China's Expansion into Kazakhstan’s Market through Nazarbayev University

Large Kazakhstani companies-suppliers of reagents no longer satisfy the Ministry of Justice’s price. Businessmen believe that a cheaper player from China has appeared - Microread Technology Co. Ltd. A Kazakhstani is at its helm. However, the reason for dissatisfaction is due to something else: with the support of the two countries, the Chinese-Kazakh firm previously engaged exclusively in research. Now the door to trade has been opened. Orda has looked into the matter.

The Chinese-Kazakh laboratory of Microread Technology Co. Ltd opened in 2019 at Nazarbayev University for various studies.

A month ago, deputies criticized the autonomous organization of education, Nazarbayev University. The management was asked to report exactly how they spend budget money. At the same time, our correspondent’s sources informed us that the heads of Microread Technology Co. Ltd gave a command to their employees. They were to make themselves widely known and start actively selling chemical reagents at low prices.

The Ministry of Justice’s Forensic Medical Examination Center is responsible for DNA testing of physical evidence in Kazakhstan. For 30 years, the department has concluded contracts with several Kazakhstani suppliers of certified equipment and reagents from factories in the USA and Germany.

But why are these suppliers only now having questions? The Chinese-Kazakh laboratory was previously engaged only in scientific and clinical research. In 2019, sources say, they were reassured that Chinese partners in Kazakhstan would only develop science. Nazarbayev University provided the possibility for this. 

Later, the camp of the company's partners expanded:

• Republican State Enterprise "National Center of Biotechnology" of the Committee of Science;
• Joint Stock Company "Republican Center for Breeding in animal Husbandry "ASSYL TULIK";  
• Limited Liability Company "BIOHIDE Company".

What Kind of Company?

Microread Technology Co. Ltd’s website was launched in early 2023. Based on this resource’s information, in order to implement a comprehensive plan at an early stage, the company needed not only expensive equipment but also highly professional specialists.

Now their website proudly states that "Microread Technology Kazakhstan is an independent subsidiary of Beijing Microread Genetics, working in close relations with China and producing reagents for genetic testing."

This all started in 2013 when Chinese President Xi Jinping visited Kazakhstan. He and ex-President Nursultan Nazarbayev visited Nazarbayev University, where the Chinese leader announced the Belt and Road program. The plan assumed not only infrastructure, capital, and construction projects but also the interaction of people, knowledge and technology.

They thereby created a laboratory for such an occasion at the university named after the president. Genetic analyses were carried out in the laboratory offices.

In the year of the company's foundation (2018), Microread Technology Co., Ltd was granted a license to engage in medical activities. After 11 months, the company received three more licenses-conclusions "on the attribution of goods, technologies, works, services, information to products."

Thus the first private company with the potential to provide the market with forensic identification services appeared in Kazakhstan. 

In 2019 it was noted that this laboratory was the first of its kind in Central Asia. The basis for starting research was provided by the parent company Beijing Microread Genetics Co., Ltd., whose website says that the project is designed to improve the effectiveness of forensic medical examination and investigations in the Middle East, and then around the world.

License Oddities

In July 2022, the “subsidiary" was audited and received an ISO/IEC17025 certificate from Kazakhstan’s National Accreditation Center. The process of replacing suppliers began.

ISO/IEC 17025 allows laboratories to demonstrate that they competently perform their work and provide reliable results, thereby increasing the level of confidence in their work both at the national and global levels.

In 2019, the factory of the "parent" company in Suzhou also received the ISO18385 certificate. At that time, it was the first factory in China and the fourth factory in the world to receive it. 

Contamination of human DNA is one of the main problems of forensic analysis. The ISO 18385 standard was implemented to reduce this risk. It defines the requirements for the production of products used for the collection, storage and analysis of biological material for forensic purposes.

Exactly the same document is published on the website of the "independent" branch. However, there is no mention in open sources of how and when Kazakhstan's Microread Technology Co., Ltd received it.

Incidentally, this Chinese company is considered the undisputed leader in its market.

Under a Magnifying Glass

Microread Technology is currently officially engaged in the development of genetic testing technologies in four areas:

• forensic examination;
• criminology;
• clinical medicine;
• agriculture.

Ernazar Rashtabek heads the branch in Kazakhstan. There are 10 people on the list of founders, but their surnames cannot be found in open sources. According to open data, the LLP has also paid 25.2 million tenge of taxes since 2018, while 11.9 million tenge was contributed to the treasury in 2023. According to other information, the company's revenue in 2023 amounted to 444.1 million tenge so far.

Up to five people can study science here. They assured at the opening in 2019 that Kazakhstanis make up the majority. China planned to invest $3 million in the creation of the laboratory at that time. Kanat Baigarin, an adviser to the President of Nazarbayev University, also spoke about this.

The legal address of the company does not coincide with the actual one. The LLP is registered not at the university’s address, but in the capital apartment of the housing complex on 38/12 street.

The head of the company, Ernazar Rashtabek, shares his successes on social networks. For example, photos from different cities around the world. Or acquaintance with the head of the operational-criminalistic Department of the Ministry of Internal Affairs, Colonel Serik Sadykov. At the same time, the Ministry of Internal Affairs signed a memorandum of cooperation with his company.

Management's Position

We contacted a representative of the company. We sent a letter with explanations and a request to give feedback. We were told that everything is not as clear as the reagent suppliers say. However, time is needed to prepare a full-fledged answer to our questions.

Orda also sent a request to the Ministry of Justice regarding the concerns of the aforementioned Kazakhstani market participants. At a briefing in the CCS, the Minister of Justice of the Republic of Kazakhstan, Azamat Eskarayev, replied that "you need to contact the relevant ministry and figure it out."

A lot of money was put into the laboratory at the university and into the company. And a developed giant in China, most likely, played an important role. Time will tell what will happen in this market section.

Original Author: Alexander Smolin

DISCLAIMER: This is a translated piece. The text has been modified, the content is the same. Please refer to the original piece in Russian for accuracy.