Radio Liberty

Not Only Pensioners Protest, but also Akims

7 Days in Kazakhstan by Radio Azattyk

In the last week, on behalf of the Civil Party and the Agricultural Party Victor Vesnin and Yermek Kelimseit initiated a law that was supposed to ease the lives of peasants. Agricultural producers are to pay to the budget about 17 million tenge. Now these debts are delayed by three years. Now it is the Senate that is to decide.

Almaty. In the late April the first Eurasian Summit to be held here. Mainly Central Asian countries and the Caucasus will participate in the Summit. Representatives of business circles from Russia, Turkey, Iran, the U.S.A., Japan and Germany invited to the Summit. The chairman of the Investment Agency Dulat Kuanyshev foretells the great success of the Summit and its influence on the investment climate in Kazakhstan.

The last seven days may be called a chain of meetings. This time not only pensioners protested. A parliamentary and a city Akim joined demonstrators. The parliamentary Valerian Zemlyanov threatened to dies from hunger to support despaired workers from Uralsk, who did not receive any salary for three years. The Ekibastuz Akim Yeltai Arbiev sent in his resignation making a precedent in sovereign Kazakhstan. Of course, pensioners were leaders by the scale of their protest. The chairman of the Association of movements Pokolenye Irina Savostina said this to the Radio Liberty.

Demands by veterans and other socially active strata of the population from Almaty, Ust-Kamenogorsk, Karaganda and Taraz are the same � old people want different life. For example, in Ust-Kamenogorsk three thousand pensioners participated in demonstrations.

In this week protest demonstrations held also in Kentau and Shymkent.

During the improper privatization and concession of the Kazakhstani economy, the US company Access Industries gained the open-cast mine Bogatyr. This happened in 1996. In the late 1997 the company�s supervisor Danial Akhmetov was succeeded by the new regional Akim Galymzhan Zhakiyanov, who was known a young reformer. First of all the new Akim examined investors and pseudo-investors who had been previously freed from taxation. The tax on land from Access Industries was increased 200 times. The US company did not agree with these innovations and went to the law.

The Ekibastuz former Akim Yeltai Arbiev in his interview to Radio Liberty said that courts supported local authorities. In the last year Danial Akhmetov became the deputy Prime Minister. Access Industries gained back all its former privileges. Yeltai Arbiev thinks that corresponding members of the government were governed by exclusively easy money: �The town budget has never repaid a taxpayer pensions and salaries paid to people. For two months Ekibastuz is on starvation rations. Ekibastuz is full of economic refugees from Kazakh auls (villages). The government doomed Ekibastuz to the humanitarian catastrophe, by its suspicious decree.�

The head of Access Industries Dennis Price refutes accusations by the former Akim Arbiev. He thinks that it was rather misunderstanding between local and central budgets.

The �coal war� in Ekibastuz has transformed into informational one. Most Kazakhstani influential newspapers criticized policy by Yeltai Arbiev and Galymzhan Zhakyanov. The administration of Pavlodar oblast that significantly affects only some Kazakh newspapers is obviously losing in the informational battle. The electronic newspaper Navigator states that �newspapers being truncheons in pseudo-investors� hands do not consider interests of either the local population or the local elite. This again proves that Kazakhstan remains an informational colony as well.�


THE GLOBE based on materials from the Kazakh Service of

Radio Liberty (Radio Azattyk)

(Translated from Kazakh by THE GLOBE, a brief variant)

Woman Should Live, but not to Graze, - Bakhytzhamal Bekturganova

ALMATY, March 6


- Maybe, it is straightforward question, but why the women�s movement in Kyrgyzstan has successfully won parliamentary seats, while your Women�s Alliance lost at the previous election?

There are some aspects of this question. I repeatedly associated with Kyrgyz women and I should say that they are active. Their thoughts are natural and democratic. On the whole, they make people appreciate them. Besides, the Kyrgyz political system is not more democratic than the Kazakhstan�s one, but nevertheless, the women�s presence in the power structure, representation bodies, their active involvement in the social life of the country are the index of country�s democracy.

As far as Kazakhstani women are concerned, recently women�s public organizations stirred up. But if we consider the Association of Businesswomen of Kazakhstan headed by Raushan Sarsenbaeva, activity of women transforms to the corporate level, i.e. is being commercialized. These women successfully use grants allotted by foreign funds. Possibly, they create additional jobs for unemployed women. But, on the whole, this activity is of a corporate character. In this regard the social effect of this organization is low.

- On February 14 Women of Kazakhstan movement registered in Almaty. You are the leader of this movement. Could you describe briefly the objective and tasks of the movement?

My headquarters and women-voters who voted for me during the election initiated the creation of Women of Kazakhstan. The idea of this movement has taken shape long ago. Women from different regions constantly appeal to me. They try to protect their rights, but fail. Our movement has political orientation. Our task is to monitor observation of civil and political rights of Kazakhstani women. This monitoring should be continuous and regular. We should be able to compare real condition of women with the legislation worked out by the Parliament and the executive authorities. We are entering the policy to approve tender expertise of the national legislation and its compliance with the international standards.

- What can you say about 5% of women who working in powerful bodies now determine the people�s fate? Can you say that they are erudite and highly-professional?

