Kyrgyz Shuttle Traders Woes

Kyrgyzstan's army of shuttle traders is in crisis, their livelihood criss-crossing the republics of the ex-Soviet Union, buying and selling goods under threat.

The decline in their fortunes was highlighted by an incident in May when Russian officials seized the stock of 1,500 traders on the Kazak-Russian border, confiscating goods worth half a million dollars.

The incident on 23 May at the Petukhovo railway frontier was not the first. Last year, Russian customs officers confiscated goods worth $2m from Kyrgyz shuttle-traders, an action blamed for the subsequent suicides of eight people.

The traders' plight has become serious enough to warrant government intervention in Kyrgyzstan, where parliament adopted a motion in early June to speed up new laws regulating their activities.

Shuttle traders are crucial to the republic's economy. Since the collapse of the Soviet Union, the big state firms have either ceased production or virtually stopped making goods. Petty trading between the republics has become a lifeline for hundreds of thousands of people.

But their numbers are now in free fall. From 500,000 in 1996, the ranks of Kyrgyz shuttle-traders have dropped to less than 300,000, and many are these are on the verge of bankruptcy.

Aynagul Kerimkulova, a former army major, now a trader, said the Petukhovo border station was notorious. "The goods are often confiscated and sent off to warehouses," she said. 'The local militia thrives on the shuttle-traders.' She said Kyrgyz traders ran the gamut of racially motivated hostility from the border customs officials and from local residents.

There are few official complaints. Natalia Ablova, of the Kyrgyz Human Rights Bureau, said Kyrgyz residents in Russia were second class people "with no choice but to grovel and to hold their tongues".

In theory, this should not be so. Kyrgyzstan and Russia signed an agreement on the status of Kyrgyz residents, granting them similar rights to Russian citizens. The protocol has made no difference to the shuttle-traders who rarely have any idea of their rights. The Russian police and customs behave accordingly.

Byubyuaisha Arstanbekova, chair of Akikat Jolu, a lobby group for the traders, complains that Russia has toughened up its customs regime. Kyrgyz traders transporting goods by car have run foul of laws insisting they use container lorries. The Russian customs officials then confiscate their goods. It was this, said the Kyrgyz media, which drove eight traders to suicide last year.

But not all traders blame the Russians. Raphael Aliev, who works the route between Bishkek and Krasnoiarsk, says it is often a matter of paper work. "The Russian customs officers and the transport militia are better than they were," he said. "If the documents are all right, there is usually no problem." He knows all about racial hostility. "I have a typical Caucasus face," he says. "So I've been involved in plenty of ethnic conflicts."

Russian customs officials agreed that the border regime was improving. "Until recently, Russian customs officers were notoriously cruel to the shuttle traders,' Aliev said. "But since the Russian ambassador to Kyrgyzstan intervened, it's got better." Like Aliev, he said the main problem was the trader's own ignorance of customs legislation, which made them easy targets for extortion at the hands of corrupt officials.

Bakhtiar Mukhamediev, deputy head of the customs office in Kyrgyzstan, says his Russian counterparts are only doing their job and that in spite of repeated warnings 99 per cent of Kyrgyz traders continue to defy the law by transporting goods without any paper work.

After the affair at the Petukhovo crossing in May, he said, seminars for traders had been organised and information stands put up at the border railway crossings, but no one had paid any attention. Mukhamediyev added that the Russians had got rid of the worst officials.

But another customs expert, who did not want to be named, says shuttle-traders have few incentives to obey the law. Neither the Russian nor the Kyrgyz officials possess equipment to deal with questionable cargo, he says. "There are no laboratories where experts can examine goods, and if there are any problems about the documents, the traders have to take their goods for certification to Cheliabinsk, Kourgan, or Yekaterinburg. This takes time and the storage fees are high, so the potential for profit is almost zero."

Akbokon Tashtanbekov, a Kyrgyz parliamentarian and head of the assembly's economic committee, warns that the government is ignoring the shuttle-traders' plight at its peril. "The state pays little attention to these men, who are simply trying to earn a decent income abroad to support their families." The government had promised to open a new consulate in Yekaterinburg - the destination of many shuttle traders - he says. But nothing has happened.

Many experts fear no amount of custom reform can save the shuttle traders from going under, as the forces of economic change squeeze out their way of life. Yelena Meshkova, an economic commentator in Bishkek, believes their time has past. As she puts it, they are 'dinosaurs from the era of economic chaos, which is now at an end.'

"Russia is not interested in importing low-quality, cheap goods from China," she adds, and in any case, the Chinese now supply these goods direct to Russia without relying on small traders.

The problem is that the demise of shuttle trading is no simple prospect in a country with Kyrgyzstan's social and economic problems. If 300,000 small businessmen lose their jobs, the knock-on effect will be the destabilisation of the whole country. Kyrgyzstan's shuttle traders are a very real economic force, who could be transformed into a political one. Their dilemma shows every sign of becoming a major headache for the government.

Yevgeni Nikolaev is an IWPR contributor