According to various foreign news services, Richard Hoagland has been nominated by President Bush to replace John Ordway as Ambassador to Kazakhstan. Hoagland is currently serving in the U.S. Embassy to Turkmenistan and was Ambassador to Tajikistan.

Hoagland was nominated as Ambassador to Armenia last year but his nomination was withdrawn in relation to questions of the US acknowledgment of the Armenian Genocide. The then-Ambassador to Armenia was withdrawn when he gave a speech regarding the genocide and Hoagland’s nomination was stalled and then withdrawn while the Senate debated whether to publically acknowledge the genocide or not.

Ordway has been Ambassador since 2004.

Askar Mamin, akim of Astana, will become the head of Kazakhstan Temir Zholi, after the present head was detained by police for corruption. Zhaksybek Kulekeyev is suspected of taking a bribe in the amount of US$100 000 and rumor has it that he was caught by undercover police in a sting operation.

The new akim of Astana will likely be Imangali Tasmagambetov, currently akim of Almaty and widely popular. He was also considered an enemy by Rakhat Aliyev. Some have claimed that Tasmagambetov is the most likely person to become President after Nazarbayev due to his popularity and ability.

The Minister of Agriculture, Akhmetzhan Yessimov, will likely be appointed akim of Almaty. It is still not clear who would become Minister of Agriculture.

This just in: Nazarbayev will run the first leg of the torch relay. Hopefully that won’t mean that they shut down the route to people who want to watch, which they sometimes do when cool people are involved in things.

EDIT: The official route and who is carrying the torch is up. The President doesn’t appear to be on the list. And to answer the question in the comments, I think that occasionally Presidents or high government officials might be there to greet the torch at the airport–as I believe the akim was at Almaty airport last night–but they don’t usually carry it.

EDIT THE SECOND: Nazarbayev did carry the torch. As did the Chinese Ambassador and Rosa Rizimbayeva. Cool.

Thanks to the for posting this news.

President Nazarbayev gave an interview to Reuters last Friday. In it, he touched upon the crisis in the banking sector, NATO, foreign relations, and the energy sector. He also discussed the issue of succession, saying:

I would like to clarify this nonsense that the first president, that is me, can stay in power for an unlimited number of terms. That does not mean I will be here forever. After a five year period I will have to take part in an election in 2012. And if the people give me their support, I can stay. But I have been in this job for so many years and after all I might hand it over to the next generation, so to say, when I see that we need new, fresh people and so on. This is an electoral process…We have a lot of them here. … I think I should not give any names now to avoid upsetting anyone.

Obviously he is trying to deflect criticism that he has been named President for Life, but the hint that he may not seek another term is a rare comment heard in this country.

Other excerpts can be found here. Probably most interestingly, on the problem of Kazakhstan banks which owe collectively 4 billion dollars due this year to various lenders, Nazarbayev said,

The government has not extended a single kopeck to support banks’ liquidity itself. And the banks themselves did not need it. Of course they wanted us to boost their liquidity using state money but we will not do this. They have to deal with it themselves.

This seems to belie the fact that the government was urged to cut its budget at the end of last year to free up 4 billion dollars. Perhaps that money is being used a reserve. Or some have suggested that that money will be given to banks in the form of a development fund for small and medium businesses to boost the domestic economy and give banks some business. In the interview the President does cite the government mortgage program which has spent 1 billion dollars to give people low-interest mortgages and assist in affording housing.

In answer to those who believe Kazakhstan is nationalizing its oil industry, Nazarbayev offered reassuring words:

…Kazakhstan has no desire to nationalise any assets like in Latin America…If investors break their contracts themselves, and Kazakhstan sees that the country is losing out on something with regard to a certain contract … then we’ll say: ‘Dear friends, either pay us compensation or give us shares back to compensate for the money we lost’. Kazakhstan does not want to nationalise or take anything away from anyone

Following his conviction for kidnapping, criminal conspiracy, misuse of state property and fraud and sentence of 20 years in prison, Rakhat Aliyev, former son-in-law of President Nazarbayev, former Vice-Minister of Foreign Affairs, and former head of the KNB, among other posts, was tried and convicted by a military tribunal. Because the trial involved discussion of state secrets, the trial was closed to the public and the press. Aliyev was sentenced to 20 more years on charges of plotting to take over the government through force.

