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TURKMENISTAN


 

 

In-depth Business Intelligence

Key Economic Data 
 
  2002 2001 2000 Ranking(2002)
GDP
Millions of US $ 7,672 4,000 4,400 98
         
GNI per capita
 US $ 1,200 950 750 127
Ranking is given out of 208 nations - (data from the World Bank)

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REPUBLICAN REFERENCE

Area (sq.km) 
488,100 

Population 
4,775,544 

Principal 
ethnic groups 
Turkmens 77%
Uzbeks 9.2%
Russians 6.7%

Capital 
Ashkhabad 

Currency 
Turkman Manat

President 
Saparmurat Niyazov

  

Update No: 288 - (01/01/05)

"Serious instability" possible in Turkmenistan without urgent changes 
Turkmenistan needs to diversify its economy and reverse the "destruction" of its education system, otherwise it faces "serious instability," an International Crisis Group country report bluntly states. It goes on to recommend that the international community apply more consistent and focused pressure on President Saparmurat Niyazov's regime. 
The report, titled Repression and Regression in Turkmenistan: A New International Strategy, maintains that the "quiet-diplomacy" strategy for Turkmenistan is a failure. "The international response to Turkmenistan has been weak and poorly coordinated. Niyazov has successfully played different states and organizations against each other," the report, released in November, states. 
Since an alleged assassination attempt on Niyazov in 2002, the president, spurred on by "growing paranoia," has expanded authoritarian controls over society, leading to a rise in human rights abuse. "The government clamped down even more on dissent, and took a much stronger line against independent activity in civil society," the report says. 
Niyazov's efforts to eliminate his enemies, both real and perceived, have extended beyond Turkmenistan's borders, the ICG report says. "Opposition leader Avdy Kuliev was beaten up in Moscow in August 2003 by suspected Turkmen agents, an allegation backed up the next month when Russian authorities reportedly asked eight Turkmen embassy officials to leave the country, supposedly due to suspicions they were planning to murder Moscow-based dissidents," the report said. "In April 2004 Makhamedgeldi Berdiev, a Radio Liberty journalist and human rights activist, was attacked in his home in Moscow and badly injured." The report, which follows up on a similar study conducted by ICG in 2003, says the economic future for an overwhelming number of Turkmen citizens is grim. The report states that Niyazov's regime relies on the country's abundant natural resources to prop up the police state, adding that energy production is estimated at 30 percent of GDP, but only one fifth of that revenue is devoted to social spending. The bulk of revenue is under direct presidential control - funds that Niyazov uses to maintain a large security force to intimidate the citizenry. At the same time, Niyazov has devoted sizeable sums to eccentric projects that reinforce his already well-developed cult of personality. In August 2004, for example, he approved a $43-million plan to build an ice palace in the desert outside the capital Ashgabat. 
The agricultural sector, which accounts for 25 percent of GDP and which employs over half the labour force, is facing "serious decline" because of mismanagement and counter-productive policies, the report says. Unrealistic government production goals have led to seizures of seed stock, and all farmers must adhere to "Niyazov's decision to sow seeds according to a set schedule without consideration of the weather." The "gradual decline" in agriculture shows no signs of slowing, and the 2004 harvest is predicted to be the worst in years. With about half the young people in Turkmenistan unemployed, the continuing agricultural-sector collapse can lead to a "humanitarian crisis," the report warns. 
Recent developments in the educational sphere could have the most damaging long-term consequences for Turkmenistan's development, according to the report. Niyazov has transformed the education system into an instrument of "heavy ideological indoctrination," with the president's "quasi-spiritual guide," or the Ruhnama, serving as the paramount textbook in Turkmen schools. The system, in effect, now emphasizes political reliability over acquiring knowledge. The report cites one example at a vocational college, where 18 of the 34-hours of academic work are devoted to studying the Ruhnama and other tracts devoted to reinforcing Niyazov's personality cult. 
"I believe [the reforms] are good for Turkmenbashi [Niyazov] to stay in power. However they are terrible for people, because it makes them dumber…Turkmenbashi is brainwashing the Turkmens by his policies and making them like sheep to herd them easily," the report quotes one unidentified student as saying. With 40 percent of the population under fourteen, the changes in education will outlast Niyazov's lifetime and, as quoted in the report, lead to "the creation of an isolated, stupid people dangerous for stability to the region." 
The government's effort to cut Turkmen citizens off from information stretches far beyond the classroom, the report says. As of 2002, only eight people per every 1,000 had a telephone. Meanwhile authorities closely monitor access to outside sources of information, especially the internet. 
While current policies may help reinforce Niyazov's hold over society in the near-term, they will likely leave Turkmenistan more vulnerable to instability over the longer haul. Niyazov's management style, which relies on frequent purges to prevent challenges to his authority from within the authoritarian system, has disrupted the development of a cohesive political elite in the country. There is also no clear line of political succession. Thus, political turmoil can easily ensue when Niyazov eventually leaves the political stage. The lack of developed political institutions, combined with the ongoing degeneration in the economy and education, could produce a "catastrophe" when Turkmenistan confronts the succession issue, the report says. To minimize the risks, the report urges a drastic overhaul of the international approach to Turkmenistan. The international community so far has preferred to work behind the scenes in trying to encourage the mercurial Niyazov to moderate his policies. There are powerful geopolitical reasons for prominent regional players not to confront Niyazov. Russia, for example, is intent on developing a potentially lucrative energy export relationship with Turkmenistan. Meanwhile, the United States has voiced criticism of Niyazov's policies, but has nevertheless been reluctant to exert strong pressure on Ashgabat out of a desire not to upset US security interests in Central Asia. Such policies of tacit cooperation raise the chances of tumult in Turkmenistan, ICG representatives believe. 
"The international community has put short-term economic and security benefits ahead of longer-term regional security, and there is likely to be a terrible price for that," David Lewis, Director of ICG's Central Asia Project, said in a written statement. "Despite its oil and gas, Turkmenistan's economy is becoming brittle, and the inevitable political succession could well be violent." 
The report urges that the international community establish clear benchmarks that Turkmenistan must meet, or face concrete economic and political sanctions. For instance, the report says Russia should link continued economic cooperation to efforts by the Niyazov government to restore Russian-language instruction in Turkmen schools, and to open access to Russian media outlets. Russia should also insist on the restoration of dual citizenship rights for Turkmen residents. 
In addition, the report specifically urges the United States designate Turkmenistan "a country of particular concern." The European Union, meanwhile, should tighten its criteria for the extension of economic assistance, the report said. 

