Nazarbayev has proven to be an astute politician who has prevented ethnic tensions from threatening the integrity of Kazakhstan and has protected the nation's independence by cooperating with Russia on some issues and quietly circumventing it on others. He has allowed some opposition parties and media to operate, but has controlled them, among other means, through use of a law outlawing threats to the "honor and dignity" of the president.
In 1993, the Supreme Soviet (or Supreme Kenges) approved a new Constitution. An election was held the following year to a new unicameral legislature of 177 members. This election was judged by international observers to not be free and fair. The Kazakh Constitutional Court ruled in early 1995 that the election was invalid. Nazarbayev supported this decision, since the legislature had balked at approving his policies. Dissolving the legislature, he assumed legislative powers and ruled by decree for the rest of the year. A new Constitution, approved by a questionable referendum in August 1995, increased the powers of the presidency and reduced those of the legislature. Less emphasis was given to the protection of human rights. While the president was given broad powers to dissolve the legislature, he could only be removed for disability or high treason. The independence of the judiciary was also constrained by replacing an earlier Constitutional Court with a Constitutional Council, mostly controlled by the president. The 327-member People's Assembly, created by Nazarbayev and composed of various cultural and ethnic leaders, acted as a propaganda forum for the president.
Legislative elections, held on 5 and 9 December 1995, were judged by international observers to be largely fair although some problems were evident. An onerous fee was required to register as a candidate and voter turnout rates were inflated. The 47 (now 39) deputies of the Senate were indirectly elected by regional legislatures, except for seven appointed by Nazarbayev. Deputies to the 67-member lower chamber (the Majlis, now 77 members) were directly elected by district. The two opposition parties alleged government harassment and voting irregularities. Most deputies who won the election were formally unaffiliated, though the nomination process was heavily weighted toward pro-Nazarbayev candidates.
In October 1998, Nazarbayev orchestrated changes to the Constitution allowing him to advance the timetable for the presidential race by one year to 10 January 1999. The official reasons given for changing the date were increased economic uncertainty following the August 1998 Russian currency devaluation and the need to get the election out of the way before addressing the economy. A more pressing reason might have been concern about the widening political disenchantment with Nazarbayev as the economy worsened.
The Kazakh Central Electoral Commission and Supreme Court ruled in November 1998 that Nazarbayev's main opponent, the popular former prime minister, Akezhan Kazhegeldin, was ineligible to run in the presidential race, because of his earlier participation in an "unauthorized" public meeting. Three candidates were registered besides Nazarbayev, two of whom were Nazarbayev supporters and only one, Serikibolsyn Abdildin (head of the Communist Party), a true opposition candidate. Onerous registration requirements included a US $30,000 deposit (forfeited by the losers) and 170,000 signatures gathered in at least 11 of 16 regions. Campaigning by the minor candidates was impaired by their lack of funds, while Nazarbayev was given extensive coverage by state-owned and private media. The Kazakh Central Electoral Commission reported on 16 January 1999 that Nazarbayev had won the 10 January presidential election with 79.8% of about seven million votes cast. The Organization for Security and Cooperation in Europe (OSCE), critical of the run-up to the election, sent only token monitors, and declared on 11 January that "the electoral process…was far removed from the standards which the Republic of Kazakhstan has pledged to follow as an OSCE member state." Human Rights Watch on 5 January also characterized the electoral campaign as being "blatantly unfair." Nazarbayev was inaugurated on 20 January 1999 for a seven-year term.
In an interview in April 2000, he called for ethnic Kazakhs to "respect other ethnic peoples," including foreigners, so that Kazakhs may be considered "intelligent and developed people" in the global economy. He particularly warned against ethnocentrism against Russians residing in Kazakhstan, since Russian-Kazakh ethnic conflict could tear Kazakhstan apart, and accused much of the political opposition of fermenting ethnic discord. Instead, he urged "ethnic Kazakh unity" to ensure political stability, since "Kazakhstan is for the ethnic Kazakhs." He also dismissed political liberalization, stating, "let no one think that [I] will allow everyone to do whatever they want. I will not allow that. People trusted me and elected me as their president in order to bring order to the state." He also stated that the opposition seemed to prefer state socialism since they criticized his economic reforms. Nazarbayev asserted that he had opened the economy and carried out privatization, and that, under his leadership, the economy had stabilized. He concluded that his political and economic reforms had created an independent Kazakhstan, where Kazakhs "are slowly getting rid of the psychology of a slave….We and Ihave organized all this."
A key to Kazakhstan's future is the development of its oil reserves. In late 2000, Kairat Satybaldy, the president's nephew and considered his possible successor, became vice president of the state-run oil company, Kazakoil. As unconfirmed rumors about the declining state of Nazarbayev's health spread, international analysts consider Satybaldy a key player in Kazakhstan's relations with foreign governments and private investors.