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Qishloq Ovozi

Saturday 18 November 2017

In June, Turkmen President Gurbanguly Berdymukhammedov announced the creation of the State Service for Combating Economic Crimes.

Anticorruption campaigns in Central Asia, and investigations into corruption there in general, are fascinating to observe. They are so seldom about actually fighting corruption. (The views expressed in this blog post do not necessarily reflect those of RFE/RL.)

Anticorruption campaigns in Central Asia, and investigations into corruption there in general, are fascinating to observe.

They are so seldom about actually fighting corruption.

Corruption is a huge problem in Central Asia and authorities have regularly declared new battles against it.

If asked to name the primary source of corruption in their countries, most citizens of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan would probably point (discretely) at their own governments.

The idea that everyone in government is somehow “dirty” is pervasive across Central Asia.

If this is true, it would mean anyone in government could be exposed at any time. That makes political alliances all the more important, which in itself breeds “turf wars” among the elite.

And that raises questions about why officials and other powerful figures are detained, arrested, or imprisoned, officially on corruption charges.

Turkmenistan’s President Gurbanguly Berdymukhammedov announced his country’s latest campaign against corruption at the start of May. The first to go were Prosecutor-General Amanmurad Hallyyev and nine other prosecutors, regional and city, officially dismissed for failing to rein in corruption. A week later, they were then arrested on charges of corruption.

However, RFE/RL’s Turkmen Service, known locally as Azatlyk, heard from people in the Turkmen government, including the Interior Ministry, who offered a different version of Hallyyev’s incarceration.

Speaking on condition of anonymity, because Turkmen authorities tend to throw people into prison for speaking to Azatlyk, these people said Hallyyev was sacked for failing to squeeze sufficient money out of businesses to help Turkmenistan pay the huge costs of hosting the Asian Indoor and Martial Arts Games (AIMAG).

Hosting AIMAG seemed like a good idea a few years ago when Turkmenistan was raking in money from gas sales. But gas prices dropped and Turkmenistan was still looking at spending more than $8 billion, at least, to host AIMAG in September 2017, at a time when the country is experiencing its worst economic crisis since independence.

Some accounts claim Hallyyev simply could not get all the money Ashgabat wanted; other accounts say he and the other prosecutors were caught skimming off some $15 million of that money.

Whatever the truth, Hallyyev’s sacking started a purge in the Prosecutor-General’s Office and the Interior Ministry. Dozens of people were dismissed.

In June, Berdymukhammedov announced the creation of the State Service for Combating Economic Crimes.

The other Central Asian governments have created and re-created state agencies to combat corruption over the years, but Turkmenistan had never done so.

Qishloq Ovozi asked Alex Melikishvili, a senior analyst at the Washington-based research company IHS Markit, why Turkmenistan needed an anticorruption agency now, after all these years without one.

Melikishvili said it was probably a combination of several factors. Among those factors, he said, “having a formal mechanism to carry out anticorruption measures creates the impression that the Turkmen government has become more serious about tackling graft.”

That, as Melikishvili suggested, “reflects nicely on Turkmenistan’s overall investment profile, as having a state service specifically dedicated to fighting economic crimes provides talking points to Turkmen officials in their talks with potential foreign investors and international financial institutions.”

Turkmenistan desperately needs foreign investment. Twenty-six years of an isolationist foreign policy, a long record of human rights abuses, and amazing financial opacity have made Turkmenistan an unattractive investment opportunity, despite the country having the fourth-largest reserves of natural gas in the world.

But Melikishvili noted there could have been a more immediate reason to establish the State Service for Combating Economic Crimes.

“It is very likely that this service [would] be used to shake down high-ranking state officials and entrepreneurs to fill the rapidly dwindling state coffers,” he said.

Azatlyk, and Turkmen opposition websites, such as Chronicles of Turkmenistan and Alternative News of Turkmenistan, reported there were such shakedowns in the weeks leading up to AIMAG.

Hallyyev’s political demise was followed by the crippling of the Prosecutor-General’s Office and the Interior Ministry, possibly suggesting there was a battle between ministries and agencies for dwindling sources of income.

Tajikistan has seen an “anticorruption” campaign this year aimed, ironically, against the country’s State Agency for Financial Control and Fighting Corruption.

Tajik President Emomali Rahmon (right) and his son Rustam (left)
Tajik President Emomali Rahmon (right) and his son Rustam (left)

As Edward Lemon, a postdoctoral fellow at Columbia University’s Harriman Institute and an authority on Tajikistan, recounted, “Citing its ineffective work, in February 2015, President [Emomali] Rahmon fired 330 of the agency’s 495 staff members. These workers were never replaced."

The next month, Rahmon’s son Rustam Emomali, who was 27 years old at the time, became the agency’s director, but he left that position in January 2017 after he became mayor of Tajikistan’s capital, Dushanbe.

During the time Emomali was the director, no one in the agency was sacked. But in April 2017, arrests started. The agency’s deputy director, senior investigators, and others were detained -- 10 high-ranking officials altogether by June.

