Wednesday, 22 March 2006

POLITICAL REFORM EFFORTS IN KAZAKHSTAN BOG DOWN IN CORRUPTION

Published in Field Reports

By Marat Yermukanov (3/22/2006 issue of the CACI Analyst)

The most impressive part of Nazarbayev’s lengthy speech was the optimistic assessment of the current economic performance of Kazakhstan and generous social spending planned for the years 2006 and 2007 which, if implemented successfully, should raise the standard of living for vast sections of population. The President promised a 30 percent increase in pay for civil servants in 2007 and social benefits for war veterans will rise to make up 6,000 tenge ($46). Among other encouraging signs are the planned 30 percent social tax reduction and the introduction of a 10 percent flat income tax rate next year.
The most impressive part of Nazarbayev’s lengthy speech was the optimistic assessment of the current economic performance of Kazakhstan and generous social spending planned for the years 2006 and 2007 which, if implemented successfully, should raise the standard of living for vast sections of population. The President promised a 30 percent increase in pay for civil servants in 2007 and social benefits for war veterans will rise to make up 6,000 tenge ($46). Among other encouraging signs are the planned 30 percent social tax reduction and the introduction of a 10 percent flat income tax rate next year.

Strictly speaking, these and other social benefits do not place much burden on the state budget, and represent only a drop in the sea of the country’s oil revenues. But these promises have great psychological effect in a country brought to the brink of political upheaval in the wake of the hideous murder of one of opposition leaders Altynbek Sarsenbayev on February 12. The already fragile public confidence in authorities and law enforcement bodies was shaken to the roots as the investigation revealed the involvement of five members of Arystan special task squad subordinated to National Security Committee, and of the head of administration of the Senate chamber of parliament Yerzhan Utembayev, in this murder case.

The scandal led to the arrest of Yerzhan Utembayev and resignations of the chief of the National Security Committee Nartay Dutbayev and the commanding officer of Arystan special task squad Serzhan Koybayev. But these spectacular detentions and resignations cannot dispel suspicions that the murder, described by Foreign Minister Kasymzhomart Tokayev as a “political murder”, was masterminded by influential groups in higher echelons of power. The opposition staged rallies in Almaty and demanded from the Prosecutor’s Office the questioning of Dariga Nazarbayeva, first deputy foreign minister and son-in-law of the president Rakhat Aliyev, and the first deputy director of the Kazakhstan Temir Zholy national railway company Kairat Satybaldy, as well as the founders of the Eurasian Industrial Group Aleksandr Mashkevich, Patokh Shodiev and Alidzhon Ibragimov.

The opposition bloc demanded the resignation of the speaker of parliament Nurtay Abykayev who is regarded as the main suspect in Sarsenbayuly’s case and whose name is linked to a corruption scandal at the Khorgos customs checkpoint on the Kazakh-Chinese border, which erupted weeks before the murder of the opposition leader. In mid-January, a gang of bribe takers, high-ranking customs officials at Khorgos, were brought to trial for extortion of large sums of money from shuttle traders and business people. The illegal monthly receipts of the gang, which included the deputy head of the customs office of Almaty region and a head of department at the Prosecutor’s Office of Almaty city, reached $4 million. Traces of this crime led to the Almaty department of the Interior Ministry where top police officers covered up the crime of the gang. Almost simultaneously, National Security officers arrested the deputy head of security department of the Interior Ministry Mirbolat Shamelyev. He was accused of organizing a criminal gang.

Summoned to parliament by the Aimak (Region) faction of parliament members, Andrei Lukin, the deputy chairman of the Agency for fighting economic crimes and corruption said that last year 1,260 civil servants were arrested on corruption charges, two high-ranking finance police officers among them.

In his address to the nation Nursultan Nazarbayev noted that bribe takers are among the most vociferous critics calling the authorities to root out corruption. He apparently alluded to critics from opposition ranks who demand transparency of the National Fund where oil revenues are accumulated, and accountability of top level officials. Opposition leaders see corruption as one of the stumbling blocks in implementing genuine political reform. President Nazarbayev, in his March 1 speech, routinely expressed his commitment to democratization of the society, but in remarkably ambivalent terms. He said authorities should “defend democracy” disregarding criticism from opposition or from abroad. On the one hand he called non-government organizations to participate actively in implementing social programs; on the other hand he unequivocally warned them not to interfere in political affairs of the state. “Glasnost is a responsibility and not permissiveness” he stressed.

Nazarbayev’s speech signals that the standoff between democratic forces and authorities is entering a new phase. Astana is increasingly reluctant to be lectured by the West on democracy and human rights. Perhaps the most ominous signs are that political murders and the persecution of opposition leaders reached a scale no longer controllable by the president.

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The Central Asia-Caucasus Analyst is a biweekly publication of the Central Asia-Caucasus Institute & Silk Road Studies Program, a Joint Transatlantic Research and Policy Center affiliated with the American Foreign Policy Council, Washington DC., and the Institute for Security and Development Policy, Stockholm. For 15 years, the Analyst has brought cutting edge analysis of the region geared toward a practitioner audience.

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