Harvard Asia Quarterly Winter 2001

1Harvard Asia QuarterlyWinter 2001

2Harvard Asia Quarterly

Winter 2001

HAQHAQ Editorial StaffEditor in ChiefSuzzanne Yao

Harvard Law School

Executive EditorThomas Cheng

Harvard Law School

Managing EditorMichael Arbogast

Harvard Law School

Production EditorAlice Yu

Harvard Law School

Photography EditorAlice Yu

Harvard Law School

Web EditorMatthias Lind

Graduate School of Arts and Sciences

Area EditorsLindsay Beck, Co-China Editor

Graduate School of Arts and SciencesJulianna Lee, Korea Editor

Graduate of School of Arts and SciencesOwen Lewis, Japan Editor

Harvard Law SchoolWeishi Li, Co-China Editor

Harvard Law SchoolMario Moore, South Asia Editor

Harvard Law SchoolMichou Nguyen, ASEAN Editor

Harvard Law School

Associate EditorsHarvard Law School

Joshua BloodworthHua ChenKok-On ChenMalou FelicianoGillian Koh

Graduate School of Arts and SciencesXin Zhou

Harvard Asia Quarterly Publishing BoardVirginia Harper-Ho

Harvard Law School `01Victor Shih

Graduate School of Arts and Sciences `02

Harvard Asia QuarterlyFaculty Advisory BoardProfessor W.P. Alford

Harvard Law SchoolDean David Smith

Harvard Law SchoolProfessor Hue-Tam Ho Tai

Faculty of Arts and SciencesProfessor Ezra Vogel

Faculty of Arts and SciencesProfessor Shang-Jin Wei

Kennedy School of Government

CONTENTS

4 Economics and Security in Central AsiaRobert M. CutlerRobert Cutler presents a comprehensive survey of the most significant economic andsecurity issues in contemporary Central Asia, including an analysis of their evolutionsince 1991 and an evaluation of their future prospects.

13 ‘Asian Values’ and the Democratic Transition inCentral Asia

Gregory GleasonGregory Gleason analyzes the significance of cultural differences for public policy inthe countries of Central Asia and explains why international efforts to promotedemocratic institutions and processes have met with limited success.

21 The Politics of History in Tajikistan: Reinventing theSamanids

Kirill NourzhanovProducing a nationalist version of history has acquired special importance for theleaders of independent Tajikistan as a means of reinforcing common Tajik identity,particularly in the aftermath of the civil war. This article discusses the particulars of acampaign launched by President Rahmonov in March 1997 to reinvent and glorify theSamanids and the ways in which it contributes to the general political discourse inTajikistan.

31 From Tamerlane to Terrorism: The Shifting Basis ofUzbek Foreign Policy

William D. Shingleton & John McConnellIn February 1999, a series of major bombings in the Uzbek capital of Tashkent alteredthe face of Uzbekistan’s government. The bombings caused a shift in foreign policybased on nationalism to one focused on counter-terrorism. In this article, the impactof this shift on Uzbekistan’s relations with ‘greater Uzbekistan’, the other formerSoviet states, and the outside world are discussed.

34 Elections in Central Asia: A New Beginning for aComprehensive Environmental Strategy?

Daphne BiliouriThe recent elections in three of the five Central Asian states (Kazakhstan, Kyrgyzstan,and Uzbekistan) over the past two years have raised concerns over the path todemocracy and the effect such will have on the environmental policy of the region.This article provides an overview of the existing situation and suggests that thoughthe environment has become a priority for the leaders of Central Asia, the questionremains whether the international community is providing necessary assistance andsupport.


Volume V, No. 1.Winter 2001

HARVARD ASIA QUARTERLY is a student pub-lication affiliated with the Harvard Asia Center.HAQ was established in 1997 by members ofthe Harvard Asia Law Society in conjunction withstudents from other graduate and professionalprograms at Harvard University as an interdis-ciplinary journal of Asian affairs.

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Credits:Cover Design

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No material appearing in this publication maybe reproduced without the permission of the pub-lisher. The opinions expressed in this publica-tion are those of the contributors and are notnecessarily shared by the editors or publishers.All statements of fact and opinion represent thework of the author, who remains solely respon-sible for the content. All editorial rights reserved.

