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Published on Central Asia-Caucasus Institute Analyst (http://www.cacianalyst.org)

25 February 2008 News Digest

By Alima Bissenova (02/25/2009 issue of the CACI Analyst)

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Iran enters Tajik energy market as U.S. and Russia idle
12 February
Iran is filling an investment gap in Tajikistan left by the United States and Russia, agreeing to spend on hydropower and other quality-of-life projects. Iran has offered to help Tajikistan complete the construction of the 3,600 megawatt Rogun hydroelectric power station on the Vakhsh River, 70 miles east of the capital, Dushanbe. If built, it would be Central Asia's largest.  Begun in 1976, Rogun, if completed, would have been the world's highest dam, at 1,099 feet, but Moscow assigned it a lower priority. Until last month Dushanbe looked to Moscow as its best potential partner for achieving its hydroelectric dreams. In 2004 the Tajik government and Russia's Rusal aluminum company concluded an agreement to complete Rogun, whose electricity would be used to produce aluminum, but construction was stymied because of technical differences between Dushanbe and Rusal over the facility's specifications. In late August 2007 the Tajik government declared the agreement null and void but was unable to raise sufficient foreign interest to fund the estimated $3.4 billion needed to complete Rogun, which by this time was 40 percent finished. Tajikistan remained optimistic that outstanding differences with the Kremlin over Rogun could be resolved, particularly since Russia is already a significant player in the Tajik energy market. The 670-megawatt, four-unit Sangtuda 1 hydroelectric project, currently under construction in southeastern Tajikistan, is a joint Tajik-Russian project in which Russia has a stake of more than 75 percent. Tajik hopes that Moscow might still participate in finishing Rogun were dashed last month, however, during a state visit to vast natural gas holder Uzbekistan by Russian President Dmitry Medvedev. The Uzbeks fear Rogun would harm the supply of water to agricultural needs in downstream states.Medvedev told journalists during the visit that new Central Asian hydroelectric facilities should be built taking into account not only the neighboring countries' interests but also international legal definitions of transboundary rivers' flows, adding Moscow "would refrain" from projects lacking legal accords. Tajikistan, furious at Moscow's apparent siding with Uzbekistan, delivered a formal note of protest to the Russian government. Iran saw -- and seized -- the opportunity. During a Feb. 8 news conference in Dushanbe, Iranian Ambassador Ali Asghar Sherdust told reporters his country would assist in completing Rogun "both at the governmental level and via the private sector." Iran is also helping Tajikistan develop another hydroelectric project at Shurob. If completed, Rogun would even allow Tajikistan to export electricity, most notably to its power-starved southern neighbor, Afghanistan, as well as Pakistan [1]. In turn, last week Tajik President Emomalii Rahmon telephoned Afghan President Hamid Karzai [2], who stated that he backed Tajik initiatives on use of regional water resources. Iran is preparing to put its cash into a "quality of life" project that Tajiks, who have suffered electricity cuts this winter of up to 14 hours, will view with gratitude. (UPI)

 

Five Children Killed In Afghan Shoot-Out With Taliban
13 February
Five children have been killed after a shoot-out between Taliban insurgents and Australian soldiers in Afghanistan, the Australian Defense Force said. The incident happened on February 12 in Oruzgan Province, where Australia's special forces were clearing a number of houses in the hunt for insurgents, defense officials said in a statement."Current reporting indicates that those killed include a suspected insurgent and, sadly, local nationals including five children killed, and two children and two adults injured," it said. Those injured in the incident were treated at the scene and evacuated for further treatment. Australia's military has started an inquiry into the incident, but said the rules of engagement for forces in Afghanistan were designed to minimize civilian casualties. Australia has around 1,100 troops in Afghanistan, based mainly in the southern Uruzgan Province where the Taliban has a strong presence. (Reuters)

 

