China strengthens its role in Kyrgyzstan
By Daniel Allen
BEIJING - At the high-altitude Irkeshtam border crossing a convoy of shiny
Chinese rigs waits to cross into Kyrgyzstan. Facing the deserted vehicles, a
snaking line-up of battered Kamaz trucks with Kyrgyz plates sits patiently,
returning to China to load up with more cheap cellphones, TV sets and plastic
kitchenware.
Here, even at this remote trade conduit between Xinjiang and Central Asia, the
Chinese economic juggernaut is dominating the dynamics of trade.
Chinese and Kyrgyz vehicles alike are tangible reminders of the huge imbalance
that exists between these two countries: in 2006 the value of Chinese exports
flowing into Kyrgyzstan was 150
times greater than the flow in the opposite direction. China is steadily
strengthening political and economic ties with small, landlocked Kyrgyzstan,
with one eye on the sizeable energy reserves of its neighbors to the north and
west. At the same time, Kyrgyzstan's dependence on Chinese income and
infrastructure grows deeper by the day.
Looking to fill the vacuum created when the Russians returned home from the
five former Soviet Central Asian republics of Kazakhstan, Kyrgyzstan,
Uzbekistan, Tajikistan and Turkmenistan, and the roubles dried up, China is now
making moves to become the new Central Asian superpower. It is constructing
roads, factories, power plants and pipelines and filling supermarket shelves
with cut-price consumer goods bought with low-interest loans from Chinese
banks.
One of the principal mechanisms by which China is expanding its influence in
Kyrgyzstan and Central Asia is the Shanghai Cooperation Organization (SCO). The
grouping was initially formed as the Shanghai Five in 1996, bringing together
Russia, China and the three Central Asian countries of Kazakhstan, Kyrgyzstan
and Tajikistan, being renamed when Uzbekistan joined in 2001.
Despite its cosmopolitan membership, China is clearly the driving force behind
the SCO, giving the organization's economic heavyweight the appearance of a
well-intentioned mother hen. Last year saw Chinese President Hu Jintao's first
state visit to Kyrgyzstan as he attended the annual SCO summit in the capital
Bishkek, promising other SCO member states that "China would promote regional
economic co-operation to advance towards mutual benefits and all-win results."
The growing influx of Chinese products into Kyrgyzstan has been accompanied by
a similar inflow of Chinese citizens. Over the past 15 years Kyrgyzstan's
Chinese population has swelled from zero to around 100,000 in a total
population of a little more than 5 million. These immigrants marry locals,
obtain Kyrgyz citizenship, ramp up their business interests, and buy
apartments. Current plans to make the yuan fully convertible in Kyrgyzstan will
only serve to accelerate the flow of both Chinese currency and people.
One business analyst in Kyrgyzstan's second city of Osh, who wished to remain
anonymous, commented, "It's obvious this country is fast becoming another
Chinese satellite. Trade with China now accounts for almost 80% of Kyrgyz
foreign turnover. The European Union and Russia seem to have no unified policy
on Kyrgyzstan. In the end the Chinese will become so strong that they will
directly influence government policy, and that will alter the foreign political
orientation of Kyrgyzstan."
Indeed, the growing influence of China within Kyrgyzstan's corridors of power,
and in the foreign policy of other Central Asian states, has led to fears in
Washington that the SCO is being developed to counter US interests in the
region. These fears have been strengthened by the recent inclusion in the SCO
of Iran, Pakistan, India, Mongolia and Afghanistan as either observer or guest
nations.
Despite claims by Russian president Vladimir Putin and Hu Jintao that the SCO
is not being built up as a rival to the North Atlantic Treaty Organization, or
NATO, the SCO has already secured the closure of a US military base in
Uzbekistan in 2005. A similar base at Kyrgyzstan's Manas Airport in Bishkek,
which is proving crucial for US and coalition operations in Afghanistan,
remains open in spite of Sino-Russian pressure, although the rent has jumped to
more than US$150 million a year (roughly 7% of Kyrgyzstan's entire GDP).
Kyrgyzstan is now paying for the price for not bending fully to Beijing's will.
Bishkek's reluctance to close the Manas Base has been cited as a major factor
in China's refusal to include Kyrgyzstan in a gas pipeline set to run from
Turkmenistan to Xinjiang and beyond. Although the most direct route from
Turkmenistan to China does pass through Kyrgyzstan, and the Kyrgyz government
lobbied hard for inclusion in the project, Beijing’s move was interpreted by
some as a warning to Kyrgyz leaders not to get too close to the US.
Indeed, despite China's ascendancy, Beijing isn't getting everything its own
way in Kyrgyzstan. Alarmed by strengthening Chinese-Kyrgyz and Kazakh-Kyrgyz
ties, Moscow has taken steps to renew its interest in the country. Former
Russian president and now prime minister Vladimir Putin recently announced
plans to invest up to $2 billion in the Kyrgyz economy, and Russian energy
giant Gazprom is investing $300 million in a joint venture with Bishkek to
explore for new fuel reserves and build pipeline infrastructure. Only 7% of
Kyrgyzstan's land is available for agriculture and it has relatively limited
hydrocarbon resources.
Preparatory work has been announced on a China-Kyrgyzstan-Uzbekistan railway,
which will start in Kashgar, in the far west of China's Xinjiang autonomous
region, while China and Uzbekistan have announced their intention to accelerate
construction of transit roads through Kyrgyzstan to facilitate growing regional
trade. China has also helped to construct a road that links northern and
southern Kyrgyzstan.
Many analysts see power generation as another area where Kyrgyzstan may be able
to generate much-needed income. Although a China-Kyrgyzstan partnership formed
in 2004 promised $2 billion from China for construction of two hydroelectric
sites on the Naryn River, Kyrgyzstan's "Tulip Revolution" in 2005, which saw
the overthrow of president Askar Akayev, seems to have effectively scuppered
the deal. However, the apparent recent willingness of Bishkek to privatize all
national assets is almost guaranteed to bring about renewed Chinese investment
in Kyrgyzstan's energy sector.
Not all Kyrgyz citizens resent China's growing influence within their nation's
economy and internal affairs. Asel Amankulova, who runs a guesthouse in Karakol
beside Lake Issyk-Kul, hopes that China can assume Russia's previous role in
Kyrgyzstan. "I'm not saying the Soviet days were great, but at least we had
enough to eat, enough water, and enough power," she says. "Now I'm struggling
to feed myself, I've got this trickle of dirty water, and the town's plagued by
constant blackouts. If China can help us by investing in this country then
that's fine by me."
As the Chinese economy continues to grow, accompanied by spiraling energy and
raw material demands, so the strategic importance of Kyrgyzstan to Beijing will
undoubtedly increase. Kazakhstan and Russia, both currently awash with
fossil-fuel dollars, are looking for foreign investment opportunities, and the
US needs to retain its crucial foothold in Kyrgyzstan for Afghan operations.
Daniel Allen is a freelance writer and photographer from London who has
lived in China for the past three years.
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