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TURKMENISTAN


 

 

Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 6,010 7,672 4,000 110
         
GNI per capita
 US $ 1,120 1,200 950 131
Ranking is given out of 208 nations - (data from the World Bank)

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Update No: 319 - (26/07/07)

The personality cult lives on; residents take it in their stride
A while ago, the silhouette portrait of the deceased Turkmen despot, Saparmurat Niyazov, was unexpectedly removed from the upper corner of state television broadcasts. While it might be tempting to see the disappearance as a harbinger of the dismantling of Turkmenistan's notorious cult of personality, there is plentiful evidence in Ashgabat to suggest otherwise. 

If anything, it seems as if the country's new leader, Gurbanguly Berdymukhamedov, is simply replacing Niyazov as the chief object of the cult's affection. Indeed, Berdymukhamedov's portrait has already replaced Niyazov's on state television news broadcasts.

Berdymukhammedov was named acting president in late December after Niyazov's death. In February, he was elected to president in what has been called an unfair election that fell short of international standards. 

Turkmenbashi recidivus?
While some observers have welcomed signs of change in Central Asia's most isolated country, critics fear the development of a personality cult of the president similar to the one by the man that Berdymukhammedov replaced, "Turkmenbashi" Niyazov. 

In his first six months as Turkmen President Berdymukhammedov has launched some reforms, reinstated pensions, and reopened the national Academy of Sciences, which had been shut down by his autocratic predecessor. 

But the president has also held a gala birthday celebration, fit to rival any potentate's and complete with the minting of gold coins graced with his portrait. 

The Sobers award
The greatest all-round cricketer of all time, Sir Gary Sobers, was used to adulation, especially in his native West Indies; but it did not turn his head. He kept a modest demeanour throughout his eventful career and summarised his view of life as "self-praise is no praise at all."

They don't play cricket in Turkmenistan, alas, so that it is unlikely that any Turkmen has heard of this nugget of wisdom or the standards of fair play that are associated with the game. Their new leader, Gurbanguly Berdymukhammedov, certainly hasn't. He celebrated his 50th birthday on June 29th by awarding himself the Watan (Motherland) Order -- a gold and diamond pendant weighing about 1 kilogram. As a part of the award, the president was also paid a bonus of US$20,000 and received a 30 percent increase in his salary and pension. 

The Watan Order, which can be awarded to the Turkmen president only once, was given to Berdymukhammedov to honour his "outstanding achievements" -- after only six months in office. 

During that half a year he also managed to have his biography published. And to help commemorate his birthday, the government issued 400 gold and silver coins decorated with the president's portrait. 

Russian and Western news agencies criticized the lavish birthday honour of Berdymukhammedov as a continuation of the presidential cult of personality in Turkmenistan established by Niyazov, also known as "Turkmenbashi," the "father of all Turkmen."

Hope For Change 
However, some analysts say it could be a one-off celebration and that Berdymukhammedov will actually move away from Niyazov's excesses. Few people expected major changes in Turkmenistan's domestic and foreign policies, since Berdymukhammedov made it clear from the beginning of his rule that he would continue his predecessor's policies. However, he did promise some reforms, including social reforms, and to some extent he started to open up the isolated country to the world. 

Berdymukhammedov's electoral platform included a revision of the country's social-security law. Niyazov had cut off some 100,000 pensioners' retirement benefits and substantially decreasing many others' social payments. 

Restoring Pension Payments 
Under the new social-security law -- which came into effect on July 1 -- the suspended pensions were reinstated. 

Berdymukhammedov has also reopened the Academy of Sciences, which was described by Niyazov as a "useless institution" and closed down. 

Niyazov's numerous portraits decorating walls and billboards around the country -- and turning Turkmen cities into a kind of personal photo-album -- are now being taken down. Some of them, however, are being replaced by the new president's portrait. 

The new president has made some changes to Turkmenistan's power circles by removing some of the key "behind-the-scenes" political figures. 

The influential Akmurad Rejepov, the former head of the presidential guard, was fired and then arrested in May. This Lieutenant General, formerly of the Soviet KGB, was the most powerful man in the state after the deceased president, and was the kingmaker of the current one. He must, if he is still alive, be regretting his decision to put Berdymukhammedov into the top position, instead of taking it himself.