Aliyev: Azerbaijan needs non-oil growth
13 February
Azerbaijan needs to advance in competitive areas in the non-oil sector in order to reduce dependency on the energy market, the Azeri president said."We should increase attention to the establishment of competitive areas of production in order to lower Azerbaijan's dependence on oil production and oil prices," President Ilham Aliyev [3] told Russian news agency Itar-Tass. He said the role of his country in the regional energy [4] sector was in line with national objectives, but Azerbaijan needs to put a greater emphasis on other areas that are just as important as the oil sector. Aliyev hailed the job growth in the non-oil sector as a major achievement in economic and social reform, pointing to the creation of more than 500,000 new jobs in the past five years. "All these show that the social program and economic reforms carried out in our country are effective," he said. Azerbaijan sits on major energy reserves, notably in offshore fields in the Caspian Sea. It also hosts several major oil and pipelines.  The U.S. Energy Information Administration says Azerbaijan produced roughly 860,000 barrels of oil per day in 2007. (UPI)

 

Turkish, Russian Presidents on Caucasus Security
14 February
Russia and Turkey are willing to strengthen security in the Caucasus and cooperate on “supplementary” security measures for the region, the Turkish and Russian Presidents said after meeting in Moscow on February 13. “Our countries are naturally interested to strengthen security in the Caucasus region and to have a proper security in the Black Sea [region]. In this, we are fully in solidarity on number of issues, which can strengthen this security,” Dmitry Medvedev said at a joint news conference with his Turkish counterpart, Abdullah Gul. “The August crisis, last year, showed how important coordination between all countries of the region is when such threat emerges; and it also showed, that we can deal with such problems ourselves, without the involvement of outside powers,” he added. A joint declaration signed by the two presidents reads: “Recognizing that the stability and security of the Eurasian region is directly linked to the stability in the South Caucasus, the parties [Turkey and Russia] agree that effective measures are needed to be taken for resolving the frozen conflicts, which represent potential destabilizing element for the South Caucasus. In this context, the parties consider the Turkish-proposed initiative of creating the Caucasus Stability and Cooperation Platform as constructive and supplementary to the already existing international mechanisms, which is capable to remove lack of confidence between the parties involved in the frozen conflicts.” (Civil Georgia)

 

Moscow affirms commercial terms of U.S. cargo transit to Afghanistan

16 February
Terms of U.S. non-military cargo transit to Afghanistan across Russia will be commercial, a source at the Russian   Foreign  Ministry's  information  and  press  department  told Interfax on Monday. "The transit  will be conducted on commercial terms. Most probably the first trains will cross Russia within the next few days," he said. The precise date of the transit is so far unknown, the source said. The first freight train is being formed in Riga, he added. (Interfax) 


Georgia to pay for water from S. Ossetia from April 1
17 February
The South Ossetian government made a decision  that  consumers  should  pay  for fresh and irrigation water supplied  to  Georgia  from  South  Ossetia  from April 1 at its meeting chaired by South Ossetian President Eduard Kokoity on Tuesday. "Inform the Georgian side about  this. And we need to carry out relevant financial work in order to set the price for using water,"K okoity said. "If the Georgian side refuses, we will stop supplying water to the Georgian territory," the president said. (Interfax)

 

New Tajik-Afghan-Iranian TV Network Discussed
18 February
Iran and Tajikistan are discussing the creation of a Tajik-Afghan-Iranian TV network with Iran providing the equipment, Afghanistan providing the air time, and Tajikistan providing the studios.Tajik State Committee of TV and Radio Director Asadullo Rahmonov told RFE/RL's Tajik Service that the director of Iranian International Broadcasting arrived in Dushanbe on February 17 to discuss ways to strengthen the two countries' partnership, which was established in 2007. Experts say that the main obstacles to the launching of the network are Afghanistan's multilingual audiences and policy differences between the countries, such as Iran's insistence that female moderators wear the hijab. Rahmonov said he hopes that the sides can find a compromise on all issues. (RFE/RL)