Copyright © 2001 by the President and Fellowsof Harvard College. (ISSN 1522-4147).

39 Bankruptcy Law in China: Lessons in the PastTwelve Years

Dr. Li ShuguangIn this article, Professor Li examines the current state of bankruptcy law in China.He also outlines problems in the enforcement of the current bankruptcy law andsuggests how these problems can be remedied.

47 Was World Bank Support for the Qinghai Anti-Poverty Project in China Ill-Considered?

Pieter BottelierIn July 2000, China withdrew its request for World Bank financing for the Qinghaianti-poverty project, one of the most controversial projects in the 54-year history ofthe Bank. Mr. Bottelier expertly traces the events leading to the decision and raisesimportant questions regarding the validity of the charges against the project andthe appropriate role and responsibility of the World Bank.

56 The US-Vietnam Trade AgreementTai Van TaIn this article, Tai Van Ta examines the US-Vietnam trade agreement and itslikely impact on the Vietnamese economy and society.

62 Interview with Doan Viet HoatMichou NguyenOn December 8, 2000, ASEAN editor Michou Nguyen conducted an interviewwith Vietnamese human rights observer Doan Viet Hoat. Dr. Hoat spoke on avariety of issues, from free trade and economic stability to President Clinton’sreception by the Vietnamese people.

65 The Meaning of President Clinton’s Trip to VietnamChan TranChan Tran reflects upon President Clinton’s trip to Vietnam and its possibleimplications for human rights advancement in the country.

67 Book ReviewPhar Kim BengPhar Kim Beng reviews Amitav Archarya’s The Quest for Identity: InternationalRelations of Southeast Asia: “By his own admission, Amitav Archarya is not anAsianist. Rather, his niche is ‘Asian Pacific regionalism’. Two questions obviouslyemerge: Can an entity as diverse as Asia-Pacific be labeled a ‘region’ withoutskewing the meaning of the term? More importantly, have contemporary socialsciences developed the necessary tools and lenses to examine it?”


Winter 2001

ECONOMICS AND SECURITY INCENTRAL ASIA

BY ROBERT M. CUTLER

Robert M. Cutler is Research Fellow at the Instituteof European and Russian Studies, CarletonUniversity, Canada. He was educated at theMassachusetts Institute of Technology and earnedhis Ph.D. in Political Science at the University ofMichigan. He has extensive practical experiencein Central Asia and former Soviet areas includingCaspian-region energy development. He has doneconsulting for a variety of international andnonprofit organizations and the businesscommunity, and served as an NGO Representativeto the UN Economic and Social Council. He can bereached at <[email protected]>. Homepage:<http://www.robertcutler.org>.

Geography puts Central Asia at a crossroads of global economyand security. At the height of the Roman Empire, the territory ofpresent-day Uzbekistan was astride the transcontinental trade

routes between China and the West. The first Turkic state was estab-lished in present-day Mongolia in the middle of the sixth century. Fromthe eighth to the twelfth centuries, Islam expanded into the Caucasusand Central Asia from Arabia in the southwest. Next the migrationscame from the northeast, with the Mongol invasions during the 1200sand 1300s, while other Turkic peoples came to Central Asia at the sametime. Subsequently, Muscovy (Moscow) consolidated its rule and pre-pared to expand into the Caspian region in the nineteenth andtwentiethcenturies from the northwest.

Today, the region is only re-acquiring its historical position as astage across which there sweep vast waves of people and goods fromnearly all directions of the compass. It opens to China and the rest ofAsia in the east, Iran and Afghanistan and the rest of the Islamic worldto the south, and Russia and the “new Eastern Europe” to the north andwest. If the southeast is the only direction of the compass from whichworld-historical waves have not rolled over Central Asia, this is be-cause the Himalayas block mass international migration; however, theyhave not been a barrier to influences from India, Pakistan, and Afghani-stan in the south or from China in the east. Indeed, broadly speaking,“the East” has, since the fall of the USSR, come once again to signifythe broad belt of culture stretching from North Africa to the Pacific thatit was under the British Empire: the old Near East, which we now callthe Middle East; the old Middle East, which we now call Southwestand Central Asia; and the Far East, which we now call the Asian-Pa-cific Rim.

