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Turkmen Report: June 24, 2000


24 June 2000
POLITICAL NEWS
Turkmenistan Bans Foreign Bank Accounts
June 23, 2000

Turkmenistan has banned individuals and businesses from holding foreign bank accounts in an effort to stem capital flight from this impoverished Central Asian nation, the state news agency TDH said today.

President Saparmurat Niyazov, a Communist Party boss in the Soviet era, urged the ban at a government meeting last week, and later signed a presidential decree barring foreign accounts, the agency said.

"The money must work for the country," TDH quoted Niyazov as saying.

The government will allow businesses and individuals "a couple of months" to transfer their hard-currency savings to local banks, he said.

Foreign banks operating in Turkmenistan include Deutsche Bank. In addition, joint venture banks with Russian, Turkish, and Iranian shareholders have branches in Turkmenistan. They could not immediately be reached for comment on the ban.

Residents of the former Soviet republic of 5 million said Friday they feared the government would forbid them from holding foreign currency altogether, obliging depositors to change their hard-currency savings to the local currency, the manat, at an unfavorable rate.

The official exchange rate is currently 5,200 manat to the U.S. dollar, with the black market rate as high as 17,000 to the dollar.

Because of the manat's instability, most people in Turkmenistan try to keep their savings in dollars. But individuals can officially buy hard currency only for foreign travel.

Niyazov in the early years of Turkmenistan's independence promised the gas-rich nation would become "a second Kuwait" but the autocratic president has so far failed to find an international market for the gas. (AP)

Turkmenistan, Uzbekistan Have No Mutual Territorial Claims
June 23, 2000

Turkmenistan and Uzbekistan have no mutual territorial claims, says a protocol of the Turkmen-Uzbek negotiations that took place today in Ashgabat.

The sides formed an intergovernmental commission for the delimitation and demarcation of the state border by instruction of Presidents Saparmurat Niyazov and Islam Karimov. The commission will draft a treaty on the state border to be signed by the presidents. (Itar-Tass)

Turkmen Association Branch Opened In Kazan
June 20, 2000

Tatarstan's branch of the humanitarian association of the world's Turkmens opened in Kazan, Tatar-inform reported. The adviser to Turkmen president, the head of the Institute of History Mukhamet Aidogdiyev participated in today's opening ceremony.

About 1,000 Turkmens live currently in Tatarstan. The association will help them keep national-cultural ties with the Motherland. (RFE/RL)

ECONOMIC NEWS
Turkmenistan Harvests 1.5 Million Tons Of Grain
June 22, 2000

Turkmenistan has already harvested 1.5 million tons of grain, fulfilling the government target for the second year running, the Turkmen media reported today.

The total grain output in Turkmenistan had been planned at 1.65 million tons, and not all the country's regions have finished bringing in the harvest, the Turkmen Agriculture Ministry has told Interfax.

According to a plan for Turkmenistan's social economic development and the concept of food security, the republic is to reap 2.5 million tons of grain per year by 2003 and 3 million tons per year by 2005. (Interfax)

Turkey Ratifies Agreements On Caspian Pipeline
June 22, 2000

The Turkish parliament today ratified agreements to build a pipeline from Azerbaijan to Turkey.

Energy Minister Cumbur Ersumer said Turkey has guaranteed to pay the difference if the cost of the pipeline stretching from Azerbaijan through Georgia to Turkey's port of Ceyhan exceeds 1,300 million dollars.

Ersumer said Turkey will initially earn about 300 million dollars a year from transit fees.

Azerbaijan and Georgian ratified the project last month. (RFE/RL)

Putin, Nazarbayev Urge Progress In Caspian Talks
June 20, 2000

Presidents of Russia and Kazakhstan, Vladimir Putin and Nursultan Nazarbayev, have called on the Caspian states to step up the search for a compromise on the sea's status.

The call is contained in the joint statement issued after the two leaders met yesterday in Moscow.

The statement says that an agreement to divide the sea floor into national sectors - "with the goal of exercising sovereign rights to develop sub-surface resources" - could serve as a basis for a consensus.

The sea itself could be reserved for common use "to ensure freedom of shipping, agreed fishing norms and environmental protection," the statement says.

The statement notes that the agreement signed on July 6, 1998 by Russia and Kazakhstan on division of the northern portion of the sea, "has made a positive contribution" to the process of determining the sea's status.

"Russia and Kazakhstan enjoy sovereign rights to the subsurface resources in those portions of the sea floor to be delimited in the aforementioned agreement," the statement says. (Interfax)

Ukraine To Resume Gas Talks With Turkmenistan
June 21, 2000



Ukrainian President Leonid Kuchma is set to resume the dialogue with his Turkmen counterpart Saparmurat Niyazov on gas deliveries when he visits that country soon, Kuchma announced to the press in Kiev upon his return from the CIS summit in Moscow.

