FAST Local Information Network

Berne, August 2001 F • A • S • T

Kazakhstan

Country Update 3 / 2001

May – July 2001

Matthias Müller Dr. Heinz Krummenacher

Table of Content

1 Risk Assessment Kazakhstan ...... 1

2 Chronology Kazakhstan...... 4

3 Tension Barometers Kazakhstan...... 7

4 Analytical Raster Kazakhstan ...... 8

Note by the authors: For more general information on Kazakhstan (e.g. socio-demographic figures) see: FAST Report on Central Asia, 2 / 2000, p.16ff.

1 Risk Assessment Kazakhstan1

There is no likelihood of major domestic or international armed conflict involving Kazakhstan within the next three to six months. Although we do not expect conflict escalation on the domestic level in the short term, we do see the ongoing enrichment of the country’s small elite along with the economic and political marginalisation of a considerable part of the Kazakh population as fertile grounds for Islamic extremist ideology. If opposition forces outside the government’s sphere of influence – for example, Islamic extremists – can orchestrate existing frustrations, destabilisation and armed conflict could occur in the mid- or long term.

Factors increasing the likelihood of armed conflict

There have been no events during the period under consideration having the potential to spur armed conflict over the next three to six months. Nevertheless, several developments and events could aggravate the situation within the Kazakh society and bear the potential for armed conflict in the mid or long term: First, the growing disparity in the standard of living between the small Kazakh upper class and the remainder of the population increases tensions within the Kazakh Society and even jeopardises national cohesion.

The increasing performance of the Kazakh economy does not affect the man on the street. In fact, those who are profiting from rising oil and gas revenues are the members of the Kazakh elite who have concentrated all-important economic assets in their hands. Examples for this ongoing process of enrichment of the political and economic elite of the country during recent months are:

• In mid May President Nursultan Nazarbayev started a campaign to lure capital back to Kazakhstan by offering tax amnesty to those who illegally put their untaxed profits on foreign accounts during the last decade. About 3000 people of the Kazakh political and financial elite seized the opportunity to whitewash an amount of about 500 million US

1 This assessment is based on the analysis of events and developments from May to July 2001 along the FAST Analytical Monitoring Raster for Kazakhstan (see heading 4).

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Dollars. However, The tax amnesty, after all, penalises law-abiding citizens and institutions and favours tax dodgers. In the eyes of many citizens, the capital amnesty is only benefiting the upper class while it does not help the domestic economy.

• President Nazarbayev moved another important step forward in the ongoing process to place his relatives in top positions in the county’s politics and economy by appointing his son-in-law, Rakhat Aliyev, to the position of first deputy chairman of the Kazakh National Security Committee (successor of the KGB).

On the other hand, the standard of living – especially in Southern Kazakhstan – is decreasing continuously. According to Seidakhmet Kuttykadam, leader of the opposition “Orleu” movement, people in this region hardly have any job opportunities. Also the infrastructure is almost completely run down. People even face great difficulties getting access to fresh water. Thus, not surprisingly, during recent months thousands of people left Southern Kazakhstan to western and eastern provinces. Most of the people who left the southern provinces were not engaged in political Islamic activities. Therefore, they don’t benefit from the social security programs of Islamic organisations. This in turn changes the proportion of people supporting the Islamic extremists to those who still favour a secular state.

In the mid and long term the concentration of the economic and political resources in the hands of one family clan combined with growing disparities, and grave poverty could provide fertile grounds for Islamic extremist ideology as the only alternative to the current regime. Eventually, this could lead to armed conflict, especially in the much-deprived Southern part of Kazakhstan.

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Factors decreasing the likelihood of armed conflict

Despite existing tensions and existing conflict potential which may threaten the country's stability in the mid to long-term, Kazakhstan can still be considered a relatively stable country. This is reflected by the Tension Barometers showing that on the one hand the “Conflict Carrying Capacity” remained consistently high while almost no forceful actions were reported (see p. 7). This stability can be credited to the recent economic boom that, while favouring only the country's small elite, would resolve tensions along clan, regional, ethnic and linguistic divisions by infrastructure investment in disadvantaged regions. Kazakhstan’s GDP and industrial output have increased by more than 10% in the year 2000. Oil exports account for the biggest part of the performance (26% more than in 1999) enabling Kazakhstan to present a household surplus for the past year and to increase its bank reserves.