The identification of what we today call Central Asia is relativelynew. In the pre-Communist Russian Empire, “Central Asia” referred tothe Asia that was part of the Empire. In the Soviet period, the term“Middle Asia” was used in Russian to refer to four of the five Asianrepublics (Kyrgyzstan, Uzbekistan, Tajikistan, and Turkmenistan) butnot Kazakhstan, reflecting Moscow’s strategic and geopolitical perspec-tives, including Soviet Russian claims of various sorts on northernKazakhstan and the Caspian Sea littoral. By contrast, the same term“Middle Asia” in Turkic languages has historically referred to landspopulated by the broad swath of Turkic-speaking people eastward up toMongolia, including China’s Xinjiang province, which the native in-habitants to this day call “Eastern Turkestan”. Indeed, from the stand-point of demography and physical geography, Central Asia includesnorthern Afghanistan as well as western China. Following the Tashkentsummit in January 1992, the term “Central Asia” was generally adoptedto refer to Kazakhstan, Kyrgyzstan, Uzbekistan, Tajikistan, andTurkmenistan. This article focuses on these five countries. Since it isimpossible to consider them in a vacuum, the discussion of regionalsecurity contexts ranges a bit more widely.


1. ECONOMIC BACKGROUND TO THE CURRENT PROBLEMS

One good approach to understanding present-day eco-nomic and security problems in Central Asia is to begin withUzbekistan, the most populous country in the region, with 26million inhabitants. The country’s median age is in the low20s, making the country ripe for heavy growth. By the year2010, the population will explode to between 30 and 35 mil-lion,1 and most of the growth will occur in regions unlikely toexperience job creation. The effects of population growth onthe environment, the economy, and the potential for increasedtension have already been visibly negative. The country’seconomic stagnation is at the root of the region’s most acutesecurity problem. Therefore, the economic background con-ditioning this security problem needs to be briefly set out.

1.1. THE COLLAPSE OF THE RUBLE

ZONE

That economic backgroundbegan with deepening crisis in theearly 1990s throughout CentralAsia. This came to a head inspring and summer of 1993, whenquestions of trade and paymentsamong the former Soviet repub-lics became increasingly acute.During this early period, the re-publics negotiated many agree-ments for currency and financialcooperation that were successively overtaken by events.The issue of the ruble zone’s status was brought to the foreby the fact that banks in these new states continued to issuecredit denominated in rubles, for which they were not finan-cially accountable. Continuing subsidies from Moscow toformer Soviet industrial plants in the newly independentstates only increased the acuity of the ruble-zone crisis.

In September 1993, Kazakhstan and Russia signed anaccord to unify the monetary systems of the two countries.Russia would assume responsibility for Kazakhstan’s for-eign debts in return for title to Soviet assets on Kazakhstaniterritory. Uzbekistan almost immediately sought to join thiscooperation, and in September 1993, a multilateral agree-ment on a new ruble zone was signed that included thesethree countries plus Armenia, Belarus, and Tajikistan. How-ever, Kazakhstan left this ruble zone within two months,forced out of it with the other former republics by Russia’srequirement to deposit, in Moscow, gold and hard currencyreserves equivalent to roughly half the total volume of rublesin circulation in the given former republic.

1.2. ATTEMPTS AT CENTRAL ASIAN COOPERATION

Kazakhstan and Uzbekistan almost immediately intro-duced their respective national currencies, the tenge and thesom, and initiatives for trade and economic policy coordi-nation between the two countries began to take shape. Thetreaty that Kazakhstan and Uzbekistan had signed in lateJune 1992 on friendship, cooperation, and mutual assistancewas deepened at a January 1993 meeting in Tashkent, so as

to provide for the creation of a single unified economic space.Kyrgyzstan joined that space at the end of April 1994, es-tablishing the Central Asian Union (CAU), which sought todevelop multilateral cooperation in the economic and finan-cial sphere. A trilateral development bank was establishedto that end.

