Kazakhstan and Putin's Russia: Together or just Beside

(Continued from # 26(444))



As Russia can pretend to the status of a great power, and taking into consideration its historical role, it really was, remains and will be so, an adequate to this status national ideology, compensating a low living standard of its citizens in comparison with "the golden billion" of the U.S.A. and Europe, must emerge.

As a matter of fact, this ideology has emerged and is rapidly ripening during the � victorious campaign� in Chechnya and unanimous voting for Vladimir Putin. This is notions of a peculiar, Eurasian way and Russia's image, where national values, not contradicting to recently obtained democracy and the market economy, but prevailing over them, are ideas of super-power, social solidarity, collectivism and patriotism. This national idea must become the priority, as it is objective. In fact, Russia is self-sufficient, in all in the full sense of the word, and that is why it should have its own image in the international scene, as it cannot imitate or depend on anybody for a long.

From this point of view the Russian national idea obviously opposes the western idea, not in a confrontational, but in an alternative way. As a matter of fact, this is necessary for Russian citizens' creative attitude, they need not pursuit of the U.S.A. and Europe wallowed in consumable individualism and spiritless life, and competition in style and essence of life is as if �piercing through� the historical spiral to come to "renewed� socialism at once.

There will be no antagonistic opposition between Russia and the West. Just the opposite, Putin's Russia will take great pains to attract western resources for its own development. But obviously, it will be co-operation through competition, accompanied by toughen rhetoric, and sometimes by rigid actions.

Namely for such a new place in the geopolitics Russia will select its foreign allies and form them itself.

As far as Kazakhstan is concerned, its current political system has to be determined with the term pseudo-democracy. It does not mean a biting word of the opposition, but the content of the phenomenon of our ruling regime. Undoubtedly, now we have democracy, as there as its formal institutions, including some of them working; and as there are no attributes of totalitarian and authoritarian systems (not in the opposition's statements, but indeed).

At the same time, our democracy is �pseudo�, as institutions of a lawful and democratic state in Kazakhstan are now either imitating structures, inspired by the authorities, or anti-system formations, to which the regime has to outwardly resign itself, but it secretly struggle against such formations wasting both its and national resources.

This is true, as privatisation transformation has been objectively completed in Kazakhstan according to the peripheral-primitive variant, when all major components of the power (political, financial, poverty and informational) turned to be concentrated in hands of the same ruling oligarchy. Primitivism of this form of �democracy� results from, that, for example, the political regime absolutely controlling all national television and almost all mass newspapers, having monopoly on financial resources and subordinating the entire administrative and force state machine, nevertheless it already cannot realise its hegemony in a "nation-wide" support and has to apply to direct falsifications of polling results.

It may seem to a person knowing the Constitution (but not declarations of the 1st and 2nd sections devoted to the power mechanisms) of Kazakhstan and the real arrangement of the �presidential vertical� that we have an obvious authoritarian system. However, currently we have democracy namely, along with its �restraining counterbalances�, though in a rudimentary, primitive form.

That is to say, if in true democratic systems political power is separated from business, and hence, cannot control economic competition, as it does not participate in it, in Kazakhstan any serious business is being conducted either by those directly in power, or under their protection. Another peculiarity of the Kazakhstan �authoritarian� system is that from inside the major oligarchy has been already divided in some main branches, that have distributed somehow profitable branches of the economy, leading banks and media between them. Each of them uses its possibilities to affect the staff composition of the government, Akims and parliamentarians, thus providing advantages to their own business. In the result, economic competition between members of the oligarchy makes them political competitors. This finally destructs the entire construction.

Our political system that in outward appearance seems to be authoritarian, in fact is composed of many heterogeneous elements, sometimes not just badly adjusted to each other, but mutually destructive. It is a temporary arrangement, to construct which they spent everything available.

Currently formation of this power system has been completed: a certain �selected� person has settled in all its �joints� supervising a resource (a political, administrative or financial one), in all geographical points, from the Capital to the village. As territorially Kazakhstan is huge and very heterogeneous from the angle of ethnical and clan-tribal characteristics, �the presidential vertical� is indeed divided between tribal and regional-countrymen and Mafiosi clans, being at odds with each other. A person knowing Kazakhstan also knows that inside the �presidential team� there are immeasurably more his hidden spiteful persons than his true supporters.