"We have made peace with him," Ukrainian leader said, adding that it is necessary "to think about how gas shipments might be resumed."

Turkmenistan terminated its gas deliveries to Ukraine on May 25 of last year, in the absence of forthcoming payments. In 1999, Ukraine received 8.8 billion cubic meters of gas worth $315.5 million.

Contractual conditions stipulated that the gas was to be paid 40% in cash and 60% in goods and work on investment projects. Ukraine still owes Turkmenistan $90 million. (Interfax)

Turkmenistan Announces Tender For Oil And Gas Equipment Supplies
June 19, 2000

The Turkmeneftegaz state corporation has announced an international tender for equipment suppliers on behalf of the commission for selecting commercial offers in the material and technical provision of the Turkmen oil and gas industries.

The tender has been announced in compliance with President Saparmurat Niyazov's resolutions of June 6 concerning new oil and gas fields in eastern Turkmenistan and the Kirpichli gas field.

It is possible to apply for documents for the tender on June 19-24.

The overall cost of the two investment projects is $94.178 million. It is planned to spend $55.678 million for development of oil and gas fields in eastern Turkmenistan, including $41.1 million for equipment. The project will be completed within a year. Oil and gas fields of the Takhtabazar zone with a total stock of about 600 million tons of oil will be prospected and prepared for extraction.

The cost of the Kirpichli project is $38.5 million. That project will be implemented in two phases. First basic equipment will be replaced and the gas lifting method will be adopted for the production of gas condensate. It will take $13.5 million worth of equipment to do the work. An installation for making liquid gas will be installed at the second phase and will cost $25 million. The project's recoupment period will be 3.5 years. (Interfax)

REGIONAL NEWS
Kyrgyz President Criticizes Law Enforcement
June 24, 2000

Kyrgyz President Askar Akayev severely criticized his country's law enforcement agencies today for failing to tackle soaring crime in the country.

At an annual meeting of law enforcement agencies in Bishkek, Akayev said that law enforcement leaders are pandering to criminals. He said that crime has jumped by 35 percent this year compared with last year.

Akayev warned that he would sack security officials for their inefficiency if the situation did not change by the time the national Security Council met next month. (RFE/RL)

Organization Protests Kyrgyz Journalist's Imprisonment
June 23, 2000

The New York-based Committee to Protect Journalists has sent a letter to Kyrgyz President Askar Akayev protesting the imprisonment of a journalist.

Moldosaly Ibraimov was accused of insulting a regional judge by writing a newspaper article that said there were rumors the judge accepted bribes. He was convicted in the southern town of Jalalabad on Monday and sentenced to two years in jail. (RFE/RL)

No Presidency For Life For Kazakhstan's Nazarbayev
June 23, 2000

President Nursultan Nazarbayev does not intend to remain the Kazakh head of state for life.

"I am not going to be a khan or president for life," Nazarbayev announced today at a news conference in Almaty. All elections, including presidential, will be held in accordance with the republic's constitution, he said.

When asked about his attitude to the bill on the first Kazakh president currently under parliamentary consideration, Nazarbayev responded that he first learned of this in the Russian press during his recent visit to Moscow.

Nazarbayev also mentioned that despite media speculations, there is no need for the Cabinet of Kasymzhomart Tokayev to resign. The President praised the Cabinet's performance, attributing positive changes in the country's economy to favorable prices on Kazakhstan's exported goods and raw commodities and to fact that the leading Asian countries are weathering the crisis.

President Nazarbayev further spoke about a decree starting a development fund in Kazakhstan. The fund should accumulate returns from export projects, including the extraction, refining and transportation of oil and oil products, precious metals, etc.

Nazarbayev went on to say that the idea of starting the fund is based on the current favorable tendencies in the economy, high oil and gas prices, and partial sale of the government stake in the oil extraction joint venture Tengizchevroil.

"There is every precondition for GDP to grow 8-9% this year and industrial production 16-17%," Nazarbayev said. Inflation should remain low and the national currency tenge be stable this year, he added. (Interfax)

Kazakh Parliament Passes Bill Concerning First President
June 22, 2000

A joint sitting of the Kazakh parliament approved today a draft law bearing on the republic's first president in the bill's first reading.

The second reading, as initiated by members of the Civil Party from the parliament's lower house, is scheduled for June 27.

The bill would give President Nursultan Nazarbayev the following rights after his presidency expires in 2006:

-to appeal to the nation, state power institutions, and officials with initiatives concerning public development;

-to speak at parliament and government meetings;

-to head the Assembly of Kazakhstan's People;

-to be a member of the republic's Security Council;

-to award yearly peace and progress prizes;

-to make proposals to the new president about personnel policy, states of emergency, martial law and the use of the republic's armed forces.

