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Turkmenistan: Finance Officials Sacked Amid Talk Of Economic Reforms

  • Bruce Pannier

Turkmen President Gurbanguly Berdymukhammedov (file photo) (AFP) Turkmen President Gurbanguly Berdymukhammedov has fired several top officials involved in the country's financial sector. Observers say the move may be intended to show he is serious about economic reforms as the country moves to redenominate its currency next year.


Berdymukhammedov has already ordered an audit of all state assets, including foreign bank accounts that once belonged to his late predecessor, Saparmurat Niyazov. For months now, Berdymukhammedov has called on economic and financial officials to facilitate foreign investment and keep domestic prices stable. Much of that work remains unfinished, however.


At a cabinet session on April 14, Berdymukhammedov expressed dissatisfaction with the Central Bank’s work and with its chief, Geldymurat Abilov.


"The leadership of Abilov in the Central Bank is not adequate," Berdymukhammedov said. "It has now become quite clear that the work of the Central Bank is not up to current demands. The banking system from day to day remains static and has not made progress. I want to remind you that the goals and obligations of the Central Bank are first to maintain price levels and uphold the economic policies of the president; create new hard currency policies and maintain them; and work to overhaul the accounting system and increase the effectiveness of the budgetary system. But unfortunately, this work still has not been done."


Berdymukhammedov said Abilov was being sacked for his "grave shortcomings and the fact that he cannot understand the job we gave him."


The president also dismissed the minister of transportation and communications, as well as several other lower level finance officials at the same cabinet session.


Berdymukhammedov spent 2007, his first year in office, focusing on expanding international business ties -- not an easy task given that Niyazov isolated the country from the rest of the world. Niyazov preferred to let interested business representatives come to him.


By contrast, Berdymukhammedov has spent much of his first 15 months in office meeting with world leaders, including the Chinese, Russian, and U.S. presidents, and top international business officials, promoting investment in Turkmenistan or seeking customers for Ashgabat's natural-gas and oil resources.


But Berdymukhammedov has also made promises for modest domestic reforms and has made good on some pledges. He restored the 10-year mandatory education system, a health-care system that had seen severe cuts, and has allowed limited access to the Internet.


At the cabinet meeting on April 14, Berdymukhammedov also appointed a new deputy prime minister, Hojamyrat Geldimyradov, who shares that title with seven other officials. Geldimyradov will be in charge of issues related to financial recovery, developing the banking system, and strengthening the manat, the national currency.


Part of the president’s economic reforms have so far involved setting a new official rate for the manat to the U.S. dollar, lowering its value by about 20 percent. As of January 1, 2009, Berdymukhammedov also wants to redenominate the Turkmen currency so that, for example, 1,000 manats will become 1 manat.


The redenomination plans were a major focus of the cabinet session, where Berdymukhammedov said he believed it would help in accounting. But the immediate reaction of Turkmen citizens was to trade all the manats they could for hard currency. Many exchange points were reportedly emptied of dollars in a few hours.


The new currency will feature portraits of famous figures from Turkmen history. The 500-manat banknote will be the highest denomination and the only note to retain Niyazov’s portrait, which still graces all Turkmen banknotes.


Guvanch Geraev of RFE/RL's Turkmen Service contributed to this report

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