Alnur Musayev, who has held various security positions including head of the National Security Committee and head of the Presidential Guard (as did Aliyev formerly) was also convicted for conspiring with Aliyev. Musayev is allegedly also in Austria with Aliyev. Both men would begin their sentence were they to return to Kazakhstan or be extradited.

According to the report from the Office of the Prosecutor, shown on Khabar television last night, starting in 1996 Aliyev and Musayev used their positions in security organizations to assemble a military force with the goal of overthrowing the government violently. These men were spread throughout police and military organizations such as the Presidential Guard, the KNB, and the Financial Police to disguise their purposes. Aliyev personally paid them to ensure their loyalty to him.

The prosecutor mentioned that Aliyev had put together a media empire that covered the entire territory of Kazakhstan (until the sale of these assets to his ex-wife Dariga Nazarbayeva and/or their nationalization) and had Internet resources ready to spread propaganda.

Aliyev and Musayev apparently also developed a new kind of poison,which may have been tested on human beings, and prepared over 1000 doses for the purpose of assassinations. Toward this end he prepared James Bond like pens that also can shoot poison. Furthermore the two were assembling radioactive material.

When you add to this the telephone calls that Aliyev allegedly recorded from bugs in the phones of various high government leaders, Aliyev seems to have had quite a bit of power and reach. It’s probably for the best that he is sequestered in Austria at the moment.

Opposition party Nagyz Ak Zhol has changed its name to Azat, which means freedom in Kazakh. The party has also changed its leadership structure. Before the 29th of February, the party was led by a three co-chairs, Bolat Abilov, Tolegen Zhukeyev and Oraz Zhandosov. Now Abilov is the sole chair, unanimously in. Zhukeyev was elected secretary-general and Zhandosov it is widely believed will become deputy leader and focus on the economic platform of the party.

Nagyz Ak Zhol was founded in 2005 by Abilov, Zhukeyev Zhandosov, and Altynbek Sarsenbayev (who was murdered 2 years ago) when it split from the Ak Zhol party, led by Alikhan Baymenov who ran for President in the last election. Ak Zhol means “White Path” and “Nagyz Ak Zhol” means “True White Path” because the founders felt that the Ak Zhol party was too soft on the current administration and too willing to compromise and enter into dialogue.

However the similarity of the two names was confusing for voters and the antagonistic subtext of the name made it hard to work together with Ak Zhol and other opposition parties.

With Nurotan holding 100% of seats in Parliament and with the President as leader, many in the opposition are struggling to find a strategy that will make their voices heard in Kazakhstan.

Azat was also the name of an independence movement during the Soviet period, founded in 1990.

Frank Giustra, the businessman who is making headlines for his alleged deal with Kazakhstan government officials in order to get uranium rights, has put out a press release listing the inaccuracies that the Bloomberg Press Service has made in covering the story. Among the errors Giustra cites:

Bloomberg: Giustra was negotiating with the Kazakhstan government to buy controlling stakes in three uranium mines.

Fact: The negotiations were with private companies, not the government…

Bloomberg: In November, 2005, Giustra flew back to Kazakhstan for another meeting with the President of Kazakhstan to get the uranium deal back on track.

Fact: There was no such meeting.

Bloomberg: Giustra stipulated that funds donated by him or Canadian mining companies to the Clinton Giustra Sustainable Growth Initiative, which is aimed at fighting poverty and building sustainable economies in developing countries, be deployed where he does most of his business.

Fact: The work of the initiative is, in fact, global, with a particular focus on helping local economies where mining takes place. In other words, the world’s mining sector is giving something back that can be sustained long after mining is finished. There is no “stipulation” that funds be spent only in countries where Giustra has business interests. In fact, of the several programs being introduced on March 1, only one will be in a country where Giustra is doing business.

Giustra also criticized in general terms the New York Times article which broke the story as being inaccurate. However he does not directly dispute the basic facts that he met once with Nazarbayev and President Clinton, that his company acquired uranium rights in Kazakhstan, or that he has made large donations to Clinton’s charity.

The Bloomberg story, like those in both The New York Times and The Wall Street Journal, contains errors of fact, uses innuendo, and omits key facts, either intentionally or through a lack of due diligence, to construct an article designed to suggest improprieties in the relationship where none exist.

The head of KazAtomProm in a recent interview also gave a similar response to the effect that something happened, but it was nothing illegal. He alleged that the American journalists who claim impropriety were paid by someone trying to defame Hilary Clinton and her Presidential campaign.