Kazakhstan needs pipeline developments

18 February
Kazakhstan needs major expansions to handle the spike in oil exports expected once the offshore [5] Kashagan field enters full production, Chevron says. Ian MacDonald [6], a vice president at the California-based supermajor, said Kazakhstan needs to boost its export capacity quickly to cope with anticipated production levels, The Wall Street Journal reported Wednesday. "With Kazakhstan expected to add a minimum of over 1.5 million barrels a day of production over the coming 15 years, it needs new, dedicated and reliable export capacity, and it needs it urgently," he said. The offshore Kashagan field was one of the biggest oil discoveries in the past three decades, but it lacks an export pipeline to hand exports. Plans are in the works for an export system [7] to bring oil from western Kazakhstan to Caspian ports and on to oil transit routes in Azerbaijan. That project, however, may not be completed by the time full production at Kashagan begins, the Journal said. Kazakh oil made its debut, meanwhile, through the Baku-Tbilisi-Ceyhan oil pipeline, the world's second longest, in November, with promises of 120 million barrels of oil per year. This marked the first time crude oil outside Azerbaijan transited to the pipeline. (UPI)


Georgia, Abkhazia, S.Ossetia agree on terms of preventing, dealing with incidents – Karasin
18 February
The fourth round of the international discussions  in  Geneva  has  produced  proposals on joint mechanisms of preventing  incidents  and  dealing  with  them,  leader  of the Russian delegation, Deputy Foreign Minister Grigory Karasin said. "It  is the first joint agreement to have been reached by the three Caucasus  states after the end of the Georgian aggression in August 2008 and after  Abkhazia and South Ossetia gained independence," Karasin told Interfax after the consultations on Wednesday. (Interfax)


Obama Orders 17,000 More U.S. Troops To Afghanistan
18 February
U.S. President Barack Obama, in his first major military decision as commander-in-chief, has ordered 17,000 more troops to Afghanistan to tackle an intensifying insurgency, the White House has said. But in an interview with Canadian Broadcasting Corporation (CBC) ahead of a visit to that country, Obama also said military means alone would not solve the problem. U.S. officials have said Washington and its allies are not winning in Afghanistan, more than seven years after toppling the Taliban for giving sanctuary to Al-Qaeda leaders thought to have been responsible for the September 11 attacks on the United States in 2001. The extra 17,000 troops will increase the U.S. military presence in Afghanistan by more than 40 percent. "This increase is necessary to stabilize a deteriorating situation in Afghanistan, which has not received the strategic attention, direction and resources it urgently requires," Obama said in a statement. But in an interview with CBC, Obama said, "I'm absolutely convinced that you cannot solve the problem of Afghanistan, the Taliban, the spread of extremism in that region, solely through military means."He added: "We're going to have use diplomacy, we're going to have to use development, and my hope is that in conversations that I have with [Canadian] Prime Minister [Stephen] Harper that he and I end up seeing the importance of a comprehensive strategy." (Reuters)

 

Tajikistan, Uzbekistan Sign Deal On Power, Water

19 February
Tajikistan and Uzbekistan have signed an agreement establishing closer economic ties that will ease the electricity shortage in Tajikistan, RFE/RL's Tajik Service reports.  Parts of Tajikistan have been without power since December, when Uzbekistan stopped allowing Turkmen electricity to be carried to Tajikistan. Other regions of Tajikistan have been rationing electricity. The two countries also approved a debt repayment timetable, trading Uzbekistan's $16 million debt to Tajikistan for Uzbek natural gas. A water-sharing agreement was also put in place for a reservoir in northern Tajikistan. Tajik experts say the agreement should ease the strained relations between the two countries. (RFE/RL)

Kyrgyz Parliament approves US airbase closure
19 February
Kyrgyzstan's parliament has voted overwhelmingly to approve a government proposal to close a U.S. air base in the Central Asian nation. The Manas air base is a vital transit point [8] for U.S.-led troops fighting in nearby Afghanistan. The decision was passed by 78 votes to 1 against by the legislature dominated by the ruling Ak Zhol party. The closing of Manas, the last remaining U.S. air base in Central Asia, would pose a challenge [9] to new U.S. President Barack Obama's plans to send additional troops to Afghanistan to boost NATO and U.S. military efforts to defeat Taliban insurgents. It also comes at a time of heightened rivalry between Moscow and Washington for control of Central Asia, a vast former Soviet region still seen by Russia as part of its traditional sphere of interest."Once all the procedures are over, an official eviction vote will be sent and after that the United States will be given 180 days to wrap up operations at the air base," Kyrgyz Foreign Minister Kadyrbek Sarbayev told journalists after the vote. He could not say when President Kurmanbek Bakiev was expected to sign the approved decision into law, but under Kyrgyz that should happen within a month. Bakiev announced the closure plans this month after accepting more than $2 billion in aid and credit from traditional ally Russia. He has accused Washington of refusing to pay more rent for use of the base. "We are definitely voting to close the base. We do not need other countries' military bases here. We have always called for strategic cooperation with Russia," Communist Party deputy Iskhak Masaliev said, addressing the chamber. Russia has an air base of its own in Kyrgyzstan, located in Kant just a few dozens kilometers away from Manas. (Reuters)

