A team of International Monetary Fund specialists have concluded their latest visit to Turkmenistan and returned with some sobering observations on the state of the energy-dependent nation’s economy.
One key takeaway from a statement issued on December 6 is that the government will have to adopt greater measures to compensate for the expected persistence of low prices for oil and gas.
“Hydrocarbon prices remain low and trading partner growth is muted. As a result of these external factors, Turkmenistan’s overall economic growth has slowed down,” the IMF mission said in a post-visit statement.
These confluence of developments means that Turkmenistan is spending beyond its means, and that this trend is worsening.
“The current account deficit is expected to widen significantly in 2016 as a result of lower energy revenues, and in spite of an active policy effort to substitute imports with domestic production, promote exports, and reduce public investment expenditures,” the IMF mission said.
President Gurbanguly Berdymukhamedov has advanced import substitution as a cure-all panacea to his country’s troubles. Not that any officials have admitted there is anything wrong with the economy, which may be part of the problem, as the IMF mission implies.
“Amid multiple external policy challenges and a number of domestic reforms, stepped-up communication efforts to explain policy plans, their benefits as well as the possible side effects, would be helpful,” the fund delegation said.
Areas for improvement highlighted by the IMF mission included “increasing the efficiency of public spending,” improvement to banking regulations and taking more steps toward creating a more market-based economy and financial sector.
Turkmenistan’s routine harassment of reporters is taking on harsher and increasingly systematic qualities as authorities seek to clamp down on news of the country's economic crisis from trickling out.
In the latest example of such pressure, RFE/RL reported on December 6 that police in Turkmenistan arrested one of its contributors on suspicion of possessing dipping tobacco.
RFE/RL said Khudayberdy Allashov was detained at his home in the Dashoguz Province on December 3. Armed policemen also beat him and rounded up his mother and wife, the broadcaster said.
Nasvai, a popular and mildly intoxicating form of tobacco, is deemed illegal in Turkmenistan but is consumed widely all the same. RFE/RL quoted Allashov's wife as saying her husband had confessed under duress to possessing 11 kilograms of the tobacco, a charge reportedly punishable by up to seven years in jail.
"We believe these charges are part of a targeted campaign intended to silence our Turkmen Service and intimidate the Turkmen people," RFE/RL President Thomas Kent said in a statement.
Allegations of drug possession are one of the Turkmen government’s preferred methods for silencing independent reporters.
In July 2015, authorities arrested Saparmamed Nepeskuliev, who lived in the city of Balkanabad and also worked as a freelance reporter for RFE/RL’s Turkmen service, on suspicion of carrying pills allegedly containing narcotic substances. He was later sentenced to three years in jail.
More recently, another RFE/RL correspondent, 67-year old Soltan Achilova, was subejected to physical attacks by unknown assailants, only days after being interrogated by the police in late October.
A railroad linking Turkmenistan and Afghanistan, part of a regional project called the Lapis Lazuli Corridor, was inaugurated in an official ceremony on November 28 overseen by the leaders of both nations.
Turkmenistan’s President Gurbanguly Berdymukhamedov described developing transportation infrastructure as a top priority for his government and that railway and highway bridges traversing the Amudarya River are also to be put into commission in the coming days.
The goal of the Lapis Lazuli Corridor is to see Afghanistan connected to Turkey, and consequently Europe, through transit nations Turkmenistan, Azerbaijan and Georgia as part of a vision to relieve the country’s remoteness from lucrative trading routes.
Turkmenistan’s government portal cited Afghan President Ashraf Ghani as hailing the importance of the railway for international cooperation.
After a symbolic golden rail clamp was fixed into a place, a maiden consignment of 46 carriages crossed from Turkmenistan into Afghanistan.
The segment of newly inaugurated railroad stretches 88 kilometers from Atmyrat (formerly Kerki) in Turkmenistan to the Ymamnazar border crossing and ends in the Afghan settlement of Akina, the Turkmen state news agency reported. (Spelling for each of these locations vary wildly depending on transliteration or rendering). Two stations — Gulistan and Ymamnazar — have also been built from scratch along the route, the agency said.
Intriguing figures on China’s natural gas purchases reported by Russian state news agency TASS and relayed by website Eurasia Daily has shed some light on Turkmenistan’s current economic woes.
In the first nine months of 2016, China reportedly increased its overall imports of gas by 26.5 percent on the previous year, up to 71.6 billion cubic meters. The average price it paid for the fuel was $228 per 1,000 cubic meters, according to data reportedly collated by China’s General Administration of Customs. That was apparently $100 less than Beijing was paying last year.
The cheapest gas of all, however, is coming from Turkmenistan, which reportedly sells its exports to China at a giveaway rate of $185 per 1,000 cubic meters. Turkmenistan sold China 23 billion cubic meters of gas over the reported period, accounting for 13 percent of what Beijing imported.
