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Kazakhstan Unrest Costs Retailers $57 Million in Damage and Theft

Damaged stores in a shopping mall following protests in Almaty, Kazakhstan.
Damaged stores in a shopping mall following protests in Almaty, Kazakhstan. (Alexandr Kuznetsov/Anadolu Agency via Getty Images)

More than 100 businesses, including major shopping malls Mega Alma-Ata, Promenade and the local branch of Tsum, have been affected by protests that began Jan. 5, with retailers collectively experiencing an estimated $57 million in damage and theft.

Numerous shopping centres and banks, including small businesses in Kazakhstan’s largest city Almaty were targeted by looters smashing shop windows and breaking ATMs before government forces intervened.

The damage to shopping centres amounted to around 25 billion tenge ($57 million), the Union of Retail Chains of Kazakhstan reported Thursday. On Monday, Kazakhstan’s President Kassym-Jomart Tokayev estimated that the protests had cost the country over $2 billion.

Olga Comissar, a retail expert on Russian and Kazakhstani markets and owner of the Glyph Agency, told BoF the looters targeted shops specialising in electronics, as well as jewellery and shoe stores. She pointed out that some of the shopping malls, including Almaty’s Essentai Mall, were able to fend off looters, especially the jewellery shops, which were equipped with quality security systems.

Russian-owned sportswear chain Sportmaster and its high street fashion retail chain O’Stin estimated their collective damage to be 3 billion tenge ($6 million) with 20 to 25 stores in Uralsk, Almaty and Shymkent impacted. The Mon Amie beauty chain reported eight of its stores in Almaty were looted, while Intertop shoes and Eureka, another retail chain, estimated damage of 50 million tenge ($114,000), and fashion retail chain Kimex/Gracie said 11 of its stores were looted, with damage and theft accounting for 1 billion tenge ($2.2 million) in losses.

Comissar, a Russian citizen who was evacuated from Almaty to her homeland in recent days, said some of the shopping centres are now planning to reopen. The situation in the country has calmed somewhat, but most stores remain closed.

Protests in Kazakhstan started in the beginning of January when fuel prices rose abruptly in western areas of the country, where major petrol companies are based. Protests opposing the price hikes quickly reached large cities, including the country’s former capital and its largest city, Almaty, as well as its current capital, Nur-Sultan (formerly known as Astana).

Authorities have imposed a state of emergency across the country until Jan. 19 and launched a counter-terrorism operation. According to the UN, about 1,000 people have been injured during the protests. Kazakhstan’s Ministry of Internal Affairs says 17 security officers were killed.

On the morning of Jan. 5, President Tokayev dismissed the government and called on the Russian-led Collective Security Treaty Organisation (CSTO), an intergovernmental military alliance in Eurasia that consists of select post-Soviet states, for help “overcoming the terrorist threat”. The CSTO Collective Security Council has since sent peacekeeping forces to Kazakhstan.

Learn more:

Kazakhstan, More Than Just a Klondike

In the next instalment of Market GPS, BoF examines Kazakhstan, the undisputed goliath of Central Asia.

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