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Paper short abstract

This paper analyses how Kazakhstan’s electronics firms in the semi-periphery build digital technologies through in-house capabilities and foreign inputs. It shows how such strategies enable learning and upgrading but also reproduce dependency, especially via reliance on Chinese technologies.

Paper long abstract

This paper examines how firms in the semi-periphery build digital technologies through hybrid pathways that combine in-house capabilities with foreign technologies. Focusing on Kazakhstan’s electronics sector, it analyses when such strategies enable technological learning and upgrading, and when they reproduce dependency and power asymmetries. Drawing on semi-periphery theory (Amin, 1978; Cairó-i-Céspedes & Palacios Cívico, 2022; Wallerstein & Wallerstein, 2011), the paper situates semi-peripheral firms between center and quasi-center (Cheng & Zhai, 2021), technology producers and peripheral users, highlighting their constrained but strategic agency in navigating global digital production networks.

Based on fieldwork interviews conducted in Kazakhstan in 2022 and 2023, the study identifies four business models among electronics firms that reflect distinct approaches to capability formation. These range from firms primarily localising imported Russian and Chinese technologies with limited domestic hardware and software development, to more advanced models that layer in-house R&D and software capabilities onto imported hardware, including a fabless IT firm outsourcing component production while retaining core design and development functions.

The findings show that reliance on external digital technologies, predominantly from China, can both support learning and entrench dependency, depending on how firms domesticate technologies and invest in absorptive capacity. While Chinese partnerships dominate due to cost, availability, and the absence of local manufacturing ecosystems, firms’ positions in the semi-periphery allow limited but meaningful scope for upgrading through software development, systems integration, and regional South–South knowledge flows.