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2 Chronology Kazakhstan

Date Events 2001 May 1 In a May Day address, Kazakh President Nursultan Nazarbayev stated “inter-ethnic accord is the key to democracy and economic development”. Nazarbayev said the preservation of inter-ethnic accord was a result of the "rational and balanced" domestic policy and that no ethnic group should be considered superior to others. He praised the people for showing tolerance and openness, adding that the state remained dedicated to the policy of democratisation. 2001 May 2 About 25 workers of the Sokolov-Sarbay Iron Ore developing facility in Qostanay Oblast, Northern Kazakhstan, started a hunger strike demanding their overdue salaries to be paid off. 2001 May 4 Kazakh President Nursultan Nazarbayev signed a decree according to which Altynbek Sarsenbayev – who until today was Kazakh Minister of Culture, Information and Social Concord – was appointed as Secretary of Kazakhstan's Security Council. He has been replaced by Mukhtar Qul-Mukhammed, a member of Kazakh parliament’s Upper Chamber. Marat Tazhin, who was Secretary of Kazakhstan's Security Council became Chairman of Kazakhstan's National Security Committee (KNB, formerly KGB). Alnur Musayev, who was the former Chairman of Kazakhstan's National Security Committee, became Chief of Presidential Body-Guarding Service. 2001 May 4 Kazakh security officials have detained a Russian citizen, Ziyavudin Ziyavudinov, on suspicion of involvement in the bombing of an apartment building in Buinaksk, northern Daghestan, in September 1999. Fifty-eight people were killed in that blast and a further 87 injured. Ziyavudinov was living in Almaty using forged Kyrgyz papers. 2001 May 4 The Kazakh Cabinet has drafted plans for building a new rail link connecting Qostanay in Northern Kazakhstan with Aqtobe in northwest Kazakhstan. The new railroad will be about 300 kilometres long and cost about $140 million, and will make it possible to transport wheat, petroleum and other goods between the two regions without crossing Russian territory. 2001 May 4 OSCE Parliamentary Assembly chairman Adrian Severin called on the Kazakh leadership to embark on a dialogue with the opposition. Severin stated that Kazakhstan needs a strong opposition, as a weak opposition "is hysterical and incapable of compromise." President Nursultan Nazarbayev claimed that "unfortunately - and I stress unfortunately - we do not have a normal opposition that would be able to offer the country a program of development”. 2001 May 10 President Nursultan Nazarbayev's son-in-law, Timur Kulibayev, has been named to head the newly created state pipeline company Oil and Gas Transport. That agency was created on the basis of the oil transportation company KazTransOil. 2001 May 11 Arat Narmaghambetov, a leading member of the “OTAN” party created in January 1999 to support President Nursultan Nazarbayev, has addressed an open letter to Kazakhstan's Prosecutor- General Rashid Tusypbekov, the U.S. Department of Justice, and the Swiss Justice Ministry stressing that President Nazarbayev has repeatedly rejected as untrue articles published in the U.S. press over the past 18 months implicating him in accepting huge bribes from Western oil companies that were allegedly paid into foreign bank accounts. In the letter, Narmaghambetov appeals to Tusypbekov to bring legal proceedings for insulting the honour and dignity of the president against the foreign newspapers that published such articles. 2001 May 14 The Kazakh Slavic movement wants Russian to become the status of a state language. At the third conference of the association of Russian, Slavonic and Cossack public in Almaty the conference participants urged the strengthening of the status of their mother language. 2001 May 14 The new head of the Committee for National Security Marat Tazhin, told Kazakhstan's parliament that his agency must tackle "new tasks," in particular terrorism and drug abuse. With regard to the former, he said his committee should expand international cooperation with the objective of determining Kazakhstan's role in the regional security system.

