Turkmen Report: January 21, 2001

Following visits to Armenia and Azerbaijan, NATO Secretary General George Robertson met with Turkmen President Saparmurat Niyazov and other ranking officials in Ashgabat.

Robertson said Turkmenistan's UN-recognized status as a neutral country will not be affected by the country's participation in NATO's Partnership for Peace program, which Turkmenistan signed on to in 1995 but has been reluctant to participate in fully. The purpose of Robertson's regional tour is to discuss cooperation within the framework of the Partnership for Peace program. (RFE/RL, Itar-Tass)



Turkmen President Saparmurat Niyazov received the head of the OSCE mission in Turkmenistan, Istvan Venczel. Discussions focused on the recent amnesty and plans of OSCE Secretary-General Jan Kubis to visit Ashgabat later this year. Kubis's successor, Romanian Foreign Minister Mircea Dan Geoana, is also expected to visit at an undetermined date this summer. (Turkmen TV)



According to Uzbek officials, an earthquake shook the towns of Bukhara and Samarkand in southern Uzbekistan, but there were no immediate reports of casualties or structural damage. The tremor, which measured 6.5 on the open-ended Richter scale, had the epicenter in the southern Kashkadarya region. (RFE/RL, AFP)



Under the Turkmen Energy and Industry Ministry's program for 2001, Turkmenistan is slated to generate 10.15 billion kWh of electricity and export one billion of it. The program also provides for the production of 1.22 million gCal of heat. (Interfax)



Turkmen President Saparmurat Niyazov has given his seal of approval for the construction of an oil depot in Atamurat, in east Turkmenistan. The value of the contract is estimated at 18.5 billion manats; Turkmenneftegazstroi will serve as general contractor for the project, and the completed project will become an asset of the state oil and gas concern Turkmenneftegaz. The official exchange rate is 5,200 manats/$1. (Interfax).



Turkmen President Saparmurat Niyazov has awarded the heads of Turkmengaz and Turkmennebit, respectively gas and oil subsidiaries of Turkmenneftegaz, presidential awards. Other recipients included Turkmenistan's textile minister and his counterpart in the construction materials industry and chief editor of the newspaper Turkmenistan. (Turkmen Radio)



A session of the Turkmen State Council, chaired by President Saparmurat Niyazov, took place in Ashgabat in the presidential palace. The results of 2000 and plans for 2001 were tabled, including ambitious plans to boost cotton and wheat production, and increase the number of sheep. A "serious staff reshuffle," otherwise known as a purge, also took place at the meeting attended by the heads of all ministries and agencies (see below). (Interfax)



Turkmen President Saparmurat Niyazov sacked two deputy prime ministers for shortcomings and reshuffled his government, accusing ministers of incompetence and graft. Those sacked included Deputy Prime Minister Khudaikuli Khallykov, in charge of transport, communications and construction. He was dismissed for shortcomings in his work and replaced by Communications Minister Rovshan Kerkavov. Also sacked was Deputy Prime Minister Chary Yazlyev, in charge of education. Niyazov said Yazlyev lacked experience and that his choice of textbooks on Turkmen history left a lot to be desired. Niyazov also dismissed Agriculture Minister Amanmukhammet Atayev for serious shortcomings in his work, replacing him with Deputy Prime Minister Rejep Saparov. Niyazov also sacked Education Minister Abat Ryzayeva and appointed A. Ashirov to the post. (RFE/RL, Reuters, Turkmen State News Service)



Turkmen President Saparmurat Niyazov has appointed a clutch of officials on standing six-month probationary basis. Appointees include: Orazmukhammet Berdiyev, deputy head of the National Security Committee; Khojamyrat Ojarov, deputy head of the National Security Committee; Gurban Gurbanov, deputy director-general of Turkmenistan's State Insurance Company; Begmurat Otuzov, first deputy prosecutor-general of Turkmenistan; Serdar Yagshyyev, head of the department of consular services of the Ministry of Foreign Affairs; Eduard Rejepov, first deputy head of the National TV and Radio Company; Khoshgeldi Babayev, head of the State Enterprise for Caspian Sea Issues under the president of Turkmenistan and director of the institute of oil and gas of the Turkmengaz (and member of the Supreme Council of the State Enterprise for the Caspian Sea Issues under the president of Turkmenistan);Chary Yazlyyev, rector of the Magtymguly Turkmen State University. According to the resolution appointing these officials, failure to carry out official duties is to result in dismissal "without offer of another job." (Turkmen TV)



Turkmenistan had a state budget surplus of 98.6 billion manat, or 0.43% of GDP, in 2000, according to the Turkmen National Institute for Government Statistics.