There was talk of a battle between government agencies. “It remains possible that Rustam, in collaboration with the security services, is behind the move to marginalize the agency," Lemon said.

Many officials, not only in Tajikistan, have business interests, and their fall from power on corruption charges opens up new opportunities for enrichment.

Charges of corruption are also a means of weakening political opponents. In 2014, Tajik authorities seized the Sahovat bazaar in the western city of Tursunzade that belonged to Muhiddin Kabiri, the leader of the opposition Islamic Renaissance Party of Tajikistan (IRPT). Before the end of 2015, Kabiri had fled Tajikistan and the IRPT, officially registered for 18 years, was declared an extremist party.

The cases against Omurbek Tekebaev, the leader of Kyrgyzstan’s Ata-Meken party, and several other leading members of that party seemed to be aimed at neutralizing a political opponent and vocal critic of the government of President Almazbek Atambaev.

Tekebaev was convicted of corruption and fraud in August 2017 for alleged offenses that dated back to 2010.

Tekebayev came under investigation in February 2017 after he started looking into Atambaev’s alleged business ventures and property abroad. Tekebaev had also announced plans to run for the presidency in the October election. His conviction came almost exactly two months before election day.

Qishloq Ovozi just looked at the case of former Minister of National Economy Kuandyk Bishimbaev. He is in custody for corruption, but there appears to be more to his case than allegations of taking bribes.

Former Kazakh Prime Minister Serik Akhmetov (who was also a former defense minister) was convicted on corruption charges in December 2015 and sentenced to 10 years in prison, but like Bishimbaev, some felt Akhmetov’s legal problems were the result of infighting among Kazakhstan’s elites.

However, his 10-year prison sentence was reduced by two years in January 2017 as part of an amnesty marking Kazakhstan’s 25th anniversary of independence. And in September 2017, Akhmetov was let out of prison and given “limited freedom,” essentially parole, for the remainder of his sentence.

And then there are the untouchables.

In December 2009, Aliakbar Abdulloev, the director of Tajikistan’s nongovernmental organization the Center for Anticorruption Education and Promotion, said, “Facts show that today the activity of Tajik law enforcement bodies is mostly aimed at uncovering corruption-related crimes among doctors, university lecturers, and state officials of low and middle rank, but senior state officials, as always, remain out of reach.”

That could be said about any of the Central Asian states, and it really begins with the presidents and their immediate family members, all of whom are widely rumored to be wealthy. But it is not only officials.

Melikishvili from IHS Markit recalled the case of Kazakh businessman Vasily Ni, a longtime friend of Kazakh President Nursultan Nazarbaev, who “was arrested while receiving a $1 million bribe in September 2016 by the operatives from Kazakhstan’s National Anticorruption Bureau.”

Ni was released in April 2017 and “no sensible explanation was offered by the Kazakh authorities to justify Ni’s release,” Melikishvili said, “leading to speculation that his release was probably due to behind-the-scenes kickbacks.”

We’ll give Abdufattoh Goib, the former head of Tajikistan’s anticorruption agency, the last word. On March 19, 2014, Goib said his agency “never set a goal to eliminate corruption [entirely].”

Qishloq Ovozi will follow up this article with one of the most bizarre tales of power and corruption in Central Asia so far: the story of Gurbanbibi Atajanova, Turkmenistan’s “Iron Lady.”

RFE/RL’s Central Asian services contributed to this report.
The views expressed in this blog post do not necessarily reflect those of RFE/RL.
Before his recent travails Kuandyk Bishimbaev had been rising rapidly through the ranks of Kazakhstan's elite. (file photo)

Though just 37 years old, Kuandyk Bishimbaev has already been Kazakhstan's deputy minister of industry and trade, deputy chairman of the sovereign wealth fund Samruk-Kazyna, chairman of the national holding company Bayterek, and economy minister. But his current title is court defendant, as his trial got under way on November 7.

Though just 37 years old, Kuandyk Bishimbaev has already been Kazakhstan's deputy minister of industry and trade, deputy chairman of the sovereign wealth fund Samruk-Kazyna, chairman of the national holding company Bayterek, and economy minister.

But his current title is court defendant, as his trial got under way on November 7.

Bishimbaev is accused of accepting bribes when he was head of Bayterek, but there is far more to this story than allegations of an official engaging in corrupt practices.

Bishimbaev is the product of an elite educational program -- known as Bolashak -- that was founded and is strongly supported by Kazakh President Nursultan Nazarbaev.

Bishimbaev's case has shed some light on the Bolashak program and family connections that can be used to propel a young career.

And Bishimbaev's current incarceration might be at least partially the result of a power struggle between much higher officials.

Born in 1980 in the south-central city of Kyzylorda, Bishimbaev finished high school at age 15 and went on to graduate from the Kazakh State Academy of Management in Almaty at age 19.

Meteoric Ascent

Scholarships from the Bolashak program supported Bishimbaev's later studies at George Washington University (GWU) in the United States.

