FREE GEOPOLITICAL NEWSLETTER

kyrgyzstan  

For current reports go to EASY FINDER

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)

Books on Kyrgyzstan

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: 301 - (30/01/06)

Foreign affairs in the background
The fall of the long-ruling Akayev amid street protests on 24th March and the ascent to power of the "tandem" of President Kurmanbek Bakiev and Prime Minister Feliks Kulov had surprisingly little effect on Kyrgyzstan's foreign relations, despite widespread fears among its neighbours that the latest of the 'colour' revolutions in the FSU could have a domino impact in Central Asia. With the exception of a conflict with Uzbekistan over refugees from Andijan, where a brutal massacre took place in mid-May, the primary concerns of Kyrgyzstan's new leadership have been domestic.
Tensions flared with Uzbekistan when hundreds of refugees crossed into Kyrgyzstan after violence in Andijan on 12-13th May. Uzbekistan claimed that the refugees included terrorists and demanded their extradition, while Western countries urged their evacuation to a third country. In late July, 439 Uzbek refugees were airlifted to Romania. Uzbekistan reacted with predictable anger, but no significant escalation resulted.
The new leadership tried its hand at the multivector diplomacy that its northern neighbour, Kazakstan, has practiced with such skill. Kyrgyzstan continued to host two foreign military bases -- one American and one Russian. After Uzbekistan asked the United States to vacate its air base in Khanabad in late July, and as Russian officials showed interest in boosting funding and troop strength at their base in Kant, Bakiyev indicated that he would like to see the United States make higher lease payments on its base outside Bishkek. 
On several occasions in 2005, Kyrgyz officials made a point of denying "reports" that China might open its own military base in Kyrgyzstan.

A 'faltering state'
Some entrepreneurs in Kyrgyzstan characterize the country's current business climate as anarchic, featuring a drastic increase in official corruption since the ouster of former president Askar Akayev in March. The mounting disorder in Kyrgyzstan has prompted one international organization to dub Kyrgyzstan a "faltering state." 
The new administration, headed by President Kurmanbek Bakiyev, came to power amid vows to curb corruption and promote democratic values. But it has made little tangible progress is reaching those goals. As Bakiyev continues to struggle to consolidate his power, bureaucrats on various levels are taking advantage to their regulatory authority to effectively extort money from entrepreneurs and entities, local businessmen say. Bribe rates have risen between 200-500 per cent, according to entrepreneurs. 
A 2005 survey conducted by the international anti-corruption group Transparency International confirmed that graft is a serious problem in Kyrgyzstan, as Bishkek ranked in the top 20 per cent of most-corrupt countries. Within the Central Asian context, however, Kyrgyzstan ranked behind only Kazakstan in the corruption index. Corruption in Tajikistan, Turkmenistan and Uzbekistan was deemed more problematic than in Bishkek, according to the Transparency International survey. 
"It's one thing to write an anti-corruption plan, its another thing to implement it," said Aigul Ahmatjanova, director of Transparency International Kyrgyzstan, referring to the Bakiyev administration's performance. 
One Kyrgyzstan-based Western entrepreneur said conditions in Bishkek are now worse than during the Akayev era. "Investors knew if something had to be fixed, you could fix it with the Akayev family. Now there's uncertainty of who has the power in the country," he said. 
The investment mood has dampened noticeably over the past year. A survey conducted by the International Business Council (IBC), a Bishkek-based NGO that promotes entrepreneurial activity, showed that foreign investors are scaling back their plans for Kyrgyzstan in 2006.

