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Qishloq Ovozi

Thursday 8 April 2021

People line up outside a state grocery store to buy cooking oil in the Turkmen city of Mary.

When the exchange rate of Turkmenistan's national currency, the manat, fell to 40 to the dollar on the black market on April 3, it was more than 11 times the long-standing official rate of 3.5 manats per dollar.

It was also an all-time low for the troubled Central Asian country's beleaguered currency.

The manat's weak rate on the black market -- reported by RFE/RL's Turkmen Service (known locally as Azatlyk) -- parallels the dire economic situation in Turkmenistan -- a situation that has severely deteriorated compared to January 2015, when the government originally devalued the manat from 2.85 to 3.5 to the dollar, but also gotten noticeably worse this year.

The exchange rate on March 26 was between 33 to 33.5 manats, so in roughly one week it had lost more than 20 percent of its value on the black market, an exchange rate that is generally seen as a far more accurate reflection of the manat's real value.

It is illegal to trade money on the black market in Turkmenistan and during the last few years government restrictions have made it increasingly more difficult to acquire hard currency.

Despite The Resources...

Turkmenistan is rich in natural gas, with the fourth-largest reserves in the world, and has a relatively small population generously estimated at 6 million people.

But Turkmen authorities put too much faith in the sale of gas as a reliable source of revenue for the country and discovered too late that simply having the gas does not guarantee a bright financial future: It still has to be effectively exploited and sold.

Officially, the government says the average monthly salary in the country is 1,200 to 1,400 manats ($350-$400 at the official rate), which would make it one of the highest in all of Central Asia, behind only Kazakhstan. But that's at the artificial official exchange rate that hasn't changed in more than six years. Instead, Turkmen are among the poorest people in the region.

The government offers many basic goods at subsidized prices in state stores, which should make it easier for people to buy enough food.

Explosion In Food Prices

But on February 25 the cost of sugar in state stores suddenly increased from 7 to 9 manats per kilogram. Cooking oil went from 13 to 19 manats and chicken legs from 10 to 16 manats per kilogram.

Those lower, subsidized prices were in place for several years, going back to when the black-market rate was about 4 manats to the dollar. The sudden, sharp inflation in prices was a shock to many who have seen other unexplained price increases in recent years.

Such food staples are also usually available in private stores where sugar, for example, reportedly sells for about 23 manats per kilogram, which is difficult for many Turkmen to afford. And the high inflation in recent weeks has hit virtually all food staples in the country.

People line up outside a grocery in the Lebap region.
People line up outside a grocery in the Lebap region.

The website reported on March 23 that the price of 1 kilogram of beef at private stores in Mary Province was 75 manats, in Turkmenabad -- the provincial capital of the eastern Lebap Province -- the price was 70 manats. In the western Balkan Province, beef cost 65 manats, and in the northern Dashoguz Province a kilogram cost between 55 and 60 manats. reported on February 1 that two bazaars in the capital, Ashgabat, appeared to be out of potatoes, which usually sell for a state-regulated price of between 15 to 17 manats per kilogram.

Such outages are no longer unusual in Turkmenistan, as people have learned to go without certain foods for periods of time. But added that merchants kept potatoes behind the counter that they were willing to sell in unlimited quantities for 25 manats per kilo.

Since January 12, state stores in Mary Province have required customers to show documents that prove the number of family members before selling them bread. In order to obtain such documents, people had to go to their local administrations, where officials demanded that all utility bills were paid before issuing the necessary documents.

Residents of the eastern city of Turkmenabat wait to buy flour from state shops.
Residents of the eastern city of Turkmenabat wait to buy flour from state shops.

In Lebap Province in late January, state stores were reportedly limiting customers to two loaves of bread per family, per visit.

Azatlyk reported in early April that state stores in Ashgabat were out of flour and often had no bread, with some state stores in Mary Province having no bread for sale for three weeks at a time.

Long, Long Lines

Lines have formed outside many state stores in recent years, especially those selling bread, which begin hours before the shops open, as people who cannot afford to buy at private stores try to purchase subsidized goods before they run out.

Even before the long lines for food, there were queues snaking out from automated bank machines, the only place people can get cash using their bank cards. Unfortunately, just as with the goods at state stores, there is a very limited supply of money that usually runs out quickly, with strict limits placed on the amount one person is allowed to withdraw.

The authorities tried years ago to transform Turkmenistan into a cashless society, but many stores and nearly all bazaars still don't have the equipment needed to conduct transactions using bank cards.

People wait for an ATM to start working in Baharden in August 2020.
People wait for an ATM to start working in Baharden in August 2020.

None of the shortages and associated lines for scarce goods existed in Turkmenistan before 2015 and they appear to concern the authorities. Police routinely disperse people forming lines and generally discourage citizens from waiting in them.

Officials never provide unemployment figures, but several analysts believe it was at least 50 percent of the workforce before the economic problems started six years ago and, after dismissals and layoffs in recent years due to the ailing economy, the unemployment rate is thought to be much higher.