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2001 May 15 The U.S. Congress discussed the political development in Kazakhstan and U.S. policy toward this country. The Subcommittee on the Middle East and South Asia of the House of Representatives' Committee on International Relations has discussed at its hearing a report by Clifford G. Bond, Special Adviser to the Secretary of State for the New Independent States. The opening part set the tone for the whole meeting. Benjamin Gilman, head of the Committee told his colleagues of his recent meeting with Kazakh foreign minister Yerlan Idrisov. It was made absolutely clear to Mr. Idrisov that the attitude toward Kazakh government would depend entirely on its treatment of opposition, independent media and respect for human rights. Kazakh foreign ministry and the whole propaganda machine insist that Washington is allegedly interested only in Caspian oil and security issues. 2001 May 22 German Foreign Minister Joschka Fischer held a meeting with Kazakh President Nursultan Nazarbayev, Prime Minister Qasymzhomart Toqayev, and other senior ministers in Astana. According to Fischer the two sides “discussed the link between democracy and the creation of a state governed by the rule of law”. During discussions with Economy Minister Zhaksybek Kulekeev about potential investment opportunities, Fischer similarly noted that developing the economy depends on greater transparency, which is impossible without a clear division of powers. 2001 May 22 The Almaty City Court rejected an appeal by Ermurat Bapi, editor in chief of the opposition newspaper "SolDat," against the one-year prison sentence handed down to him last month by an Almaty district court on charges on insulting the honour and dignity of President Nazarbayev. 2001 May 24 The Presidents of Russia, Kyrgyzstan, Kazakhstan, Tajikistan, Armenia, and Belarus agreed to create a rapid deployment force to tackle terrorism and Islamic extremism in Central Asia. The Presidents of these states signed the deal at the end of a two-day security summit in the Armenian capital of Yerevan. The head of states declared in a joint communiqué that "we regard the creation of a rapid deployment force as very important. Now we are ready to take joint and firm action against attempts to violate peace and stability in Central Asia." 2001 May 24 Azerbaijan Deputy Foreign Minister Khalaf Khalafov is interested in signing accords with Russia and Kazakhstan about the division of the Caspian seabed by a modified medium line. The agreements are bound to legalize the right of the three countries to mineral development and other economic activity. Agreements similar to the ones signed by Russia and Kazakhstan in 1998 may become a step towards the comprehensive definition of the Caspian Sea status, Khalafov said. 2001 Jun 12 Kazakh President Nursultan Nazarbayev stated that he sees any reason to postpone the date of the commissioning of the Tengiz-Novorossiisk pipeline constructed by the Caspian Pipeline Consortium (CPC). Kazakhstan hopes that the first tanker will be loaded with Kazakh oil at the new terminal near Novorossiisk as early as August 6. 2001 Jun 14 Mass deaths of seals have again occurred in Kazakhstan's sector of the Caspian Sea. A local ecology official in Mangystau said the deaths might have been caused by recent storms. No official explanation was ever given for the mass deaths of seals last year, which some experts attributed to pollution from oil-drilling rigs. 2001 Jun 28 Kazakh President Nursultan Nazarbayev named First Deputy Economy and Finance Minister Zhanat Ertilesova as deputy Defence Minister. Ertilesova will be responsible for the financing of the ongoing reforms of Kazakhstan's armed forces. 2001 Jun 29 The labours of the energy plant of Ust-Kamenogorsk have created a strike committee. The workers protest against the permanent violations of the workers right. 2001 Jun 30 An Uzbek military plan crossed the Kazakh border illegally and flew over Southern Kazakhstan. 2001 July 2 The Kazakh authorities have expelled 93 citizens of Tajikistan who stayed for longer than the maximum three days in transit in Kazakhstan en route for the Russian Federation, where they hoped to find work. 2001 July 10 The Kazakh authorities are again putting pressure on their main opponent – the Republican People's Party. A whole series of persecutions and attempts to intimidate the party's members took place during recent days.

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2001 July 12 Minister of Natural Resources and Environmental Protection Andar Shukputov stated that the water consumption quotas have been reduced in Southern Kazakhstan. This step was taken because the level of the Kyrgyz Toktogul water reservoir, which is the basic source of irrigation water for the southern regions of Kazakhstan, had fallen to a critical point. By the beginning of the vegetation period this year, the amount of water in the Toktogul reservoir fell to 87 cu.km., whereas in 2000 it had more than 200 cu.km. of water. 2001 July 15 Amirzhan Qosanov, a leading member of the opposition Republican People's Party of Kazakhstan, and Ermurat Bapi, the editor of the independent newspaper "Sol-Dat," were told by security officials at Almaty airport that the country's National Security Committee had given orders that they were not allowed to board a plane leaving for the U.S. The two men were scheduled to testify to U.S. Congress hearings on human rights, democratisation, and freedom of speech in Kazakhstan. 2001 July 24 Kazakh President Nursultan Nazarbayev and his Kyrgyz counterpart Askar Akayev didn’t find a way out of the water dispute between the two countries during a meeting in Bishkek. During his talks with Akayev Nazarbayev rejected as "unacceptable and a violation of international norms” the Kyrgyz parliament's proposal that Kazakhstan and Uzbekistan should pay for water resources from Kyrgyzstan. He warned that insistence on that issue could negatively affect Kyrgyzstan's relations with both countries. 2001 July 27 Russian Deputy Prime Minister Viktor Khristenko assured that his country will not create any customs barriers to the export of Kazakh crude via the Caspian Pipleine Consortium to Novorossiisk. Khristenko said he is unaware of the reasons for the postponement, announced the previous day, of the 6 August ceremonial filling of the first tanker with oil from that pipeline. A Kazakh government press release had blamed the postponement on the "negative attitude" of the Russian side.

