According to its late first president, Saparmurat Niyazov, Turkmenistan was destined to become a second Kuwait -- a land where everyone owned a Mercedes.
As the country's 28th anniversary of independence approaches, the country is far -- very far -- from becoming a second Kuwait. And some question how the government of President Gurbanguly Berdymukhammedov has managed to survive.
Life in Turkmenistan today is characterized by shortages of basic goods: sugar, cooking oil, eggs, and other similar items. In many Turkmen towns and cities, there is a limit of two loaves (chorek) of bread per day. Those goods are generally available at private stores, but at several times the price of state stores. There is even a shortage of cash, as evidenced by the lines that quickly form at ATMs when word gets out there are banknotes in the machines. And there is rarely enough cash for everyone who hurries to such machines.
In 2018, the government canceled subsidies on gas, electricity, and water that had existed since independence in 1991. The government doesn't publish unemployment figures, but the jobless rate is believed to be 60 percent or more. And recently, authorities have been preventing citizens from leaving the country. Years of government repression and, more recently, the deteriorating economic situation might have led to more than one-third of Turkmenistan's citizens leaving the country.
Its economy is in the worst shape it has been in the independent era. Natural gas is Turkmenistan's major export, and is believed to account for 70-80 percent of the country's revenues. Russia's Gazprom has just renewed a contract for Turkmen gas, but for only a modest amount. China has been purchasing nearly all of Turkmenistan's gas since the start of 2017, but an undisclosed portion of that gas goes toward paying the billions of dollars Turkmenistan owes China (ironically, much of that is for loans Turkmenistan accepted to develop the gas field and build the gas pipelines to ship gas to China). Turkmenistan is seeking foreign investment; but in 2019 alone, two reports (one from International Policer Digest and the other from The Foreign Policy Centre) made clear the perils of investing in Turkmenistan.
Meanwhile, the government has spent billions of dollars on hosting an obscure international sporting event in 2017; building a new airport capable of handling hundreds of thousands of travelers in a country that probably does not even receive 50,000 foreigners annually; and continuing the construction, with white marble, of luxury hotels in the Caspian resort area Avaza and in the capital, Ashgabat. And to top it all off, Berdymukhammedov has appeared regularly on state television showing how fabulous his life is as he drives around in expensive automobiles and sits in luxuriously furnished rooms.
Optimal Regime?
Berdymukhammedov and his government have seemingly proven inept at tackling the numerous problems Turkmenistan faces. Yet he remains.
How?
The answer might be that other governments see Berdymukhammedov's regime as optimal, and Turkmenistan might be receiving more outside help than is immediately apparent.
Since 1995, Turkmenistan has been a UN-recognized neutral country. First, President Niyazov used neutrality as a vehicle for isolating his country. Officially, Turkmenistan had no ill will toward anyone and avoided entanglement in the problems of other countries, although it always stood ready to offer its services -- whatever those might be -- as an arbiter to any feuding parties. The perfect neighbor.
This actually suits Turkmenistan's immediate neighbors -- Iran, Afghanistan, Uzbekistan, and Kazakhstan – as well as fellow Caspian Sea littoral states Azerbaijan and Russia.
If they don't have the influence they might wish in Turkmenistan, the likelihood is that no one else does either.
Turkmenistan has ties with Western nations and even allowed some U.S. military planes to refuel at Turkmen airfields as part of the U.S.-led campaign in Afghanistan. But for the most part, Ashgabat keeps its relations with Western countries focused on economics; the Turkmen government doesn't welcome Western influence and is as unwilling to join Western security alliances as it is to join any security pacts or alliances.
That might be a comforting thought for Iran, which shares a border some 1,000-kilometers long with Turkmenistan. During much of the past two decades, U.S. troops have been on the other side of Iran, in Afghanistan and Iraq.
Ashgabat's resistance to outside influence or strong partnerships (other than trade) might serve Turkmenistan's neighbors well. When they deal with Ashgabat, they deal with Ashgabat alone; reducing the chance that another government takes Turkmenistan's side in a dispute or comes to Ashgabat's aid in a time of crisis.