'Equal Relationships' 
However, it is the foreign policy of the energy-rich country that attracts more attention abroad -- especially among those who want to import Turkmen gas. 

Speaking at the ceremony in the capital, Ashgabat, marking his 50th birthday, Berdymukhammedov said that Turkmenistan maintains its "neutral status" and has "equal relationships" with all. 

"Without joining any kind of political alliances, we will carry on with our efforts to build new gas pipelines to carry our gas to China, and to Pakistan and India via Afghanistan, and to Europe via the Caspian Sea," he said. "This means that we will have equal and mutually beneficial relations with Russia and the United States, with European countries, and with our neighbours as well." 

Most recently Chevron, a U.S.-based energy company, announced its intention to open an office in Turkmenistan and participate in the development of Caspian Sea energy resources. 

Matthew Clements is the Eurasia editor in the Country Risk Department for Jane's Information Group in Britain. 

Clements says Turkmenistan's engagement with the international community will continue to be limited, and Berdymukhammedov will not want great foreign interference -- especially by Western, democratic countries -- in the country. 

"I think we can see a greater level of engagement from Turkmenistan in the international world, but again I think it is going to be limited to what Turkmenistan wants to be dealing with," he said. "And I would not expect a livening of relations with the West unless it is going to involve energy deals." 

Berdymukhammedov's reforms have thus far not touched on the dire situation of human rights and civil liberties in Turkmenistan, which have been sharply criticized by international observers for most of Niyazov's reign as president, which began in 1991. 

Similarly, they have done little to improve the living standards of Turkmen people. Despite vast gas resources, most of the population lives in poverty. 

For instance, Berdymukhammedov's latest action to reinstate pensions and other social payments looks good on paper. But the minimum pension in Turkmenistan is only around US$25 a month. 

Iran and Turkmenistan to pump gas to Europe 
The Central Asian country exports most of its gas via a Soviet-era pipeline to the Russian giant, Gazprom. it has long been obvious that it should diversify its exports away from Russia. Niyazov tried, but failed in this endeavour, rubbing potential partners up the wrong way by his arrogance and ignorance of the world scene re energy.

Things are now changing, with the new president having the sense to leave negotiations to his experts. Turkmenistan is going to muscle in on the back of its Iranian neighbour, which has even more gas reserves than itself. Iran and Turkmenistan will pump 30 billion cubic metres of gas a year to Europe via Turkey, leaving no need for alternative supplies to the Nabucco pipeline project, a senior Turkish energy official said on July 14th. On top of this, Turkey and Iran have also agreed that the Turkish Petroleum Corporation (TPAO) will produce 20 bcm natural gas in the three phases of Iran's South Pars gas field, the official, requesting anonymity, said. 

Iran and Turkey have signed a preliminary agreement to pump Iranian gas to Europe via Turkey, Iran said earlier, a move that will open a new export market for Iran's massive reserves. "The agreement signed between Turkey and Iran paves the way for the Nabucco project and we no longer need any other supplies to meet the Nabucco gas requirement," said the official. 

Turkey had sought Russian gas for the €4.6 billion or US$6.3 billion Nabucco project that will cross Turkey. It is backed by the European Union partly as a means to diversify from reliance on Russia by gaining access to central Asian gas. The pipeline, running across Turkey to Hungary and Austria through the eastern Balkans, will eventually be able to carry 31 billion cubic metres a year of gas from producers in Central Asia to big consuming countries in Europe. 

Details of the preliminary agreement with Iran will be announced in a month's time, the official said, adding that the timing of when the gas would start flowing had yet to be settled. "But it is agreed that Iran will pump 30 bcm gas to Turkey per year which might include Turkmen gas," he said. 

The memorandum of understanding includes an agreement to pump gas from Turkmenistan to Turkey via Iran, and Tehran's approval for Ankara to develop the three phases of South Pars. 

Iran, with the world's biggest gas reserves after Russia, has been considering Ukraine and Turkey as possible routes to get its gas to Europe. In August 2006, it announced plans for a joint scheme with Ankara to use its pipelines. 