Garbage Picking To Survive

Some people are now so poor that they have resorted to rummaging through garbage in the hopes of finding food scraps or something that might be sold for small change, like paper or plastic that can be recycled.

Such activity would have been unthinkable just two or three years ago.

Azatlyk reported in January that in the city of Mary, women and children are increasingly seen digging through the trash or, in some cases, intercepting people about to dump their garbage and asking if they can have it with the promise they will properly dispose of everything they do not take.

A woman picks through garbage cans in Ashgabat.
A woman picks through garbage cans in Ashgabat.

By March, police in Mary seemed to have accepted that they could not hold back the tide and, according to Azatlyk, lectured people digging through the trash, photographed them, and took down their personal details. Some even advised people searching through garbage to buy vests like city workers wear to be less conspicuous.

Azatlyk also reported an increase in the number of children with water buckets and towels waiting along roadsides to wash stopped cars in the hope of receiving small change in return.

An Azatlyk correspondent noted that there were children of kindergarten age who, when asked why they were not in school, replied that they had never gone to kindergarten. Some older siblings explained that their families did not have the money needed to send them to school.

One 12-year-old girl said she and others "go every day to the Green Bazaar and beg for money. Last week police chased us away and yelled at our mom."

"They told [our mother] that if they ever saw us again they would put us in a jail for minors...and [she] told them to put us in jail and her, too, because at least we would be fed in jail," the girl continued.

No Virus Here

The global spread of the coronavirus has only made the economic situation in Turkmenistan worse, compounded by the government's laughable insistence that the virus has not infected a single person in the country.

Though a national vaccination program has recently started, officials have taken few real measures to protect the population from COVID-19.

Nonetheless, medical workers have quietly and without any special recognition continued to carry out their duties amid the increasing hospitalization of patients.

Some health-care workers expected they might receive some compensation for their difficult, longer work, and for staying quiet about those with coronavirus-like symptoms in their care. Instead, their salaries were reportedly cut by almost 20 percent at the start of 2021.

Despite the grim first months of this year, authoritarian President Gurbanguly Berdymukhammedov and his government have continued to do what they have been doing since economic problems started to bite in 2015: claim that the country's economy is forging ahead and drawing their attention somewhere else, often something insipid.

For example, Berdymukhammedov in recent weeks has been checking up on preparations for upcoming beauty contests -- for horses and the Turkmen alabai dog. Both competitions are scheduled for late April, with state employees being forced to volunteer their time and donate money from their salaries for the events.

Diminishing Value

Tracking the value of the "gift" the president gives women every year to mark International Women's Day on March 8 is a monitor of how bad the manat is doing on the black market.

In 2015, Berdymukhammedov presented each woman in the country with 40 manats, about $11.50 at the official rate and, in 2015, it would have still been worth more than $10 on the black market.

In 2016, the same 40 manats would have traded for about $8 on the black market.

In 2017, 40 manats was worth about $6. A year later it would get you about $3.

The president decided in 2019 to increase the International Women's Day gift to 60 manats, about $17 at the official rate, but only $3.5 on the black market then.

Last year, 60 manats on Women's Day was worth about $3 on the black market and this year it was not quite $2 and, by month's end, was closer to $1.5.

In October 2020, the government increased the minimum monthly wage to 957 manats, which at the black-market rate as of April 3 this year is some $24.

For those making the official monthly 1,400-manat average salary, it is worth about $35, which would make Turkmen the poorest people in Central Asia.

Radio Azatlyk contributed to this report
Kamchybek Tashiev, the head of Kyrgyzstan’s State Committee for National Security, speaking to reporters on March 26: "No issues remain."

The head of Kyrgyzstan’s security service returned from border talks with Uzbekistan last week claiming that all remaining demarcation disputes between the two former Soviet republics have been “resolved 100 percent.”

But this week, the same official has been telling residents of some disputed areas that it is not completely a done deal.

Kamchybek Tashiev, the head of Kyrgyzstan’s State Committee for National Security (UKMK), made the claim on March 26 after two days of talks in neighboring Uzbekistan -- saying “the issue of the borders with Uzbekistan has been resolved 100 percent.… No issues remain.”

Tashiev said agreement was reached for a complicated territorial swap involving land and water rights to settle, once and for all, the border disputes both sides have wrestled with since the disintegration of the Soviet Union in 1991.

It was a stunning announcement after nearly 30 years of border talks that had appeared deadlocked over several areas where neither side was willing to make concessions.

But during the past week, as Tashiev traveled to Kyrgyzstan’s southern provinces to discuss details of the deal with residents in the affected areas, it quickly became apparent that the border issue with Uzbekistan is not “100 percent” resolved.

In the Uzgen district of Osh Province on May 30, the UKMK chief spoke about the village of Birlik in the Kadamzhai district, which borders the Uzbek exclave of Soh.

