Using local content policy to drive economic growth in resource-rich countries

As a result of the research, local content is now recognised by international organisations as a developmental instrument for nurturing the whole economy, beyond the oil and gas sectors. These organisations include the European Bank for Reconstruction and Development (EBRD), the United Nations Economic Commission for Europe (UNECE) and resource-rich governments. The research has therefore demonstrated how local content policy can be adopted to enable economic growth in industries associated with natural resource extraction.

In 2010 the Centre for Euro Asian Studies (CEAS), led by Professor Yelena Kalyuzhnova, formulated the first project related to the impact of local content development in Kazakhstan; this was supported by a Strategic Partnership Grant from the British Council's International Strategic Partnership in Research and Education (INSPIRE) programme, which is aimed at strengthening the links between higher education institutions in the UK and those in central and south-east Asia. This facilitated a long-standing collaboration between the CEAS and both Kainar University and the Kazakh-British Technical University in Kazakhstan.

Through continued engagement, the CEAS was successful in winning further British Council Institutional Links funding (from the Newton Fund) for research on local content impact in Kazakhstan's Energy Value Chain and was tasked with developing a Centre for Competitiveness. It received £500,000 from April 2015 to April 2017. The research generated by this funding was novel in that local content had not been considered before as an instrument for industrial and economic policy.

As a result of this engagement, the Kazakh-British Research Centre for Competitiveness (KBCC) was formed and is still in existence today. The research investigated government policies in five resource-rich countries to determine which local content policies and institutional drivers underpinned innovation-driven growth in other industries in those countries. It aimed to understand what supports successful local content strategies and how these relate to developments in domestic research, innovation and skills capacity, which drive economic activity.

Addressing the context-specific challenges of implementing local content policy, Professor Kalyuzhnova's research has underpinned the development, refinement and adoption of policy in resource-rich emerging economies. It has informed investment decisions by the EBRD and underpinned the teaching and training of business executives in local content policy on a global scale.