Let's mention the most aggravate characteristic of the present political regime and the national economy being its derivative, in our opinion. Despite mixed character and internal conflicts of the clan-tribal packing of administrative and other �profitable posts�, the administrative and business-�elite� are united with the only thing, clan-tribal mentality (including Russian-speaking people assimilated by the system) and with the common low culture. As somewhat important posts have been distributed among �insiders�, the rest have only time-serving perspectives. As really best, the most educated, professional, young and energetic part of the population, including Kazakhs, realise they are �second-quality� and unclaimed in their native country, this literally �pushes� them out from Kazakhstan.

Well, within the next two to three years the internal situation in Kazakhstan will develop according to �running on the spot� scenario. The authorities will simulate optimism, yet the real economic situation will not improve; just the opposite, problems will be growing. The government, force structures and Akims will remain castled, but this will not change anything significantly.

Most probably, the regime will not be in a position to properly utilise the last political resource, the election of Akims. Bills on local self-governing and local state power bodies now prepared for issuing, are not oriented to divide appointment by election and appointment according to "cities-regions" scheme, what could have been a real step to shift a part of authority and responsibility to regions, but according to the exhausted �main-secondary� scheme. That means it is supposed to introduce appointment by election in small towns and settlements, which are lack of minimal economic and personnel potential required for this. Thereafter sad experience of self-governing in collapsing Zhanatas and anaemic Kaskelen will excuse cities' �non-readiness� for democracy.

Who Got All Koumiss?

Control of the Kazakhstani gas-supply system to be transferred from the Belgian company Tractebel to Gasprom

(Continued from # 26(444))

Olga VLASOVA, Ptyotr VLASOV (Expert # 59)

Increased transit tariffs displeased Gasprom, made resale of Central Asian gas in other CIS countries unprofitable. So, in the last year while transporting Turkmen gas to the Ukraine, Tractebel collected US$ 13.5 per 1,000 cubic metres. This increased the gas price at the Russian-Ukrainian border up to US$ 72. Besides, Gasprom had to reject from the interest in the international consortium exploiting Karachaganak, where the Russian company had been adopted in condition it would ensure transportation, processing and export of condensate produced at the deposit.

Withstanding a siege

However, Tractebel and Kazakhstan's �honey moon� was not to last for long. Most Kazakhs disliked the Belgian company after it had decided to work here in a European way: to increase gas and electricity tariffs, as well as to cut off deadbeats from the network. Recently, slogans such as �Belgians, go away from Kazakhstan!� have become usual in Almaty.

Disagreements between Tractebel and the government were have been gradually emerging. The government repeatedly accused Tractebel of non-paying taxes and non-fulfilling of conditions of the contracts. Sometimes company's accounts were frozen, and its representatives were not allowed access to their own gas depository by the police, as happened, for example, in February 1998. But the Belgians, who understood perfectly well the requirements for the Kazakh business world, not only had patience, but often tried to call the Kazakhstani authorities to order, threatening to leave Kazakhstan. All is fair in love and war. Tractebel continued working and was even occasionally praised by the President. When in May 1998 the Kazakh General Public Prosecutor blamed Tractebel of non-payment of taxes for two years and introducing illegal power tariffs, Nazarbayev announced Tractebel was a good European company and that they should not have disturb it.

In fact, the Belgians were not disturbed for a year. For that period the company managed to realise its first gas project in the Kazakh market, having completed construction of the second branch of the pipeline Uzbekistan-Kazakhstan, through which Uzbek gas was supposed to be transported to Almaty in winter. In May 1999 another achievement was the refusal to Itera to transport gas from Turkmenistan to Russia (further this gas was intended for the Ukraine), as the Ukraine did not pay transit properly.

Problems emerged at the end of summer. Tractebel was again going to increase heating and power tariffs, complaining of a lack of money needed to repair the power installations. In response to this, the Co-operative of Owners of flats demanded to investigate the activities of the Belgian company. Tractebel was again in a difficult situation and responded accordingly: it announced that the government was guilty of losing the company billions Francs due to a non-increase in tariffs. In reply to this students of the Kazakh State Academy boycotted classes, as Tractebel had cut off their building for due debts.