Rakhmet Mukashev, leader of the Civil Party faction in the Kazakh parliament, said the bill is in no way connected to Nazarbayev's 60th birthday on June 6.

Mukashev further said that the bill does not contradict the Constitution and "causes no immediate material expenses to the country's budget." Expenses for social, material, and political guarantees to the first president and his family, which are stipulated in this bill, will arise only "after Nursultan Abishevich [Nazarbayev] steps down from the president's post" (in 2006), the deputy said.

Mukashev cited the USA, France, Moldova, and the Baltic States as states which have adopted similar legislative acts.

He also denied rumors that Nazarbayev is planning to follow the example of first Russian president Boris Yeltsin and step down before the appointed time, passing his post to an acceptable successor. The deputy said these rumors are "absolutely groundless," adding that "this bill gives no grounds to even talk on this subject." (Interfax)

Human Rights Watch: Uzbek Poet Tortured In Prison
June 22, 2000

Human Rights Watch says poet and opposition leader Mamadali Makhmudov, who is jailed in Uzbekistan, has been reportedly tortured in prison and his life may be in danger.

Makhmudov was jailed last August for supporting a banned opposition party. Human Rights Watch says he was transferred in May to a prison in the northern city of Jaslyk, notorious for brutal treatment of inmates.

The rights group says Makhmudov is facing punitive treatment, including being forced to sit crouching for extending periods of time with his hands behind his head.

The group says Makhmudov is suffering from pain in his chest, sides and back. (RFE/RL)

Russia To Continue Promoting Peace In Central Asia - Putin
June 21, 2000

Russian President Vladimir Putin said today Russia is determined to continue promoting peace and stability in Central Asia.

Putin said he is confident the decision to wrap up the CIS peacekeeping operation in Tajikistan is correct.

All problems that concern Russian interests in the region will be settled with Tajikistan on bilateral basis, he said.

Tajik President Emomali Rakhmonov explained that Tajikistan had entered a new stage of peaceful regulation.

Rakhmonov said that "the status of Russian troops in Tajikistan is assuming a new basis" because of the Russian-Tajik treaty on the creation of military bases on the territory of Tajikistan.

In his turn, Uzbek President Islam Karimov also said he hopes Russia will pay more attention to Central Asia.

The heads of CIS states emphasized that the solution of the problem of Tajikistan is an example of how the CIS countries can, if they so choose, concentrate their efforts and solve other conflicts on the post-Soviet territory. (Interfax)

Boris Mylnikov Appointed Chief of CIS Anti-Terrorist Center
June 21, 2000

Boris Mylnikov was appointed chief of the CIS anti-terrorist center at the CIS summit today in Moscow.

Mylnikov previously held the post of first deputy chief of the Russian Federal Security Service's (FSB) protection of the constitutional system and anti-terrorist department.

Heads of all CIS states except Turkmenistan signed the resolution, Russian President Vladimir Putin has said.

Establishment of the center is "a significant step forward in combating religious extremism and terrorism in the post-Soviet area," Putin said. (Interfax)

CIS Leaders Praise Russian Stand for ABM, START-2 Treaties
June 21, 2000

The leaders of the 12 CIS countries today sided with the Russian position on the 1972 Anti-Ballistic Missile (ABM) Treaty, agreeing that United States plans to amend the treaty are not in the interests of world security.

The leaders praised Russia for ratifying the START-II Treaty in 1997 and said they hoped the U.S. will also ratify that treaty. Russian President Vladimir Putin said that treaty is a brick in the foundation of international security.

The issue of creating an anti-terrorist center did not find full agreement. Turkmen President Saparmurat Niyazov did not sign the document proposed by his neighbor Kazakh President Nursultan Nazarbayev.

Other agreements are expected, notably on the creation of a common economic zone within the CIS.

The leaders agreed already to hold another summit in the Belarus capital Minsk at the end of this year. (RFE/RL)

Tajik Defense Minister Calls Situation Along Afghani Border Tense
June 19, 2000

The situation in the Central Asian republics bordering on Afghanistan "has been tense," Tajik Defense Minister Shirali Khairulloyev told journalists at today's session of the CIS Defense Ministers' Council in Moscow.

"Afghanistan as a state has actually turned into a center for training terrorists," Khairulloyev said. From Afghanistan, he added, "a huge amount of drugs flows not only into Tajikistan, but also to other Central Asian republics and further on to Russia and Europe.",

"If the Taliban movement eliminate Ahmad Shah Masoud [the anti-Taliban coalition leader], they will have their hands untied against the Central Asian republics," Khairulloyev said. (Interfax)

Bomb Defused In Dushanbe; Two Afghan Smugglers Killed Near Tajik Border
June 18, 2000

Tajikistan's Defense Ministry says police in the capital of Dushanbe this morning defused a time bomb about 15 minutes before it was set to explode on a bridge.