Useful Idiot?
And Turkmenistan's government is in no position to threaten anyone. With a population of possibly around 5 million, Turkmenistan is smaller than any of those immediate neighbors. Its military is by far the weakest in the region.
And the Turkmen government has always been propped up by the country's feared security forces, which for nearly three decades have worked to cow the population into submission. Turkmenistan is not fertile ground for reformers or revolutionaries, and the government has been particularly harsh on what it regards as suspect Muslims.
But perhaps most of all, Turkmen President Berdymukhammedov might be regarded as something of a clown. He does not seem to have a thorough understanding of statecraft, has proven an arguably feeble negotiator, and has few chips with which he can bargain in disputes with other countries.
Some might be tempted to regard such a leader as a useful idiot, in some ways. Perhaps too useful to allow him and his government to fail.
Russia seems satisfied with Berdymukhammedov and his government. Gazprom, half-jokingly referred to as an extension of Russian's Foreign Ministry, just renewed a contract to buy gas from Turkmenistan after canceling its previous contract unilaterally at the start of 2016.
Gazprom does not seem to need Turkmen gas but will purchase some 5.5 billion cubic meters (bcm) of gas annually under a new deal signed at the end of June. The Azerbaijani website Caspianbarrel.org reported in April that, knowing Turkmenistan was desperate for revenue and short of customers, Gazprom wanted to "buy Turkmen gas at a very low price -- no more than $110 per 1000 cubic meters."
If that reported price is accurate, Turkmenistan stands to receive a little more than $600 million annually from sales to Gazprom -- not enough to balance Turkmenistan's books, but a potential lifeline nonetheless.
Russia also helped Turkmenistan by sending vaccines for hepatitis during an outbreak in Turkmenistan at the end of 2016.
Opaque Dealings
China's dealings with Turkmenistan have always been somewhat opaque. But the China National Petroleum Corp is the only foreign company with a sizable onshore gas-and-oil-field contract in Turkmenistan. And once Line D of the four gas pipelines leading from Turkmenistan to China is complete -- and optimistically that is still several years away -- Turkmenistan will be able to export some 55 bcm of gas to China annually. That would make it China's largest supplier of gas. And, of course, Turkmenistan still owes China an unspecified amount -- believed to be several billion dollars -- for loans not only for gas-field development and pipeline construction but also, it seems, for weapons Turkmenistan has recently been buying from China and showing on television during Turkmen military parades.
That suggests it would not be in China's interest to see Berdymukhammedov's government fall, at least not without some assurances that Ashgabat's policies toward China would remain unchanged. It has never been clear what portion of the gas Turkmenistan ships to China is considered payment for loans, but it might be reasonable to assume China would not gouge Ashgabat to the point where the Turkmen government could collapse.
Azerbaijan has already opened up its oil- and gas-export routes with the West. Turkmenistan would like to connect a trans-Caspian gas pipeline to Azerbaijan's pipeline network and also export to Europe. But, again, Berdymukhammedov's government has been fickle in its dealings with companies and countries wishing to be involved in this project, with one of the results being that not much progress has been made toward realizing that goal. Until there is some progress, Azerbaijan will continue to ship only its own gas westward to Europe.
This is a point that affects all Turkmenistan's neighbors, since all of them also have gas and are also seeking to export to new markets. A shrewder Turkmen leader might be more successful in finding new routes for Turkmen gas and taking away business from its neighbors.
According to Turkmenistan's government and the country's state media, there are no problems in Turkmenistan. Ashgabat has never asked for outside help to deal with floods, earthquakes, salt storms, drought, or food shortages, which Turkmen authorities have never acknowledged happened anyway, despite ample proof. So if the Turkmen government is accepting aid from outside parties, it is doubtful Turkmen authorities would publicly speak about it, since that would amount to an admission that things were not as perfect as the government and state media assert.
But there is reason to believe Berdymukhammedov's government is not weathering this economic crisis totally unaided, so the question might be less how is he doing it, but rather who is helping him do it?
