From Oil Wealth to Human Capital

While Norway debates how much it can withdraw from its sovereign wealth fund without “burning the future,” Kazakhstan has chosen a radically different path. The country now channels part of its oil revenues directly to its youngest citizens—literally.

Through the National Fund for Children—proposed in 2022, legislated in 2023, and implemented in 2024—every Kazakh child born after 2006 automatically receives a personal savings account. Each year, 50% of the National Fund’s investment income is distributed equally among all eligible children. The funds remain untouched until the child turns 18 and may only be used for education or housing.

Where Norway uses its oil fortune to balance public budgets, Kazakhstan uses it to build citizens.

A Geo-Economic Innovation

Kazakhstan, the world’s ninth-largest country, sits strategically between Russia, China, and the Caspian Sea—endowed with vast reserves of oil, gas, and minerals. Historically dependent on resource exports, President Kassym-Jomart Tokayev has now redefined the nation’s development model: national wealth is measured in people, not barrels of oil.

In the spirit of Joseph Schumpeter’s theory of creative destruction, the program breaks with the logic of the traditional resource state—where the government owns and distributes wealth—to a model that invests directly in its citizens.

Economist Albert O. Hirschman argued in National Power and the Structure of Foreign Trade (1945) that economic power and social stability are intertwined. A state that channels resource income into the welfare of its people strengthens its sovereignty. Kazakhstan’s approach exemplifies this logic amid growing geopolitical pressures.

Stability Through Geo-Economics

Kazakhstan walks a fine line between three major spheres of influence: Russia, China, and the West. It is a member of the Eurasian Economic Union, maintains trade agreements with the EU, and has a strategic partnership with the United States.

In such a delicate geopolitical landscape, social stability and national loyalty are vital. By giving every child a personal stake in the nation’s wealth, the government creates both emotional and economic attachment to the state.

Where many resource-rich states purchase loyalty through subsidies, Kazakhstan cultivates trust through ownership. Those who own part of their nation’s wealth are more likely to defend it.

Numbers and Real Economy

In 2024, nearly seven million children received their first deposits—around USD 100 each, rising to USD 129 in 2025 (ENPF, 2025). Assuming a 5% annual return, a child born in 2024 will accumulate USD 3,000–3,500 by age 18—enough to finance higher education or a housing down payment.

While modest by Norwegian standards, this amount represents roughly a year’s tuition in Kazakhstan.

If Norway adopted a similar scheme—allocating 0.5% of the annual returns from its Sovereign Wealth Fund (approximately NOK 15 billion)—each Norwegian child could receive NOK 25,000 annually, or around NOK 450,000 by the age of 18.

That would turn the so-called “generation fund” into an actual fund for the generation.

Structural Discipline and Social Trust

The Kazakh system combines financial discipline with social trust through five core principles:

Automatic inclusion – all citizens born after 2006 are enrolled without application.
Currency protection – funds are held in USD through the Unified Accumulative Pension Fund (UAPF) to hedge against inflation.
Usage restriction – funds can only be used for housing or education, not consumption.
Time limit – unused funds after 10 years are transferred to the individual’s pension account.
Transparency – all accounts are digitally traceable and publicly audited.

This framework merges macroeconomic discipline with micro-level social confidence—a quality increasingly absent in Western democracies.

Norway: A Generation Fund Without a Generation

Norway’s Government Pension Fund Global (GPFG) is the world’s largest sovereign wealth fund, valued at over NOK 17 trillion. Yet despite being called a “generation fund,” no generation actually benefits directly. The fund serves primarily to balance budgets rather than build personal capital.

Norway manages the future—but does not share it.

Kazakhstan, by contrast, demonstrates that national wealth can be made tangible—transforming state assets into citizen assets. While Kazakhstan finances education and housing, Norway finances public administration. Over time, that divergence may shape the two nations’ economic dynamism in profound ways.

From Redistribution to Co-Participation

Norway has perfected redistribution: the state takes and gives back. Kazakhstan practices co-participation: the state invests with its citizens in their future.

This model nurtures a different society—

less dependent on the state,
more individually responsible, and
socially cohesive through shared ownership.

It challenges traditional social-democratic thinking, yet unites market efficiency with social equity.

A Norwegian Lesson: Capital as Social Infrastructure

If Norway truly seeks a sustainable post-oil society, capital must circulate among people, not remain locked in public accounts.

A Norwegian version of the Kazakh child fund could:

reduce inequality,
strengthen youth access to education and housing, and
promote financial independence.

This is not welfare—it is freedom: the right to own, create, and contribute.

Geo-Economic Insight: Trust as Currency

In an era of geopolitical fragmentation, trust has become the ultimate currency.

Kazakhstan builds it from the ground up—starting with its children. Each account is a symbolic and material contract: you are part of our future.

Geo-economically, this enhances national resilience. States that invest in social stability and personal ownership reduce both internal conflict and external vulnerability. This is geo-economics as national security strategy.

A Lesson from the East

Kazakhstan has accomplished what Norway merely discusses: transforming oil wealth into a mechanism for social investment.

From a geo-economic standpoint, it stands as one of the most innovative experiments in modern resource governance—turning natural wealth into social, human, and psychological capital.

For Norway, this is a wake-up call. Rather than guarding the oil fund as a sacred relic, we could let it work for the next generation—literally.

In a world where power, economy, and identity converge, the true measure of national strength is not how much you own—but how fairly you share.

A message that echoes far beyond Astana—all the way to Oslo.

By Dr. Glenn Agung Hole – Geo-economic and Geopolitical Commentator, Associate Professor in Entrepreneurship, Economics and Management at the University of South-Eastern Norway, and Honorary Professor at Sarsen Amanzholov East Kazakhstan University

References

Government of Kazakhstan. (2024). National Fund for Children Program. Retrieved from https://www.gov.kz/situations/718/intro?lang=en
The Astana Times. (2024). Kazakhstan’s National Fund to Allocate Funds to Children. Retrieved from https://astanatimes.com/.../kazakhstans-national-fund-to.../
ENPF. (2025). National Fund for Children Annual Update. Retrieved from https://www.enpf.kz/en/press-center/news/18539/
Sherraden, M. (2024). Child Development Accounts as National Policy. Center for Social Development, Washington University in St. Louis. https://files.eric.ed.gov/fulltext/EJ1475916.pdf
Hirschman, A. O. (1945). National Power and the Structure of Foreign Trade. University of California Press. https://www.ucpress.edu/book/9780520302821/national-power-and-the-structure-of-foreign-trade
Schumpeter, J. A. (1942). Capitalism, Socialism and Democracy. Harper & Brothers. https://archive.org/details/j.-schumpeter-capitalism-socialism-and-democracy