annual Report on SMEs Development in Kazakhstan and its regions, https://damu.kz/upload/iblock/192/Damu_Book_2019_EN.pdf.

[4] EIU (2022), The Inclusive Internet Index (database), https://theinclusiveinternet.eiu.com/ (accessed on 21 April 2022).

[10] FCC (2022), Broadband Speed Guide, https://www.fcc.gov/consumers/guides/broadband-speed-guide (accessed on 28 April 2022).

[17] Government of Kazakhstan (2021), Digital Era Lifestyle Programme.

[16] Government of Kazakhstan (2017), State programme “Digital Kazakhstan:, https://digitalkz.kz/wp-content/uploads/2020/03/%D0%93%D0%9F%20%D0%A6%D0%9A%20%D0%BD%D0%B0%20%D0%B0%D0%BD%D0%B3%D0%BB%2003,06,2020.pdf.

[1] ITU (2022), Digital Development (database), http://itu.int (accessed on 27 April 2022).

[5] ITU (2022), World Telecommunication/ICT Indicators Database online, https://www.itu.int/pub/D-IND-WTID.OL-2021/fr (accessed on 29 April 2022).

[2] ITU (2021), The affordability of ICT services 2020, https://www.itu.int/en/ITU-D/Statistics/Documents/publications/prices2020/ITU_A4AI_Price_Briefing_2020.pdf.

[15] Mölleryd, B. (2015), “Development of High-speed Networks and the Role of Municipal Networks”, OECD Science, Technology and Industry Policy Papers, No. 26, OECD Publishing, Paris, https://doi.org/10.1787/5jrqdl7rvns3-en.

[8] National Statistics Office (2022), Share of large and medium-sized industrial enterprises using digital technologies (database), https://stat.gov.kz/api/getFile/?docId=ESTAT410029 (accessed on 3 May 2022).

[13] OECD (2021), Bridging digital divides in G20 countries, OECD Publishing, Paris, https://doi.org/10.1787/35c1d850-en.

[18] OECD (2019), The Path to Becoming a Data-Driven Public Sector, OECD Digital Government Studies, OECD Publishing, Paris, https://doi.org/10.1787/059814a7-en.

[6] OECD (n.d.), OECD Studies on SMEs and Entrepreneurship, OECD Publishing, Paris, https://doi.org/10.1787/20780990.

[9] UNESCAP (2020), In-depth national study on ICT infrastructure co-deployment with road transport and energy infrastrutcure in Kazakhstan, https://www.unescap.org/sites/default/files/In%20depth%20national%20study%20on%20ICT%20infrastructure%20co-deployment%20with%20road%20transport%20and%20electricity%20infrastructure%20in%20Kazakhstan%2C%20ESCAP.pdf.

[7] World Bank (2021), World Bank Enterprise Survey.


← 1. The term “connectivity gap” refers to gaps in access and uptake of high-quality broadband services at affordable prices in areas with low population densities and for disadvantaged groups compared to the population as a whole (OECD, 2021[13]).

← 2. At the time of writing, a new draft law is under consideration to increase the liabilities of the operators in case of low or deteriorating network quality.

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