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e-Magazine (For the Japanese version of this article)

Series: Central Asia and Japan: Part 6 Turkmenistan Neutral Country of Natural Gas and Deserts | Fumiaki Inagaki Senior Visiting Researcher Keio Research Institute at SFC [Date of Issue: 30/September/2013 No.0223-0905]

Date of Issue: 30/September/2013

Series: Central Asia and Japan: Part 6
Neutral Country of Natural Gas and Deserts

Fumiaki Inagaki
Senior Visiting Researcher
Keio Research Institute at SFC

Due to holding the world's fourth largest natural gas reserves, Turkmenistan is enjoying steady economic growth. Under the leadership of President Gurbanguly Berdimuhamedov, gradual progress is being made toward reform, and Turkmenistan's relationship with Japan looks likely to strengthen.

Central Asia's North Korea? Presidential Personality Cult

Turkmenistan is a unique country, sometimes called, for example, "Central Asia's North Korea". This is partly due to the personality cult that tends to build around the country's president. This was particularly pervasive in the case of Saparmurat Niyazov, who became First Secretary of the Communist Party of the Turkmen SSR at the end of 1985 during the Soviet era, and then went on to become the country's first president after independence. Turkmenistan's presidential system, whereby the president as head of state is also the prime minister, inevitably vests a lot of power in presidential hands. On top of this systemic factor, Turkmenistan's parliament—the Majilis—gave the title "Turkmenbashi", or "leader of the Turkmen people", to Niyazov in 1993 to boost his authority still further. In December 1999, Turkmenistan also became the only country in the world to have a president for life when the People's Congress, or Halk Maslahaty, which is Turkmenistan's supreme authority, granted this status to Niyazov. The president's portrait was everywhere, and the government made the Niyazov-authored Book of the Soul ("Ruhnama") required reading in schools even as it enforced information control elsewhere, including the banning of Internet use.

A Foreign Policy of Active Neutrality

The presidential personality cult is not the only representation of Turkmenistan's uniqueness. In its foreign policy too, Turkmenistan has adopted a different approach to the other Central Asian nations—namely, "active neutrality". The United Nations General Assembly recognized Turkmenistan's permanent neutrality status in December 1995, and the country is also not interested in participating in regional organizations like the Collective Security Treaty Organization (CSTO) and the Shanghai Cooperation Organization. While it was formerly a full member of the Commonwealth of Independent States (CIS), the Soviet Union's successor institution, Turkmenistan has not ratified the CIS charter, and in 2005 changed its CIS standing to associate member. On the other hand, the Turkmen government maintains diplomatic ties with the two countries which lie on her southern border, Afghanistan and Iran. Even as international sanctions remain in place against Iran because of Iran's nuclear development program. on the basis of its neutral status, Turkmenistan continues to export natural gas and power there . For Turkmenistan, its relationships with Afghanistan and Iran are very important for security reasons.

Abundant Natural Gas

As seen above, Turkmenistan has a unique internal political situation and diplomatic policy, but it also has natural gas reserves which as at the end of 2012 were the fourth largest in the world (according to BP, 17.5 trillion cubic meters), and that abundant resource has supported steady economic growth. According to the IMF, Turkmenistan's gross domestic product (GDP) reached US$33.68 billion in 2012. While this is only the third largest GDP in Central Asia after Kazakhstan (US$194.26 billion) and Uzbekistan (US$45.35 billion), Turkmenistan comes in second in terms of per capita GDP with US$5,998.7 against Kazakhstan's US$11,729.3, with Uzbekistan at third with US$1,367.1.

Per capita gross national income (GNI) has grown six times from US$800 in 1993 immediately after independence to US$4,800 in 2011, which is a faster rate of expansion than Kazakhstan, where GNI has risen 5.8 times. Turkmenistan uses the national revenue from the exporting of natural gas to provide the public services of power, gas and water free of charge. While the country might labor under a pervasive personality cult and information control, it differs from North Korea in its economic affluence.

Natural Gas Pipeline Policy: From Russia to China and Southward

As of the Soviet era, Russia was the only route out for the natural gas exports underpinning Turkmenistan's economy, but today a 7,000-kilometer pipeline runs to China through Uzbekistan and Kazakhstan. Turkmenistan and China reached an agreement on that pipeline during President Niyazov's visit to China in April 2006, with operations launched at the end of 2009. In November 2011, the Turkmenistan and Chinese governments agreed to expand the amount of natural gas supplied to 6.5 billion cubic meters, or 20 percent of China's total consumption, by 2020. On 3 September this year, during Chinese President Xi Jinping's visit to Turkmenistan, he and President Berdimuhamedov reaffirmed this expansion. Currently, more than half of Turkmenistan's natural gas exports go to China.