Budget revenues and spending respectively totaled 5.898 trillion and 5.799 trillion manat, or 2% and 10% less than planned. Tax revenues totaled 5.706 trillion manat, or 96% of all revenue. This included 1.687 trillion manat (23.5%) in value-added tax, 1.22 trillion manat in contributions to government social insurance (21.3%), 769 billion manat in excises (13.4%), 689 billion manat in profit tax (12.07%), and 433 billion manat in personal income tax (7.5%). The oil and gas industry and the consumer sector contributed respectively 50.7% and 30% of all tax revenue. Spending on social programs totaled 4.203 trillion manat, or 72.4% of the total. This included 1.665 trillion manat on education, 814.7 billion manat on health care, and 990.7 billion manat on general government services. Turkmenistan's GDP measured 22.9 trillion manat in 2000. The official exchange rate is 5,200 manat/$1. (Interfax)



The combined pretax profits of companies and organizations in Turkmenistan rose 110% year-on-year to 4.1 trillion manat in the first eleven months of 2000, according to the country's National Institute for Government Statistics and Information. Industrial companies doubled profits to 3.3 trillion manat, or 81% of total corporate profits, with the fuel and energy sector accounting for 73% of this figure. The official exchange rate is 5,200 manat/$1. (Interfax)



According to the Moscow office of Boeing, Turkmenistan Airways will take delivery of a Boeing 757-ER passenger liner at the end of January 2001. The plane was bought without the use of any Western credit, the company said. The amount of the deal has not been disclosed, but Boeing's Moscow bureau said that planes of that class cost between $65.5 million and $81 million, depending on its configuration. Equipped with two Rolls Royce engines, the plane is to be used for flights from Ashgabat to London and New York and represents the fourth Boeing airliner acquired by the Turkmenistan Airways. (Interfax)



Turkmen farmers have developed a new kind of mushroom and named it Serdar [leader] after Turkmen President Saparmurat Niyazov. The mushroom in question is being produced in mass in Akhal province in the run up to Niyazov's February 19 birthday, reportedly. (Turkmen TV)



According to the National Institute of State Statistics and Information, Turkmenistan's population was 5,369,400 as of January 1, 2001, which represented growth of 3.3% on the year 2000. The urban population constituted 45.9% or 2,463,500 people. The rural population was about 2,906,000 people, or 54.1% of the entire population. The population of Ashgabat is 676,400, a rise of 3% on the year prior. The most populated province in Turkmenistan is Mary with 1,226,000 people. Other provinces include Dashoguz (1,142,000), Lebap (1,109,600), Akhal (754,200) and Balkan (461,200). State statisticians note that population growth in Balkan and Dashoguz was registered at 4% and 3% in all other provinces. (Turkmen State News Service)



Deputy Foreign Minister Viktor Kalyuzhny said that presidents of Russia, Iran, Kazakhstan, Azerbaijan and Turkmenistan are to meet in Ashgabat in late February or early March to discuss ways to share out the sea's vast oil and gas resources; the meeting is expected to follow a gathering early next month of the five countries' foreign ministers in Iran. (RFE/RL, AFP)



Turkmen President Saparmurat Niyazov will pay a state visit to the United Arab Emirates in March for talks focusing on trade in the energy sphere. The Turkmen leader agreed to the trip during a short "vacation" visit to Ashgabat by the Crown Prince of Abu Dhabi Sheikh Khalifa Ben Zayed al-Nahayan. The UAE has contributed money to a range of construction projects in Turkmenistan, including the reconstruction of damaged airport runways. An Abu Dhabi development fund has also allocated $50 million in 2000 to finance several healthcare projects with the aim of boosting partnership between the two countries. (AFP/Itar-Tass)