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3 Tension Barometers Kazakhstan

Source: FAST Local Information Network

Conflict Carrying Capacity and Forceful Actions: Kazakhstan (M o n th ly )

1 0.8 0.6 0.4 0.2 0 -0.2 2000/6 2000/7 2000/8 2000/9 2001/1 2001/2 2001/3 2001/4 2001/5 2001/6 2001/7

-0.4 2000/10 2000/11 2000/12 -0.6 n = 21 n = 39 n = 31 n = 27 n = 29 n = 7 n = 6 n = 81 n = 82 n=47 n=107 n=65 n=113 n=131 -0.8

CCC Forceful Actions

Conflict Carrying Capacity (CCC): Reflects the stability of the system or polity as a whole rather than a particular regime or administration. A CCC trend line approaching 1.0 suggests 100 % stability. Forceful Action (FA): Refers to the proportion of any and all uses of physical force and any associated manifest violence by any actor. When the CCC and FA trend lines intersect it implies regime instability coupled with violence. “n”: signifies the number of events per month reported by the FAST Kazakhstan Country Coordinator. Each event consists of a clearly identifiable actor, target and action.

Goldstein Conflict and Cooperation: Kazakhstan (Monthly)

10 8 6 4 2 0 -2 2000/5 2000/6 2000/7 2000/8 2000/9 2001/1 2001/2 2001/3 2001/4 2001/5 2001/6 2001/7 2000/10 2000/11 2000/12 -4 n = 18 n = 21 n = 39 n = 31 n = 27 n = 29 n = 7 n = 6 n = 81 n = 82 n = 47 n=107 n = 65 n=113 n=131 -6 -8 G oldstein average

Goldstein Conflict and Cooperation: measures the relationship between individuals, groups, or states ranging from – 8.4 for unmitigated conflict to + 10.2 for complete cooperation, whereas 0 stands for neutral events. The Goldstein scale summarises the different values to an average for every time period. The value 0 indicates that the sum of all negatively and positively valued events revoke each other. “n”: signifies the number of events per month reported by the FAST Kazakhstan Country Coordinator. Each event consists of a clearly identifiable actor, target and action.

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4 Analytical Raster Kazakhstan

I N T E R V E N I N G F A C T O R S A ROOT CAUSES PROXIMATE CAUSES Decreasing the likelihood of conflict

Historic Political / Governance Natural disasters R Foreign assistance (NGO, IO) Soviet hegemony / legacy Autocratic regime behaviour Seasonal changes Widespread corruption Economic and social consequences of drugs production and M Suppression of opposition forces Political / Institutional drugs trade Harsh state control and suppression of suspected Islamic Authoritarian political culture (as a Economic growth extremists perpetuating pattern of the Soviet era) E Unequal economic support of different regions by the

government Societal / Socio-Demographic D Language cleavage between Russians and Security Kazakhs Poorly equipped army Ideological vacuum after the break-up of the Border demarcation Soviet Union Negative impact of clan structure on nation C Societal / Socio-Demographic building High unemployment rate (especially among the young) Economic Collapse of key elements of social infrastructure (e.g. O education and health care) Economic inequalities between different

regions N Economic Growing disparity between poor and rich, i.e. increased International poverty F Arbitrary national borders with neighboring I N T E R V E N I N G F A C T O R S Closure of Uzbek borders Increasing the likelihood of conflict countries (e.g. Uzbekistan) Competition between different states in getting L Ecological Natural disasters access to Kazakh resources Further repression of opposition groups Ecological pollution (from Soviet times). Growing economic inequality between different I regions International Erection of border posts by Uzbek Foreign support of Islamic forces in southern Kazakhstan authorities C Visa restrictions with neighboring countries Economic and social consequences of Frontier disputes with Uzbekistan, and Kyrgyzstan drugs production and drugs trade Closure of Uzbek border (landmines, visa restrictions, Land reform T border posts)