Mr. Chairman, it's an honor to represent the Administration before this Commission to discuss recent developments in Kyrgyzstan and U.S. interests there.
The Secretary’s Visit
The Secretary just returned from a trip that included stops in Central Asia to express American appreciation for the Central Asian states’ ongoing critical support to Operation Enduring Freedom. He also took the opportunity to explore other areas of common interest, including economic cooperation, the development of civil society and human rights, humanitarian relief, and Caspian energy. The Secretary had planned to visit Kyrgyzstan as part of the trip to thank President Akayev and the Kyrgyz people for the overwhelming support offered this week by their Parliament to make Kyrgyzstan’s airport facilities available for use by coalition forces. He also intended to discuss counterterrorism cooperation, regional issues, and progress on Kyrgyz efforts to promote further democratic reform. Unfortunately, his stopover on Saturday was cancelled at the last minute when bad weather closed the Bishkek airport. He did talk with President Akayev by telephone.
Kyrgyzstan, which was once the standard bearer for reform in Central Asia, has slipped backward. Presidential and parliamentary elections have been seriously flawed, but the level of democratization since independence, compared with Central Asian states is nonetheless impressive. Earlier this year, President Akayev announced that he would step down when he completes his third term in 2005. We hope that the presidential election to choose his successor will mark the first democratic succession of power in Central Asia.
During 2000, both presidential and parliamentary elections were marred by irregularities. President Akayev was elected to a third term in an election, that did not meet international standards for legitimate, democratic elections. Restrictions on the registration of candidates, intervention by local officials, and harassment of opposition candidates’ activities negatively influenced the fairness of the campaign.
In February and March 2000, the first and second rounds of parliamentary elections were held. For the first time, 15 of the Legislative Assembly’s 60 seats were distributed proportionally based on party lists. Prior to the parliamentary elections, the Government took numerous actions, which disadvantaged opposition political parties. Although there were improvements in overall election administration on the day of the vote, there were allegations of ballot tampering, intimidation of voters, and harassment of campaign officials in the elections of a number of opposition leaders. The opposition party of Feliks Kulov, the former Vice President, was excluded (along with a number of others) from the February 2000 elections on technical grounds. Kulov himself was allowed to run, but he was subjected to intense political pressure by the GOK, including the opening of an investigation against him. After first being acquitted, Kulov was tried again in January of this year and sentenced to seven years. On the plus side, imprisoned opposition leader Tolchubek Turgunaliyev received a presidential pardon and has since returned to opposition politics.Despite these problems, the parliament has again developed real independence, initiated its own legislation, and on several notable occasions overrode presidential vetoes in defense of its own legislative priorities. In the past, the parliament and the president have worked together to pass significant reforms of the criminal, civil and commercial codes and to begin the process of privatizing state industry and state-owned commercial enterprises. Recently, Parliament has proposed legislation to create an ombudsman, decriminalize libel, and reform the educational system. If enacted and implemented, these bills could help get Kyrgyzstan moving in the right direction again.
Independent media outlets have developed since 1991, including television, radio, newspapers, periodicals and internet providers. However, there have been serious problems. Government harassment against opposition the Kyrgyz-language newspaper Asaba is a case in point. The paper was subjected to pressure and intimidation shortly after the newspaper's owner declared his candidacy to run in the Presidential election in 2000. Two so-called “honor and dignity” suits were lodged against the newspaper, a longstanding tax dispute was revived, and a dormant debt case was reactivated against the newspaper. In April of this year, the newspaper closed. It reopened in October under new management with ties to the Government. Many of the original staff left to join the independent newspaper Res Publica.
In April, the Ministry of Justice cited an excess of outdated registrations to require media outlets throughout the Kyrgyz Republic to re-register. To the government’s credit, by October, 65 media outlets successfully re-registered. In June, citing a previously unknown April decree, the Ministry cancelled the registration of 16 new media outlets that had been approved after April, including two opened by editors of newspapers previously closed under Government pressure. The outlets were forced to re-apply by October 1, but all were successfully registered by November 1. The basic underpinning of the positive movement is Kyrgyzstan's well-educated and politically involved population.
Kyrgyzstan's early record of economic reform also stands out among countries in transition. Despite the limits of its exploitable natural resources, Kyrgyzstan managed to attract private investors from U.S. and other western corporations by improving its investment climate and working toward a modern regulatory structure. The government achieved real progress on agrarian reform and the privatization of state-owned enterprises. The private sector has grown, although the lack of resources and capital funds limited the scale of private enterprises. By 1998, Kyrgyzstan had achieved significant economic growth rates and was on the verge of a breakthrough in market reform. Kyrgyzstan's accession in December 1998 to the World Trade Organization is a testament to its progress.
Unfortunately, with a resource-poor economy heavily dependent on trade, Kyrgyzstan was particularly vulnerable to the disastrous 1998 Russian financial crisis. Russia had been the country's number one trading partner, accounting for nearly half of total trade. Armed incursions in the south by radical Islamic rebels in 1999 and 2000 created a security crisis that also exerted severe pressure on the budget. Whether in reaction to these factors or not, the Government of Kyrgyzstan discontinued many of its economic reforms, and in some cases actually reversed previously implemented steps on privatization and market liberalization.