The Russian president's envoy for Caspian Sea status settlement, Viktor Kalyuzhny, visited Tehran to discuss bilateral cooperation and issues concerning the Caspian Sea. The visit is a response to last December's trip to Moscow by Ali Ahani, Iranian Deputy Foreign Minister and the Iranian president's envoy on Caspian Sea issues. (Itar-Tass)



Turkmen President Saparmurat Niyazov adopted a resolution supporting the pilgrimage of 185 Turkmen to Saudi Arabia. The Central Bank of Turkmenistan will exchange $1,100 for each haji at the current exchange rate and a Turkmenistan Airways Boeing will transport them coming and going. (Turkmen State News Service)



According to a document circulated by the US embassy in Baku, "The Baku-Tbilisi-Ceyhan project has been and continues to be the cornerstone of impartial U.S. energy policy in the region." It also underscored that "the US government plans to continue supporting this project, which will increase the independence of states in the region." The statement expressed the hope that an existing sponsorship group "will be joined by companies working in Azerbaijan and Kazakhstan, which will strengthen the project from a commercial point of view." The statement appears to have been circulated in an effort to reassure Turks and Azeri fearing that an oil-savvy Bush administration with a potentially pro-Armenian energy secretary nominee would abandon the Clinton administration's policy, hitherto little appreciated in petroleum industry circles. (Interfax)

By Bruce Pannier, RFE/RL

Central Asia hosted two high-ranking Western officials this week: U.S. Deputy Assistant Secretary of Defense Jeffrey Starr visited Tajikistan, and NATO Secretary General George Robertson concluded a regional visit with a stop in Turkmenistan.

Both Tajikistan and Turkmenistan are members of NATO's Euro-Atlantic Partnership Council, but neither is an active participant in NATO programs. This contrasts with neighboring Kazakhstan, Kyrgyzstan and Uzbekistan, all of which are active participants in NATO's Partnership for Peace program.

Starr arrived in Tajikistan on Tuesday. His purpose appears to have been two-fold: First, to improve U.S.-Tajik military ties and, second, to convince Tajik officials to become more active in the Partnership for Peace program.

He seems to have been successful on both counts.

Tajikistan, which shares a long border with Afghanistan, is a heavy transit country for trade in illegal drugs and weapons. The Tajik government is ill-prepared to deal with these problems because the country is still recovering from a five-year civil war that ended in 1997.

Starr says the U.S. can help:

"My visit has focused on the issue of establishing a bilateral relationship between the Untied States and Tajikistan in the area of defense and security. And, of course, in our conversations in the last few days, the issue of regional security, terrorism and narcotics trafficking came up. But the primary focus was simply to establish a bilateral relationship between the United States Department of Defense and the Ministry of Defense of Tajikistan and other ministries with [which] I met in the last few days."

Tajikistan already receives military help from Russia. Russian-led border guards have kept watch over the Tajik-Afghan border for years, even during the Tajik civil war. Tens of Russian soldiers have been killed guarding the border since Tajikistan became independent in 1991.

The cash-strapped Tajik government's need for the border troops has made the country dependent on Russia.

Starr told Tajik officials that the U.S. will provide special equipment to help monitor the border, but he says Tajikistan's relationship with Russia will not be affected:

"We recognize the historical relationship that has existed between Russia and Tajikistan, and I find no contradiction between that relationship and Tajikistan's desire to establish a relationship with the United States, and our desire to establish a relationship with Tajikistan."

Starr apparently succeeded in his other aim, getting Tajikistan more interested in playing an active role in Partnership for Peace. NATO started hosting military exercises with Kazakhstan, Kyrgyzstan and Uzbekistan in 1996. But Tajikistan, in the midst of civil war at the time, was in no position to take part. Starr says:

"I think the decision whether Tajikistan will join the Partnership for Peace program is a decision for the government of Tajikistan to make. Over the last two days, I received several positive indications of interest on the part of the government of Tajikistan to join the Partnership for Peace program. The real value in joining Partnership for Peace is that it presents more opportunities for the soldiers of Tajikistan to interact with soldiers of other countries, other NATO countries, other partnership countries."

NATO Secretary General Robertson's agenda during his visit on Wednesday and Thursday to Turkmenistan was probably more modest: simply reminding Turkmenistan that NATO has not forgotten the country.

