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Kyrgyzstan: In China’s tightening embrace?

 

Kyrgyzstan’s inability to escape China’s increasingly assertive influence is emblematic of the struggles faced by many smaller nations, who received investment from China under the Belt and Road Initiative (BRI). The country will have to decide between the lures of development and the demands of concerned citizens. 

 

15 Jan. 2019

By Julius Rogenhofer and Hacer Zekiye Gonul

 

Kyrgyzstan, revered by adventurous travellers as the “Switzerland of Central Asia” for its scenic mountain ranges, is not known for drawing international attention. Yet 2018 was marked by a series of political turbulences, which might become characteristic for the struggles faced by recipients of Chinese investment under the BRI. When in 2013 the former Kyrgyz President Almazbek Atambaev met Xi Jinping to upgrade Kyrgyzstan’s relationship with the Peoples Republic of China to a strategic partnership, this step was viewed by both sides as the spark for increased Chinese infrastructure investment into Kyrgyzstan. Both sides promised closer cooperation, including on combating what China refers to as the “three evils” of terrorism, separatism and extremism. Since 2013, the nation of approximately six million inhabitants has received between USD 200 million and USD 500 million annually in Gross Foreign Direct Investment from China, with loans from China amounting to 36% of the country’s sovereign debt (2015) and trade with China amounting to 28% of Kyrgyzstan’s total trade (2016).These figures are significant not only because exports to China from Kyrgyzstan are limited, but also because until the 1990s virtually all of Kyrgyzstan’s trading partners were members of the Soviet Union. 

 

Increased economic dependency on China was at the center of a heated corruption investigation launched against former Kyrgyz Prime Minister Sapar Isakov and former Bishkek Mayor Kubanychbek Kulmatov over the failure of the Chinese-modernized Bishkek Heating and Power Plant in January 2018. The two men stand accused of lobbying for the Chinese company that was awarded the modernization project without a tender and of redirecting Chinese financial aid received in connection with the modernization. The new President of KyrgyzstanSooronbay Jeenbekov must walk a tight rope between taking a stance on corruption and maintaining amicable relations with Xi Jinping. At the same time, new corruption allegations are emerging over other China-funded infrastructure projects, including the 433 km long road between North and South Kyrgyzstan, dubbed Kyrgyzstan’s biggest infrastructure project.

 

Beyond the corruption allegations, tensions between Kyrgyzstan and its overpowering Eastern neighbour have impacted both the Kyrgyz government and the country’s public sphere.A major source of ambivalence for the Kyrgyz population are rapid increases in the presence of Chinese companies and migrant labourers in the country. Chinese road work companies became a major source of employment for Kyrgyz citizens in the infrastructure projects agreed between the two nations. However, the vast influx of Chinese migrants to the small nation have triggered concerns among sections of the Kyrgyz population: According to local media sources thousands of Chinese migrants use illicit means to work in the country, which has adverse effects on the rental and housing markets. Chinese migrants already make up 75% of all migrants to Kyrgyzstan, which locals perceive as a threat to their own employment prospects and way of life. These concerns peaked over China’s demands for visa free access to Kyrgyzstan. While framed as an initiative to boost tourism, the Kyrgyz State Migration Service and the State Committee for National Security expressed concerns that those who enter the country under the guise of visa-free tourism would, in fact, become migrant labourers. The harsh, coercive tone in which the Chinese delegation demanded “visas for life” for its citizens has outraged both politicians and the Kyrgyz public. Meanwhile, President Jeenbekovhas come under increased pressure to speak out over the internment of Askar Yunus, a leading Kyrgyz historian and brother of the Kyrgyz parliamentary deputy Zhunus uulu Adyl, in a, so-called, “re-education” camp in Xinjiang. 

 

What emerges from these challenges is country torn between the urgent need for development and infrastructure expenditure and the significant political costs associated with China’s ostensible generosity: Corruption, lacking transparency and political meddling are only some of the hidden cost of China’s embrace. Perhaps this predicament should serve as a note of caution for European nations that are increasingly lured by “strings-free” Chinese investment.