Unfortunately, women selected by conformism are coming to power. These women satisfy the present authorities. Women who have principal positions and disagree with the top leaders� activity just rejected. Hence, our task is of a missionary character � to teach the policy and basic literacy. Women�s activity may be constructive. Let� s remind the Soviet example. Women participated in collectivization, restoration of the economy and the war. Women can do everything.

- What do you mean talking of the political activity of women?

Persisting on 30% participation of women in powerful structures, we want to teach our government that staff selection is to be very functional and very tight. Women are not to be selected by their loyalty to the authorities, but by professionalism.

- What can you say about Raushan Sarsenbaeva who represented Kazakhstani women at the Summit in Turkey?

I do not know who selected her, but our (of the women�s political movement � editors) task is that we want to teach our society democracy. That means that we want to say that freedom of will and the right to choose belong to people. Hence, no incidental people should go to summits, but women that are worthy and supported first of all by women.

- Do you think, we have such women?

Of course, now there are a lot of clever, educated women who may bring many new fresh ideas to both the economy and the policy.

Where from did the Kazakh Trace in Swiss Banks Appear?

Why �the Kazakh Trace� came to light right now

From the editors: This article is devoted to the scandal surrounding accounts of Kazakhstani officials in Swiss banks. In the article the author proposes the version that accounts belong to the former Ambassador to Switzerland, the President�s assistant Bulat Utemuratov. You may read comments on the material in the article � How Alexander Antonovich Picked a Fight with Bulat Dzhamitovich� on the same page.

New Africanate

How Alexander Antonovich Picked a Fight with Bulat Dzhamitovich


No rest for three days

No exercise for three days

And all for a few lines in a paper


(From a Soviet song about journalists (the question is ours � N.A.)(

Questions and Answers

The scandal surrounding the concessions to the leading gas company Tractebel in Kazakhstan, whilst themselves interesting, highlight a second peculiarity which is itself even more important: namely that the authorities are constantly hindered by the squabbles and arguments which surround them, and yet no means exist to prevent such contradictions. This case is a prime example, a reflection of the nature of the relationships between groups, a clash of interests within the Kazakh establishment, wanting - even in basic level public service � elementary limits to prevent such conflicts. Undercover struggle and the whole affair has even made waves amongst foreign journals � inadvertently and unintentionally. However there is obviously only one means of preventing such disputes: the role of the press, already highly valued amongst official and, above all, business circles in Almaty and Astana.

The leader in this field, it emerges, is Akezhan Kazhegeldin: the first to befriend the foreign and, more importantly, Russian press. His foreign campaigns, have after all, not escaped people�s attention in Kazakhstan. He was also the first to join in with the Kazakh press: with attempted dealings with Caravan and KTK.

But for now, on the whole, the various group members amongst the authorities � who we can refer to for simplicity�s sake as �clan members� are avoiding the risk open battles in the Kazakh press. The groaning echoes of the inter-clan struggles reach us from abroad (the Belgian paper Le Soir covering the events surrounding Tractebel, the New York Times covering President Nazarbayev�s Swiss bank accounts, etc.) and are coming closer and closer to Kazakhstan.

The �Rossiskaya Gazeta� printed an article on the 2nd March entitled �Where did the Kazakhs pick up the scent of the Swiss Banks� (the whole text of the article can be found in the current edition of the Globe). Whilst Victor Svetin, the author of the article, claims that his group �only stumbled on the Kazakh story by accident, while they were making inquires into Russian links with Switzerland�, we must underline how accurate the data is given that it was found �accidentally�.

At first glance, from the article, the author openly attacks Bulat Utemuratov, former Kazakh Ambassador to Switzerland and current aide to President Nazarbayev. Is it not strange that a journalist from a Russian state newspaper goes to Astana, and before that to Zurich, to investigate a certain Mr. Utemuratov? After all, who is he trying to kid?

The whole text seems full of warmth towards the President, his family and his administration, but contains hidden threats in relations to some of these people. In this case , we ought to ask to what purpose does the article serve? In fact, as we have tried to demonstrate, the article is not at all about Bulat Utemuratov, but rather about his backers and his interests. His interests are gas, namely 20 billion cubic meters of gas in Turkmenistan, which is to be transported across Kazakhstan to Russia in this year alone, with perhaps double that amount in the near future (see the article �the United States Steps Away From Central Asia� from Stratfor, a translation into Russian and the same material �Russia may Demand More Caspian Gas� from Radio Liberty in the current edition of the Globe).

Answers: Readers may wish to refer to my article about Victor Svetin. A logical conclusion, in actual fact, would be that the article is about gas in Turkmenistan, which is to be transported across Kazakhstan. On the site of the present headquarters of �Transgas�, 55% owned by Tractebel, there is another company, Kaztransgas. The latter is responsible for managing the transport of all gas but primarily that of Turkmenistan. Tractebel has been forced � with no room for manoeuvre � to sell its shares and leave the Kazakh gas sector altogether. So who gets the remaining 55%?