Turkmenistan already exports gas to Iran and sent 4.1 billion cubic metres to the Islamic Republic in the first half of 2007. Of course none of this takes into account the possible UN sanctions of new export markets for Iranian oil and gas, which depend on whether Iran is considered to be adequately co-operating in respect of its nuclear enrichment program.

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ENERGY

Turkmenistan, LUKoil to agree on Caspian shelf PSA


Russian oil major LUKoil hopes to complete talks by the fall and sign a Production Sharing Agreement with Turkmenistan for the Caspian shelf, Rossiiskaya Gazeta quoted LUKoil President, Vagit Alekperov, in an interview on June 28th.
"In Turkmenistan, we estimate that the Caspian shelf has strong prospects for hydrocarbon reserves. We have received preliminary approval from the Turkmen authorities to conduct a detailed study of the shelf and to propose a contract. We hope to finish talks by the fall and sign a contract with Turkmenistan on production sharing," he said.
In answer to a question on whether joint projects are possible with other companies that have shown general interest in the Caspian, Alekperov said: "Of course joint projects. There are huge risks connected with exploring for hydrocarbons in the Caspian. This needs to be done with partners, therefore we are moving towards a consortium. LUKoil has a competitive advantage in the Caspian region. We have experience in the successful use of sea drilling equipment."
The company will also launch projects in 2007 to explore for gas in Uzbekistan, Alekperov said.

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FOREIGN ECONOMIC COOPERATION

Ashgabat, Tehran to further develop economic relations

There is no obstacle to expanding further ties between Iran and Turkmenistan, Iran's ambassador to Turkmenistan, Mohammad-Reza Forqani, said. Iran-Turkmenistan's relations have increased greatly in different arenas, the envoy noted. Iran and Turkmenistan have 1,200 kilometres borderlines. Turkmen President, Gurbanguly Berdimuhammedov arrived in Tehran on June 15th for a two-day state-visit. Besides his Iranian counterpart, Mahmoud Ahmadinejad, Berdimuhammedov also met Iran's Supreme Leader, Ayatollah Ali Khamene, New Europe reported.
Ahmadinejad and Berdimuhammedov discussed the legal status of the Caspian Sea and increase of Turkmen natural gas exports to northern Iran. Also construction of an oil pipeline from Kazakstan to Iran via Turkmenistan was said to be on the agenda. Symbolic for the relations between two neighbouring countries is a dam along the joint border dubbed as "dam of friendship" which secures for both sides some 650 to 950 million cubic metres of water per year and is supposed to boost agricultural irrigation. Tehran and Ashgabat established diplomatic relations right after Turkmenistan's independence from the Soviet Union in 1991 and since then, the two countries have maintained good political and trade relations. After the top-level meeting the presidents signed a joint communiqué on developing bilateral relations. "The visit of this high-ranking Turkmen official to the Islamic Republic of Iran which is among his first (foreign) tours since he became president, is an indication of the depth of friendly interactions and close relationship and an interest by the senior officials of the two countries to expand ties," Forqani said. The ambassador said over the past years more than 150 documents and cooperation agreements have been signed between Tehran and Ashgabat. During Berdimuhammedov's visit, more documents were signed between the two sides especially in economic and cultural areas. Currently the value of trade deals between the two countries stands at about 1.2 billion Euro which is mostly in oil and energy sectors. It was reported that trade ties between the two countries will expand during Turkmen president's tour of Iran.

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INFORMATION TECHNOLOGY

MTS to provide Turkmenistan with wireless Internet 

The CEO of Mobile TeleSystems, Leonid Melamed, met with Turkmen President, Gurbanguly Berdimuhammedov, on June 29. During the talks, Melamed said his company plans to expand its presence in the Turkmen telecommunication market, Turkmenistan.ru reported.
Melamed offered MTS's services in the field of high information technologies, in particular wireless Internet. "Having expressed interest in the offer, Berdimuhammedov emphasised that Turkmenistan pins great hopes on the attraction of latest achievements of scientific-technical progress and world best experience in this field," the Turkmen State News Agency (TDH) reported.

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