Kyrgyzstan

Border management is not only about security but also about freer trade and transit. © OSCE

Border management, the EU, and UNDP

Border management has become a significant line of external assistance for the European Union, and for cooperation between member states, the European Commission, and the UN, particularly in the former Soviet Union (FSU). The funding comes from European Commission budget lines devoted to implementation of regional political strategies,such as the European Neighbourhood Programme and the Central Asia Strategy. Border management has also come to represent a major focus of UNDP multi-country programming in this region. Including related drug action programmes, since 2002 UNDP has initiated work in Ukraine and the Republic of Moldova, Belarus, Georgia, Azerbaijan and Armenia, Turkmenistan, Kazakhstan, Tajikistan, Kyrgyzstan and Uzbekistan. Broadly speaking, UNDP’s work to date has been understood as successful.1 Among other things, UNDP has implemented nearly 150 million Euros’ worth of EU border management programming during the past decade.

There is no question that the EU wishes to export its ‘soft power’ via these border management programmes. But what exactly does this entail? And what dangers and opportunities are presented for the UN’s development work by this cooperation?

For some EU member states, these programmes began as an important component of a broader agenda to develop European policy and capacity on security. Border management was (and still is) seen as an acceptable vehicle for common action against mutual threats: drug trafficking, movement of Islamic extremists, etc. However, some EU Member States and Commission officials remain opposed to UNDP implementation of these programmes, due in part to concerns about trying to advance that agenda under a UN rather than directly European umbrella. The different management arrangements for the EUBAM, SCIBM and BOMCA Programmes (click here for more information on these) therefore represent various Commission attempts to satisfy the EU Member States and keep UNDP’s role to that of ‘administrative support platform’ for the application of ‘visibly’ European expertise.

Many in the Commission recognize that only the UN has the operational capacity on the ground to deliver border management assistance on a multi-country basis. However, others see utilizing development assistance to enhance security as a somewhat quixotic enterprise: Commission rules of aid assistance do not allow the transfer of key equipment or expertise; drugs and militants flow like water, taking the easiest route, so that reinforcing certain border areas merely displaces (rather than eliminates) activities of concern; it is next to impossible to establish objectively verifiable indicators in regard to countering security threats; and the whole venture may be undermined by corruption within the border services, which can only be tackled through direct budget support to pay salaries, as part of a broader developmental approach to public administration reform.

Likewise, engaging UNDP to the projection of EU soft power in the FSU risks jeopardizing the neutrality and impartiality of the UN system in the eyes of other stakeholders. Russian concerns in regard to border security in its ‘near abroad’ are inter alia expressed operationally through its leadership of the Council of Border Guard Commanders of the countries belonging to the Commonwealth of Independent States. With a Secretariat based in the Lubyanka in Moscow (to which all CIS countries have attached liaison officers), the Council meets bi-annually. It has a mandate to coordinate joint efforts of Border Guards in relation to external CIS borders, as well as the reinforcement of internal border cooperation. Specific areas of work include harmonization of national legislation on border issues, mutual exchange of information, personnel training, and military/technical policy.

Suggestions for the future

In spring 2010, the Council of CIS Border Guard Commanders signed a memorandum of understanding with FRONTEX (the EU’s Border Agency), but the technical and institutional details of cooperation with the UNDP-implemented EU aid programmes have yet to be resolved. Significant discrepancies between the regulatory and technical models for border management being offered to CIS countries therefore remain. Most CIS countries seek to strike a balance between the ‘near abroad’ and the ‘new neighbourhood’: in autumn 2010, in the context of the SCIBM project, Armenia agreed to a European integrated border management strategy only weeks after extending the presence of Russian border forces within the country for a further 39 years.

But if the dangers here are obvious, so also are the opportunities—if the EU and UNDP can agree on a different, more collaborative agenda for the export of European border management to the CIS countries. The European model of border management has twin objectives: increased security, plus improved trade and transit facilitation. These objectives are seen as mutually reinforcing: stability and security attracts trade foreign investment; freer movement of goods and people enhances stability and security.