To look at it from another angle: 100% minus 55% equals 45%. The question: to whom does the other 45% of Transgas belong (i.e. excluding the Tractebel share)? The answer: to the Mashkevich group. It seems that Utemuratov made a deal about a new investor in Kaztransgas � a dubious if not Mafiosi investor, connected to the Russian company Gasprom (the Globe will try to prove this link). Such an investor would not suit the Mashkevich group at all. Could they therefore be attacking Utemuratov? Perhaps. So Alexander Antonovich could argue with Bulat Dzhamitovich. Everything is rosy: flattery and threats, and�It is difficult to imagine what could be happening behind the scenes: has he met his match this time? The prize? Several hundred million dollars every year.

Our answer: It is most likely that the article in the �Rossiskaya Gazeta� was prepared and financed by Alexander Mashkevich. In any case, it shows that someone does not want Gasprom to take a hold in Kazakhstan�s gas sector.

But for those on the side of Utemuratov, he has succeeded in becoming the head of the President�s administration. Is it the people who so feared this who ordered the article in the �Rossiskaya Gazeta�?

Who will emerge the victor? Who can tell, but the Globe will follow it.


Flattery and poor arguments by Victor Svetin and of his ilk

And Odessa flourishes,

And Odessa lacks a tiny bit � the variety Theatre.

Vladimir Vysotsky

You have read the article by Svetin (see below on the same page). Here is the set of flattery that he uses to describe President Nazarbayev�s surrounding. Simultaneously, the author attacks Utemuratov.

About Rakhat Aliev: �� recently the husband of the President�s elder daughter, the young General Aliev appointed to one of the KNB key posts. Most probably, the country�s leader did not appointed his close man to this unfavorable, but complex post accidentally. Many people consider Aliev to be clever and strict head, who managed to raise the tax policy that he created and then conducted a number of successful operations in the KNB.�

About Syzdyk Abishev (former Minister of Foreign Economic Relations, died some two years ago, was very close to the President, was Utemuratov�s head): �Syzdyk Abishev who headed the Ministry and whom everybody knew as an honest man, absolutely trusted his subordinates. Using this fact, his pugnacious deputy (i.e. Utemuratov - N.A.) personally supervised and determined companies that were either granted or not licenses for foreign trade� After S. Abishev was honorably retired on a pension, he died soon. Curious people that searched for disappeared money gained from foreign trade, came across the moderate deputy of the Minister��

About Timur Kulibaev: �It is astonishing how he (Utemuratov � N.A.) managed to push out Timur Kulibaev, the husband of the President�s middle daughter and the head of the biggest company Kaztransoil from the number of partners of ATF-Bank that he monitored now himself. Most probably, the talented man who knew business and management well impeded the functionary-banker.�

About Sarybai Kalmurzaev: �Thereupon his (Utemuratov�s � N.A.) relations with the present head of the administration Sarybai Kalmurzaev are worthy of especial attention. It is also impossible to call this top functionary absolutely open to the society. The post that made him famous and that became for him a jumping-off place to the big policy was the head of the Committee on State Property during the most active period of privatization in the Dzhambul oblast. From the Akim�s seat he occupied the key post of the head of the presidential administration. People say that under his governing the administration became more open to the press. At regular meetings with journalists the administration�s head explained not only the President�s position, but just presented the true information to prevent rumors. They say that this activity weakened again due to the struggle for influence inside the administration. Though today he namely is eager that the administration to work as a single team, but not as influential figures. Today he namely is the only force able to oppose people striving for a closer position to the President. Considering talks, Kalmurzaev tries to restrict activity of the �gray cardinal.�

Here it is not just flattery (�managed to introduce order�, �the administration became more open to the press,� �presented the true information to prevent rumors�), not just a desire to hammer a nail of contradictions between Kalmurzaev and Utemuratov (Kalmurzaev tries to restrict activity of the �gray cardinal� (i.e. Utemuratov � N.A.), but this may be interpreted as a hidden menace (�It is also impossible to call � absolutely open to the society�, � the post that made him famous and that became for him a jumping-off place to the big policy was the head of the Committee on State Property during the most active period of privatization� are faint resemblance to his ties with Akezhan Kazhegeldin and to just unfair character of the privatization, he means that the jumping-off place was peculiar.)

About the President he said quite simple: �Especially after the forum in Davos, when having seen and heard the President Nazarbayev, investors hurried to Kazakhstan� (as if investors stood in a queue).

Finally, here it is what does our moderate author write about Mashkevich: �According to Belgian editions Soir and Soir Illuster, it is he (i.e. Utemuratov � N.A.) that played a significant role compromising Tractebel�s partners in Kazakhstan, that became scandalously famous as Kazakhgate. Accusations against some Kazakhstani functionaries of bribes by Tractebel through the Mashkevich�s group thundered all over the world. According to Le Monde Renesegneman, this provocation was invented at the B. Utemuratov�s meeting with the same Grigory Luchansky, Shabtai Kolmanovich and Eric Van de Veg in August 1999 in Royal hotel in Paris.

It is provocation, gentlemen! Utemuratov provokes Mashkevich.

