Postcard from Bishkek

Tomorrow is Easter here in Kyrgyzstan … where the Russian Orthodox Church still operates on the Julian Calendar whilst the rest of the world, (well, most of it – including secular Kyrgyzstan), operates on the Gregorian Calendar.

There’s a fourteen day difference between the two but the date of Easter is tied to a complicated formula decided at the Council of Nicea in 325AD, (actually, the first council of Nicea), which connects the Spring Equinox, phases of the moon and the date of the Jewish Passover.

As a result, the date of Easter is not a fixed date, like Christmas, it doesn’t fall on the same day each year.  When the formula in the two different calendars, the resulting dates for Easter sometimes coincide, but the Orthodox Easter is usually later than that celebrated in the West.

Unlike most things in life, it’s not all to do with money, it’s not all down to the bottom line, it’s not simply a question of economics … so, Amy, when your Mother used to say that Orthodox Easter was later it was “because then you get stuff cheaper”, I am afraid that she got it wrong.

Hey, it happens!

Although it is important – not everything is down to the “bottom line” … A British lawyer, (described as as an “international expert”), gave an interview to one of the news agencies and although he was fairly positive in some respects his general advice won’t have enamoured him to the authorities here.  As the headline put it … “British expert advises investors to keep out of Kyrgyzstan”.  Indeed, he’s apparently taken his own advice and chosen to open a company in neighbouring Kazakhstan rather than here.

When asked if investors from “foggy Albion” might be interested in projects here in Kyrgyzstan, he replied that, in his experience, “Kyrgyzstan is still interesting to investors …”.  He also added that this “is typical for any country with mineral resources and low labour costs” and also referred to the possibility of creating a “transport corridor from Chine”.  So, Kyrgyzstan has advantages which are attractive … but, despite the efforts of the government to create a favourable economic and investment climate … there are some issues which probably outweigh them.

As well as the possible economic profit that can be earned from their investments, he said, potential investors will also look at the regulatory environment and, “of course”, the political stability in the country – and he stressed that stability was the crucial issue – NOT democracy, (which made me wonder what the State Department and Foreign Office will think of that).  He quoted in particular the example of China, “where there is no democracy at all,” (and I wonder what China will make of that), “but there is unconditional stability and political predictability”, (although I think that there are some people who might want to take issue with that as well).

He goes on to suggest that one of the reasons investors are put off Kyrgyzstan is the need to “defend their legal rights and go to law”, having pointed out that the legislation is “quite amorphous and is totally government orientated”, subject to “constant law making” – presumably referring to the constant changes in legislation that are introduced.

As an example – there’s a new suggestion from some of the deputies that law should be changed again to permit Casinos to operate in the country one more.   This would not be the first time that there has been an about face on this issue.  They were banned for a short time about ten years ago and then a law banning them once again was passed in 2011, signed by the then President, Roza Otunbaeva, and the existing licenses were revoked when the law came into force last year amid considerable controversy.  Since then, President Atambaev has said that he thinks all forms of gambling should be prohibited and bookmakers’ should be closed down and he’s received some support, so it is not clear if this latest initiative will be eventually be successful.

He even used the word “arbitrariness” to describe some of the cases that have recently hit the headlines.

I am not sure what the British embassy here in Bishkek might make of his comments, as they are working to try and improve commercial relations between the two countries.  The ambassador has been quoted as saying that the amount of bilateral trade between the two is less than both sides would like …  however, she also been quoted as saying that political stability is important for business.

Anyway, I wonder if he will ever be allowed back into the country again.

As it happens, recently, there have been several cases where people have been barred from entering the country.  I mentioned one last week, but perhaps the most high profile case to date concerns the Russian Political Analyst Alexander Knyazev.  He is well known for being critical of the government and the socio-political situation in the country.

It seems that he turned up at the border together with his son and was simply not allowed to cross the border, turned around and sent back to Almaty in Kazakhstan.  Nobody seems to have any idea why he’s been banned – although there was a report that there was a “problem” with his documents, (despite the fact that he’s apparently used the same passport to enter Kyrgyzstan before), and another that is was because of a violation of the State Border Law, (but there were no further details).

It seems to me, however, that he has does have a point.  There is a saying that “Cash is a coward” and doesn’t like uncertainty.  However, as Benjamin Franklin is supposed to have pointed out, there are only a few things in life that can be counted on as certainties – he cited two: Death and Taxes.  When people ask me about doing business here in Kyrgyzstan I tend say that it is although it is possible to do, but there are difficulties … on the other hand, there are difficulties everywhere, and a Kyrgyz citizen trying to set up a business in Britain, (America or almost anywhere else), would also face difficulties.