In need of setting Kazakhstan’s bilateral relations withRussia in a multilateral context, so as to rally other partnersto increase leverage, Kazakhstan’s President Nazarbaev pro-posed in 1994 to create an Euro-Asiatic Union (EAU). Theidea behind this initiative was that the CIS was moribundand bogged down in peace and security matters and thatanother organization (a “natural development” of the CISthat would not supplant it) was required to promote deeperfinancial integration and economic cooperation across the

former Soviet area. Nazarbaevspecifically excluded from even-tual EAU membership thosestates involved in civil or inter-national military conflict. Theinitiative for the EAU was still-born when Uzbekistan, testify-ing to its differences with Rus-sia, declined to participate. Inaddition, another reason forUzbekistan’s refusal to partici-pate in the EAU was the com-petitive nature of Uzbekistani-Kazakhstani relations, based onthe long and complex culturalhistory between the two ethnic

groups these states represent. This is one of the reasonswhy the country sought designation from Washington asthe “strategic partner” of the U.S. in Central Asia in 1995.When Kazakhstan was also designated a “strategic part-ner” in 1997, Uzbekistan President Karimov’s response, in1999, was to join the GUAM (Georgia-Ukraine-Azerbaijan-Moldova) entente, turning it into GUUAM.

1.3. DIVERGENCE BETWEEN UZBEKISTAN AND KAZAKHSTAN

Economic circumstances in the mid-1990s intervenedto drive a wedge between Uzbekistan and Kazakhstan. Anextremely poor cotton crop in Uzbekistan in 1994 ledTashkent to impose currency-exchange restrictions, whichin turn effectively stymied CAU-based cooperation. Whathas most retarded the development of the CAU still to thisday has been President Karimov’s refusal to lift all controlson the convertibility of Uzbekistan’s national currency. Thebanking system in Uzbekistan has not been adequately re-formed, and the IMF has for several years suspended assis-tance to the country although it still maintains a mission inTashkent.

Kazakhstan, in contrast to Uzbekistan, accepted all rec-ommendations made to it by the IMF, including those re-lated to macroeconomic policy in particular. The countryhas completed its banking system reform, and is set to expe-rience real economic growth, although a very significantportion of the population remains in very dire straits as aresult of the hardships of the last decade. This poverty is

Today, the region is only re-acquiring itshistorical position as a stage across which

there sweep vast waves of people andgoods from nearly all directions of the

compass. It opens to China and the rest ofAsia in the east, Iran and Afghanistan andthe rest of the Islamic world to the south,

and Russia and the “new Eastern Europe”to the north and west.


Winter 2001

spread throughout the country but is especially felt in theheavily populated and ethno-nationalist south, traditionalhome to the Greater (or Elder) Horde, one of the three largeKazakh social and political formations that for centuries gov-erned the nomadic ethnic group’s life. One of the most im-poverished areas in this already poor region is around thecity of Kzyl-Orda, which suffers from the desiccation of theAral Sea.

2. ECOLOGY AND HUMAN SECURITY

2.1. WATER MANAGEMENT AND POLLUTION

Although the Aral Sea’s degradation directly affects onlyKazakhstan, Uzbekistan, and Turkmenistan, its waters risein Tajikistan, Kyrgyzstan, and Afghanistan. Because the is-sue of water management affectsall states of the region, in theoryit has the potential to become afocal point for economic coop-eration throughout Central Asia.Several years ago, the UnitedNations held a conference aboutthe Aral Sea in Nukus,Uzbekistan. This conference wasto concentrate on sustainable de-velopment and on providingclean water and health care tothe region. However, PresidentKarimov used it to suggest resuscitating an old Soviet-eramega-project, which his water management ministry hadnever really abandoned for its own bureaucratic reasons, todivert Siberian rivers to the Aral Sea. The Nukus initiativecontinues as an international technical-scientific studyproject with participation by highly qualified experts fromthe West. However, its practical effects were limited by thesomewhat transparent use of the conference by regionalleaders to justify their efforts to obtain general internationalaid. Moreover, the “Nukus episode” illustrates how evenattempts to address the water problem are enmeshed inUzbekistan’s regional diplomatic competition withKazakhstan. Relations with Turkmenistan are also strainedby competition for this scarce natural resource.

Karimov politically marginalizes the two ethnic groupsmost affected by the ecological disaster, the Karakalpaks (aseparate group also composed of Turkic Muslims) and theKhorezm Uzbeks, who speak a nonstandard dialect.Karakalpakstan, which formally has autonomous republicstatus within Uzbekistan, is located on the lower Amu Darya,where the river empties into the Aral Sea. The population isabout 1.3 million people with a population density of about10 per square mile. It is more rural than Uzbekistan as awhole, and some parts of the region have no urban centersat all. Yet its population is much younger than the nationalaverage, and the rate of population growth is very high. Theshrinking of the Aral Sea and the consequences of the long-term use of chemicals for irrigation in agriculture have madeKarakalpakstan one of the poorest and most environmen-tally devastated parts of Uzbekistan if not the former Sovietarea altogether.

