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4 November 2011
Kyrgyzstan: China Seeks “Silk Road” on Rails
A train from Moscow pulls into the railway depot in Bishkek, Kyrgyzstan. As China pushes for the right to build its own track that would provide a quicker link to Uzbekistan, and to Europe, Kyrgyzstan's leaders contemplate whether it's worth jeopardizing relations with Moscow.
Kyrgyzstan’s president-to-be, Prime Minister Almazbek Atambayev, and his political allies seem intent on calibrating the cash-strapped country’s foreign policy so that it aligns with Bishkek’s dire economic needs. This is likely to force Kyrgyz officials into a delicate balancing act in which they are challenged to keep the country’s two largest trading partners -- Russia and China – happy.
Atambayev made membership in a Moscow-led customs union, along with a general orientation toward Russia, a cornerstone of his successful presidential campaign, even though making good on such a pledge could threaten the crucial trade relationship with China by muddling tariff policy. At the same time, Kyrgyz policymakers, including Atambayev’s allies, are taking steps to assuage potential Chinese concerns by helping Beijing fulfill an old dream: construction of a Chinese-Kyrgyz-Uzbek railway.
“Atambayev adopted a very pro-Russian position in his campaign and I understand him,” said Osmonakun Ibraimov, who served as a state secretary under former president Askar Akayev and later became an economics professor at Manas University in Bishkek. “To win an election without Russian support and the votes of the Russian-speaking population is difficult. But as president he will have to accommodate a quieter, more necessary force – that force is China.”
Since joining the World Trade Organization (WTO) in 1998, Kyrgyzstan has developed into a major conduit for cheap Chinese consumer goods entering the former Soviet Union. An element of doubt, however, hovers over the future of Chinese-Kyrgyz trade.
In recent months, Bishkek has moved tentatively towards joining the customs union of Russia, Kazakhstan and Belarus, a bloc that has already hurt Kyrgyz re-exports. Full accession could undermine Bishkek’s ability to meet its WTO obligations—a state of affairs that would not please China. Kyrgyzstan’s tariffs for cross-border trade could double in line with the custom union’s protectionist policies, inhibiting the influx of Chinese goods that has accounted for so much of the country’s foreign trade and kept domestic consumer prices relatively low.
For the moment, Beijing is proceeding as if it has little to worry about. Chinese officials have long entertained hopes for expanding the Kyrgyz export corridor, underscored by the fact that their plan to lay more than 300 kilometers of steel rails across the heart of Asia dates back to the late 1990s, when Kyrgyzstan’s WTO membership spurred Beijing to mull new export strategies.
The railroad would be “like a port for a landlocked country” that would “connect Kyrgyzstan with the global economy,” said Ibraimov. As an early proponent of the rail route, he maintains the project could help unify Kyrgyzstan economically. Currently, only one mountainous highway connects the northern and southern provinces.
On the Kyrgyz side, economic necessity is running up against national pride. The idea of a Chinese-owned track slicing through their country sits uncomfortably with many Kyrgyz, who are emotionally averse to an increase in Chinese influence of any sort. Many Kyrgyz look distrustfully at China’s rapid growth, fearing their giant neighbor could swallow the tiny country.
So with acting Prime Minister Omurbek Babanov earlier this year offering China mining concessions as compensation for Beijing’s projected $2.5 billion outlay, political and media opposition is gearing up again.
Since Kyrgyzstan gained independence in 1991, opposition politicians have used the appearance of cozy bilateral ties with China to assail successive administrations. When Akayev ceded land to Beijing in 1999 to resolve a border dispute, the opposition uproar eventually led to the deaths of six protestors in 2002, and culminated with the demise of his administration. Former President Kurmanbek Bakiyev took heat in 2009 after his government allegedly offered Zhetim-Too, an iron-rich, mountainous territory in Naryn Province, as bait for China’s railroad scheme. Provincial Governor Omurbek Suvanaliyev resigned in protest. When running against Atambayev in the recent presidential election, Suvanaliyev had a television spot that replayed the episode, alluding to the Chinese as “wolves” that should be “annihilated.”
Kyrgyzstan’s priority should be “retaining our statehood,” said Turat Akimov, editor of the Bishkek-based business magazine Dengi i Vlast, or Money and Power. “For this we will need Russia, not China’s railroad.”
The train track is planned to run from Kashgar in China’s Xinjiang Uyghur Autonomous Region to Andijan in Uzbekistan, where it would link into the Uzbek rail network and shave hundreds of kilometers off the existing China-Europe route. Uzbekistan has already agreed in principle to pay for its own section of the track, which would total only 50 kilometers or so.
Beijing needs overland export routes, says Marc Lanteigne, a China scholar at the Victoria University in New Zealand, adding that concerns about sovereignty are overplayed: “Kyrgyzstan is poor in natural resources, but it does have the advantage of being a potential hub for various 'Silk Road' plans which China has for Eurasia,” he told EurasiaNet.org.
“With Beijing hoping to extract resources from Afghanistan and nearby in the coming years, safe trade corridors are a priority for China's Central Asian trade,” Lanteigne added.
Railroad negotiations have been opaque, fuelling concerns that the project is not in the national interest. The project also bears the taint of a former proponent, Bakiyev’s business-savvy son,Maxim, who promoted the project shortly before the family’s ouster from power in 2010.
“No one has explained to us exactly what this railroad will bring us,” said Akimov, the magazine editor. “They talk of economic benefits ... but we will only be a transit country and China will own the track.”
