14. MASSIVE FRAUD, BUT WHAT OF IT WHEN THERE IS OIL TO BE HAD?

Ukraine has none, Kazakhstan is awash with the stuff



ANALYSIS & COMMENTARY:

Chris Stephen, Irish Times,
Dublin, Ireland, Friday, Dec 16, 2005

Astana Letter: One year ago the government of a former Soviet republic
rigged an election and the West erupted in fury. With protesters filling the
streets, American and European leaders issued strong condemnations.

The weekend before last it happened again, but the West raised not a
whisper. The difference is oil: Ukraine, of Orange Revolution fame, has
none, whereas Kazakhstan is awash with the stuff.

Hence the stony silence from the outside world when president Nursultan
Nazarbayev romped home with an improbable 91 per cent of the vote in a
presidential election teeming with irregularities.

So much for a neutral election press centre – it was run by the president’s
daughter in a snowbound hotel in Kazakhstan’s capital, Astana. And the
T-shirted handmaidens, who served me free coffee, cake, nuts and chocolate,
did not happen to have the phone numbers of opposition parties.

Downstairs, election monitors spent a lonely press conference recording
fraud, intimidation, censorship, ballot-rigging and media manipulation. They
might as well have been talking to the wall.

“Nobody wants to rock the boat,” says a western oilman, sitting with me in
an Italian-style restaurant in one of the glitzy shopping centres in Almaty,
Kazakhstan’s former capital and still its commercial hub.

With American, Chinese, Anglo-Dutch, French and Russian oil companies
salivating over Kazakhstan’s riches, nobody wanted to upset the president.

Admittedly there are other differences with Ukraine, the first being the
lack of much of an opposition. Deference, inherited from the time when three
tribal chieftains ran this country, is deeply ingrained and protesters are
noticeable by their absence.

For another thing, Kazakhstan’s president is a nice guy. Not so nice that he
investigates how a key opponent managed to shoot himself no fewer than
three times while committing suicide – the police verdict – last month, but nicer
than most other rulers in this neck of the woods.

He did not drop poison into the soup of his opponent, as happened in
Ukraine, or shoot dead 200 protesters, as in Uzbekistan, or stage a
Tiananmen Square massacre as did China. “If you look around the
neighbourhood, it doesn’t get any better than this,” says my oilman, and it
is hard to disagree.

Although Transparency International rates this as one of the world’s most
corrupt states, it is also, in the Muslim world, one of the most tolerant.
The best place to see this tolerance is not in its new, antiseptic capital
but in Almaty, the country’s beating business heart.

Nestling at the spot where the great steppe that runs north to Russia
collides with the mountains that run south to the Himalayas, it was for
centuries a crossroads for travellers and home to a rough-and-ready
tolerance.

Mosques jostle with churches, pubs with shrines; and bazaars dating from
the time of the great Silk Road sell spices from India, perfumes from the
Orient, and pirate CDs from China.

Bumper-to-bumper SUVs and German saloons bought with oil cash fill the
boulevards, and the first snows of winter provide great entertainment as
speeding drivers reared on Ladas lose control of their powerful new
machines.

There are no political prisoners and police on the streets do not
ritualistically check your ID as they do in neighbouring Russia.

Rather, the culture is so attuned to following orders that it is hard to see
how democracy can get a foothold. At a hotel gym, the receptionist told me
that if I took my sheepskin coat inside, rather than leaving it as required
in the cloakroom upstairs “we will get into trouble”.

Finally, the president, while seriously dodgy – witness the billion dollars
of state cash he was forced to admit stashing away in Swiss banks – is at
least a shrewd operator. He has used considerable skill in keeping rapacious
foreign companies from gobbling up his country.

This does not mean Kazakhstan is a jolly old place. Outside busy Almata and
gleaming Astana, poverty is appalling and, for the world’s 10th richest oil
state, frankly inexcusable. “The richest people in my family village are the
pensioners, and the state pension is tiny,” a young Kazakh human resources
manager told me.

Meanwhile, rampant corruption stifles enterprise, cripples the middle class
and rewards parasites. This corruption and lack of democracy will remain in
place as long as the oil companies – and, to be fair, their customers, you
and me – impose no ethical standards on the people from whom they buy their
oil.

My oilman concedes these points, but he is the exception. Most oilmen prefer
corrupt regimes to straight ones because, with no tiresome social programmes
to attend to, the profits are bigger. But ask an oilman where he banks, or
plans to retire, and he says “in a democracy”. -30-

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