Solving these problems requires rationing the use of

water among the states of the region. Yet it is difficult toforesee a diminution of water usage, since altogether 45 mil-lion people depend economically upon the Amu Darya andSyr Darya Rivers. Cutting cotton production would be onepossible solution, especially since Central Asian cotton har-vests are late, crop failures are widespread, and climate canbe problematic because the growing regions are the furthestof all, worldwide, from the equator. However, domestic po-litical and economic interests militate against this, particu-larly since cotton production generates hard currency in theshort term and has become central to Karimov’s import-sub-stitution development strategy.

2.2. HEALTH AND HUMAN SECURITY

It is impossible to evoke eco-logical and environmental issueswithout lamenting most unequivo-cally that vast majority of thepopulation throughout the regionhave scarce access to the basicneeds of food, shelter, and medi-cal care. Ensuring sufficient sup-ply of economic and political re-sources to the population wouldhave been difficult enough for anynewly independent state. This iseven more difficult in Central Asiabecause there were no well-estab-

lished institutions of governance or pre-existing nationaleconomy, that could, for example, even absorb and channelin a regularized fashion the large revenue streams that imme-diate energy development and export would have created.

What was left of the Soviet social safety net afterGorbachev’s reforms soon disappeared, and it is not muchof an exaggeration to say that only pre-existing social net-works (some elaborately developed from traditional formsand surviving even through the Soviet era) remained to takeup the slack. In Tajikistan’s civil war, for example, the basiccleavage was not between communists and Islamists, or evenclans per se. The civil war was, rather, a conflict betweenregions, based on opposing identities. Clans have not beenirrelevant, but the real issue is the opposition among socialnetworks that developed under Soviet administration. In theearly 1990s, these provided the organizational basis for fur-nishing security goods after the Tajikistani state apparatusfell apart under conditions of general economic deprivation.Tajikistan is thus a sort of Central Asian “worst case” exem-plifying the most extreme results of the privatization of thatpublic good called “social order”.

As bad as things were a few years ago, they are nowworse and disaster threatens. There are two reasons for this:drugs and disease, the latter including, but not limited to,AIDS. The illegal drugs now afflicting populations of manyformer Soviet republics, and not just in Central Asia, areseveral, but heroin is the one that invites most attention. Therate of heroin use has soared in the last several years, mainlysince the Taliban conquest of Kabul. It is well known, andhas been for some time, that much agriculture in Afghani-stan is given over to poppy cultivation because this is a

Solving these problems requiresrationing the use of water among the

states of the region. Yet it is difficult toforesee a diminution of water usage,since altogether 45 million people

depend economically upon the AmuDarya and Syr Darya Rivers.


highly profitable cash crop with guaranteed demand.Statistical evidence on disease abounds. Temirtau is a

city in central Kazakhstan, less than one hundred miles fromthe new capital Astana. It is, in fact, the city where Nazarbaevstarted his political career in 1967 as a local administrator.Reports indicate that whereas the percentage of the popula-tion that was HIV-positive was in single digits in 1997, thisfigure has soared to about forty per cent. If space permitted,I could multiply such statistics and personalize them withindividual anecdotes to bring home to the reader the weightand tragedy of this misery in human terms. But for this ar-ticle it must suffice it to say that the sector of populationmost affected is that of working age, and that there is a greatdeal of social denial that complicates prevention.

The implications of this phenomenon on prospectiverates of economic growth followinexorably, and those on poten-tial effects on political stabilitystill more inexorably, when oneconsiders that the population it-self will increase in absoluteterms while the general produc-tivity of the working-age cohortswill decline along with theirhealth. The cynical view that ifenough people are ill, then noone will be left to destabilize theregimes, is mistaken. Macroeco-nomic performance figures willprobably improve in comingyears in at least some of the countries concerned; however,such statistics should not be ingested unsalted. If there isone thing that the Stalin experiment taught Western econo-mists, it is that macroeconomic figures are not always reli-able indicators of microeconomic well being.