Although one of the definitions of an entrepreneur is someone who “organizes and operates a business or businesses, taking on financial risk to do so”, his point is that some uncertainties introduce more risk than an entrepreneur might be willing to accept.

 

There hasn’t been much news about Kumtor but the tender for the Jeroy gold mine is underway – not that there are any takers so far.  In fact, the state Agency admits there’s a chance that there may be no bids as happened with the attempted sale of Zalkar Bank.  Oddly enough, a buyer for the bank has now appeared and the transfer seems to have gone through.  At least someone hasn’t been listening to advice about staying away from Kyrgyzstan.

Among the instabilities that keep cropping up is the issue of the borders down in the Ferghana valley.  There has been more trouble with fighting breaking out between the Kyrgyz and Tajiks around the Vorukh enclave – a piece of Tajikistan surrounded by Kyrgyz territory.  It seems that there was a question about the planned route of a road being built to bypass the enclave and one report suggested that some 10,000 people were involved.  The situation seems to have calmed down, but there is always a concern that more disturbances may still occur.

Another issue,. of course, is corruption.  The Vice Price Minister said in a speech that we need to adopt a “zero tolerance” towards corruption … and I don’t think many will disagree with him – but it’s nbot clear how we can achieve this.  There are more and more stories about corruption appearing each week – but not all of them are new.  This week, for example, the case of the control tower at Manas Airport resurfaced.  It’s alleged that large sums were siphoned off from the project with the control tower not being as tall as it should have been … which actually affects its functionality.

Perhaps more embarrassing is the fact that some 300 hectares which were supposedly earmarked a few years ago for expansion of the airport – including the construction of a cargo hub and a second runway, which are needed if the airport is really going to be turned into a transport hub after the closure of the Transit Center when the Americans and others withdraw from Afghanistan – have apparently been sold off for warehouses and private development .  The news report suggested this was the result of “negligence” rather than corruption.

Another facility intended to help the the airport become an international hub is the development of Duty Free shopping zones.  The airport management company say that they want to create the “best Duty Free in the CIS” by the beginning of 2014 and as we are almost half way through the year they don’t have much time left to realize their plans.  It’s going to involve an investment of something like five million dollars and some Turkish companies are involved … so at least some investors haven’t heeded to the advice to stay away from Kyrgyzstan.

Another instrument to help turn the airport into an international hub after the closure of the Transit Center would be the adoption of an Open Skies policy.  Up until now the Ministry of Transport has been very cool towards the idea – but it seems that they had a change of heart.  Apparently, a government decision approving open skies agreements with 45 countries of the world has already been drafted.

As as attempt to try and increase the number of international flights, discussions are underway with China to open another air corridor – to the South and East, which would allow planes from Europe to fly from Europe to South East Asia.

Manas is not the only international airport in Kyrgyzstan – there is another one, for example, down in Osh.  It’s being reported that one investor is proposing to construct a five star hotel on the basis of the airport.  That sounds pretty impressive, but I wonder how many potential guests there are for such a hotel.   At least they haven’t heeded the advice to stay away from Kyrgyzstan.

 

When people talk about investment opportunities here in Kyrgyzstan, the conversation usually revolves around mineral resources (mining), energy (hydroelectricity) and tourism.  Obviously, I have a vested interest in the latter.  As a result I am pleased to see potential adoption of an Open Skies policy.  I am slao pleased to see that there are plans to withdraw the “ecological fees” for vehicles entering Issyk Kul.

I am not opposed to having clean, ecologically friendly, vehicles … but the money charged is basically just an entrance fee.  Although there is a scale of fees that depends on the type of vehicle – car, minibus, bus, lorry … etc. – there’s also a scale based on the registration of the vehicle    – Issyk Kul registered vehicles pay nothing, Kyrgyz vehicles pay and foreign registered vehicles pay a different, (higher), fee.

Don’t misunderstand me; I am not opposed to entry fees or tolls either – but there needs to be some logic behind them, control and transparency.  The funny thing is that in an attempt to introduce control and transparency, it was announced last week that the special automatic barriers would be introduced to collect the tolls.

 

Another news item related to tourism was the report that, last year, Kyrgyz citizens travelling abroad spent spent over half a million dollars.  According to official statistics, foreigners visiting the country spent almost seven hundred million dollars, so at the moment tourism is a net earner for the country … what the report failed to mention, however, is that over the years the gap seems to be getting smaller.