Today the economic situation in Kyrgyzstan is serious, but not desperate. Government figures show a growth rate of over 6%. The war against terrorism in Afghanistan has brought tougher times, making investment prospects scarce and putting further pressure on the Kyrgyz budget. Foreign debt payments are a crushing burden that cripple efforts to improve health, education, and defense.
On the positive side, the Kyrgyz government and the World Bank developed and are implementing a comprehensive strategy aimed at reducing poverty and generating growth. On November 30, the IMF Board approved Kyrgyzstan’s new Poverty Reduction and Growth Facility. Under this program, the IMF has identified a need for Paris Club debt relief. As a result, the Paris Club gave financing assurances to the IMF. The terms of the debt treatment will be negotiated within the Paris Club in the near future.
The Government has also sought to improve the investment climate by cutting red tape and passing new legislation, as well as by creating an investment roundtable to promote new ideas for attracting FDI into Kyrgyzstan.
Promoting U.S. Interests
Since September 11, we have received an unprecedented level of support and cooperation from Kyrgyzstan and our other Central Asian partners. The Kyrgyz legislature just yesterday formally agreed to the stationing of American and allied forces at Manas airport for military and humanitarian actions in Afghanistan. The stakes are undeniably high in Central Asia. We rely on the Kyrgyz and other governments for the security and well being of our troops and for vital intelligence that has allowed us to conduct such an effective campaign in Afghanistan. The front-line states of the region also provide a critical humanitarian corridor for food and emergency supplies that can save the lives of thousands and thousands of desperate people living in northern Afghanistan this winter.
Without human rights, free elections, religious freedom, open markets and foreign investment, there can be no long-term stability because the people of Central Asia will demand the economic prosperity and personal liberties to which they are entitled. We have told President Akayev and other Central Asian leaders that America does not forget those who have stood by us during this time of trial. After this conflict is over and our troops have come home, we will not walk away from Central Asia, and certainly not Kyrgyzstan. We are committed to a deeper, more sustained, and better-coordinated engagement with the region on a broad range of issues. We want these countries to be firmly on the path to full participation in the modern community of nations. The foundation of our policy continues to be the principle that political and economic reform is the only path to long-term stability and prosperity.
We are committed to developing the resources, the high-level attention, and the multinational coordination to support reform opportunities in Kyrgyzstan. We want to stand by the Kyrgyz in their struggle to change their society in the same way they have stood by us in the war on terrorism. We are ready to explore new areas of assistance, but it must be accompanied by demonstrated, concrete steps toward reform.
We shall reinforce our assistance for civil society, especially the independent media, non-governmental organizations, and fundamental political reform. We are also focusing our assistance on programs that seek to educate and inspire the next generation of leaders in Kyrgyzstan. You know these initiatives well. They include the high school-level FLEX program, the university-level Freedom Support Act program, the graduate-level Muskie program, the Fulbright scholars program, the IREX professional exchange program and the Peace Corps. Dollar-for-dollar these have been our most important investment in the region. We want to broaden these programs, and we will need increased financial and human resources to do so.
In addition to helping Kyrgyzstan become stable and prosperous, we have a significant U.S. national interest in preventing the spread of terrorism. The terrorist threat that developed in Afghanistan reinforces our view that underdevelopment and repressive, anti-democratic regimes in the region provide a breeding ground for terrorism and Islamic extremism. We must ensure that other states in Central Asia do not replace Afghanistan in this role in the years ahead. In accordance with our commitment to Kyrgyz sovereignty, stability, and territorial integrity, the USG has provided the Kyrgyz with customs and border guard training, anti-terrorism assistance, and communication, observation and detection equipment. These programs have been well received and have served to develop the basis of cooperation for our current joint efforts in Operation Enduring Freedom.
Kyrgyzstan has just marked its first decade as a sovereign state. Despite the difficulties of the past ten years, Kyrgyzstan has made great strides. It has established peaceful relations with all of its neighbors and become a member of the Organization for Security and Cooperation in Europe, the World Trade Organization, the Euro-Atlantic Partnership Council, and NATO’s Partnership for Peace.
Now Kyrgyzstan is at a historical crossroad. The government’s willingness to expand our cooperation presents a unique opportunity to improve our bilateral ties and for Kyrgyzstan to restore its reputation as a progressive country in Central Asia. It is our hope that Kyrgyzstan will develop into a fully functioning free-market democracy and pursue the policies that will create robust and enduring partnerships with the U.S. and the community of democracies. We are working with Kyrgyzstan to promote a flourishing democracy and vibrant civil society, which play key roles in economic prosperity and future stability.
Congress, and in particular this Commission, will play a vital role in this effort. The Administration wants to work with you on new ideas for programs and the funds to implement them. We need to support each other’s messages in Kyrgyzstan and the region. I am particularly grateful for your invitation to share our views with you today.