Earlier in the day, Tashiev had been to Birlik -- the scene of clashes in May 2020 that destroyed several homes and vehicles and left more than 200 people injured. Tashiev views the cause of the violence to be the shared use of a large spring by inhabitants of the Uzbek exclave and neighboring Kyrgyz villages.

“Concerning this area, there was no final decision. To be candid, we did not reach an agreement on this section, including adjacent territory,” Tashiev said.

Tashiev mentioned the settlement of Chesme in Kyrgyzstan and the neighboring settlement of Chasma in the Soh exclave. Both were at the epicenter of the May 2020 clashes.

“There are villages there in which thousands of people live, and there are thousands of hectares [of land], and the fate of these need to be resolved,” Tashiev said.

“Of course, if the people are against [the land-swap agreements], it is possible that some will not be implemented,” Tashiev also said.

Discontent about the land-swap agreements has already surfaced.

On April 1, Kyrgyz residents of the Kara-Suu district of Osh Province protested against part of the agreement that would hand over 50 hectares of land from the village of Yntymak to Uzbekistan.

Tashiev has stressed that Kyrgyzstan will receive some 13,000 square hectares of disputed land under the agreement he announced on March 26. He also listed those areas involved in the land-swap deal.

This breakthrough came after Kyrgyz President Sadyr Japarov made an official visit to Uzbekistan on March 11-12 and met with Uzbek President Shavkat Mirziyoev.

Border issues were one of the main topics of their talks. Mirziyoev said the two sides wanted to complete talks on demarcation within three months.

Border issues were one of the main topics when Kyrgyz President Sadyr Japarov (left) traveled to Tashkent on March 11-12 and met with Uzbek President Shavkat Mirziyoyev.
Border issues were one of the main topics when Kyrgyz President Sadyr Japarov (left) traveled to Tashkent on March 11-12 and met with Uzbek President Shavkat Mirziyoyev.

The task of relocating people will be much easier for Mirziyoev because his government has a much tighter grip on society than has been the case with the Kyrgyz government. Japarov came to power after protests in early October 2020 ousted the previous government.

The Kyrgyz president’s legitimacy is still debatable, despite his victory in a snap presidential election on January 10.

Some doubt Japarov can survive his full term in office given the daunting number of problems he faces in a country where protests have led to the ouster of three presidents since 2005.

Japarov’s government needs some political victories.

It could be that Tashiev, who once said Kyrgyzstan would never cede even one square centimeter of its territory, has oversold the land-swap deal.

Nevertheless, the agreement represents significant progress for both Kyrgyzstan and Uzbekistan -- even if it hasn’t resolved 100 percent of the remaining border issues.

Upcoming border talks with Tajikistan are unlikely to be as successful as Kyrgyzstan’s negotiations with Uzbekistan.

Tashiev’s suggestion on March 26 that Tajikistan might make a land-swap deal over its large Vorukh exclave was met with silence by Tajik authorities.

Then, on March 31, RFE/RL’s Tajik Service reported that President Emomali Rahmon had scheduled a visit to Vorukh for April 4.​

Rahmon had met in July 2019 with Kyrgyzstan’s then-President Sooronbai Jeenbekov to discuss their border issues. It was Rahmon’s first visit to Vorukh in 26 years. So his sudden return there less than two years later raises suspense about the aim of his visit.

Then-Kyrgyz President Sooronbai Jeenbekov (right) met with Tajik President Emomali Rahmon in July 2019.
Then-Kyrgyz President Sooronbai Jeenbekov (right) met with Tajik President Emomali Rahmon in July 2019.

Meanwhile, Kyrgyzstan’s military and security forces on April 1 started a three-day training exercise in Batken Province in the area near the Tajik border.

In the end, none of these border disputes can be finally and peacefully demarcated without the participation and agreement of border area residents.

Tashiev mentioned when speaking about Chesme that part of the problem with exchanging land there is the presence of an old cemetery.

The major obstacles to drawing definitive borders appear to be related to generational ties to the land by local residents -- such as cemeteries or trees planted and agriculture fields tilled by grandfathers and great-grandfathers.

Concerns of residents that the land they receive in a swap deal will not be as fertile as the land they surrender also appear to be a remaining obstacle to finalizing the lines on the map.

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About This Blog

Qishloq Ovozi is a blog by RFE/RL Central Asia specialist Bruce Pannier that aims to look at the events that are shaping Central Asia and its respective countries, connect the dots to shed light on why those processes are occurring, and identify the agents of change.

Content draws on the extensive knowledge and contacts of RFE/RL's Central Asian services but also allow scholars in the West, particularly younger scholars who will be tomorrow’s experts on the region, opportunities to share their views on the evolving situation at this Eurasian crossroad.

The name means "Village Voice" in Uzbek. But don't be fooled, Qishloq Ovozi is about all of Central Asia.


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