During the Andijan events of 2005 in Uzbekistan, the local community at Karasuu, a town in the Fergana Valley divided between Kyrgyzstan and Uzbekistan, opened a border crossing spontaneously, to support continued visits of relatives and to maintain what had previously been one of the largest cross-border markets in Central Asia. The BOMCA Programme acted immediately to secure agreement from the governments to keep the crossing open, with offers to provide the necessary means to ensure security. Within weeks up to 40,000 border crossings a day were being made, including multiple trips by small traders.

Apart from the economic support this provided to households in one of Central Asia’s poorer regions (e.g., providing residents of Kyrgyzstan with fresh fruit and vegetables in the winter; providing residents of Uzbekistan with access to manufactured goods from China) BOMCA helped defuse a direct challenge to state power at a critical moment and created a safety valve in the explosive environment of the Fergana. In this way, border management programmes can allow the EU and UN(DP) to express a voice on behalf of the most vulnerable households and help governments to strike critical balances between security and development.

Border areas are often comprised of large ethnic minorities (linked to neighbouring countries), communities that are marginalized in many respects. Beyond the Fergana Valley, frozen conflicts in the FSU countries—Transnistria, Nagorno-Karabakh, Abkhazia, South Ossetia—are all located in border areas. While the full resolution of these conflicts is not in prospect, progress can be made by allowing local populations to cross borders with ID cards rather than passports. In addition to being familiar to many FSU countries from Soviet times, such systems can also be drawn from the experience of European integration. Modern European integrated border management methodologies can provide the technical means and cross-border procedures required.

Separating transit of local populations from international transit and cargo trade at border crossing points in the FSU countries could bring significant reductions in journey times and delays experienced at borders. Reconfiguring border crossing point infrastructure, providing modern equipment to automate processes, and introducing integrated border management practices such as joint control by border agencies, could further reduce travel times and delays.

Prosperity in Europe was built on the incremental removal of such barriers to trade and transit. The border management programmes could therefore do more to mobilize civil society and private enterprise—road hauliers, freight forwarders—to promote the free trade agreements signed between EU and FSU countries, as well as those trade agreements concluded among FSU countries (e.g., the EurasEC customs union). Freer trade and transit, democracy building and security can be advanced together.

Without abandoning its multi-country programming approach, the EU and UNDP may wish to consider targeting assistance more discriminately within these border management programmes. This might also help define clearer exit strategies for programming. In most FSU countries, the key border agency remains the Border Guards—a military force within each national security service. In the poorer FSU countries, transition to European border management standards will ultimately require EU direct budget support for border guard salaries. A prerequisite for this should be conversion from a largely conscript-based military force to professional civilian border police serving as an arm of the Ministry of Interior, accountable to parliaments, not presidencies.

People hate borders—uncertainties over laws and procedures, conforntation with state power, men with uniforms and guns. The Schengen arrangements therefore represent both the EU’s true soft power and a culturally iconic aspiration for many citizens in FSU countries. The EU-UNDP border management programmes can export to the CIS many of the principles and practices behind the Schengen arrangements, with enormous development potential: facilitating movements of local populations to reduce social tensions and resolve frozen conflicts; supporting trade as a smart and quick way to alleviate poverty; building democratic governance through support for civil society and private enterprise; and promoting security sector reform.

The EU-UNDP border management programmes flow from a powerful concept. They are well-funded and usually well-implemented. They should be better articulated to reflect a clearer and more developmental agenda, acceptable to all stakeholders in the FSU countries.
Philip Peirce is an independent consultant to UNDP for border management and migration projects.


1 See, for example, George Gavrilis, “Beyond the Border Management Programme for Central Asia”, EU Central Asia Monitoring, no. 11,November 2009.

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© Chris Loades/Fauna & Flora International

Borders, security and instability in the Fergana Valley

The Fergana valley, divided between three countries—Kyrgyzstan, Uzbekistan and Tajikistan—is home to over 10.5 million people. International aid agencies calculate that up to 60 percent of the combined populations of all three countries are poor; living on or below $500 per year. The population is also highly diverse with significant communities of Uzbeks, Tajiks, Kyrgyz, and Russians, as well as numerous smaller groups.

