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Kazakhstan Wants to Get Out of a Deadlock in Digitalization

A new platform by Sber is a good option, says the government

Photo: Pixabay.com

Kazakhstan’s authorities are ready to spend about $500 million to upgrade eGov, a national hub for state services online. The largest commercial bank in Russia Sber might receive the lion's share of that money. Local companies can have in view just one-fifth of the total sum.

The future transition to digitalization platform and Data Driven Government concept has been discussed in Kazakhstan for two weeks. During the Eastern Economic Forum on September 3, Kazakhstan’s Prime Minister Askar Mamin and CEO of Sber Herman Gref signed a Memorandum on Cooperation in the Area of Digital Transformation of Kazakhstan, which is expected to be based on Sber’s technologies.

The news has provoked an outcry in the country. Because the text of the agreement has never been published, some people are fearful that Russia may acquire personal data of Kazakhstanis and oppose the idea.

According to Bagdat Musin, minister of digitalization, innovations and aerospace industry in Kazakhstan, the decision is right because, despite the impressive success on the surface, the country’s digitalization got stuck in a deadlock and needs external help.

Exit from IT deadlock 

“Currently, there are more than 400 different IT systems in Kazakhstan. They are not the same in terms of quality; they use different technologies and were built by 400 IT teams from 30-40 independent companies. Of course, they do not feel good about the idea of a single platform. They are used to making money on contracts with the government and would prefer to leave things as they are,” Musin stated while meeting with the IT industry's representatives.

This heterogeneity will disappear once the digitalization platform is set, said the digital minister. The future platform should operate similarly to how the AppStore does: there are loads of services and developers but only one platform.

Currently, some services that were always supposed to be online aren’t online at all. Once all digital systems are placed on a platform, it will be much easier to upgrade or add any new service to that platform.

While delivering a speech at the IDC CIO Summit-2021, Musin gave an example of architectural replanning of one’s apartment. First of all, any owner would have to find an architect who prepares a new plan. Then an owner has to get approvals from several city departments and only then an operator would add a new plan to the database.

“I’ve asked a simple question: who would take the responsibility if a building collapses? Officials who had approved the document or an architect who designed the project? And every department responded to me that it would be an architect because he has a license. If so, why don’t we give him access to the system to make him able to download all these new plans on his own and avoid all that bureaucracy?” said Musin. He’s also promised to revise every aspect of the issue while the transit is occurring.

Money issues

The digital transit stipulated by the agreement with Sber might cost about $500 million. For comparison: over the period of five years, Kazakhstan has spent $940 million for the development of e-government, communication infrastructure and information security.

About one-third of the money will be a share of Sber, which is a vendor in this project. Also, Kazakhstan is going to buy some new equipment and purchase services from local IT companies which should also take part in the process. As Bagdat Musin told the Kursiv edition, the industry’s players can be recipients of about $100 million.

According to the official his agency wants Russian suppliers and local designers to develop a Kazakhstani version of GosTech (an online platform in Russia) based on Platform V by Sber. Musin doesn’t rule out that this product may be exported in other states of Central Asia in the future.

Whose code is better

No state on Earth has completed a full transit of all its IT systems to just one platform. However, Kazakhstan has chosen Sber due to its national legislation, which requires taking security concerns into consideration. In 2017 Kazakhstan tried to negotiate with Microsoft to purchase the company’s product for governments. At that moment, this software was already used in UAE and Singapore. But Kazakhstan had one pre-condition: the country wanted to get the initial code along with the product; Microsoft refused to do so.

In turn, Sber is ready to pass all codes over to Kazakhstan, which makes the National Security Committee, the government and the president's office happy.  

“We want initial codes to make sure that no one is going to spy on us or hurt our national interests,” said Musin.

Moreover, all servers for the new platform will be placed in the territory of Kazakhstan. The laundry list of all technologies offered by Russia should be published soon even though Kazakhstani experts have already reviewed 90% of it, the minister added. 
However, Nurlan Isin, head of the IT Companies Association says that there are at least two similar V-type platforms in Kazakhstan: OR3 and Arta.

“Platform V is just a tool which can be used for developing any application. And we have this tool as well. But does it fit well for e-government? There are loads of services and all of them should be rewritten one by one to get adjusted to the new system. This is a huge task that can last for years,” said the expert.

Bolat Basheev from Committee on IT, Education and Innovations under the National Chamber of Entrepreneurs Atameken agrees. 

“There are at least two low-code / no-code platforms, which can do exactly the same as Sber’s platform does,” he told the Kursiv edition. Unless the real costs of the project are published, there is no way to guess what the share of Kazakhstani companies might look like, he added.

This spring Both Basheev and Isin were among those who signed a letter to President Kassym-Jomart Tokayev in an endeavor to attract his attention to the domestic IT industry. They insisted that locally designed platforms can embrace any information system in a cheap and fast manner.

“Kazakhstani IT companies are ready to provide the government with these platforms in the shape of private-public partnership,” they said in the letter. Industry players advocated digital sovereignty and asked to allow them to find a technical solution for further digitalization in the country on their own.

The letter was sent to the president after the first draft of the agreement with Russia and Sber appeared on the internet. Right after the public outcry, the draft was deleted and Musin assured the public that this was a mistake and Sber just offered to make an audit of the digital systems in Kazakhstan.

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