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KYRGYZSTAN


 

 

In-depth Business Intelligence

Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 1,737 1,632 1,500 145
         
GNI per capita
 US $ 330 290 280 178
Ranking is given out of 208 nations - (data from the World Bank)

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REPUBLICAN REFERENCE

Area (sq.km) 
198,500 

Population 
5,081,429

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

Capital
Bishkek 

Currency 
Kyrgyz Som 

President 
Askar Akayev



Update No: 307 - (27/07/06)

Bakiyev faces growing opposition
There is always a period of disillusionment that sets in after a successful revolution. The high hopes it generates are never fully met.
Just over one year after Kyrgyzstan's March 24 Tulip Revolution Kyrgyz President Kurmanbek Bakiyev faces outspoken criticism of his regime from both political and non-governmental sources. Although the current political situation in Kyrgyzstan largely resembles the final years of former president Akayev's regime, when the general public was dissatisfied with widespread corruption and ineffective economic policies, most political actors now strive to avoid another revolution. That is one gain of the turn events have taken.
The majority of Bakiyev's opponents are his former political allies who helped him to oust Akayev's regime. Corrupt regime politics are driving more and more prominent political figures into the opposition camp. To date, Roza Otunbayeva, Azimbek Beknazarov, and Omurbek Tekebayev are Bakiyev's most active challengers. All three leaders were also strong opposition forces against former president Akayev. For several years they acted separately by leading their own political factions, but in late 2004 they united into one block.
The new political opposition claims that Bakiyev is repeating the mistakes made by Akayev. Specifically, the president is becoming increasingly authoritarian in appointing government members and curbing freedom of speech. To avoid a further deterioration of political transparency in Kyrgyzstan, the new opposition is acting more thoughtfully than their counterparts did during the Akayev era. In particular, former foreign minister and Akayev critic Otunbayeva is drawing attention to the success of political party building in Kyrgyzstan. According to her, the current opposition values social cohesion and seeks to involve large numbers of people, as opposed to clustering around a few charismatic individuals.
The new political opposition is also revealing some previously unknown details about the March 24 revolution. According to Otunbayeva, shortly before the parliamentary elections in February-March 2005, Bakiyev was pushed forward by political figures from southern parts of the country. She claims that three years ago, when Absamat Masaliyev, an "elder statesman" of Kyrgyz politics and a parliamentarian from the south, was still alive, he informally anointed Bakiyev to become the next presidential candidate. Political figures such as Usen Sydykov pledged to follow Masaliyev's orders after his death and supported Bakiyev as the Tulip Revolution unfolded. 
Otunbayeva has been criticized for not revealing the nuances of the current political regime while she was still part of the post-March 24 government (analitik.kg, March 12). However, she claims that she was not able to remain in the government because she constantly confronted the president's cadre politics and opposed the many manifestations of nepotism. She was offered various positions in the foreign service before parliament rejected her nomination to become foreign minister. 
Otunbayeva and Beknazarov had asked Bakiyev to make a report on March 24 about the progress made by the new government since last year. Both opposition leaders are pessimistic about changes brought by the revolution, yet neither denies the fact that the revolution was necessary. 
Meanwhile, the president had announced beforehand that March 24 would be a public holiday, with nation-wide celebrations organized by the government. Top government officials -- Bakiyev, Prime Minister Felix Kulov, Head of Presidential Administration Usen Sydykov, State Secretary Dastan Sarygulov, and Vice Prime Minister Adakhan Modumarov -- were all actively promoting the day's symbolic significance. Celebrations were held in all of Kyrgyzstan's largest cities, and a special monument commemorating the Tulip Revolution was erected in Jalalabad, Bakiyev's birthplace. 
Bakiyev's efforts to celebrate the March 24 anniversary show the president's detachment from society's prevailing mood. Behind the spectacle of the upcoming events, there is deep disappointment with the regime among both the urban and rural populations. For many Bishkek residents the events of March 24, 2005, are still closely associated with the looting and banditry that followed the takeover of the government headquarters and the demoralization of law-enforcement agencies. Businessmen who suffered from arson and theft still have not received monetary compensation for their losses. "March 24 should be called the day of triumph for looters and hooligans," one student from Bishkek commented bitterly. 
Speculation was circulating in Bishkek that another mass uprising against Bakiyev government might have taken place on March 24 this year. However, it did not. Members of the new opposition have confirmed that they are determined to build exclusively constructive relations with the government until the next presidential and parliamentary elections are held in 2010. 

EU in support 
As the only country in Central Asia attempting democratic reforms, Kyrgyzstan won praise in mid-July in Brussels at a meeting with senior EU officials. However, the praise was tempered privately by EU diplomats, who stressed the challenges still facing the country. 
Finnish Foreign Ministry Secretary of State Pertti Torstila, who led the EU delegation at the meeting, said the EU understands the difficulties facing Kyrgyzstan. "We [understand] the difficult situation which currently [the] Kyrgyz Republic is facing and welcome the earnest efforts of Kyrgyz authorities to address the problems such as widespread corruption and organized crime," he said. 
"[The] Kyrgyz Republic is an exception in the region," Torstila added. "The responsible handling of protests and demonstrations by the authorities is exemplary, but we on the European side emphasized continuing engagement which is needed to stabilize the political situation." 