Stop, gentlemen, is have not completely proved yet that Mashkevich ordered the article. I will not prove this, I will just try to show further the Mashkevich is one of those interested in the publication. But we may come to one conclusion based on the above-mentioned quotations: everything is fine in Kazakhstan, but Utemuratov impedes. Here is my conclusion: somebody ordered the material, somebody has interests in the powerful structures in Kazakhstan and the Customer obviously does not want to quarrel with the elite. But his objective is definite to get Utemuratov out of the way.

Moreover, Svetin states: �At the same time those around him are naively confident that his (i.e. Utemuratov�s � N.A.) present post is not the end. However, Akims or ministers� cool attitude to the posts does not mean that they are not eager to gain the post of the head of the administration. It is not a secrete, that from this post namely all structural power of the state is being governed.� The Customer fears that Utemuratov will become the head of the administration.

Gas vestiges of Victor Svetin

Here he has the passion with interest.

Here it is his breeding-ground.

(Gleb Zheglov, �Place of the meeting cannot be changed�)

Why does the Customer fear Utemuratov? The key to understanding is in another quotation from the article by Svetin: �The crafty deputy Minister (i.e. Utemuratov � N.A.) coped with niceties of the foreign trade when he headed in 1993 the Kazakhstan�s embassy in Austria. The established connections were so string that further his services were used to settle issues with different Austrian companies. The trade representation office was situated in the building of Nordex company headed by the famous �Russian Mafiosi� Grigory Luchansky� So, we suspect that his former neighbor by the office Bulat Utemuratov initiated Luchansky�s coming to Kazakhstan.�

That is Luchansky that matters to the Customer of the article in Rossiskaya Gazeta. Here is the quotation from Belgian Le Soir dated February 16: �In July Luchansky and Makarov recommenced the contract with the Kazakh President, and three months later on October 15, 1999 Luchansky got in touch with Pier Boke, the manager of Tractebel responsible for the Central Asian region. Luchansky offered to hold negotiations��

The same Le Soir writes about Igor Makarov: �In the Russian raw materials market not the official Russian structure Gasprom and let�s say the �injurious� one are coexisting. The latter exists at the former one and is under a very advantageous protection by the big Moscow Mafiosi Family. This company is called Itera and governed by Igor Makarov. Makarov is known in Belgium by his machinations��

Boke knew who Luchansky was, but Le Soir despite the obvious threat to the company�s image, Tractebel decided to negotiate (confidentially). The objective of Tractebel is to withdraw all its �gas� investments from Kazakhstan.

So, Utemuratov encourages Gasprom to make �gas� investments to Kazakhstan, for the time being it does not matter to us if through doubtful partners or very doubtful partners of the Russian giant.

�At the meeting with Gazprom personnel Pier Boke raised a question that if Tractebel can sell its 55% of shares of the venture dealing with gas transit in Kazakhstan, he can do nothing with the fact that other shareholders have an option on the shares, Le Soir writes, in this case Calverton company, including US investors and �the Kazakhstani trio.� This trio is the cause of first court troubles for Tractebel in Belgium.

The essence is that �the Kazakhstani trio� impedes �the Gasprom trio.� They are those called the Mashkevich group: Alexander Mashkevich himself, Alidzhan Ibragimov and Patoh (Fatah) Shodiev. Here is the key to the publication in Rossiskaya Gazeta.

The essence of the negotiations with Tractebel (if they were held under the aegis of Utemuratov � N.A.) is what Le Soir writes: �The general line of the negotiations proved by Tractebel with the letter to President Nazarbayev dated December 8, 1999 is quite simple: Tractebel sells its share to Gasprom; partners having fewer shares are to sell their share equity to the newly established Kazakhstani national company; and Tractebel strives for a permission to increase tariffs of electricity in Almaty. Thus, at last the Tractebel�s activity in Kazakhstan may become profitable.�

But �the opposition by the minority of shareholders remains stubborn,� Le Soir states. Mashkevich and Co. do not want to give their gas share. Just the opposite, they are eager to cut off Gasprom and that�s all. That means to replace Utemuratov.

The author of the article in Rossiskaya Gazeta asks himself a question: �Why did the �Kazakh trace� appear this time namely?� His answer is quite simple. On one hand, Svetin says that �documents received by us proved that his namely (i.e. Utemuratov�s � N.A.) fussy efforts to transmit his money (marked by us � N.A.) from personal accounts from Switzerland to other countries attracted attention and aroused suspicion of Kazakhstani high officials� concern in this,� and that if Utemuratov worried because of other corruption events in Switzerland, and as if he covered with President�s name. On the other hand, the author states that scandals are profitable to those who are eager to �weaken the influence by the Kazakh President, especially in establishing relations with the Russian new authority. This scandal was required then.�

We have a different answer to the question �Why now?�. Because multi-million flows of Turkmen gas will run through Kazakhstan soon. Everything mixed here: Tractebel, Kazhegeldin who was the Prime Minister when the Belgian company came to Kazakhstan, Gasprom and its staff, the Kazakhstani business that desires to get its tidbit. They are big and small geopolitics, compromising materials and scandals, they are hundreds of millions of dollars.

More scandals will happen later. Not only regarding gas. This private story illuminated the general character of the development of the Kazakhstani establishment and the entire society: the absence of any mechanisms to settle contradictions. But we will talk of this next time.

