Energy issues a significant factor in Kyrgyz ousting U.S. from Manas air base

WASHINGTON, Feb. 4 (UPI) -- The Pentagon is in a state of deep denial over the Kyrgyz Parliament's apparently imminent vote Friday to abrogate the Status of Armed Forces Agreement allowing the U.S. military to use Manas Air Base 17 miles from Bishkek in support of the administration's global war on terror.

Manas was established in late 2001 as a transit point for NATO supplies to the international coalition in Afghanistan and now houses more than 1,000 military personnel. Two years later the Russians checkmated Washington's new base by setting up their own military air base at Kant, also near Bishkek.

In the coming days, as denial gives way to sullen acceptance, officials in Washington will complain about crafty nemesis Russian Prime Minister Vladimir Putin and begin assigning blame for "who lost Kyrgyzstan."

Kyrgyz President Kurmanbek Bakiyev's decision, however, has been carefully thought out for some time and is the result of years of American obtuseness, arrogance and stinginess.

Russia's decision to fund the construction of Kyrgyzstan's Kambarata-1 hydroelectric power cascade, after years of futile attempts by Bishkek to raise funds from the international community, may well have tipped the balance. During his visit to Moscow, besides negotiating fiscal assistance, Bakiyev and Russian President Dmitry Medvedev formed a joint stock company incorporating Kyrgyzstan's Elektricheskie Stantsii and Russian Inter RAO EES. Kyrgyzstan's 15 hydroelectric stations generate 92.5 percent of domestically consumed electricity, but the aging network is in desperate need of renovation and expansion.

What financial assistance did the Kremlin offer Kyrgyzstan? A $2 billion loan and a non-refundable credit worth $150 million to cushion the country against economic decline caused by the global financial crisis, along with writing off Kyrgyzstan's $180 million debt to Russia.

Amidst Russia's fiscal largesse to Kyrgyzstan, the lion's share, $1.7 billion, is allocated as credit for completing construction of the Kambarata-1 hydropower station over the next four years. Again, this credit is hardly a spur-of-the-moment gesture of generosity on the Kremlin's part but, rather, part of the $2 billion assistance to Kyrgyzstan promised by President Vladimir Putin in August 2007. This in turn followed a Russian-Kyrgyz agreement announced on Dec. 15, 2006, to invest a billion dollars in constructing the Kambarata-1 and Kambarata-2 hydroelectric cascades, which would supply electricity not only for domestic consumption but also for export to Afghanistan, China or Pakistan. Negotiations on funding and ownership in the project remained gridlocked until Bakiyev's visit to Moscow, however.

For Bakiyev, the Pentagon's obdurate refusal to re-examine the original fiscal terms of the Manas leasing arrangement was a major factor in his decision. Bakiyev told reporters: "We have repeatedly discussed with our American partners the issue of economic compensation to Kyrgyzstan in return for hosting the base. But unfortunately, we did not reach an understanding with the United States. We have been saying for three years already that we must re-examine the conditions of this agreement, that those questions of economic compensation don't meet the requirements of Kyrgyzstan in any way."

According to Bush administration budget documents released a year ago for fiscal year 2008 U.S. foreign aid, while Afghanistan was slated to receive $1.07 billion, funding for the five Central Asian states of the former Soviet Union declined 24 percent compared with the amount of assistance allocated in fiscal year 2006. Kyrgyzstan was to receive $26.5 million, a decrease of more than $5 million from two years earlier.

For specialists, such policies were having a negative impact. Martha Brill Olcott, a Central Asia specialist at the Carnegie Endowment for International Peace, observed: "We're sending really tiny sums there. The United States has had declining influence in the area, and this isn't going to stop it."

Nevertheless, during last summer's negotiations over the base, State Department spokesman Sean McCormack commented the United States would pay more than $150 million in assistance and compensation for the base, while a government statement said the United States since 1991 had contributed more than $850 million to support democracy, economic development, aid and security in Kyrgyzstan. Bakiyev in Moscow cited different figures and criticized the annual U.S. rent of $63 million as "too little."

What McCormack neglected to tell reporters was that U.S. aid, particularly the operations of various American non-governmental organizations promoting democracy, increasingly came to be viewed with suspicion by Kyrgyz officials as covert fronts to subvert the government, a suspicion heightened in the wake of the March 2005 "Tulip Revolution" that ousted President Askar Akayev and brought Bakiyev to power.

Following Akayev's departure, Mike Stone, director of American NGO Freedom House in Bishkek, commented simply, "Mission accomplished," which raised eyebrows throughout Central Asia as to the real purpose of American assistance.

While the sums involved may seem trifling to Washington, they are of critical importance in Kyrgyzstan, where, according to Minister of Labor and Social Development Uktomhan Abdullayev, 35 percent of the population now lives below the poverty line, while Kyrgyzstan's foreign debt, now equivalent to around 40 percent of gross domestic product, has ruined Bishkek's ability to secure substantial loans from international investors.

The Pentagon's wishful thinking aside, on Feb. 4 the Kyrgyz government press service stated, "The government of Kyrgyzstan has approved a bill terminating the Kyrgyz Foreign Ministry note issued in response to a U.S. Embassy note of Dec. 4, 2001, which constitute together an intergovernmental agreement."

Bakiyev's decision increases Russia's already looming presence in the Kyrgyz energy market. The Kyrgyz natural gas industry is bankrupt, and last October the government announced it was studying selling Gazprom about 75 percent of the country's state-owned natural gas company Kyrgyzgaz.

With the West absent from Kyrgyz energy investment, Bakiyev said in a Dec. 28 interview with the Russian media, "Russia was always, is and will be the most important strategic partner of Kyrgyzstan."

The decision to cancel the air base deal is not universally applauded in Bishkek: Kyrgyz Social Democratic Party parliamentary head Bakyt Beshimov said, "The country's political elite should ask themselves the question: To which extent Bakiyev's decision meets the country's long-term national interests." Alikbek Dzhekshenkulov, leader of the "For Justice!" opposition group, said, "It may be dangerous for such a small country as Kyrgyzstan, which is vulnerable in many respects, especially as regards security issues, to play between great powers like Russia and the U.S."

Miroslav Niyazov, a former Kyrgyz Security Council secretary, told reporters: "The withdrawal of the Manas anti-terrorist coalition air base from Kyrgyzstan runs counter to this country's national interests. Kyrgyzstan does not have its own security system, and the presence of the air base met our national interests by providing such a system."

According to a Feb. 4 report in Russian newspaper Nezavisimaya Gazeta, Kyrgyz air force Commander of Air Defense Oleg Popik stated that Russia will deploy anti-aircraft missile batteries in the south of the country. Russian analysts are also speculating that Moscow will acquire 100 percent ownership in a secret joint Kyrgyz-Russian factory on Lake Issyk-Kul that manufactures advanced "Squall" torpedoes.

A pundit recently observed, "The Russians play chess, the Americans checkers." Apparently the Kyrgyz play not only the game of their former imperial masters, but dominoes with penny pinchers in Washington as well.