In a government meeting this week, Prime Minister Massimov assured the cabinet of ministers that work to renegotiate contracts with foreign investors will continue and that abrogations will be made on new contracts.

…officials announced that they would no longer negotiate production sharing agreements, or PSAs, which tend to be favored by international energy conglomerates because they tend to clearly outline taxation obligations. Prime Minister Karim Masimov said that all existing PSAs between Kazakhstan and foreign entities would be honored. The rule would only apply to new investors, he added.

What is more, oil companies are not to be the only targets of renegotations. Steel giant Arcleor Mittal whose mines have come to public attention for disasters that killed miners late last year and in 2006, is under pressure as well:

“The owner has been warned that if measures are not taken to assure safety the question of revoking rights to subsoil use will be raised,” Emergencies Minister Vladimir Bozhko – who heads a commission investigating a January accident at ArcelorMittal’s Abay mine which killed 30 workers - told the cabinet.

In fact it would appear that high profile companies are not the only victims of the government strategy to regulate foreign investors.

Energy Minister Sauat Mynbayev added to the pressure on investors by stating during the session that Kazakhstan had abrogated nearly 100 contracts in 2007. Government monitoring of 831 firms found that just over half were fully meeting their financial obligations, Mynbayev said, while 97 companies were meeting less than a third of them.

“These 97 contracts have to date been broken off. Notification has been sent to a further 182 [companies] about violations of contractual obligations and licensing conditions,” Mynbayev said. The ministry did not immediately respond to a request for clarification about which companies were implicated, but Kazakhstani analysts suggested most were probably minor subcontractors.

The mass investigation and cancellation of contracts may be aimed at reconciling breaches of contract, safety violations, and unfair terms of contracts made early in Kazakhstan’s independence. However some note cynically that in some cases violations years ago are being cited only today as reasons for canceling contracts. Critics note that likely this means that either monitoring institutions are not doing their job or that earlier informal arrangements were made to ensure that the government overlooked violations.
Others believe that the government is essentially nationalizing its resource industries by canceling contracts that do not give the government enough control or a big enough profit share.

Frank Giustra, the businessman who came to the public light as allegedly getting a boost from President Clinton in order to enter the Kazakhstan uranium market, is defending himself.

From The Globe and Mail article:

Mr. Giustra denied the suggestion that Mr. Clinton had in any way paved the way for the successful deals. Both transactions were well advanced at the time of the meetings and both sets of assets were purchased from private sellers and not the government, he said.

“I have business dealings all over the world. There are two countries where I have had business dealings and have visited with the president - Kazakhstan and Colombia. If people want to draw conclusions, let them. President Clinton has not helped me in any of my business dealings, period. End of story,” he said.

As for donations made to Clinton’s charity, Mr. Giustra says his business goal is to make money in order to give it to charity and there is nothing shady about it. “I’m choosing to give my money away as part of the CGSGI effort and that’s the way I’m going to live my life. People can think whatever they want about it,”

Thanks to Registan.net for pointing me to this article on problems with US AID funding for Central Asia:

Aid for almost every country in the former Soviet Union will be falling in 2008, under the current foreign affairs budget released by the US State Department. Much of the planned US assistance will go toward helping independent-minded states in the region resist Russian efforts to reassert its dominance in the Caspian Basin and elsewhere. Even so, some Washington experts lament the drop-off in aid, and describe the dwindling budgets in recent years as “monuments to weak analysis, inter-agency pettiness, and trite bureaucratic formuli.”

Overall, the budget for the Freedom Support Act, which provides aid to former Soviet states, is $346 million for fiscal year 2009, which actually starts on October 1, 2008. That is down from $396 million in fiscal 2008, and $452 million the year before that.

It’s interesting to note because one of the sponsors of the Freedom Support Act was John McCain, who will likely be the Republican nominee for President. So perhaps the Central Asia crowd should be cheering for McCain who has paid some attention to the region. On the other hand, Barak Obama is widely believed to be more of an internationalist and perceived to have sympathy for Muslim countries, having been raised in Indonesia. Perhaps he will be more willing to dole out aid to developing countries and to sympathize with the common rhetoric of Western democracy balanced with Asian values that is rife throughout this region. Hilary Clinton, on the other hand, seems to have a more shameful link to the region via ex-President Clinton who seems happy to do business deals here to help out his buddies and lend credence to regional leaders by talking to them.

I’d be interested in what you readers think. Which US Presidential candidate is best for Central Asia?