There was little information available about the visit, but Robertson was quoted as saying that Turkmenistan's status as a neutral nation would make it uniquely qualified to defuse regional tensions.

Turkmen officials, for their part, expressed an interest in receiving NATO training for disaster-relief efforts.

By Michael Lelyveld, RFE/RL

A flurry of diplomatic activity between Iran and Russia over division of the Caspian Sea could lead to a bidding war between the two countries for the resources of Turkmenistan.

After a week of frictions, Russia's Caspian envoy Viktor Kalyuzhny met over the weekend with officials in Tehran to find some way of furthering negotiations over how to define the Caspian's borders and share its oil wealth.

The meetings seem to have cooled some of Iran's anger over Russian President Vladimir Putin's visit to Azerbaijan and a Caspian cooperation pact between the two countries last week. Tehran had reminded Moscow that the only existing legal basis for dividing the Caspian were treaties signed by Iran and the Soviet Union in 1921 and 1940.

An even greater source of discord were reports of Russian naval war games staged in the northern Caspian at the same time, raising concerns that the purpose of Moscow's plan to keep the Caspian surface in common is to ensure a right to project its military power. Last week, Iran told Russia that there was "no threat in the Caspian Sea to justify the war games." The incident also served as a reminder that relations with Russia, which recently pledged to renew arms sales to Iran, continue to be complex.

But the Kalyuzhny visit may have lightened the tone of public discourse, at least temporarily. Andrei Urnov, head of the Russian Foreign Ministry's working group on the Caspian, called a first round of talks over the weekend constructive, "although difficult." Urnov said a second round on Sunday "was held in a constructive and benevolent atmosphere."

The outcome of the two meetings was hope that working group meetings would be held in Tehran as a prelude to a summit of deputy foreign ministers in Ashgabat in late February or early March. The Russian side cited unspecified points of progress with Iran, which has insisted on an equal 20 percent share of the Caspian instead of the Russian formula of dividing only the seabed into national sectors.

Kalyuzhny also told Agence France Presse that Iranian President Mohammed Khatami agreed to visit Moscow on March 19. The official Iranian news agency IRNA did not immediately confirm the report. The Russians hope that Khatami will sign some sort of Caspian pact during the trip.

Publicly, Russia has given assurances that there can be no Caspian solution without a consensus that includes Iran's consent. But at the same time, it has tried to maneuver Iran into a position that makes its refusal more difficult. While diplomatic contacts serve a purpose, Moscow's primary strategy has been to isolate Iran by signing separate bilateral accords with Kazakhstan and Azerbaijan.

Last week, Putin hinted that another such deal could be in the works with Turkmenistan, which has repeatedly backed Iran's stand. The two countries are the only littoral nations without major offshore discoveries in the Caspian so far.

Turkmenistan's position as a "swing" vote on the Caspian question could make it an object of courtship in the next month. Both Russia and Iran are considering gas deals with the country. On January 1, Ashgabat stopped delivering gas to Russia because Moscow refused to pay a price increase.

Russia may be able to further its case on the Caspian by agreeing to pay the modest increase now. It could create an even bigger incentive by renewing talks on a 30-year deal to import up to 50,000 million cubic meters of Turkmen gas annually, as Putin proposed last August.

Iran has also started talking again about increasing its gas imports from Turkmenistan. Last week, an Iranian official said that talks were underway on boosting the capacity of a pipeline between the two countries to 13,000 million cubic meters from 8,000 million cubic meters per year. Turkmenistan exported only about 2,000 million cubic meters of gas to Iran last year.

Turkmenistan is eager to find a route for its gas to Turkey, whether through Russia or Iran. After delaying a decision on a Trans-Caspian pipeline through Azerbaijan, it has now been left with no route at all.

Iran and Russia have also been competing for Turkmenistan's oil. Last week, Iran signed a 150-million-dollar contract with China's Sinopec oil company for a port and refinery project to handle Caspian oil. The plan relies on getting crude from Turkmenistan and Kazakhstan for swaps through the Persian Gulf.

But the Russian company Yukos has recently shown an interest in the Turkmen oil for its own refinery in Samara. If it pursues the idea, Russia and Iran could be competing for both Turkmen oil and gas.