However, soon it was evident the scandal was of a different scale. At the end of the last year the European press published information that in 1997 when Tractebel had been granted concessions for the country's gas-distributing system, it bribed US$ 50 million. The company was also blamed for money laundering. In fact, the campaign was developing according to the same scenario, as the Russian corruption scandal in the previous year. Swiss and Belgian investigators initiated investigating. It is still unclear who popularised the compromising materials.

Since the beginning of this year rumours that Tractebel will leave the country's gas market, have being circulating in Astana. In March, shortly before property of the Belgian subsidiary Intergas-central Asia was arrested, the Kazakhstani government announced creation of the state company KazTransGas, which would supervise the national gas-transit systems. According to sources in Astana, the Belgians could receive small �smart-money� in the amount of US$ 65 million.

Coming back

Tractebel's deaparture has successfully coincided with a Gasprom and Itera decision to come back to Central Asia. In November-December 1999 heads of these companies, Rem Vyahirev and Igor Makarov, actively supported by Vladimir Putin, persuaded the Turkmen authorities to recommence gas supplies suspended in 1997 to Itera and Gasprom. They signed a contract, according to which Turkmenistan was to sell 20 billion cubic metres to Russia in 2000, and after a year these supplies could be raised to 50 billion cubic metres. Tractebel would have annually paid US$ 70 to 100 million for such a transit. Most probably, it will be easier to agree with the new company KazTransGas. The Kazakh authorities stress its willingness to co-operate with Gasprom.

In December when Tractebel officially owned the country's gas transit system, Nursultan Nazarbayev announced Gasprom was designing the gas supply system for the whole of Kazakhstan. Currently civil servants in Astana are openly speaking of their desire to see the Russian company working as the country's gas operator. �Absence of Gasprom in the Kazakhstani gas market would be strange,� the Foreign Minister, Yerlan Idrisov, announced in March. Sources from the capital circles also mention �a structure friendly to Gasprom�. It is characteristic that Astana calls expropriation of Tractebel's property, �assignment of share equity� to another company. Possibly, this company will pay �smart-money� to the Belgians.

Russia's government has also promoted Gasprom's return to Kazakhstan (for example, negotiating with Turkmenistan in the last year, where Putin's handwritten letter to Turkmenbashi played an important role in concluding the gas contract). According to the Kazakh press, in February during his visit to Astana, the Minister of Fuel and Power Industry, Victor Kalyuzhny, wanted Tractebel to leave Kazakhstan. Instead he offered Nazarbayev the possibility of establishing a common power balance as well as initiating the joint export of Kazakh gas to China (the project the Belgian company failed to realise). Nazarbayev agreed. That was the denouement of Tractebel's epic in Central Asia (yet once this company challenged Gasprom).

Expert analyses the story surrounding Tractebel's departure from Kazakhstan and the return of Gasprom and Itera to the country.

The author writes: �Russia's government has also promoted Gasprom's return to Kazakhstan (for example, during negotiations with Turkmenistan last year Mr. Putin's hand-written letter to Mr. Turkmenbashi played a significant role in concluding the gas contract). According to the Kazakh press, during his visit to Astana in February, the Minister of Fuel and Power Industry, Victor Kalyuzhny, hoped that Tractebel would soon leave Kazakhstan. In its place he offered President Nazarbayev the possibility of establishing a common power balance, as well as initiating the joint export of Kazakh gas to China (the project which the Belgian company failed to realise). Nazarbayev agreed. That was the denouement of Tractebel's epic in Central Asia (and yet once this company was a challenger to Gasprom).�

In fact, the replacement of Tractebel by Gasprom and Itera aroused the opposition of the Mashkevich group, which owns 45% of Transgas (THE GLOBE, 07.03.2000). The echoes of the scuffle between Messrs. Mashkevich and Utemuratov representing interests of the Russian gas giants, could be found both in the Russian and the western press, in particular the article �From where did the Kazakh vestige emerge in Swiss banks� by Victor Svetin published in Rossyiskaya gazeta. The scuffle is directly connected with Turkmen gas, which will flow into Russia via Kazakhstan. This promises hundreds of millions of dollars as transit charges. Such a major policy, the failure of US strategy in Central Asia and Russia's active return to the region have all caused squabbles in the minor policy, for example, disputes between Kazakhstani financial-industrial groups for the slightest parts of business in Kazakhstan this year, transit of Turkmen gas.


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