The United States Steps Away from Central Asia

Feb 28 (Stratfor)

Turkmen President Saparmurat Niyazov has criticized the U.S. government for backing Azerbaijan�s proposed revisions to the Transcaspian natural gas pipeline. In a Feb. 25 conversation with U.S. energy envoy John Wolf and Turkish Foreign Ministry Deputy Undersecretary Mithat Balkan, Niyazov said, �Turkmenistan will never agree� to the Azerbaijani plan. This statement comes just after Azerbaijani President Heydar Aliyev visited Washington, apparently convincing U.S. officials of the Azerbaijani proposal�s value. This policy change, and the Turkmen response, marks a public shift of American efforts away from Central Asia and toward the Caucasus.

As originally envisioned, the Transcaspian pipeline, funded by the U.S. Export-Import Bank, would pump Turkmen natural gas to Turkey via Azerbaijan and Georgia. But Azerbaijan now demands it be allowed to use the pipeline to export its own gas. If the Azerbaijani plan is implemented, Turkmenistan would see its export revenues for the pipeline sliced in half without a commensurate drop in the cost of construction.

Turkmenistan has two other options for transporting its natural gas to market. The country has already built a small pipeline south to Iran that could connect to an expanded, and nearly complete, Turkish-Iranian pipeline project. The other possibility is to join Gazprom�s controversial �Blue Stream� that will link Russia and Turkey via a pipeline that traverses the bottom of the Black Sea.

Cutting a deal with Gazprom remains Turkmenistan�s most feasible alternative to the Transcaspian project, despite the giant Russian firm�s partial dependence upon barter trade. In December 1999 Turkmenistan agreed to supply Gazprom�s own distribution networks with 20 billion cubic meters of natural gas in 2000, and now Turkmenistan is negotiating to expand this amount to 50-100 billion cubic meters per year (cmy).

Even though the Iranian route would be useful to Turkmenistan as an alternative to Russian export routes, access to a pre-existing network, such as Gazprom�s, which can reach markets in the Commonwealth of Independent States (CIS), the European Union and Turkey, is appealing.

The U.S. policy shift away from Central Asia toward the Caucasus is not economic, but strategic. The Clinton administration decision to support Azerbaijan over Turkmenistan in the Transcaspian imbroglio indicates that, unlike the Caucasus, Central Asia is too remote for the United States to effectively counter Russian influence. It is no surprise that Turkmenistan, the former Soviet state with the most dictatorial political system and mismanaged economy, is the first Central Asian state to which the United States dealt a diplomatic loss. Other Central Asian states � especially Tajikistan with its questionable parliamentary elections this week and Uzbekistan with its ossified leadership � should expect similar treatment in the near future. Washington is shifting its eyes � and its efforts � farther west.

Russia cannot help but follow. It�s leaders will immediately take advantage of Niyazov�s disillusionment concerning the U.S. policy shift and use Gazprom to clinch a deal, locking Turkmenistan�s economy firmly, perhaps irreversibly, into Moscow�s orbit. Then watch for the Russian-backed CIS anti-terrorist cooperation agreements to broaden in scope as Russia intensifies and accelerates its efforts throughout the states of the former Soviet south. The United States� decision to fully back the Azerbaijani gas export plan ensures Russia�s next move � for economic, political and security reasons � will again be in the Caucasus.

Pipeline Route Cost Ultimate Capacity Status

Blue Stream: Izobilnoye, Russia

to Ankara, Turkey $1.7-2.5 billion 16 billion cmy Under construction: Expected

operation April 2001

Transcaspian: Turkmenistan-Azerbaijan- $2.5-2.7 billion 30 billion cmy Proposed:

Georgia-Turkey Expected operation 2002

Iranian: Tabriz, Iran to Ankara, Turkey $200 million* 10 billion cmy Under construction: Expected

operation July/September 2001

(* for the Iranian section, data not available for the Turkish section)

US Pushes For Gas Pipeline Compromise

BAKU, March 4

(Agence France Presse)

Backers of a proposed multi-billion dollar trans-Caspian gas pipeline said they were upbeat on the project�s future Friday, despite recent complications which threaten to scuttle negotiations.

US commerce department special envoy Jan Kalicki said a compromise would be reached between Azerbaijan and Turkmenistan over how to share the 2.0 to 2.5 billion dollar conduit for their separate gas productions.

�(Turkish President Suleyman) Demirel has made it categorically clear that both Azerbaijani and Tukmen gas will go through the trans-Caspian pipeline,� Kalicki said after a meeting with Azerbaijani President Heydar Aliyev.

�That is the reality,� he added. �And that is why I think that the differences will be narrowed.�

Azerbaijan is demanding half of the pipeline � which would stretch from Turkmenistan, across the Caspian and the Caucasus, and into northeastern Turkey � for its own future gas output.

Turkmenistan is resolutely refusing, however. Ashgabat has already signed a deal to supply Ankara with some 16 billion cubic meters of gas per year, and hopes to increase the output over time.

The differences could potentially spell the death of the trans-Caspian pipeline, as negotiations must be completed as soon as possible in order to beat out rival projects from Russia and Iran to the Turkish market.

Turkmenistan, frustrated at the slow pace of the talks, is likewise looking at selling its gas directly to Moscow or routing it through neighboring Iran � a potentially less expensive alternative.