3. ENERGY DEVELOPMENT: NOT A PANACEA

The possibility of efficient development and export ofCentral Asia’s energy resources seemed at one time to prom-ise economic and social progress. However, this has beencomplicated by technical difficulties in the exploitation ofthe resources, as well as by the complexity of politicalmaneuverings. In Central Asia, Turkmenistan (mainly natu-ral gas with some oil) and Kazakhstan (mainly oil but a gooddeal of natural gas) are the two countries with significantamounts of energy to export. Uzbekistan (some natural gas)also has some quantities.

All these countries share the problem that their onlyavailable export pipelines run through Russia. Turkmenistan,for example, with some of the largest natural gas reserves inthe world, exported nearly 85 billion cubic meters (bcm) ofgas in 1991 but only 13 bcm in 1998 and 23 bcm in 1999.Throughout the 1990s, it has haggled with Russia over priceand periodically suspended exports over such disputes, onlyto be reminded by a foreign-exchange earnings crunch thatit has no other major customer.

A planned pipeline under the Caspian Sea to Azerbaijan,which would have continued through Georgia to takeTurkmenistani gas into hard-currency-paying Turkey, fell

through earlier this year for several reasons. First, Azerbaijanmade a huge offshore gas discovery in the Shah-Deniz fieldand wanted more of the pipeline volume than Turkmenistanwas willing to relinquish. In fact, the Shah-Deniz consor-tium now has plans under way to pipe its own gas alone toTurkey. Second, President Niyazov imposed unacceptableconditions on the consortium that would have built it, in-cluding a huge signing bonus. However, such a bonus wasunlikely, inasmuch as the U.S. Department of Justice hadrecently begun an investigation of the relationship betweenMr. James Giffen and President Nazarbaev of Kazakhstan.2

Third, Niyazov just tried to play too many ends against themiddle, talking now with the trans-Caspian consortium, nowwith the Russians, now with Iran, and even with China. Hejuggled uncertainties for so long that the audience packed

up and went home, leaving himwith the Russians. Capital for theconstruction of a pipelinethrough Iran is nowhere to befound; and the pipeline to Chinais simply unrealistic.

The construction of a pipe-line from Kazakhstan’s Tengiz oildeposit, across southern Russiato the port of Novorossiisk onthe Black Sea was recently com-pleted. This was long sought asa way to get Tengiz oil to market.Yet it remains to be seen exactlyhow much Kazakhstani oil Mos-

cow will let into the pipeline. The Russian regions in the areawant to include some of their own production in the through-put, and Russia’s recent offshore discovery in NorthKashagan, which is still to be developed, is a natural for theNovorossiisk pipeline. Some Kazakhstani production goesto central Russia via the Soviet-era pipeline through Samara.However, both the Tengiz oil deposit and the Karachanagaknatural gas deposit still await reliable transport to market inlarge quantity. Proposed oil pipelines from Kazakhstanthrough Iran via Turkmenistan, and across Central Asia toChina run into the same problems as similar pipelines pro-posed for Turkmenistani gas.

4. NOT JUST IDENTITY POLITICS

4.1. UZBEKISTAN’S “ETHNIC REACH”: RESOURCE OR

LIABILITY?

Uzbekistan’s diplomatic concern with South Asia is con-ditioned by its geopolitical situation and by the country’sclose inter-ethnic relations with Tajikistan and Kyrgyzstan.In the early 1990s, the civil war in Tajikistan represented,for the Uzbekistani government, an external threat that couldlead to domestic unrest because ethnic Uzbeks constituteabout a quarter of Tajikistan’s population and dominate thenorthern part of the country. Samarkand and Bukhara, inpresent-day Uzbekistan, are historical centers of Tajik settle-ment and influence. The figure sometimes given, of a fiveper cent Tajik component in Uzbekistan’s population, is butan artifact of Soviet census procedures. The actual figure isseveral times higher than that.

The possibility of efficient developmentand export of Central Asia’s energy

resources seemed at one time to promiseeconomic and social progress. However,this has been complicated by technical

difficulties in the exploitation of theresources, as well as by the compexity of

political manueverings.