Australia was a far second to Turkmenistan as a gas supplier — 11.6 billion cubic meters shipped to China in liquified form at $220 per 1,000 cubic meters.
The takeaway here is that Turkmenistan is being badly pinched on its only serious export commodity.
And as the Chronicles of Turkmenistan points out, Ashgabat’s sale of gas to China is serving primarily to service multibillion loans issued by Beijing.
This might explain Turkmenistan routine but lackluster attempts to restore diversity among its buyers.
In the long-term there is the trans-Afghan TAPI pipeline — the prospects of which are subject of much skeptical analysis.
The president of Turkmenistan is due visit Moscow on November 1 for talks with Russian President Vladimir Putin against the backdrop of a worsening domestic economic crisis.
Turkmenistan’s Foreign Ministry announced the trip in an uninformative one-line statement, so there is no immediate insight into what the focus of the encounter will be. The Kremlin’s own statement on the meeting was not much more helpful.
“Key areas in bilateral cooperation will be the main subject of discussion at the talks. The two presidents are also expected to exchange views on current regional issues,” the Kremlin said.
That cryptic statement suggests there is every chance that Turkmen leader Gurbanguly Berdymukhamedov will be seeking to whet Russia’s appetite for resuming its purchases of Turkmen gas.
The countries have over the years signed more than 100 bilateral agreements covering a range of areas of cooperation. A key document was the April 23, 2002, Friendship and Cooperation Treaty.
Russian business are actively involved on the Turkmen market in sectors such as auto and industrial machinery, telecommunications, and in the oil and gas business. Around 190 companies working with Russian capital operate in Turkmenistan. In 2009, Russia’s ATERI, previously operating under the ITERA brand, signed a production sharing agreement with Turkmenistan over an offshore sector of the Caspian Sea.
But nothing ever quite superseded direct gas sales for importance.
Russia bought 45 billion cubic meters of gas from Turkmenistan in 2008, but that has through a series of commercial and diplomatic vicissitudes dwindled to nothing. Russian gas behemoth Gazprom definitively ceased its gas supply agreement earlier this year.
Turkmenistan is looking down the barrel of its worst economic crisis in years and the effects are being felt starkly on the street.
In the most radical development to date, shoppers in the capital, Ashgabat, have started reporting a lack in availability of staple groceries like sugar and cooking oil.
In some stores, sugar is missing altogether, while others are selling the commodity only in rationed amounts of 1 kilogram per buyer. Shoppers arrive at stores early in the morning and get in lines in the hope that they can get their hands on a bag. Only once they ascertain there is no sugar to be bought do they disperse.
The cheapest cottonseed oil on the market, produced by the Ahal factory, is being rationed to one or two bottles per buyer.
Smokers have it the worst. Back in January, multiple media outlets reported that Turkmenistan had slapped a ban on the sale of cigarettes. That was a slight misrepresentation of the facts, but it is most certainly true the cost of the smoking has soared and the availability of cigarettes shrunken drastically. And things continue to get worse for the cigarette-dependent. Residents of Ashgabat have reported seeing lines of many dozens of people outside stores selling tobacco.
Prices for almost all groceries are rising, and rising daily.
The unofficial exchange rate is also seeing some radical movement and reached a historic high in recent days. The official manat rate is 3.5 against the US dollar, but the currency is trading on the street for anywhere as much as 7 manat to the dollar. RFE/RL’s Turkmen service, Azatlyk, has cited people inside the country as saying they have seen rates of up to 7.4 manat to the dollar.
Turkmenistan’s President Gurbanguly Berdymukhamedov has made a major stride toward being enshrined sultan-for-life after the country’s token lawmakers approved major changes to the constitution.
Parliament and the Council of Elders at a joint session on September 14 waved through an increase of presidential terms from five to seven years and agreed to scrap the 70-year age limit for pretenders to the highest office in the land.
These fixes ensure that Berdymukhamedov, 59, will be able to remain in situ for as long as he pleases.
Speaking at the Council of Elders assembly, a gathering of town seniors from all across the country, Berdymukhamedov claimed that the amendments had been adopted at the request of the people.
The new constitution was “drafted by all our people on the basis of multiple suggestions from the country’s citizens, political parties, representatives of civic associations, state bodies, scientific organizations, lawyers and international experts,” he said.
Signing off on the new constitution, Berdymukhamedov said the revised document would give the country a new thrust of energy.
Berdymukhamedov, a dentist by training, came to power in late 2006 following the sudden death of Saparmurat Niyazov, who granted himself lifelong leader status in 1999. He was reelected to a five-year term with 97 percent of the vote in 2012.