Azerbaijan for its part has also spoken of building its own line in order to reach the Turkish market by the end of 2002.

Kalicki�s optimism was echoed by Edward Smith, president of PSG International � a US-based consortium which is helping to build the pipeline � who also arrived in Baku as part of a flurry of activity to speed up the troubled project.

Smith said that Turkmenistan and Azerbaijan would choose the efficiency of shipping their gas through one pipeline, as opposed to building separate systems.

The question of what to do with the line�s remaining capacity, which could be increased by some 14 bcm per year, would be determined by how the market developed and who signed the next contracts, Smith said.

Smith also expressed doubt at the feasibility of Turkmenistan�s recent proposal to supply Russia eventually with up to 50 bcm annually, saying that Russia could prove to be a less than reliable partner.

PSG would nevertheless look into how the plan could affect the future of the trans-Caspian line, Smith added. �We would have to see if Turkmenistan can support both projects,� Smith said.

Turkmenistan: Russia May Need More Caspian Gas

By Michael Lelyveld

As Russia�s energy reserves dwindle, it may now see the need for doing business with Caspian countries like Turkmenistan. New motives in Moscow could lead to change in the region, if Russia is serious. Correspondent Michael Lelyveld reports.

Boston, 3 March


After a hard year for energy exploration, Russia appears to be increasingly motivated to buy more gas from Turkmenistan.

This week, Russian officials said that oil and gas discoveries have lagged far behind the country�s rates of production. Fuel Ministry figures for 1999 indicate that Russia is using oil 50 percent faster than it is finding new reserves. Gas production last year was nearly three times greater than discoveries of new gas.

Russia�s energy gap has followed a similar pattern since 1994, the ministry said, voicing concern of a crisis for future supplies. Valery Remezov, Gazprom�s deputy chief executive, said that Russia�s gas monopoly is planning to cut its production by 25 billion cubic meters, or nearly 5 percent, this year.

There appear to be several reasons for Russia�s problems. Many of its older petroleum fields have been depleted. Declining investment has also taken its toll. In times of high market prices, Russia has focused on energy exports for cash. In times of economic crisis, it has been unable to afford exploration. And it also delayed legislation on production-sharing agreements for several years because of political concerns, stalling foreign investment in petroleum development.

Whatever the reason, Russia may now be turning toward other countries in the region for energy supplies.

�If we cut production by 25 billion cubic meters, we will need to attract gas from Turkmenistan,� Remezov said.

This new motivation appears to be different from earlier reasons for dealing with landlocked Turkmenistan. In the past, for example, Russia has directed Turkmen gas to debtor nations like Ukraine. These failed deals have allowed Russia to pursue political and competitive goals by keeping Turkmenistan�s gas from reaching paying markets in Europe.

But Russia�s purchases of 20 billion cubic meters of Turkmen gas this year, and talks on buying 50 billion cubic meters in the future, may be driven by necessity. Russia has made numerous commitments for gas exports to Europe. Exports rose 1 percent last year while production suffered a slight decline.

But because the price of natural gas has fallen, Russia earned nearly 16 percent less for its exports last year. Unless prices rise, Gazprom could suffer a larger drop in export earnings, unless it fills the gap with Turkmen gas.

The World Bank has been pressing Russia for over two years to use available resources more efficiently. Gazprom may find it cheaper to buy ready Turkmen gas and deliver it to some domestic Russian markets than to develop new deposits in places like the Yamal Peninsula.

Turkmen gas could also be used to offset Russia�s supplies to Turkey, or it could be piped through Russia to fulfill Turkmenistan�s agreement to supply Turkey with gas.

These factors suggest that there may be more to Gazprom�s talks with Turkmenistan than a simple scheme to block the U.S.-backed trans-Caspian pipeline to Turkey. Reports have also suggested that sales of 50 billion cubic meters of gas to Gazprom would leave Turkmenistan without enough gas for the trans-Caspian project. But not all analysts agree that is the case.

Robert Ebel, director of the energy and national security program at the Center for Strategic and International Studies in Washington, said that Turkmenistan produced nearly 90 billion cubic meters of gas in 1990. The country�s ability to supply both Russia and the trans-Caspian line would depend on when Turkmenistan schedules its peak deliveries to Gazprom, Ebel said.

He is also more cautious than some analysts who have already pronounced the trans-Caspian project as dead.

�It�s not dead, but it is seriously injured,� said Ebel. Much depends on Turkmenistan�s ability to agree with Azerbaijan on terms of transit and a financing package for the pipeline, which is due to be presented this month.

But Gazprom may now see a need for more Turkmen gas, whether the trans-Caspian project goes forward or not. Russia�s talks with Turkmenistan may show how serious the need is.

Putin�s PR Guru Warns of Sabotage

By Catherine Belton

Staff Writer

He was the brains behind the whitewashing of Communist candidate Gennady Zyuganov in the 1996 presidential elections, and he masterminded the campaign to discredit Security Council chief Alexander Lebed the same year. He was an architect of the Svyazinvest information wars in 1997, and lost.