Turkmenistan Elections
A total of 139 people will run in Turkmenistan's December 19 parliamentary elections. About 1,610 polling stations have been set up in the country's 50 electoral districts. The parliament of Turkmenistan is composed of 50 seats. 
Turkmenistan has not invited international observers to the polls, but the Central Elections Commission is ready to consider any applications from international organizations and foreign countries, the commission said. 

Government changes
Turkmen President Saparmurat Niyazov has transferred Interior Minister Geldymukhammed Ashirmukhammedov to the post of national security minister. Former National Security Minister Annageldy Gummanov was transferred to the post of first deputy foreign minister. 
Deputy Interior Minister Akhmamed Rakhmanov was promoted to interior minister. 
Ashirmukhammedov was born in 1957 and graduated from the Turkmen State University in 1979, where he majored in physics. Between 1982 and 1992, Ashirmukhammedov worked for state security agencies and attended KGB courses in Minsk and Kyiv. He worked as interior minister since August 2004. 
Gummanov was born in Cheleken in Krasnovodsk region. He graduated from the tank and artillery school in Saratov in 1988. He was appointed national security minister in November 2003. 
Rakhmanov was born in 1965 in the village of Kipchak in Ashgabat region. He graduated from the Turkmen Interior Ministry school in 1995 as a legal expert. Rakhmanov was named deputy interior minister in August 2004. 

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ENERGY

Turkmenistan eyes cooperation with Russian oil & gas firms


Turkmen president Saparmurat Niyazov recently said well-known foreign companies operate in the republic's oil and gas sector, but the Russian partners have demonstrated more active involvement in recent years. Russian companies participated in the ninth International Oil and Gas Fair and Conference, "Oil and Gas of Turkmenistan - 2004," which opened in Ashgabat on November 15th, Turkmenistan.ru reported.
A Turkmen-Russian oil and gas forum was held within the framework of the fair and conference

Turkmenistan oil output up 3%, gas production down 0.3%

Turkmenistan produced 8.092m tonnes of oil in the first 10 months of last year, up 3% year-on-year, according to a monthly report released by the national statistics institute recently, New Europe reported.
Natural gas production slipped 0.3% year-on-year in the period to 47.08bn cubic metres. Up to 39.8bn cubic metres were produced at Turkmengaz fields. Gas exports were down 2% to 33.9bn cubic metres. Turkmenistan exported to Ukraine, Russia and Iran. Oil refineries operated by state trading company Turkmenneftegaz - the Turkmenbashi and Seifi refineries, processed 5.605m tonnes of oil in the period, up 0.1% from the same period in 2003.

Naftohaz Ukrayiny to broaden cooperation with Turkmenistan

Ukraine's national oil and gas company Naftogaz Ukrainy intends to broaden cooperation with Turkmenistan, including in oil purchases, Interfax News Agency reported. 
These plans were announced by Naftogaz Ukrainy CEO, Yury Boiko, during talks, the Turkmen presidential press service was quoted as saying. The parties discussed the current state and prospects for cooperation in the gas sector, including the strategic aspect of Turkmen-Ukrainian economic relations, with a special accent on Turkmen gas exports to Ukraine under the bilateral agreement intended for 2002-2006.

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TEXTILES

New textile complex opens in western Turkmenistan

The first line of the new cotton mill, textile complex was launched in the town of Serdar (formerly Kyzyl-Arvat) in the Balkan region, Turkmenistan.ru reported.
Turkmen President, Saparmurat Niyazov attended the inauguration of the line. The complex is being built by Turkish Chalyk Holding AS. The first line's price tag reached US$59.9bn. Funds were also obtained from Japanese Mitsubisi corporation in the form of a credit worth US$34.9m for the construction of the mill. The complex will provide over 3,000 jobs. The first line's processing capacity is 13,000 tonnes of cotton. It will also produce 11,000 tonnes of cotton yarn using Italian Savio and Marzoli equipment. The second line of the complex will consist of textile, dye and garment mills.

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