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kyrgyzstan

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KYRGYZSTAN


 

REPUBLICAN REFERENCE

Area (sq.km) 
198,500 

Population 
4,753,000

Principal 
ethnic groups
Kyrgyz 52.4%
Russians 21.5%
Uzbeks 12.9%

Capital
Bishkek 

Currency 
Kyrgyz Som 

President 
Askar Akayev

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Background:
A Central Asian country of incredible natural beauty and proud nomadic traditions, Kyrgyzstan was annexed by Russia in 1864; it achieved independence from the Soviet Union in 1991. Current concerns include: privatization of state-owned enterprises, expansion of democracy and political freedoms, inter-ethnic relations, and terrorism. 

Update No: 269 - (29/05/03)

Akayev to step down
The president, Askar Akayev, is to step down. He is not standing at the next elections, leaving a yawning chasm in the republic's political life. 
He is the first of the post-communist leaders of Central Asia to retire in a peaceful fashion. There was a change in Tajikistan in 1994, but a civil war was raging at the time. Akayev was always the most civilised of the Central Asian leaders, less of a thug and with a cosmopolitan outlook.
He was for seventeen years a physicist in Leningrad, as it was then called, the "window on the West." Hence his concern to attract Western interest and investment into his country
The Kumtor gold project in Kyrgyzstan is the one element of the economy on which the republic relies. Yet it has proved a flop of late, yielding US$62.9m since 1997, instead of US$188m expected.
Kumtor amounts to 10% of GDP, along with agriculture the mainstay of the country. Its forlorn state is due to two factors, the decline in the gold price 1996-2000, and the rising costs of its production since then.
The idea that gold was the answer to Kyrgyzstan's problems rather recalls the myth of the crock of gold at the end of the rainbow, never very plausible. The country needs an economy that works in its own fashion, as did the nomadic way of life before communism. But that is nearly all destroyed.
The Kyrgyz leadership, like many others in charge of successor states to communism, became convinced that they just needed to listen to the West. They, the Westerners, had the key to prosperity, demonstrably so. Accept their advice, all would be well. Not so.

The premature Westerner
In the early 1990s Kyrgyzstan was in Western good books. The president, Askar Akayev, is the only Central Asian leader who was not an earlier communist autocrat. He was a mathematics professor, who was obligatorily in the communist party from 1981 to 1991, when he resigned.
A known liberal he was elected as executive president in October 1990, as a compromise candidate, after the communist leader (for whom the post had been designated) failed to win a majority.
Margaret Thatcher espoused him as one of her own, 'one of us.' From that moment he became a favourite of the international financial institutions. But that has led to a colossal debt - overhang. The Western banks perhaps should have read Kipling: "The East is East. The West is West. Never the twain shall meet." But perhaps not; that is exactly their destiny, to twine the East and the West. They could not have a better job on their hands than Kyrgyzstan.

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ENERGY

Gazprom, Kyrgyzstan boost long-term gas cooperation

Gazprom CEO, Alexei Miller, and Kyrgyz Prime Minister Nikolai Tanayev, met in Moscow and agreed to sign a long-term agreement on gas cooperation and principles governing the exploration and extraction of natural gas and the reconstruction, modernisation and creation of new gas transport facilities, the Russian gas monopoly said in a press release. The agreement will be valid for 25 years, Gazprom said, New Europe reported.

Kyrgyzneftgaz shares slated for trustee management

The Kyrgyz Committee for the Management of State property and Direct Investment plans to transfer a state packet of 85.16% of shares in the oil and gas company, Kyrgyzneftgaz, to trustee management, Interfax News Agency reported. The reason behind this decision is the need to improve management at the company, increase oil and gas production and also improve the company's financial performance.
In line with the republic's legislation, a tender commission will be set up to transfer the state shares to trustee management, which will reach a decision on the transfer of the shares on condition that there are at least two contenders. The contenders should submit a proposal for investment in the development of the company, a development strategy and forecasts for an increase in oil and gas production. Kyrgyzneftgaz is involved in oil and gas production in the south of Kyrgyzstan. The company produced 75,540 tonnes of oil in 2003 and about 29m cubic metres of gas. The Kyrgyz government considers this to be unsatisfactory and regularly brings up the issue of increasing production levels to make southern districts in the republic relatively independent from imports of oil products and gas. 
The State Committee for the Management of State Property and Direct Investment owns 85.16% of Kyrgyzneftgaz, the republic's Social Fund owns 8% and the company's workforce owns 6.84%.

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MINERALS & METALS

Kyrgyz shares of a gold company could be sold to a Canadian partner.

Prime Minister Nikolai Tanaev said answering questions from journalists during a question and answer session via the State TV on 29th April, that the government had formed a special commission to study an issue on selling state owned shares of the Kumtor gold enterprise to the Canadian partner. 
According to Tanaev, if the government is assured that it would more profitable to sell the shares an international tender would be organized. The CAMECO Corporation of Canada develops Kumtor and 115 tons of gold have been extracted at it in total in ten years. 
However, the Kyrgyz state budget received US$62.9m only instead of the planned US$188 million, and the planned expenditures for management and contingencies were increased two to three times. 

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