They’ve got a little list
“When I was a lad, I served a term, as office boy in an attorney’s firm …” sings Sir Joseph Porter, First Lord of the Admiralty, in Gilbert and Sullivan’s popular operetta, “HMS Pinafore”. I sometimes joke that this is really “my song” because, although I wasn’t exactly a lad when I arrived here in Bishkek and started working in a attorney’s firm, (helping my friend Tony set up his own law firm, “LegExp”), and I haven’t risen to the dizzy heights of an Admiral, yet alone First Lord of the Admiralty, in Britain’s Royal Navy, I have made it to being General Director of two companies here in Kyrgyzstan, and as result made it onto the management board of the IBC, (The International Business Council), and served four years as the President of KATO, (The Kyrgyz Association of Tour Operators).
Well, Gilbert and Sullivan have another song that seems appropriate in today’s Kyrgyzstan. In “The Mikado”, Ko-Ko, the Lord High Executioner, sings about how he “has a little list” … “of society offenders who might be underground and who never would be missed.” Here in Kyrgyzstan, they also have their “little lists”.
Back in 2005 the lists were of companies which were associated with the family and administration of the Akaev regime – “Akaev’s List”. Companies which allegedly belonged to, for example, his businessmen son or son-in-law … or their proxy. Once, Askar Akaev famously claimed that his only assets were two apartments and an old car. The list suggested there was a lot, lot more. At first, it was a small list of about only 20 or 30 companies, albeit some of the largest companies in the country. Soon, however, the list soon took on a life of its own and, like Topsy in Uncle Tom’s Cabin, “just growed”. Soon it comprised over one hundred companies and later, almost two hundred. A commission, headed by Daniyar Usenov, who was later to become Prime Minister, was established to look into the affairs of the companies on the list. There were questions about who owned the companies, how they obtained their licenses, whether they had paid vzatky (bribes) or whether they paid their taxes. Promises were made to take back into public ownership the companies, national assets, that had been “stolen”.
Now, in 2010, there is another list being compiled, the “Spisok Bakieva” – Bakiev’s list. A list of companies which were associated with the family and administration of the Bakiev regime. Companies which allegedly belonged to, for example, his businessmen son … or his proxy. The list suggested there are an awful lot of them. Banks, shopping centers, mass media, oil companies, telephone companies; property companies, office blocks, … and so on, even small cafes and apteka (chemists shops, or drugstores). It’s even reported that huge stretches of land on the norther outskirts of the city belong to either the Bakiev family or to Daniyar Usenov, and demands are being voiced from the crowds of demonstrators that this should be nationalized and handed over to the people, allocated to individuals to build housing. Strangely enough it looks as if some of the same companies are on this list as were on the previous one. Let’s hope that this list doesn’t take on a life of its own and “just grow” like the “Akaev list” did. Investigations are under way and business have been asked to show patience and cooperate with the authorities conducting the enquiries. There are questions about who owns the companies, how they obtained their licenses, whether they have paid vzatky (bribes) or whether they have paid their taxes and customs dues. Once again, promises have made to take back into public ownership the companies, national assets, that had been “stolen”.
If there are distinct similarities between the last two paragraphs – then maybe there is a reason for that. It seems as if history is repeating itself. Let’s hope and trust that it won’t repeat itself yet one more time.
Unfortunately, in a way, it already is … the question of “corporate raiding” swept into the headlines almost as soon as the revolutionary events of April 7th were over. A company faces a takeover by individuals, or groups, using questionable methods to apply pressure, taking advantage of the uncertain circumstances in which we find ourselves. There are all sorts of stories doing the rounds … about how this or that company was taken over; how a multi-storey office building was bought for a fraction of its real value; how armed guards appear in the headquarters office of a large company and monitor, or control, all comings and goings; how businesses registered a change of ownership; … and so on. Indeed it proved to be so worrying that the interim government froze all business registrations, and re-registrations and all sales of property. This was causing serious problems for estate agents, (realtors), and financial institutions in particular and the new regulations had to be amended pretty promptly.
Some of the banks that were thought to have connections with Maxim Bakiev or other members of the former regime have been put under special administration, and limits placed on transactions … cash withdrawls and the like. Oddly enough, it claimed that some seven million dollars worth of gold bars have been found in bank safe deposit boxes belonging to people associated with the previous regime. A number of arrest warrants have been issued, but we’ve yet to see how, or if, they will be effected.
It’s not just the authorities that are searching for evidence of anything untoward. Journalists have been active too. There have been reports in the Western Press linking what looks like “dodgy deals” with a number of individuals and one Brit, (of Azerbaijani descent), has apparently been arrested on money laundering charges. According to one press report, he was arrested in his hotel room. It wasn’t at our hotel, but we must think about how to handle this sort of situation if it were to arise.
Statements started to be issued by members of the interim government within days denying that any of them had played any role in such activities. It struck me as interesting that they felt it was necessary to issue such statements at all. It shows how deep is the distrust of politicians in Kyrgyzstan goes amongst the population. They are afraid that nothing will change and that history WILL repeat itself.
IBC wrote an open letter, (yes, another open letter!), together with some other business associations, urging the interim government to learn the lessons arising out of the events of both the 2005 revolution, and also those which followed the Bolshevik Revolution in 1917, and calling for fair and objective consideration of the cases of those companies on the “Bakiev’s List”. I got drafted into the drafting process. Amongst other things the letter pointed out was that:
- in general, the Kyrgyz Republic has established a good foundation for a free market economy in which everyone has the right to engage independently in creating business;
- the rate of recovery of business activity, in particular, in Bishkek, shows that the country has the resources and the will of business leaders, a talented and patient working people, all of whom are ready to do what is necessary for the restoration of normal operation in business and everyday life, and
- entrepreneurs and businesses have already suffered from the actions of individuals and groups who have been identified as being associated with the previous regime and should not be subject to “double jeopardy” and, effectively, be punished twice.
All of this hasn’t affected us as such, thank goodness. At least, not so far! Frankly, I don’t expect it to as we are too small, even if we are one of the country’s biggest taxpayers, and we are not a “cash cow” working in areas generating lots of income, such as mobile telephone operations; trading in petroleum products and banks.
I hope I am right … I don’t want to be on this particular “little list”.
Bishkek