Breakdown of Turkmenistan’s natural gas exports (2012)
By strengthening its relationship with China, Turkmenistan has succeeded in considerably reducing its dependence on Russia in terms of natural gas exports, but overdependence on China is not a good thing either. Since Niyazov's era, Turkmenistan has been working to diversify its natural gas pipelines, including the planned Trans-Caspian Gas Pipeline and TAPI Pipeline. For the former, Turkmenistan wants to build a pipeline which crosses the Caspian Sea to export natural gas to Europe via Azerbaijan on the opposite coast. The latter is intended to link Turkmenistan, Afghanistan, Pakistan and India (the abbreviation comes from the first letters of those countries). Unfortunately, in the case of the Trans-Caspian Pipeline, countries bordering the Caspian Sea are at loggerheads over territorial rights to the Caspian Sea, and the TAPI Pipeline has yet to be realized because of the unstable situation in Afghanistan. These plans, however, mean that Turkmenistan understands the risk of depending on Russia and China for its natural gas supply routes, and suggest that Turkmenistan is highly likely to pursue a more multilateral diplomacy to relativize its dependence on China..

Gradual Reform post-Niyazov

Because of the despotic and insular nature of the Niyazov administration, it was difficult to predict who would take over after Niyazov's death at the end of 2006, and there were fears of turmoil. However, Minister of Health and Deputy Prime Minister Gurbanguly Berdimuhamedov, appointed by the Halk Maslahaty as acting president, subsequently won the presidential election with 89.23 percent of the vote in the February 2007, laying rest to those fears. On taking over power, Berdimuhamedov promised to address democratization and economic reform. For example, he is implementing education reforms, including reintroducing foreign language teaching and extending the length of compulsory education, and liberalizing information access, such as allowing Internet cafes to open. In September 2008, Berdimuhamedov amended the constitution, abolishing the 2,500-member Halk Maslahaty, almost every member of which was a presidential appointment, and transferred legislative power entirely to the elected Assembly. In 2010, the Turkmen government permitted the formation of an (albeit government-organized) opposition Agrarian Party as the first political party aside from the Democratic Party of Turkmenistan. On the diplomatic front, Turkmenistan is beginning to show interest in participating in regional organizations, attending the SCO Summit as a guest with observer status, and it is also working to normalize relations with Uzbekistan and other neighbors. Under Berdimuhamedov then, Turkmenistan is making gradual progress with reform.

Relations with Japan: Last Central Asian Embassy in Japan

Japan and Turkmenistan have strong economic ties. In 2002, Komatsu Ltd. and Itochu Corporation formed a contract with the government of Turkmenistan to supply 200 pieces of heavy machinery every year until 2010 for pipeline construction, repair and maintenance. In addition, Komatsu opened a training center in Ashgabat the next year. The Japan Bank for International Cooperation (JBIC) also signed a loan agreement totaling up to approximately 45 billion yen with the Turkmenistan government in 2010 for the construction of an ammonia and urea fertilizer production plant, with the construction order going to Sojitz Corporation and Kawasaki Plant Systems, Ltd. In March this year, Japan and Turkmenistan established the Japan-Turkmenistan Network for Investment Environment Improvement, and Turkmenistan opened an embassy in Japan in May, heralding the further strengthening of bilateral relations.

President Berdimuhamedov made his second trip to Japan on 11-13 September this year, the first having taken place in December 2009. His summit meeting with Prime Minister Abe resulted in the signature of six agreements, including the Joint Statement between Japan and Turkmenistan on the New Partnership and an agreement on technical cooperation. At the private sector level, Sojitz and Mitsui Engineering and Shipbuilding Co., Ltd. received an order to build a chemical plant producing sulfuric acid, with JBIC providing around 20 billion yen in financing support. Japan and Turkmenistan did not hold summit talks in the Niyazov era, whereas under the Berdimuhamedov regime, the Turkmenistan president has visited Japan twice. These official visits mark a change in the Berdimuhamedov government's diplomatic and domestic policy that is taking Japan-Turkmenistan relations into a new phase.

(original article : Japanese)
(For the Japanese version of this article)

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