 

Tajikistan To Allow Nonmilitary NATO Cargo For Afghanistan

20 February
Tajikistan has agreed to allow the transit of NATO nonmilitary cargo through its territory to Afghanistan, a U.S. military commander has said on Tajik state television. "Tajikistan has allowed [NATO] to use its railways and roads to transit non-military goods to Afghanistan," said Rear Admiral Mark Harnitchek of the U.S. Transportation Command. The announcement comes amid reports that Kyrgyz President Kurmanbek Bakiev has signed a bill approved by lawmakers [10] on February 19 to evict U.S. forces from a key air base near Bishkek to supply operations in Afghanistan. The president's signature reportedly clears the way for an eviction notice to the U.S. military, although U.S. Defense Secretary Robert Gates suggested [11] during a NATO meeting in Poland that the U.S. is still negotiating for continued use of the facility. Reports suggest Washington is examining other possible supply routes [12], including talks with neighboring Uzbekistan for the possible use of a base there. U.S. and NATO officials have expressed particular concern over Russia's presumed role in encouraging the Kyrgyz move, which was announced by Bakiev during a visit to Moscow that included a Kremlin promise of billions of dollars in aid. (Reuters)

Kazakh oil through BTC increasing
20 February
The volume of oil [13] from Kazakhstan through the Baku-Tbilisi-Ceyhan pipeline increased steadily since coming online in 2008, statistics show. Kazakh oil from the Kashagan field in the Caspian Sea made its debut through the BTC in November, marking the first time crude oil outside Azerbaijan [14] transited to the 1,099-mile pipeline. The State Statistics Committee of Azerbaijan reported January transports of Kazakh oil reached 120,825 barrels, up from 89,475 barrels in November, the Azerbaijan Business Center reports. In January, the Turkish state-owned pipeline firm, BOTAS, said crude oil transports through the BTC passed 500 million barrels from June 2006. Kazakhstan's national KazMunaiGas and the State Oil Co. of Azerbaijan Republic in November agreed on the principles of the Trans-Caspian project to ferry natural resources across the Caspian Sea to ports in Azerbaijan. The initial stages of the Trans-Caspian system will transport 500,000 barrels per day across the Caspian, with later estimates eclipsing 1 million bpd. (UPI)

 

Azerbaijan says three soldiers killed near rebel region
23 February
Three Azerbaijani soldiers have been killed and one wounded recently in incidents near the breakaway region of Nagorno-Karabakh, the Azerbaijani Defense Ministry has said. Two were killed by a land mine on February 20. Another died and one was wounded in weekend clashes with Armenian soldiers over their tense front line. Ethnic-Armenian separatists, backed by Armenia, fought a war in the 1990s to throw off Azerbaijan's control over Nagorno- Karabakh. About 30,000 people were killed. A fragile cease-fire is in force but a peace accord has never been signed and incidents are common. The dispute is one of the most intractable and potentially explosive in a region vital for oil and gas supplies from Azerbaijani reserves in the Caspian Sea to Western Europe. "As a result of violations of the cease-fire by the Armenian side, from February 19 to 22 three Azerbaijani soldiers died," an Azerbaijani Defense Ministry spokesman told Reuters. Azerbaijani ANS television reported four had died and one was wounded. Nagorno-Karabakh's de facto authorities reported "cease-fire violations," including sniper fire, through February 21, saying its soldiers had been forced to return fire. There were no Armenian casualties. International mediators from the Organization for Security and Cooperation in Europe (OSCE) said last month they hoped for an accord between Caucasus neighbors Armenia and Azerbaijan in the near future. Analysts say last year's war between Russia and Georgia, when Russia repelled a Georgian assault on breakaway South Ossetia, has lent fresh impetus to mediation efforts on Nagorno-Karabakh. (Reuters)