But one of Russia�s most influential PR gurus and master of the art of information war, Gleb Pavlovsky, made a comeback last year with the successful State Duma campaign for Unity.

Now he�s firmly installed as one of the chief engineers of acting President Vladimir Putin�s election campaign, and in an interview Wednesday he said there was a fifth column within the Kremlin administration and government that is opposing Putin�s vault into the presidency.

�There are members of old oligarchic circles, others from the regional elite and a significant part of the old Yeltsin apparatus who fear losing their posts and old corrupt ways should Putin come to power,� Pavlovsky said.

�The main obstacles that could come in the way of a Putin victory could be provoked by them. There might be an attempt to torpedo the elections through a boycott,� he said.

�Officials could also attempt to provoke legal claims on Putin�s candidacy by agitating local leaders into showing too much loyalty to Putin so that they eventually break election laws,� he said.

Pavlovsky, however, refused to name who the members of this fifth column might be, and analysts cautioned that his remarks could be part of his game plan.

Putin and his circle have sent out signals they might try to quash the power of arch oligarch Boris Berezovsky.

On Tuesday, German Gref - the first deputy head of the State Property Ministry and the head of Putin�s

economic research center, said the government planned to create a new state airline in competition with Aeroflot, which has been linked to Berezovsky in corruption allegations.

Almost simultaneously, Press Minister Mikhail Lesin said the broadcasting license of ORT television would be up for grabs at an auction in May. Berezovsky is said to wield control over the station.

Pavlovsky was cautious in discussing Putin�s relations with the so-called oligarchs. But he conceded it was unlikely Putin would break off relations with the powerful financial-industrial groups.

�The old oligarchy has been undergoing its own revolution. New groups of businesses are coming out on top and Putin will work with them as a normal part of the political process,� he said.

Pavlovsky would not elaborate further on which groups are coming out on top of the pile. However, he said that Putin likes to keep Berezovsky at the distance he is now - �which is indeed an extremely significant distance.�

�Putin sees him as a major politician and as one of Russia�s major businessmen. But he is a private citizen and does not have any official position - continuing relations with Berezovsky on these levels does not hold any political risk for Putin,� he said.

Pavlovsky first hinted all was not well within the Putin campaign team in a front-page interview with Segodnya published Tuesday. He was interpreted as saying there was a conspiracy to oust Putin from within his campaign staff.

Pavlovsk said his words had been exaggerated by Segodnya, owned by anti-Kremlin oligarch Vladimir Gusinsky.

�There are bound to be some members of the Kremlin administration who will be sacked under a new President Putin. It makes no sense for them to play an active role in his campaign,� said Yevgeny Volk, an analyst at the Heritage Foundation.

�But there is very little they can actively do to oppose the Putin campaign. The fact that Pavlovsky publicly revealed details about infighting within the Kremlin is probably just part of the battle for influence over Putin among the political elite,� he said.

�It may also be an attempt to persuade those who think a Putin win is a forgone conclusion that they have to go to the ballot box anyway,� he added.

World in February


February 1

The primaries season opened in the U.S.A., which determines favorites of the election race from the two main parties � the Democratic and Republican Parties. Four candidates (the present Vice-President Albert Gore, the former Senator Bill Bradley, the Texas Gov. George Bush (Jun.) and the Senator from Arizona John McCain) strike with each other. A candidate from the Republican Party McCain won the race for the right to become the owner of the White House.

A gigantic survey wheel opened in London. The construction 137 meters in height called �the millenium wheel� erected near the South Bank quay in the historical center of the city. British Airways spent 600,000 pounds to the construction.

February 2

A governmental coalition with participation of the ultra-right Austrian Freedom Party (FP) established in Austria. Later, on February 4 it was known that FP and the conservative People�s Party won equal number of seats. The presence of neo-nazis headed by Joerg Haider who publicly praises �the third Reich� and SS aroused a wave of resentment in the West.

February 3

The first joint of the ground part of the pipeline Blue Stream from Russia to Turkey done near Krasnodar. The joining happened at 263 km of the pipeline Izobilny-Djubga (from the Stavropol region to the Black Sea shore). Later the �sea� and the �Turkish� parts of the pipeline will be connected to this part of the line.

February 4

The UK government published the law that holds up activity of all self-governing institutions created in Northern Ireland eight weeks ago. If the Irish Republican Army rejects from disarmament, the House of Commons will approve the law in the next week. Thus, a direct governing by London may be recommenced in the province.

February 5

Five explosions thundered in the Iranian capital. The Organization of Modjaheds of the Iranian People based in Iraq acknowledged its responsibility for the mortar fire.

February 6

The Russia�s acting President Vladimir Putin announced the completion of the operation on liberating Grozny. He said that the army had captured the last platform of Chechens � the Zavodskoy district. The Chechen President Aslan Maskhadov declared that they ceded Grozny temporarily and that they would retake it soon. Field commanders promised �the total� war in all Russian territory.

February 7

In the restaurant of the football club Rad the Minister of Defense of Yugoslavia Pavle Bulatovic killed. The murderer fired by a submachine gun through a restaurant window from the nearby football field. In some hours the Minister died in the Military-Medical Academy hospital due to numerous wounds.

