It seems like an odd place to put a capital. The city of Almaty is practically in neighbouring Kyrgyzstan with most of Kazakstan's 2.7 million square miles lying to the north. Only the Alatau Mountains separate the two former Soviet republics, which are now both struggling to establish their national identities as well as economies without the assistance of Moscow.

The unsatisfactory location of Almaty was given as one of the official reasons for moving the capital northwards to Akmola late last year. Other factors, according to commentators, were President Nazarbaev's attempt to placate some of the Middle Horde Kazaks who felt dissatisfied with their continued exclusion from power and the fact that many of the country's vital mineral resources are nearer.

Akmola may be geographically more central but it is a harsh place, in the middle of the steppe with even greater extremes of temperatures than Almaty. The move was not popular especially among government employees forced to relocate, and the many implications will be felt for years to come.

Almaty has 1.5 million people, the largest population of any Kazak city, and it will take a long time for Akmola to gain recognition as the republic's capital.

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The financial factors involved are also worrying for a relatively poor country trying hard to catch up with the developed nations. Parliament held its first session in the new capital in January, a much-publicised event attempting to show that the changeover had actually happened.

Yet Almaty, 20 hours away by train, clearly remains the unofficial capital. The major embassies remain in Almaty including the British, although a new office may be opened at a later date. Some ministries have relocated but the education ministry has yet to move completely. For some Kazak officials their Akmola residence is only part-time, with trips back home to Almaty made as often as possible. The president himself is included in this category, being sighted frequently in old haunts. He enjoys skiing at Chymbulak, for example, a resort near the city built during the communist era and now a playground for the affluent. It is not surprising that disgruntled government employees want to go home as often as possible.

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Some have drifted back for good after discovering that all the advantages they were promised in Akmola did not materialise: good accommodation and public transport, regular supplies of gas, electricity and water. Almaty suffers from frequent power shortages but the situation in the new capital is even worse. Kazakstan is rich in such natural resources as gas yet the locals are often deprived because it is exported to boost the economy.

The influx of overseas companies and their dollar-rich personnel in recent years has had many repercussions, especially for Almaty which has become the second most expensive city for business after Tokyo. There are signs of wide gaps in wealth, income and lifestyles between not only ex-pats and locals but among Kazaks. A university lecturer's average monthly salary would just about pay for a decent meal for two in an Almaty restaurant. Those working for the local mafia have few financial problems, but most ordinary people struggle in the changing economic environment, and some look back nostalgically to communism when everyone had jobs and a salary that could buy something.

The characteristics of my fellow passengers on the Almaty-bound flight reflected the changing situation in Kazakstan. There were "new Kazaks" returning from abroad laden with consumer goods. There were also many foreign businessmen and a few tourists. Education visitors were thin on the ground.

Almaty appeared elusive in the depths of winter, and bad weather forced us to divert at the last minute to Bishkek, the capital of neighbouring Kyrgyzstan. Bishkek airport would be ill prepared at any time of day for a sudden influx of 200-plus disgruntled and tired travellers. In the middle of the night, this small, run-down post-Soviet building could hardly manage, although the local staff were quick enough to relieve many of us of $35 for "transit visas" even though we were only going into the cold terminal to pass the night.

For the young man in the small cafe, it was also an opportunity to practice his newly acquired business acumen. He had almost a free hand to charge what he liked for the limited range of drinks and food on offer. He seemed poorly educated but had learned dollar-speak and knew how to make some quick money.

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As in many other transitional post-communist states, education is rapidly losing its value with an emphasis on making money. The low salaries and poor conditions of education workers attract few young people, and the contemporary role models are the new rich with their mobile phones and conspicuous consumption.

Intellectuals and teachers can only look on in despair as values and lifestyles change and feel concern about what the future holds for them. I wondered what the cafe boy was going to do with his night's earnings, which must match a teacher's annual salary.

One strategy for those who can complete all the necessary formalities and raise the required money is to leave. Australia is a popular destination for Kazaks. It seemed that there was a fairly open immigration policy and thousands have left, including teachers and lecturers, but this destination is becoming harder to reach and the cost of the application process is prohibitive.

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Meanwhile, overseas contacts are encouraged by the government in terms of business and banking while simultaneously trying to nurture not only a new capital but also a sense of national identity. President Nazarbaev announced in January that Kazak - a Turkic language - will in future be transcribed in Latin rather than the Cyrillic script used by the predominant Russian language.

Many Kazaks speak Russian as their first language, with about 40 per cent not being able to use Kazak at all. The language policy is a shift from the Soviet past but it will involve money and effort to implement. Meanwhile problems of high unemployment, increasing crime levels and disillusioned youth impatient to see the benefits of the change, persist.

Independence has had its price at the heart of Central Asia, but it is still too soon to say whether it was a price worth paying.

Ruth Cherrington lectures at the University of Veliko Turnovo, Bulgaria.

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