 

Iran, USA ready to normalize relations - Iranian minister

23 February
Tehran expects that Iranian-U.S. relations will normalize, Iranian Foreign Minister Manuchehr Motaki has said in an interview with Azerbaijan's ANS TV channel. "Both sides have agreed to turn their ties in a positive direction. One side  is  speaking of change and the other - Iranian - has agreed to that," he   said   commenting   on   the  intentions  of  the  new  U.S. administration to conduct a direct dialogue with Iran. "We  are a very sincere state and we are following the changes they have made  in  their  attitude.  On our own part we are taking steps corresponding to the changes in their attitude," Motaki said. The minister said he favors defining the future agenda in all other spheres, not just the nuclear program. "All talk about this [nuclear] program is over already. In any case America  is  facing various issues and we hope that the right steps will be taken in the direction of bilateral relations," he said. (Interfax-Azerbaijan)

 

Kazakh Police Round Up Illegal Migrants
23 February
Almaty city police have detained 111 illegal immigrants in one of the city's market places, RFE/RL's Tajik Service reports. The majority of those detained on February 20 were from neighboring Central Asian states. Saltanat Azirbek of the Almaty city police told RFE/RL that 74 Tajiks, 14 Kyrgyz, and 10 Uzbeks were among those arrested. She said the majority of the migrants are likely to be deported, adding that the court will decide their fate. Almaty police say that more than 43,000 labor migrants in Kazakhstan's largest city broke the law last year. (RFE/RL)

 

EBRD Says Turkmenistan Progressed Economically

24 February
The European Bank for Reconstruction and Development's (EBRD) transition report for 2008 says that Turkmenistan has made progress in carrying out economic reforms, though the country still has a long way to go in reforming and growing its private sector. Heike Harmgart, an EBRD economist and delegation head for Turkmenistan, told RFE/RL's Turkmen Service that "the gas export price has developed very positively for Turkmenistan, [and] that actually supports the overall growth forecast for Turkmenistan" and its GDP growth forecast. Harmgart added that the key challenge for Turkmenistan to reach its growth potential lies in private-sector reforms and reform of the banking sector. (RFE/RL)

Azerbaijani oil group suspends environmental projects
24 February
State Oil Company of the Republic of Azerbaijan (SOCAR) President Rovnag Abdullayev has announced that the company has frozen indefinitely money allocated for 2009 environmental projects due to financial constraints brought on by the global financial crisis, RFE/RL's Azerbaijani Service reports. SOCAR's environmental program said last year that it had cleaned up 500 acres of environmentally damaged property since 2006, a fraction of the total amount of land that requires clean-up. SOCAR had announced reductions in oil output earlier this year, and last month crude-oil production in Azerbaijan dropped by 8 percent, to 3.6 million tons, as international oil prices also fell by more than two-thirds against last summer's highs. (RFE/RL)

SOCAR announces crude tender
25 February
he State Oil Co. of Azerbaijan Republic announced a tender for 600,000 barrels of its crude oil at the Supsa port available at the end of March. SOCAR said it would announce the results of the tender for the Azeri Light Crude volumes Thursday, the Azeri Press Agency reports. The 515-mile Baku-Supsa pipeline to the port boasts a maximum capacity of 55 million barrels of crude [15] oil per year. Azeri customs agencies in December said its vast pipeline networks accounted for 211.7 million barrels of oil exports as of Dec. 1.In 2008 Baku-Supsa carried some 2.6 million barrels of oil. The Baku-Tbilisi-Ceyhan oil pipeline, the world's second longest, carries the bulk of the oil from the region. Operators at the offshore Azeri-Chirag-Guneshli complex said oil production [16] fell short of 2008 goals, with the latest estimates from BP Azerbaijan at just 668,500 barrels per day, compared with 900,000 bpd in 2007. (UPI)


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