Chinese Whispers in Kyrgyzstan

The announcement that a major new resort complex is to be built on the shores of Lake Issykul, Central Asia’s premier tourist area, should have come as good news for the cash-strapped economy of Kyrgyzstan.

But when it emerged that a company from China was the investor and that talks were already well advanced without the public being informed, there was a groundswell of anger.

A group of non-government organisations, NGOs, expressed concern at the veil of secrecy that officials had maintained about the deal.

Opposition politicians warned of what they see as Beijing’s expansionist ambitions, saying their own government cannot be trusted not to make unwise land concessions to the Chinese. Others said the Kyrgyz authorities have a record of mishandling foreign investment deals, so that little benefit is brought to the local community.

The controversy - reflecting uneasy attitudes to China in the recent and more distant past - goes way beyond a simple dispute over the benefits of foreign investments, and threatens to blow up into a set-piece battle between the government and its critics.

Rumours of the deal have circulated for a long time, but the Kyrgyz government remained tight-lipped on the matter.

In the end it was the Chinese ambassador in Bishkek, Zhang Yannian, who confirmed the existence of an agreement between “one of the largest companies in China” and the regional administration of Issykul.

“Enormous investments are envisaged,” he added.

The ambassador hinted that hammering out the terms of the deal had not been easy, commenting that “implementation of this agreement has been delayed somewhat, but that was not our fault. I do not think that the land-lease agreement contradicts the laws of Kyrgyzstan.”

IWPR contacted the governor of Issykul region, Tokon Shailieva, who said that talks were indeed under way to lease an area of land to a Chinese company. Like Ambassador Zhang, Kyrgyz officials have so far declined to name the firm involved.

“This agreement promises huge benefits to residents of the region,” she said. “It envisages the creation of more than 1,000 workplaces and the investment of 200 million [US] dollars. This will be an enormous contribution to the region’s development.”

The resort will cover a site of 800 hectares and will be located in Jetyoguz district, on the south side of the lake. This side of the lake has remained relatively undeveloped as virtually all the tourist resorts and sanatoria built in the Soviet period were located along the northern shores of this large lake, which runs roughly east to west.

The news was met with consternation by groups such as Civil Society Against Corruption, the Interbilim civil-society support centre, the Danko gender development foundation and others, which issued a joint media statement on August 6 condemning what they said was the lack of transparency the government had displayed by conducting the negotiations in secret.

“Why was there no tender? What sort of firm is it, what image does it have, what is it called, what does it want?” said Tolekan Ismailova, head of the Civil Society Against Corruption NGO. “In cases like this, there should be a tender so that other firms can take part - Swiss, American, whatever.

“This is straight bureaucratic corruption. And behind it lies political corruption. That’s why we are concerned about issues of access to information and public participation in the decision-making process.”

The NGOs complained that the authorities’ failure to consult let alone inform the public was reminiscent of a scandal two years ago following a decision to cede large swathes of territory to China.

President Askar Akaev signed two agreements with China in 1996 and 1999 following long and exhausting talks to decide exactly where the 1,100 kilometres of the former Soviet border, running through difficult mountainous terrain, should lie.

At the time Akaev hailed the outcome as “historic”, but when he tried to get his normally compliant parliament to ratify it in 2002, he ran into stiff resistance. A majority of parliamentary deputies, some but not all representing the opposition, refused point blank to approve a pact that they said had been kept secret from them, which by giving away 120,000 square kilometres of land was hugely disadvantageous for Kyrgyzstan.

President Akaev was threatened with impeachment, and although parliament was eventually forced to ratify, its resistance to the agreement sparked off mass protests demanding Akaev’s resignation. When police opened fire on demonstrators in the southern village of Aksy, killing six, several months of civil unrest ensued.

Zainidin Kurmanov, a member of parliament and professor of history and law, says that while long-term leases are perfectly legal, such territorial issues need to be handled with extreme sensitivity.

“There is nothing unlawful about leasing land to foreigners; this right is granted by law. But from a political standpoint, in the wake of the Aksy events, our government should be more careful and restrained when it comes to any land issues,” he said.

Opponents of the resort scheme say the Kyrgyz government has a poor record of ensuring that foreign-funded projects run efficiently and for the good of the nation.

They cite the Kumtor gold mine, developed in partnership with a Canadian company, which suffered an ecological catastrophe in 1998 when a spillage led to cyanide leaking into local streams and from there into Lake Issykul.

Omurbek Tekebaev, an opposition member of the Kyrgyz parliament, said Chinese management of the Alai coal mine in the south of the country had already proved problematic.

Although the Chinese firm promised to employ local people at the mine, “they brought only their fellow-citizens here, breaking these agreements,” said Tekebaev.

Issykul region’s deputy governor Kabylbek Jumaliev insisted that the new resort would be good for the local community. “It is a very advantageous investment, as besides providing work places, the tourist complex will pay taxes, buy food from farmers and attract tourists all year round,” he told IWPR.

Both controversies - the latest tourism project and the border demarcation – are rooted in deep misgivings about Beijing’s motives. Some in Kyrgyzstan fear that commercial interest will one day be followed by territorial expansion.

Azimbek Beknazarov, chairman of the parliamentary committee for legal affairs, who has consistently campaigned against the border agreement, talks of “an open Chinese expansion into Kyrgyz territory”.

“There is an impression that for someone in the upper echelons of authority, it is profitable to lease or give away our land to the Chinese.” said Beknazarov.

The views of renowned film director and opposition deputy Dooronbek Sadyrbaev are typical of many. “Once they set foot on the wonderful shores of Issykul, the Chinese will never leave,” he said.

Central Asia’s eastern border was more or less sealed under Soviet rule, and after gaining independence in 1991 the new states found themselves flanked by a previously little-known giant with a fast-growing economy.

At the most mundane level, people in Kyrgyzstan have become more familiar with China through its cheap consumer goods and the presence of tens of thousands of Chinese market traders – many of them from the Uighur ethnic group of western China who, like the Kyrgyz but unlike the majority Han Chinese, are traditionally Muslims and speak a Turkic language.

As well as a suspicion of China fostered in the Soviet Union after the two Communist states grew estranged, the Kyrgyz have a longer historical memory of tensions with their powerful eastern neighbour.

Local people interviewed in the Jetyoguz district appear to reflect the concerns expressed by politicians and NGOs.

“The authorities gave this land to the Chinese too quickly, without consulting with their citizens,” complained Kerimbay Rasulov, 53.

Isa Umarov, a 76-year-old man from the village of Darkhan, said Kyrgyz land should not be leased out to foreigners, “Why should we give land to others, when we don’t have enough of it ourselves?”

Karek, an NGO concerned with ecological and social affairs in Jetyoguz, conducted an opinion poll to see what people thought of the proposed Chinese resort.

“The survey showed that local residents are not at all happy about living next to Chinese on Issykul – the pearl of the Kyrgyz people,” said Erkingul Imangojoeva, Karek’s head. “The authorities assure us that the 800 hectares will only be leased to the Chinese for 49 years, but we understand what that means - our people are sure that after the 49 years are up, none of the Chinese will leave willingly.

“Residents are also scared that the foreign company may do ecological damage to the lake, which is a unique biosphere.”

The next step for the NGOs protesting about the scheme is to gather signatures for a petition. As the opposition gears up for next year’s elections, the way the government has handled the controversial Chinese investment looks like one issue that won’t go away.

Sultan Jumagulov is a correspondent for the BBC in Bishkek.