The next presidential elections will take place in 2017 and involve participation of three political parties — the Democratic Party, the Agrarian Party, and the Industrialists and Entrepreneurs Party. All those parties are transparently bogus entities clumsily designed to convey the notion of a plurality that barely anybody accepts at face value.
All the same, Berdymukhamedov opined that the spirit of competition between parties would create a fresh mood in the country.
Uzbekistan is relishing its best ever performance in an Olympic Games after some last-minute sporting victories handed the team an extra two gold medals.
The country’s haul of medals — four golds, two silver and seven bronze — put it ahead of Central Asian rival Kazakhstan and was helped in large part by its contingent of boxers. A stunning seven out of the 13 medals won by Uzbekistan came from boxing.
The first boxer to claim gold was light flyweight Hasanboy Dusmatov, who beat Colombia's Yuberjen Herney Martinez Rivas in the final of their category.
Uzbek state television broadcast a report from Dusmatov’s hometown in the Andijan region, where family and friends were watching the match. The boxer’s father said that although he family was confident Dusmatov would get the gold, they were affected by the nerves of the big Olympic occasion. Dusmatov’s could not bear to watch the broadcast and instead waited out the fight in another room.
But the best was left for last.
On the final day of competitions, Shakhobidin Zoirov won the men's Olympic flyweight boxing gold with a points victory over Russian Misha Aloyan. Later in the afternoon, Fazliddin Gaibnazarov edged out Azerbaijan's Cuban-born Lorenzo Sotomayor with a split 2-1 decision.
This last victory caught many by surprise. Sotomayor struck easily the more impressive figure with his height, long arms and confident strut.
Gaibnazarov’s win was all the more sweet for his underdog status and social media in Uzbekistan was accordingly set alight by the result.
Uzbekistan’s last Olympic gold for boxing came in the Sydney Games of 2000, courtesy of Mahammatkodir Abdullaev in the light welterweight category.
Abdullaev was one of the first to comment on Gaibnazarov’s achievement, saying that the whole country had cried with joy at the win.
A series of alleged tapped telephone conversations among senior Tajikistan diplomats discussing plans to cover up a purported rape in Turkmenistan is threatening to sour relations between the otherwise friendly nations.
The recordings appeared earlier this month on a 20-minute YouTube video edited clumsily to appear to like a news report on Turkmen state television. A link to the video — the origin of which is uncertain — is now being widely shared by exiled Tajik opposition groups, which are pointing to the claimed incident as evidence of moral corruption among officials.
None of the recordings could be independently verified and none of the governments involved have commented officially on the alleged events described.
The narrator of the YouTube video, whose voice has been distorted, possibly to disguise his identity, opens the account with praise for Turkmenistan and its leader, only to note “there are some who are prepared to do almost anything to spoil relations with our country” — a reference to Tajik diplomats.
The speaker claims in the narration that the third secretary of Tajikistan’s Embassy in Turkmenistan, Golibshoh Kayumov, was earlier this year detained by police in the city of Chardjou on suspecting to rape a minor earlier this year.
As supporting evidence, there is a lengthy recorded telephone conversation between people identified as Tajik Embassy second secretary, H. Rahimov, and then-ambassador Mahmudjon Sobirov. After some initial pleasantries, Rahimov explains to this superior that Kayumov was caught in flagrante delicto with the young girl and was later forced to sign a statement admitting to having sexual relations with her.
The president of Turkmenistan’s efforts to broaden his public appeal consisted in the past of demonstrating his skills in all fields of human accomplishment, from sport to medicine and music to literature.
Gurbanguly Berdymukhamedov’s latest tack appears, quite counterintuitively, to be a full-on embrace of the thug life.
Consider his sudden appearance at the Awaza holiday resort on the Caspian coast, where he was photographed by state posing on his yacht — named after the giant Galkynysh gas field — and dressed like a character out of an Elmore Leonard novel. Still in that worrying Aloha shirt, he took a spin around the resort trailed by his regular mini-army of bodyguards.
The stunt was apparently a fresh attempt to generate some enthusiasm for the doomed tourist resort, which is frequented almost exclusively by government workers on state-paid holidays. Anybody not in a government job would not be able to afford the cost and foreigners are few and far between, not least because Turkmen authorities unaccountably continue to throw up often insurmountable visa barriers.
Berdymukhamedov is clearly aware that his pet project is proving to be a failure, hence his unconvincing popularity-raising antics, but his proposed solutions smack of half-hearted despair.
As Chronicles of Turkmenistan reported, Berdymukhamedov said that it was necessary to develop the “economy” segment of the tourist industry as provide hotel services at low cost. The complex of dachas that existed on the site where Awaza now stands did in fact already fill that niche before being obliterated to make way for the garish and useless current structure.