Since independence, there has been considerable international concern that the region could become a centre for major conflict. In the final years of the Soviet Union ethnic violence broke out in southern Kyrgyzstan, and tens of thousands of Meskhetians fled Uzbekistan. Over the last decade violent Islamist movements and powerful narco-criminal groups have emerged in the region, often using Afghanistan as a base for their activities. In the mid-1990s, a civil war in Tajikistan led to the death of over 50,000 persons. Many analysts point to the weakness of the region’s states as a source of instability. The issue of borders in the Fergana Valley thus needs to be understood within the context of an interrelated and complex set of factors that together have the potential for promoting significant regional instability.

 

Since the early 1990s, dozens of persons have been killed by mines in the Fergana Valley’s border areas. Significant sections of the border between the three countries remain undemarcated, causing confusion and creating tensions. Elsewhere, agreement on borders has been the prelude to the introduction of tight border restrictions.

Building Borders in the Fergana Valley

The roots of contemporary border challenges lie in the incorporation of the Fergana Valley into the Russian Empire in the nineteenth century. This began a process of remaking the region’s political, economic and social space. The porous and fluid borders of the Russian conquest were steadily replaced by a new set of administrative divisions defined by the colonial regime.

During the early Soviet period, this process was greatly accelerated with the launch of a comprehensive delimitation of the Fergana Valley—as part of the broader process under way across Soviet Central Asia and, indeed, the USSR. The foundations for the Soviet administrative system in the region became the three Union Republics—the Kyrgyz, Uzbek, and Tajik Soviet Socialist Republics—putatively created on the basis of ‘titular’ nations. A boundary commission that operated from 1924-27, and then continued to work from the mid-1950s until the end of the Soviet Union, established the republican borders.

In fact, ethnic and national identities in the region were only weakly developed at that time and had to be reinforced by nearly 70 years of Soviet nation-building programmes. Just as important was the reality of complex ethnic mixing, economic interdependence, and social networks that straddled the newly created republican boundaries. The Soviet-era division of the region thus often ran contrary to the society on the ground, established networks of commerce, and historical forms of rule.

While the administrative divisions did cause frictions during the Soviet period, these boundaries did not create a major impediment to long-established social and economic patterns. The Fergana Valley was largely open within the USSR; internal ‘borders’ had little practical significance. Indeed, the Soviet authorities continued to build regional infrastructure across republican borders and to shift territory between the three republics with little concern about possible consequences.

The collapse of the Soviet Union and the emergence of independent states in Central Asia almost overnight transformed administrative divisions into international borders. A notable development was the sudden creation of independent countries with large ethnic minorities, who in most cases live along borders contiguous with their proto-ethnic homeland.

Particularly important are the Uzbek minorities found in substantial communities in southern Kyrgyzstan and northern Tajikistan, and outside the Fergana Valley in southern Kazakhstan and northern Turkmenistan. At the same time, nearly a million ethnic Kazakhs are citizens of Uzbekistan, as well as many millions of ethnic Tajiks (notably in Bukhara and Samarkand). There are important concentrations of ethnic Kyrgyz in the portions of the Fergana Valley belonging to Uzbekistan. This pattern has raised concerns about the possible emergence of irredentist movements across the region.

The ethnic dimension is, however, only one aspect of the challenge created by the introduction of international borders in the Fergana Valley. Despite the Soviet project to promote three distinct national republics, the historical legacy in the region continues to be one of a patchwork quilt of interdependence created by irrigation, road, energy and rail net works. In some parts, borders cut through villages and backyards. There are important land leasing agreements between governments and a series of exclaves in the region, including individual villages totally surrounded by the territory of another country.

In the early 1990s, little was done to formalize the nominally international borders, although the introduction of passport and visa requirements already began to impose a new situation on the region. As the civil war in Tajikistan escalated however, Uzbekistan initiated a series of measures to secure its border, including laying mines and militarizing the border region—and its exclaves.

In the late 1990s, states in the region began to construct stronger border regimes—in part in response to the violent incursion of Islamist militants from Afghanistan in 1999 and 2000. Along the Uzbekistan-Kyrgyzstan border fences were built, bridges destroyed and roads dug up to create a defined number of crossing points. Borders became increasingly militarized. A bilateral boundary commission was set up and began the difficult task of demarcating borders.