According to official statistics, again, something over a hundred and seventy five million dollars has been invested in tourism facilities in the country last year – so some investors have not been heeding the advice to stay away from Kyrgyzstan.

 

As it happens, there are some other businesses which have potential … textiles, agriculture and food processing.  It seems that in many cases Kyrgyz entrepreneurs are apparently more competitive than in neighbouring Kazakhstan, which has sometimes led to problems with border controls as, (so the story goes), Kazakhstan tries to protect it’s domestic industry.  I am not sure how that will be affected if Kyrgyzstan enters the Customs Union.

 

Among the other statistics reported this week, some of which were somewhat surprising, included:

In another member of the Customs Union is Belarus, where the former President Bakiev is currently living, along with another 50 people associated with his former regime.

Quite a bit of effort is apparently being made to beautify the city – several million flowers are being planted in the three hundred odd flower beds in the central areas … three thousand roses, for example, are being planted on Prospect Erkindik, alone.

Kyrgyzstan was ranked 44th out of 168 countries in terms of promoting gender equality – out performing even the USA which was ranked in 50th place.  That was surprising given the practice of Ala Kachuu, (Bride Kidnapping) and another statistic revealed this week that only about 25% of the deputies are female … and it was interesting to note that the Vice Prime Minister that announced this result also stressed that the government has concerns about the implementation of its Gender Equality Program.

Mind you, one Kyrgyz kickboxer visiting Dubai, put her skills and training to good use by foiling an attempted rape.

It turns out that something like 70% of the recruits to the army at the moment are apparently volunteers – employed on a contractual basis rather than conscripted.  It also emerged that quite a few of them have very basic educational qualifications.

Kyrgyzstan currently has 437 refugees according to the UNHCR – from Afghanistan, Iran, Syria, Uzbekistan as well as some other countries.

In recent years, over six hundred people have suffered food poisoning from eating mushrooms.

The average age of the planes at the Manas Transit Center is apparently 20 years …

That brings me to the breaking news … once again, as I sit down to write the weekly postcard, events seem to take over … this time it’s a plane crash – one of the refueling tankers based at the Manas airport took off in the early afternoon and was making it’s way to Afghanistan … but didn’t get very far.  According to early reports, locals called the emergency services to say that they saw a plane in the sky explode, break into three pieces and fall to earth.  It’s too early to say any definite but some of the early speculation is that the cause of the crash may have been connected to the thunderstorm that was underway at the time.  We’ll have to wait and see if the inevitable investigations reveal anything more sinister.

Some of the wreckage has been found but, by late evening there was still no sign of the five man crew – some reports are talking about a crew of three and it was not known if anyone else was on board.  There are reports of a parachute being found on the ground but no sign of anyone who may have used it.

The best news of the week was that a 75 year old man, Radik Sibgatulin, won the Kyrgyz Show Jumping competition that was held here in Bishkek last week.  The Kyrgyz are very proud of their horses and the horsemanship but, (to be honest), I didn’t know that they went in for showjumping as a sport.  It seems that it has a long tradition here and Radik was a champion several times over in the days of the Soviet Union and had retired a few years ago, but  he decided to come out of retirement this year and did so in style.   He certainly seems to have fared a lot better than the President of Turkmenistan who fell off a horse at a race meeting during the week.

 

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Postcard from Bishkek: the weekly postcard that I send out as an email also gets posted on the website ianbek.kg each week – and there are other postcards which don’t get sent out.  This week, for example, there has been the following postcards:

• Eating out … dining in Kyrgyzstan - Food is one of the most important things to concern visitors when they are traveling abroad … - 28/05/13
• Prezhervalskiy Museum, Karakol - April 29th, 1957, saw the opening of the Prezhervalskiy Museum on the headland between the Karakol and Kara Suu Rivers - 29/05/13
• The month ahead – May - People often ask me about how I keep track of all the special days and anniversaries that feature in my postcards … and the answer is that I try to keep a diary of them   - 30/05/13
• Mairamynyzdar Menen! -  Happy Holidays - 01/05/13
• The Good Book – in Kyrgyz – On the anniversary of the publication of the Bible in English … what about the Kyrgyz version? - 02/05/13
• Customs and Duty Free – Kyrgyzstan wants to have the best Duty Free Shopping in the CIS - 03/05/13

It is possible to follow me on Facebook, (where I have specific pages for Celestial Mountains and ianbek … and also links.kg, Kyrgyz Diary and Kyrgyzstan Visitki), and also on twitter, (@Bishkekpostcard and @celestialMTC ).

 

Tags: Expat, In_the_News, Life_in_Kyrgyzstan, Weekly_Postcards