February 8

In Sri Lanka in the town of Bibili there were 2 blows in passenger buses. In the result of this attack by terrorists 1 man died and over 50 people wounded. The police supposes that the attack was organized by the separatist group Liberation Tigers of Tamil Ilam.

February 9

On the US Internet-channels the so-called hackers attacked sites of the ZDNet popular network, which presents information on latest technologies. During two hours site was completely paralyzed. Before that they made a powerful electronic attack to some Internet companies, as well as the informational site of CNN company. The attack started on February 7, when hackers hammered one of the most popular search systems, Yahoo.

February 10

He US famous publisher and multi-millionaire Steve Forbes announced that he stopped participating in the election campaign. Forbes had spent almost US$ 67 million trying to get support required to nominate him officially as a candidate from the US Republican Party. When he lost at the primaries, his advisors offered Forbes to stop fighting.

February 11

In Hungary due to the fault of Esmeralda Exploration company that produces gold, the there was a leakage of cyanide used while producing gold and silver. In the result about two million people had no drinking water. A great number of birds and wild animals died, tens of tons of fish floated to the surface.

February 12

The UNO Conference on problems of trade and development opened in Bangkok. This is the first economic forum of this scale after the WTO Summit held in the late 1999. The opening of the Conference was marked by protest demonstrations, as it happened in Seattle, though these demonstrations were rather moderate.

February 14

The Indonesian President Abdurakhman Vahid announced the decision to withdraw the General Viranto from the Cabinet of Ministers. Before Vahid promised that the General would be the Minister of Security until the investigation of accusations against him for violating human rights in Eastern Timor completed. The President did not mention reasons for the sudden change of the former decision.

February 15

Russia announced that in 2000 it would pay Kazakhstan US$ 115 million for the Baikonur rent. �For us the main thing is that Baikonur will be saved as a strategic object in relations between Russia and Kazakhstan,� the first deputy of the Kazakhstani PM Alexander Pavlov stated.

February 16

The chairman of the Christian Democratic Union of Germany and the head of the faction CDU/JU in the German government Wolfgang Shoible resigned due to the financial scandals with illegal donations and secrete accounts that have been shaking the CDU for some months. Shoible is suspected in intrigues with unregistered donations to the party in the amount of DM 100,000.

February 17

The former Vice-President Bank of New York Lucy Edwards and her husband Peter Berlin began to testify. According to them, such Russian banks as the Depositary-Clearing Bank, the Sobinbank, Flamingo, as well as the head of the SBS-Agro Alexander Smolensky, a shareholder of these banks, are involved in the scandal.

February 18

The Parliamentary election held in Iran. Supporters of the President Hatami, who is eager to reform the country, gained most votes. The former Medjlis Islamic conservators that formed the majority opposed the President�s policy. Now Hatami elected in 1977 got more chances to realize reforms.

February 19

The former St. Petersburg mayor Anatoly Sobchak died in the night February 19 to 20 in Svetlogorsk (Kaliningrad oblast) because of infarct. He was 62.

February 20

The next Parliamentary election held in Kyrgyzstan. The Communist Party that gained about 30% of votes, won by parties� lists. The second is the Women�s Democratic Party. The deputy chairman of the Communist Party Nikolai Bailo announced that they were going to strive for joining to the Russian-Belarus Union.

February 21

China announced the ultimatum to Taiwan: either it starts negotiations on reunion or faces the military invasion. Before China threatened with military operations only if Taiwan declares independence or in case of a foreign invasion to the island that Beijing considers as its province.

February 22

An attempt upon the leader of Socialistic Party Fernando Buesso Blanco�s life happened in Spain, his car was full of explosives. In the result of the terrorist act, he and his body-guards died. Spanish functionaries accused the Baks separatist group ETA.

February 23

The Russian company Rosneft announced that it was ready to negotiate a part of its share in the Caspian Pipeline Consortium (CPC). According to the company�s Vice-President Sergei Oganesyan, Rosneft undertook responsibilities to transport 2.7 million tons of oil per year through the CPC, but at present the company had not such a volume of extra resources.

February 24

The Russian government decided to increase the oil export quota from 15 to 20 EURO per 1 ton and for diesel fuel � from 10 to 15 EURO. Export duties on petrol and mazut remained unchanged.

February 26

The world biggest car corporations Ford Motor, general Motors and Daimler Chrysler announced their decision to create a joint venture on Internet. Through this venture the companies are going to purchase required raw materials, spare parts and office equipment. It will be the biggest network company in the world, open to all potential car contractors.

February 27

The parliamentary election held in Tajikistan. Supporters of the current President Emomali Rakhmonov won. Opposition parties announced that there had been serious infringements during the election.

February 28

The EU commissar on human rights Alvaro Hil-Robles came to the Chechen capital Grozny. Hil-Robles was the first international observer whom the Russian authorities agreed to let in the town.

February 29

The suspected in the murder of the former Prime Minister of Bulgaria Andrew Lukanov arrested in Russia. A Russia�s Ministry of Internal Affairs spokesman stated that Oleg Protsenko had been arrested in Rostov oblast. The Russia�s General Office of Public Prosecutor decided to deliver him up to Bulgaria.

All Over the Globe is published by IPA House.
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