At age 26, Bishimbaev was named deputy minister of industry and trade before going on to enjoy a meteoric ascent over the next decade, which culminated in his appointment as national economy minister in May 2016 at age 36.

Bishimbaev barely lasted six months in that position after being abruptly sacked later that year in December, sparking various theories about his sudden fall.

Kazakh President Nursultan Nazarbaev (file photo)
Kazakh President Nursultan Nazarbaev (file photo)

Strangely, it was Nazarbaev who explained the dismissal on December 30 when he told a meeting of Foreign Ministry officials that Bishimbaev was fired in connection with an investigation into activities at Bayterek when Bishimbaev was chairman.

Bishimbaev was then detained on January 10 of this year on charges of accepting bribes when he headed Bayterek.

After Bishimbaev was taken into custody, questions arose about how he moved up so quickly and, inevitably, there was a focus on the Bolashak program.

Before going further, it is necessary to say that the Bolashak program could correctly be termed a success and Nazarbaev deserves credit for promoting it.

The Bolashak program sends students to study abroad, many at some of the world's leading universities.

Anyone who has attended a major Central Asian Studies conference, such as the annual Central Eurasian Studies Society (CESS) conferences, would have seen students from the Bolashak program.

They are usually incredibly dedicated, bright, and multilingual (in my experience at least).

Other "graduates" of the Bolashak program include Almaty Mayor Baurzhan Baybek, 42, and his deputy Erlan Aukenov, 32; West Kazakhstan Province Governor Altay Kulginov, 39; former Shymkent Mayor and now a secretary in the ruling Nur-Otan Party, Gabidolla Abdurahimov, 41; and the chairman of the board of the Association of Financiers, Magzhan Auezov, 41.

Qualification Questions

There have been accusations that some of the nearly 12,000 students who have been in the Bolashak program over the roughly two decades of its existence entered due to family connections.

Bishimbaev is an example. While no one disputes his intelligence, there are now questions about his two university degrees.

About the same time Bishimbaev completed his work at GWU, he also completed work at the Muhammad Khaydar Dulati University in the southern Kazakh city of Taraz.

It is unclear what Bishimbaev's attendance record was at the university in Taraz, but it is certain his father, Valikhan, became the rector at the university shortly before records show the younger Bishimbaev finishing his studies there.

The details of Bishimbaev's climb to deputy minister of industry and trade are not clear but eventually he does seem to have come under the wing of Kairat Kelimbetov.

Kelimbetov has been in the Kazakh government since 1997 and has, since then, been minister of economy and budget planning, minister of economic development and trade, chairman of Samruk-Kazyna, head of the state oil and gas company (KazMunaiGaz), chief of the national railway company (Kazakhstan Temir Zholy), and head of the National Bank of Kazakhstan.

He is now the director of the Astana International Finance Center.

Former Kazakh Prime Minister Karim Masimov (file photo)
Former Kazakh Prime Minister Karim Masimov (file photo)

Before Kelimbetov's career started to taper off, Bishimbaev found a new patron, Karim Masimov, a former prime minister and currently the head of the Committee for National Security (KNB).

The amount of money Bishimbaev is accused of taking in bribes is some $2 million, not an insignificant sum but -- by Kazakh standards -- it is petty cash.

Someone took a special interest in Bishimbaev after he was named national economy minister and tracked Bishimbaev's activities when he was Bayterek chief from 2013 to 2016.

That someone appears to be Kairat Kozhamzharov.

Dramatic Fall

Kozhamzharov has spent nearly 20 years in the financial police or agencies that fight corruption. Since September 2016 he has been the chairman of the state Agency for Civil Affairs and Fighting Corruption.

And he is seen as a rival to Masimov.

But there is one more element worth mentioning. Kozhamzharov studied in St. Petersburg and one of his classmates was Russia's current prime minister, Dmitry Medvedev.

That would explain how Kozhamzharov has become so powerful that he could vie with Masimov, but it does raise some interesting questions about who is supporting Kozhamzharov.

So, it is possible Bishimbaev's fall is part of a much bigger struggle between Kozhamzharov and Masimov, though that does not necessarily mean Bishimbaev is innocent of the charges against him.

Which would be an additional blow to Nazarbaev.

Nazarbaev was pushing a youth movement in Kazakhstan's government in recent years until Bishimbaev was arrested.

Bolashak is not only an investment in Kazakhstan's future, it is also a guarantee for Nazarbaev's legacy.

These talented young cadres have been well educated at state expense but also well indoctrinated into Nazarbaev's system of governance. Their purpose is to lead Kazakhstan to a brighter future while preserving the memory of Nazarbaev's contributions to the country.

Bishimbaev had attained the highest position yet of any of the Bolashak graduates, so his fall is all the more dramatic.

And if Bishimbaev's political demise comes as the result of a battle between powerful officials, it would even be distressing to Nazarbaev, who will turn 78 in July.

Based on reporting by RFE/RL's Kazakh Service
The views expressed in this blog post do not necessarily reflect those of RFE/RL.

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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 some of the dots to shed light on why those processes are occurring, and identify the agents of change. Content will draw 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.