Border tensions an conflict

The construction of highly regulated and militarized borders is seen in the capitals as reflecting the priorities of state building, national security and combating cross-border criminal activity, notably drug smuggling. The local view has been rather different: here,borders are often seen in a negative light, as creating innumerable everyday difficulties for the populations that live along the border. Frequently voiced concerns include:

  • Excessive restrictions on cross-border local trade, especially in agricultural produce.
  • Corruption of the border authorities.
  • The break up of family relations; many families have relatives on opposite sides of the border.
  • The difficulties borders impose for travel within one country, since many roads were built crossing today’s borders—sometimes many times.
  • Civil society and human rights organizations argue that the closing of borders is instrumental to political repression.
  • Cross-border disputes over water and land.
  • Fears over personal safety due to the militarization of borders and the loss of livestock that wander into border areas.

 

Regular incidents of violence reflect local frustrations over these issues. There is also a close correlation between frictions along the borders and state-to-state tensions. The friction periodically erupts into local violence among Kyrgyz, Tajiks and Uzbeks—at the local level—and has led to dangerous confrontations with border officials. The most conflict-ridden border regions are those found in Batken Oblast, Kyrgyzstan; Fergana Oblast, Uzbekistan; and Sughd Oblast, Tajikistan. Here conflicts occur on a regular basis over cross-border water and land issues. But tensions are present all along the international borders in the Fergana Valley.

For example: in 2009, tensions rapidly escalated along the Kyrgyzstan-Uzbekistan border following what Uzbekistan described as violent Islamic militant attacks in late May inside the country. According to Kyrgyz media reports, the Uzbekistan authorities responded by building three-meter-wide trenches in some border areas. Kyrgyzstan’s Border Protection Service issued a formal protest on June 9. Analysts can trace Uzbek-Kyrgyz tensions back to the previous winter, when Bishkek pushed forward with plans to build the Kambarata complex of hydropower stations, thus potentially threatening to limit water supplies for Uzbekistan’s thirsty cotton sector.

The tightening of the border had an immediate effect on border communities. The Osh and Kara-Suu bazaars, two of the largest markets in the Fergana Valley, were particularly hard-hit by the closure of border checkpoints. Traders at Kara-Suu said that the continued Uzbek border closure could potentially lead to the closure of the bazaar (most of whose customers came from Uzbekistan). After the closure of borders, sales at the bazaar dropped by more than 50 percent. A number of analysts have suggested that poverty and anger against Uzbekistan over the border issue contributed to the violence that left over 400 dead and created 400,000 displaced persons in southern Kyrgyzstan in the spring of 2010. In another incident, tensions between Tashkent and Dushanbe over the proposed construction of vast new hydroelectric dams in Tajikistan fed into a tense situation on the border. On 22 March 2010, the Ministry of Foreign Affairs of Tajikistan presented a note of protest to the Ambassador of Uzbekistan in Dushanbe complaining of interruptions in railway cargo headed for Tajikistan across the Uzbek border. Tajikistan’s Prime Minister Akil Akilov then complained to the international community about the situation on the Tajik-Uzbek border during his visit to the UN headquarters in New York and to the UN Secretary General Ban Ki-Moon during the latter ’s official visit to Tajikistan requesting help to resolve the tensions between the two countries.

Despite the creation of border commissions, over a decade later, large sections of the borders in the Fergana Valley remain to be delimited. Problems over disputed settlements are only slowly being resolved. Thus, it was only in early September 2010 that families from a disputed area along the the Kyrgyzstan-Uzbekistan border finally received land to build houses in a nearby village in Kyrgyzstan. The mostly ethnic Uzbek families left the village of Chek earlier in the summer after Uzbekistan announced it was coming under its jurisdiction, electing to live in Kyrgyzstan. In this case, it was the availability of international assistance in connection with the violence in southern Kyrgyzstan in June 2010 that allowed the relocation to proceed.

Border issues and regional instability

Finding ways to promote better managed and more open borders has been a priority for over a decade. Numerous regional and international efforts have been launched to address single issues or the whole complex of questions related to the region’s border regimes.