Still Far To Go 
However, EU officials say privately that there remains a world of difference between Kyrgyzstan and countries like Ukraine and Georgia, which have undergone recent democratic "revolutions." 
One EU official who was present at the meeting told RFE/RL on condition of anonymity that "there is hope" for Kyrgyzstan, but added that he "wouldn't say there is light at the end of tunnel yet." 
The official said the EU expected "big changes" in the aftermath of recent political upheavals, which did not materialize. In fact, he noted, "things got worse," with "criminal gangs" entering the political arena and the government. 

Organized Crime In Politics 
He said a turning point may have come with the killing of a leading alleged criminal figure, Ryspek Akmatbaev, who was suspected of having close links to the "clan" of President Kurmanbek Bakiev. 
The EU official said the killing put an end to a climate of "physical fear" and brought "enormous relief" to Kyrgyz society. He praised the Kyrgyz government, which is now trying to "get to grips with the situation," carry out constitutional reforms, and attract investment. 
However, the official noted, these remain daunting tasks -- while it is "very, very important" to secure investments and revitalize the economy, there are virtually no EU investors in Kyrgyzstan. 

Financial Help Needed Above All 
The EU-Kyrgyz meeting covered a wide range of issues. Apart from political and economic reforms, Torstila highlighted the role of the Organization for Cooperation and Security in Europe (OSCE), the treatment of Uzbek refugees, and regional cooperation. 
The head of the Kyrgyz delegation, First Deputy Prime Minister Daniyar Usenov said "over 40" issues were covered. He said Kyrgyzstan is looking to the EU as "a model of democracy and successful regional integration." However, he said Bishkek most values concrete economic assistance. 
"We would like to have more economic cooperation in our bilateral relations, we would like investments from the EU, we would like to invite private business from the EU to Kyrgyzstan," Usenov said. "We would like to say that our legal groundwork and tax reforms have thrown the doors wide open to [such investments]." 
Usenov said Kyrgyzstan has compiled a list of concrete projects in the fields of hydroelectric energy, mining, and water management, among others, for which EU financing or investors are sought. 
Usenov also said that Kyrgyz President Kurmanbek Bakiev will visit EU headquarters in Brussels in October. 

Limited EU Assistance 
At the mid-July meeting, the European Commission promised financial aid to some of the projects floated by the Kyrgyz delegation. The EU also said it will help Kyrgyzstan finance reforms of its penitentiary system, develop the energy sector, and fund a poverty-alleviation strategy. 
EU sources said after the meeting all these issues are crucial in persuading European investors to target Kyrgyzstan. 
Another EU official said the EU had to remind the Kyrgyz side that EU investors were not at the beck and call of EU governments. He said Kyrgyzstan needs to do more to persuade investors they and their property would be safe. He noted tourism would have "enormous potential," adding that "tourists like adventure, but not when there are people with shotguns everywhere." 
Better Regional Ties Needed 
The official said Kyrgyzstan was in the first instance much more likely to attract investors from neighbouring Kazakstan or Turkey, than the EU. 
The official noted Kyrgyzstan remains a very poor country even against the backdrop of its own region. He said that while Kyrgyzstan's annual gross domestic product (GDP) per capita struggles to reach US$300, that of Kazakstan is US$3,000-US$5,000 "and growing." 
As a result, large numbers of impoverished Kyrgyz citizens are forced to seek work in neighbouring countries, contributing to regional tensions. 
The EU official noted that Kyrgyzstan has "difficult neighbours" in any case. Relations with Uzbekistan are tense in the aftermath of the Andijan massacre last year, and a largely still under-demarcated border serves to complicate matters. Bishkek's cooperation with Tajikistan has improved, but, as the EU official noted, the situation on Kyrgyzstan's borders remains "volatile." 

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ENERGY

New power supply project 


Kyrgyzstan, Tajikistan, Afghanistan and Pakistan signed a quadrilateral agreement on implementation of power supply project from Tajikistan and Kyrgyzstan to Pakistan via Afghanistan at Power, Transit and Trade International Conference in Turkey, Radio Kabul, reported. 
On arrival at Kabul international airport, Afghanistan's Energy and Power Minister, Muhammad Ismail, said that Afghanistan and Pakistan signed the agreement as power consumers while Tajikistan and Kyrgyzstan signed as power suppliers. A two-day conference held at Istanbul city of Turkey at the initiative of US Trade and Development Agreement was also attended by the US Private companies.

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TELECOMMUNICATIONS

Altimo buys cellular operator 

Russia's Altimo, formerly known as Alfa Telecom, has completed a deal to buy a 100 per cent stake in Sky Mobile, which owns a licence to provide GSM services in Kyrgyzstan, Altimo said recently, New Europe reproted.
"Countries in Central Asia are a priority for Altimo business development. We consider Kyrgyzstan to be one of the most promising mobile communications markets in the region and plan to actively develop Sky Mobile as the third national GSM operator. In the very near future we will develop an investment programme to plan and build mobile communications networks throughout the republic," the press release quoted Altimo Vice President Kirill Babaev as saying.

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