The attention could give Turkmenistan a short-term advantage in seeking favorable terms from both sides in the next month before a Caspian summit in Ashgabat. But choosing between Iran and Russia could prove to be sensitive, particularly if the Caspian dispute continues. Both of Turkmenistan's suitors are powerful, and neither is likely to take disappointment lightly.

By Michael Lelyveld, RFE/RL

The outlook for an agreement on dividing the Caspian Sea seems as cloudy as ever, following Russian President Vladimir Putin's trip last week to Azerbaijan.

The two-day visit appears to have left news outlets struggling to find a headline after weeks of preparations produced no significant pacts. Although some warmth may have been generated in personal relations, little progress was made on key issues such as Nagorno-Karabakh or the Gabala radar station in time for Putin's appearances with Azeri president Heydar Aliyev.

Also, no public assurance appears to have been given on improving the sporadic Russian gas service to Azerbaijan, which is more important to the warmth of its citizens.

The one arguable exception to an otherwise symbolic fence-mending mission was a bilateral statement on principles for cooperation in the Caspian Sea, which both countries border. The vague language of the understanding seemed to reflect the will to reach some kind of agreement after Putin postponed the original date for his visit last November.

In one complicated provision, the two countries agreed "to demarcate the bottom of the Caspian between the relevant contiguous and opposite states into sectors or zones by using equidistant points to draw a median line which can be modified by agreement between the sides and also taking into consideration generally accepted principles of international law and current Caspian practice."

Those who have followed the debate over Caspian division for years may detect a series of compromises and changes in the cooperation pact. Azerbaijan has essentially agreed that its insistence on national sectors will be limited to the Caspian seabed, while Russia accepted the legality of Azerbaijan's offshore oil projects, which it first challenged in 1994.

But perhaps more important than the details, which are all subject to further negotiations among the five shoreline states, including Turkmenistan, Iran and Kazakhstan, is Putin's strategy of signing a series of bilateral agreements and their effect on Iran.

While Iran has continued to resist the Russian formulas, Putin has proceeded to line up agreements with Kazakhstan and now Azerbaijan. The Russian president hinted broadly this week that he would soon sign a Caspian pact with "another country," although he did not specify which it was.

If it is not Iran, then by process of elimination, Putin must have been referring to Turkmenistan. In seeming contradiction, earlier this month, Ashgabat's Caspian envoy, Boris Shikhmuradov, met in Iran with President Mohammed Khatami and declared that the two countries share "identical views."

Iran has steadfastly insisted that it is entitled to an equal 20 percent share of the Caspian, while the Russian formula would probably give it only about 13 percent of the sea floor.

So far, Iran has not been swayed by Russian incentives. Khatami recently repeated the 20 percent demand following the Tehran visit of Russian Defense Minister Igor Sergeyev and a decision to continue arms sales to Iran.

The timing of Khatami's statement may reflect an Iranian view that Russia's military help is all very nice, but that arms sales are in Russia's own economic interest and are no reason to give up Caspian claims. Putin's statement suggests that he would like to raise suspicions in Iran that Turkmenistan may soon go over to Russia's side, leaving Tehran alone in its opposition to a Caspian deal.

Tehran's anger at the Russian maneuvers became apparent recently, when the official news agency IRNA quoted an "informed source" at the foreign ministry as objecting to reported Russian war games in the northern Caspian.

The official said: "Iran believes there is no threat in the Caspian Sea to justify the war games and military presence, and such measures will harm the confidence-building efforts of the littoral states in the region." The statement is a sign that military ties between Russia and Iran do not extend to the Caspian, while Tehran may see the Russian navy behind Moscow's plan to keep the Caspian surface in common.

Since the substance of Russia's latest Caspian agreement is so vague, the style of Putin's diplomacy may be more critical. What can he hope to accomplish with two-party pacts before reaching a multilateral accord on principles? With each bilateral agreement, Putin has reaffirmed that a Caspian settlement can only come from consensus among all littoral nations. Yet, he continues to pursue the bilateral course.

Putin appears to be convinced that Iran can be made to respond to a combination of pressure and incentives on the Caspian issue. So far, it is the only shoreline nation that he has not visited.