Despite these efforts, to date there has been little progress in reversing the trend toward more rigid borders. Against the background of growing violence in the region, there seems a real prospect of increased measures to further separate the populations of the Fergana valley. Such steps, however, risk further aggravating the already fragile situation and contributing to the growing instability in the region.

Despite the creation of strict border regimes in the Fergana Valley, the region’s overlapping borders are notoriously porous, portals for narcotics smugglers and—regional governments claim—Islamic insurgents. Further efforts to tighten the borders now seem inevitable given recent developments in Kyrgyzstan and Afghanistan. Experience suggests,however, that steps to strengthen borders tend to exacerbate regional tensions and promote cycles of instability.

Neil Melvin is Director of the Armed Conflict and Conflict Management Programme, and Senior Fellow at the Stockholm International Peace Research Institute.

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Kyrgyzstan’s economic situation would worsen considerably if the country loses access to its current duty-free supply of oil products and other raw materials from Russia and Kazakhstan. © OSCE/Roel Janssens

The possible impact of the EurasEC customs union on Kyrgyzstan

The potential impact of the Eurasia Economic Community’s (EurasEC) customs union, the customs code for which formally came into effect for Belarus, Kazakhstan, and the Russian Federation on 5 July 2010, has been widely discussed in Kyrgyzstan. Before drawing conclusions about the advantages and disadvantages of Kyrgyzstan’s possible accession, two issues should be emphasized. First, this topic should be addressed from a purely pragmatic point of view, to draw analytical conclusions on the basis of specific economic indicators. Second, one should thoroughly examine the actual operation of the customs union. At this point, I agree with Muktar Djumaliev (deputy head of Kyrgyzstan’s presidential administration) that at present the government of Kyrgyzstan cannot even negotiate with the customs union, because we do not know enough about it.

Kyrgyzstan’s foreign trade policy is quite liberal in terms of customs duties; in 2009, the average import tariff was slightly over 5 percent. Practically no export duties are applied whatsoever. According to official statistics, Kyrgyzstan’s foreign trade volume in 2009 was $4.4 billion, of which imports constituted around $3 billion (68 percent) and exports $1.4 billion (32 percent). Customs union countries were responsible for 41 percent of Kyrgyzstan’s trade volume (50 percent of imports and 23 percent of exports). Whereas the share of imports from these countries has been relatively stable, the share of exports purchased by customs union countries shows a noticeable downward trend. It should be emphasized, however, that official statistics do not give a full view of Kyrgyzstan’s foreign trade situation, because significant volumes of goods are imported under a simplified customs clearance scheme, which distorts reported import prices.

Customs union: Implications for members and non-members

What does the creation of the customs union mean for member countries? The supranational Customs Union Commission was created in order to coordinate the activity of member countries. Decisions are made according to a simple majority of votes. These are distributed as follows: Russia—57 percent, Kazakhstan—21.5 percent, and Belarus—21.5 percent. Customs union revenues are to be divided as follows: Russia—87.7 percent, Kazakhstan—7 percent, and Belarus—5.3 percent. The single value added tax rate (which has not yet come into force) is set at 17 percent. This suggests that Russia has a preemptive position within the customs union. This may be because the size of these three economies are quite different: Kazakhstan’s GDP in 2008 was only 8 percent of Russia’s, while Belarus’s was only 4 percent. This suggests that Russia’s interests may prevail in the customs union’s trade policies: some 92 percent of the common external tariff rates are based on Russia’s tariff rates. In addition to protecting Russian producers from imports, this regime will give consumers in other customs union countries incentives to switch to Russian products.\

Analyses conducted by the Asian Development Bank, the European Bank for Reconstruction and Development, and USAID indicate that, because of significant differences in economic structures, tariff rates in Kyrgyzstan and the customs union countries vary greatly. As the below table shows, Kyrgyzstan’s tariff rates are concentrated in groups at which lower duties are applied. Moreover, in addition to these ad valorem rates, the customs union’s common external tariff applies specific rates for 5.3 percent and combined rates for 2 percent of total imports. By contrast, Kyrgyzstan applies specific tariff rates for only 1 percent of total imports, and combined rates for 1.3 percent of imports.