The ministry said the bomb was placed under the rails of a combination train and automobile bridge about two kilometers from the center of Dushanbe. The authorities said the bomb consisted of two anti-personnel mines that had been connected to a timer.

There was no immediate word on who may have planted the device. State security agents are investigating the incident.

Meanwhile, Tajik border guards says two Afghan men were killed in an overnight shootout after they illegally crossed into Tajikistan with a group of about 12 alleged drug traffickers.

Three others in the group were arrested while the rest escaped. The Tajik border guards say they seized about 20 kilograms of marijuana after the 30-minute gun fight. (RFE/RL)

RFE/RL ANALYSIS
Isolated Turkmen Leader Has Little to Offer CIS


by Bruce Pannier

June 20, 2000

Turkmen President Saparmurat Niyazov may feel like the loneliest man in the room at tomorrow's (June 21) CIS summit.

His country has little interaction with the other CIS nations. Foreigners find it ever more difficult to enter the country. The government strictly controls access to the Internet. Human rights and press freedom organizations regularly denounce the Turkmen government for violations. Turkmenistan is recognized by the U.N. as a neutral nation, but it may be more accurate to call the country isolationist.

Turkmenistan is not a member of any of the groupings within the 12-nation CIS. It refused either to join the organization's customs union or to sign its Collective Security Treaty. And it is the only one of the five Central Asian nations that is not in the Central Asian Economic Union. Niyazov has said on several occasions that his country is interested only in bilateral, not multilateral, economic relations.

In a way, trade constitutes Turkmenistan's foreign policy. Turkmenistan has a lot of natural gas and oil, and is eager to sell both -- to anyone. The Turkmen government deals more with foreign companies than with foreign governments.

After the republic became independent in 1991, Niyazov said he hoped to make Turkmenistan a second Kuwait. But Kuwait is on the Persian Gulf, and Turkmenistan has no coast except on the landlocked Caspian Sea. Exporting its resources remains the country's biggest problem. There is a pipeline to Iran, but to date the gas flowing through it serves only to repay the cost of Iranian labor that built the pipeline.

There is also a Russian pipeline in Turkmenistan. For some years, Russia shipped Turkmen gas through its pipeline. Most of it went to Ukraine, while Russian gas in the same network went to Europe. Ukraine could not pay its bills, and soon ran up a 1,000-million-dollar debt to Turkmenistan. Then three years ago, after Turkmenistan had sought to raise the cost of its gas -- from 32 to 40 dollars per 1,000 cubic meters -- Turkmenistan's negotiations with Russia's Gazprom and an intermediary company known as Itera broke down. Turkmen gas promptly stopped flowing outside the country for profit.

Turkmenistan seemed to be edging close to a compromise on the price of its gas early last year, when then Russian Prime Minister Viktor Chernomyrdin visited the country. But no deal was concluded. When Russia's new President Vladimir Putin visited the capital Ashgabat last month, Gazprom chief Rem Vyakhirev accompanied him.

Vyakhirev had first traveled to Kazakhstan, where he signed a deal to create a joint venture with the state-owned gas company. The Gazprom chief then went on to Uzbekistan, where he signed a deal for 5,000 million cubic meters of Uzbek gas annually. In Turkmenistan, Russia offered 32 dollars per 1,000 cubic meters. No deal was signed.

Development of Caspian oil and gas fields has brought Niyazov into conflict with President Heidar Aliyev of Azerbaijan, directly across the Caspian Sea from Turkmenistan. Both lay claim to the same Caspian fields, and their dispute has helped delay the construction of a trans-Caspian pipeline by a mostly Western consortium.

Two other CIS leaders who may not be happy to see Niyazov in Moscow tomorrow are Uzbekistan's Islam Karimov and Kazakhstan's Nursultan Nazarbayev. Last week, Niyazov announced he wants more soldiers and posts along those two countries' borders with his country. But he did not mention Turkmenistan's long border with Taliban-controlled Afghanistan, with which Ashgabat has signed a trade agreement. Turkmenistan is the only CIS state to have any official relations with the Taliban.

Niyazov also announced last week that he would keep a closer watch on foreign citizens in Turkmenistan. He ordered his security and interior ministries to keep track of foreigners from the moment they enter the country.

A year ago, Turkmenistan was the first CIS country to leave the organization's visa-free regime. Russia retaliated by making visas necessary for visiting Turkmen citizens.

Last month, Turkmenistan revoked the licenses of all Internet providers in the country. That left only the state-owned Turkmentelekom to provide Internet services.

Turkmenistan today has no major foreign backer, nor close ties with any other government. Nearly all of its gas and oil sits in storage containers or under the ground waiting for a buyer. In nine years, Niyazov has presided over the almost total isolation of his country. (RFE/RL)

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