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President of Kyrgyzstan heads to Russia after gold mine seized

ALMATY, Kazakhstan – The populist President of Kyrgyzstan visits Russia on Monday as problems escalate on the home front, following the seizure of a gold mine run by the country’s largest private investor and d deadly clashes along the disputed border with Tajikistan.

President Sadyr Japarov will travel to Sochi on the Russian Black Sea coast for his second meeting with Russian leader Vladimir Putin in three months. What he will gain from the trip, if any, is unclear.

What is clear is the international criticism of the Japarov government’s seizure of the Kumtor gold mine, the main contributor to the country’s besieged economy, as well as the fallout from the border battle that has taken its toll. dozens of deaths.

On May 17, the Kyrgyz government used recently approved powers – legislation hastily rushed by parliament earlier this month – to impose external management of the gold mine. Tengiz Bolturuk, who has stepped down from the board of directors of Canadian mine operator Centerra Gold, has been appointed Kumtor’s temporary external director.

Observers were not surprised by the decision to take control of the lucrative mine, however damaging it does to Kyrgyzstan’s global image.

“Kumtor has always been the source of political drama in Kyrgyzstan. And Japarov’s popularity started with this gold mine in 2012, when he launched a campaign to nationalize it, ”said Temur Umarov, consultant at the Carnegie Center in Moscow, specializing in China and Central Asia, said told Nikkei Asia.

“Of course, what is happening now with Centerra Gold will frighten all (and potential) investors in Kyrgyzstan,” he continued. But he said Japarov calculates “that he will make more money nationalizing the biggest gold mine than spending money on reforms that will not immediately guarantee a lot of investment in the country.”

Kumtor Gold Mine in Kyrgyzstan: Japarov’s government effectively took control of the mine this month. © Reuters

At the end of 2020, Kyrgyzstan owed $ 4.2 billion to external creditors, including $ 1.8 billion to the Export-Import Bank of China. Faced with heavy debt and economic pressure from the global coronavirus downturn, Umarov argued that Japarov was not interested in working to attract investors. “He needs the results of his actions now and he doesn’t care much about the country’s future.”

Japarov rose to power last fall on a wave of populist nationalism and is also under pressure to deliver on his campaign promises – from eradicating corruption and promoting the rule of law to economic prosperity.

“The company is starting to realize that the promises he made are unrealistic,” Umarov added.

“The recent deadlock on the border with Tajikistan has also led to a wave of criticism of his policy. So Japarov wants to compensate for the support he has lost and double the nationalist sentiment. Kumtor is here a perfect object for this purpose,” concludes the analyst.

In a first salvo on May 7, Centerra’s subsidiary, Kumtor Gold Company, was fined $ 3 billion after a Kyrgyz court ruled it violated environmental rules. This allowed the Kyrgyz authorities to place the mine under external management for a short period in order to remedy these alleged environmental and safety violations in accordance with fast-track legislation. The company also received a tax bill of $ 170 million.

A May 17 statement from Centerra Gold announcing the seizure said it was taking the case to international arbitration while straining an olive branch. “We remain ready and available to engage in constructive dialogue with the government on the issues it considers to be the subject of a dispute.”

On Thursday, Bolturuk – the external director and a citizen of Kyrgyzstan and Canada – said that “Kyrgyzstan aims to build true partnership relations only if Centerra Gold is ready to comply with Kyrgyz law and international standards.”

Kyrgyzstan’s two biggest trading partners, China and Russia, also control gold mines in the mountainous Central Asian state, but they are unlikely to be concerned that the government is mocking of their interests. In March, the Russian-backed Jerooy gold mine, the second largest in Kyrgyzstan, began production.

China is more concerned about security issues. In 2019, clashes erupted between local residents and workers at the Chinese-run Solton Sary gold mine. In the political turmoil of last fall, a number of Chinese-led projects were attacked by angry mobs demanding money.

The gold mining dispute is not the only issue facing Japarov’s fledgling administration. On April 28, simmering tensions along the border with Tajikistan turned into a battle between the armed forces of the two countries that left more than 50 dead, hundreds injured, thousands displaced from their homes and widespread material damage in villages on both sides of the disputed area. border.

Thirty years after the collapse of the Soviet Union, just under half of the nearly 1,000 km border has still not been demarcated. After independence, the area encompassing the Fergana Valley was divided between Kyrgyzstan, Tajikistan and Uzbekistan with a patchwork of enclaves populated by other ethnic groups left behind in neighboring states.

April’s deadly conflict, which spread to other villages along the border, was sparked by a dispute among villagers over access to scarce water resources. Tensions were fueled by Kamchybek Tashiev, the head of the Kyrgyz State Committee for National Security, at the end of March.

Japarov’s nationalist comrade Tashiev suggested that Tajikistan either abandon land claims around the fertile Tajik ethnic enclave of Vorukh or agree to an exchange for other less productive land. Soon after, Tajik President Emomali Rahmon visited Vorukh to reaffirm its status as an inviolable part of Tajikistan.

With a difficult ceasefire along the border, talks are expected soon between Japarov and Rahmon in the Tajik capital, Dushanbe, to try to resolve the issue.

In rare good news, Kyrgyzstan this month landed a $ 54 million donation from China to support its struggling economy. China has also pledged 150,000 free doses of COVID-19 vaccines to help with Kyrgyzstan’s stuttering vaccination campaign.

While Japarov may be hoping for more good news from his trip to Russia, he may remember the fate of the last Kyrgyz ruler who visited Sochi. Less than three weeks after visiting the Russian seaside town last fall, former President Sooronbai Jeenbekov was unceremoniously dismissed from his post.

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