Table 1: The share of  imports falling under different tariff rates in the Kyrgyz Republic and the EurasEC customs union

* Under the customs union’s common external tariff

These differences reflect inter alia Kyrgyzstan’s membership in the World Trade Organization: upon its WTO accession Kyrgyzstan committed itself to maintain its average tariff rate at a reference level of about 7.7 percent. Moreover, were Kyrgyzstan to consider joining the customs union and adopting its (higher) common external tariff, it would have to coordinate this decision with other WTO members. [Editors note: none of the customs union member countries have acceded to the WTO.] However, the value added tax rate on imports under the custom union’s customs code will be 17 percent—which will also apply to imports from Kyrgyzstan (where the VAT rate is 12 percent).

Kyrgyzstan’s accession to the customs union would imply the adoption of its common external tariff—the average value of which is 10.6 percent, compared to Kyrgyzstan’s average customs tariff rate of 5.1 percent in 2009. Such a hike would significantly reduce Kyrgyzstan’s trade with other countries, while increasing trade with Russia and other customs union members. In addition, Kyrgyzstan’s average tariff rate does not reflect the considerable volume of imports from China carried out based on simplified customs clearance procedures with a very low rate.

Kyrgyzstan’s Ministry of Economic Regulation has calculated that 34 percent of total imports face duties that coincide with those under the common external tariff. Some 21 percent of imports face duties that are roughly comparable to the common external tariff rates, while 43 percent do not coincide at all. Changes in these duties would need to be negotiated with the WTO, which could entail significant technical difficulties. Accession to the customs union could also reduce Kyrgyzstan’s budget revenues and increase inflation. More generally, Kyrgyzstan would have to revise the basic directions of its trade policy to reflect the interests of bigger countries, primarily Russia. Favourable conditions for imports, including from China, would likewise be revised, significantly reducing the reexport of Chinese goods.

On the other hand, Kyrgyzstan’s accession to the customs union could have a number of positive implications. These reflect the fact that Kyrgyzstani producers would obtain preferential access to the large regional market of the custom union countries, providing scale advantages for local companies. It would also make Kyrgyzstan more attractive for foreign investments, from Russia and Kazakhstan and from non-customs union countries.

What happens if Kyrgyzstan does not join the customs union? This would depend in part on whether pre-existing bilateral and multilateral free trade agreements with these countries, which provide for most favoured nation (MFN) treatment for Kyrgyzstan’s exports, will continue to be honoured. The possible revision of bilateral MFN agreements and of the 15 April 1994 agreement among member countries of the Commonwealth of Independent States (as amended as of 2 April 1999) could be quite serious in this regard. Moreover, Kyrgyzstan’s economic situation would worsen considerably if the country loses access to its current duty-free supply of oil products and other raw materials from Russia and Kazakhstan. Non-accession could also slow Kyrgyzstan’s integration into post-Soviet regional entities, such as EurasEC and the CIS. Much therefore depends on the government’s negotiations with its main trade partners, Russia and Kazakhstan.

Possible recommendations

WTO membership does not automatically preclude membership in various customs unions, because the WTO’s main goal is to reduce barriers to international trade. As such the issues discussed here would become the subject of negotiations and consultations for the government of Kyrgyzstan. The country’s most favourable option could therefore be in pursuit of a gradual, step-by-step accession in the customs union, as certain conditions would be met. One of these would be the eventual accession of Russia, Kazakhstan and Belarus to the WTO—which, most probably, is a matter of time. These countries’ WTO accession would facilitate the joint resolution of a number of issues associated with Kyrgyzstan’s prospective customs union membership, such as compensation for increases in customs tariffs. Prior to the possible WTO accession of Russia, Kazakhstan, and Belarus, Kyrgyzstan could reasonably request observer status in the customs union. This would demonstrate good faith on the part of the Kyrgyz Republic, and minimize the risks (for Kyrgyzstan) associated with the customs union’s creation. During this time, Kyrgyzstan should seek to boost investment from WTO countries, including from China in order to make good use of its comparative trade advantages.

Talaibek Koichumanov is Head of the Secretariat of the Business Development and Investments Council under the Government of the Kyrgyz Republic.

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