Prospects for 2006
President Bakiyev exuded optimism as he greeted the New Year. In sharp contrast, many citizens in the Central Asian nation seem sceptical about the chances for change in 2006, reported Nicholas Schmidle in Eurasianet.org. 
In a televised address on December 31st, Bakiyev glossed over Kyrgyzstan's tumultuous political transition since the March revolution toppled the old regime headed by Askar Akayev. Instead, Bakiyev attempted to focus public attention on the future. "Let hardships and sorrows go with the outgoing year and let the new year bring harmony and prosperity," he said. 
The rapidly accumulating difficulties of the past nine months, however, will not be easily forgotten, some regional analysts say. Temirlan Moldogaziev - the Co-Chair of the International and Comparative Politics Department at the American University-Central Asia - now characterizes the March revolution as a mere "re-shuffling of the cards." 
"All that has happened is a re-division of resources," Moldogaziev added. "Power in Kyrgyzstan is just about maximizing personal wealth. People just hope that the Bakiyev family will steal less [than the Akayev's]." 
Pressing economic issues continue to create uncertainty for many Kyrgyz. Few people are hopeful that life will improve in this tiny republic, where, according to the World Bank, the average citizen lives on an income of less than US$400 a year. One woman selling tea recently at a bazaar stall in Bishkek said: "The living was bad, and it will be bad." 
A sense of disillusionment could be detected as far back as the summer of 2005. For example, Rushiad, a 33-year old woman from Bishkek, described Independence Day festivities on August 31st, as being "like Soviet times." She then added with a glib smile, "At least, there were no pickpockets." 
Among the top problems facing Kyrgyzstan at present are burgeoning corruption and the growing influence of organized criminal groups. The country is also grappling with simmering regional tension. Northerners, especially Bishkek residents, have been unsettled by the rapid influx of southerners, who have spontaneously seized land on the outskirts of the capital. 
Southerners, including members of the region's large Uzbek community, have long complained about unfair treatment at the hands of northerners. Even though Bakiyev is a southerner, many residents in the Osh and Jalal-abad remain disgruntled and sceptical that conditions will show marked improvement in the coming months. Emil, a college-educated 24-year-old cab driver in Osh, said he saw "no signs of change." 
Bakiyev's personnel policy has been a major source of discontent. For example, the president in September nominated his brother, Marat Bakiyev, to serve as Kyrgyzstan's Ambassador to Germany, provoking an outcry over nepotism. Daniyar Derkembayev, leader of the Germany-based Manas-Kyrgyz Community of Europe, announced that his organization would refuse to recognize Marat Bakiyev, who had no previous political or diplomatic experience. Kyrgyzstan's Ombudsman, Tursunbay Bakir, in a clear reference to Marat Bakiyev's appointment, publicly reproached the new government for handing out important diplomatic posts to those who "don't know how to hold a knife and a fork and don't know a single foreign language." 
Beyond purely domestic issues, Kyrgyzstan stands to experience an intensification of an already evident geopolitical struggle between the United States and Russia. Both powers operate military bases in Kyrgyzstan. Washington has been on the defensive since mid 2005, when Uzbekistan evicted US troops from a base there, and speculation has mounted in recent months that Russia would attempt to pressure the Bakiyev administration into cutting off US access to the Manas air base outside Bishkek. 
Local analysts believe it is highly unlikely that Bakiyev will ask the Americans to leave. According to a report recently broadcast by the Independent Bishkek television channel, the income generated by the American base leasing arrangement totals US$200 million, or roughly 10 per cent of Kyrgyzstan's GDP. "For this reason, the Americans can be sure that nobody is going to throw them out of Kyrgyzstan anytime soon," the television commentary said. 
Nevertheless, Russian President Vladimir Putin, in sending New Year's greetings to Bakiyev, left no doubt that Moscow will seek to increase its influence in Bishkek in 2006. Putin "expressed confidence that in the coming year, Russian-Kyrgyz strategic cooperation, which meets the interests of the two countries and peoples, and the tasks of ensuring stability and security in Central Asia, would further expand," the Kabar news agency reported. 

Top

ENERGY

Kyrgyzstan, Gazprom to set up joint venture 


Kyrgyz Prime Minister, Felix Kulov, and Russian gas giant Gazprom CEO, Alexei Miller, agreed at a meeting in Moscow to establish a join venture in Kyrgyzstan, the Kyrgyz government's press service said. The new company will focus on geological exploration, securing investment for the republic's oil and gas sector and repairing the sector's facilities, New Europe reported.
Miller said at the meeting that the two countries' dialogue on energy matters has acquired a new impetus. "Alexei Miller believes that the creation of such a joint venture is the optimal mechanism of cooperation that will allow Gazprom to start investing in our country," the press service said. The parties ordered their experts to begin work on legal issues to enable the new company to start operation as soon as possible. A joint working group in charge of such issues will be set up at Kulov's initiative in the near future.
Gazprom experts said it is possible to considerably increase gas output in Kyrgyzstan as new fields begin coming on stream. 
Plans are also being considered to repair the country's gas extraction infrastructure and use underground gas storage facilities.
Gazprom's CEO will visit Kyrgyzstan in late January to make final decisions on cooperation in the oil and gas sector. 
Gazprom's press service said the meeting also addressed efforts to explore Kyrgyz natural gas reserves and extract gas, as well as measures to repair, modernise and a build gas transportation infrastructure in the country.

Top

FOREIGN RELATIONS

Iran-Kyrgyzstan to expand ties

Recently a meeting was held between Iran's Majlis National Security and Foreign Policy Commission chairman, Alaeddin Boroujerdi and Kyrgyz Ambassador to Tehran, s Tairov. During the meeting, there were negotiations for expansion of political and economic cooperation between the two states in tune with the current potentials, Interfax News Agency reported.
At the meeting, it was reported that according to a report released by Majlis Media Department, Boroujerdi declared Iran's support for closer economic and trade ties between the two countries. He said that considering the importance of the need for raising the regional status of both states, the economic growth and multifaced development of countries of the region is necessary.
Boroujerdi even congratulated the re-election of President Nursultan Nazarbayev and hoped that the scheduled visit of Nazarbayev to Iran in the coming year will pave the way for further bolstering of mutual bonds.
Tairov is also pleased with broadening of bilateral relations and presented a report on the latest economic and trade developments of his country. He called for the support of the Iranian parliament for further expansion of ties in the domain of politics and economy.
Tairov said that an official invitation will be sent to president Mahmoud Ahmadinejad to attend president Nazarbayev's swearing-in ceremony. Meanwhile, he appreciated Iran for sending observers to Kyrgyzstan to supervise the recent presidential election in the country.

Top

 

Back

 


 
Published by 
Newnations (a not-for-profit company)
PO Box 12 Monmouth 
United Kingdom NP25 3UW 
Fax: UK +44 (0)1600 890774
enquiries@newnations.com