Winter 2001

The ethnic Uzbek’s “reach” into neighboring countriesis matched by its neighbors’ sensitivities to Uzbek influ-ence, which can sometimes seem overbearing. For example,Tashkent has on several occasions sent its troops acrossKyrgyzstan’s and Kazakhstan’s border to conduct exercises,without seeking permission to enter the respective territo-ries. One-seventh of Kyrgyzstan’s population is ethnic Uzbek,and Uzbekistan is the pre-eminentpower in southern Kyrgyzstan,which is linked to the northernpart of the country only by airroutes.

4.2. RUSSIA RETURNS TO CENTRAL

ASIA

The question of Islamic mili-tancy in Central Asia leapt to in-ternational attention when a se-ries of bomb attacks hit Tashkentin 1998. The attention intensifiedwhen the area of Batken, Kyrgyzstan was taken by forcesunder the command of Juma Namangani, an Islamic militant,in the summer and autumn of 1999. Central Asia as a wholebegan drawing closer to Russia as the year 2000 began, partlyin response to these events and partly out of recognitionthat Russia was the only diplomatic power actually preparedto dispatch troops to the region to quell the insurgent forces.As it became clear that President Vladimir Putin was willingto take concrete action in support of his stated objective torestore his country’s prestige and diplomatic status, thisrapprochement with Russia deepened. Central Asia was anatural place for Putin to begin to reassert, by practical steps,a Russian sphere of interest. Already as Prime Minister in1999, he had responded favorably to Kyrgyzstan PresidentAkaev’s request for assistance in the Batken episode.

In early 2000, Putin, as head of the CIS newly elected byits Council, signaled a new special security relationship withUzbekistan. The two countries have had ambiguous rela-tions for the whole of the last decade. After eliminating Is-lamic parties in the Ferghana Valley in 1989, PresidentKarimov of Uzbekistan sent troops to fight in Tajikistan’scivil war in the early 1990s, a period when Russia couldneither define nor assert an interest in Tajikistan. DifferentRussian Army military formations supported different sides,each for idiosyncratic reasons, but Uzbekistan had well de-fined interests and acted on them.3 By the time post-SovietRussia got around to Tajikistan, Uzbekistan had played itsmilitary role there. Tashkent tried to distance itself fromMoscow throughout the 1990s by undertaking autonomousdiplomatic initiatives in Central Asia and turning to the UnitedStates as a “strategic partner”. However, since summer 2000,partly because Russia is the only major country willing tosend troops to assist Uzbekistan’s fight against Islamic in-surgency, relations between the two countries have onceagain drawn closer. These relations are also economic andso include, for example, renewed Russian purchases ofUzbekistan’s natural gas, which are in tandem with Russia’sincreased gas purchases from Turkmenistan as well.

Russia’s re-assertion of influence in Central Asia repre-

sents a move to fill what appears from Moscow as a securityvacuum. It is part of a broader Eurasian trend in Russianforeign policy that includes the development of limited stra-tegic cooperation with China. In fact, China has stealthilybecome deeply involved in Central Asian affairs. This de-velopment may be traced back to one of the more interestingsecurity initiatives in the region: Kazakhstan’s attempt in

the 1990s to organize a Confer-ence on Interactions and Confi-dence-Building Measures inAsia (CICA), with a view towardssubsequently establishing aConference on Security andCooperation in Asia (CSCA).The Conference seeks neither toorganize a collective securityregime nor to reproduce theConference on Security andCooperation in Europe in theAsian theater. In the conceptionof Kazakhstani diplomacy, the

CICA is a conference where states have the opportunity todiscuss problems and organizational mechanisms to assuresecurity in all domains.

Several preparatory meetings were held in view of con-voking the CICA. These meetings revealed three essentialdifficulties with the initiative. First, the geographical scopeof the participating countries was ill-defined. Second, andrelated to the first, there was concern with duplicating theactivities and functions of other organizations and structures.Third, the heterogeneity of the Asian countries themselves,including cultural differences, rendered the overall initia-tive more difficult by complicating the discussions of non-military issues. The U.S. declined an invitation fromKazakhstan in the mid-1990s to participate in the CICA’sExecutive Organizing Committee. However, Russia and Chinaboth accepted. The serious development of security andeconomic ties between the two countries, including theirrapprochement around “anti-superpower” rhetoric, may bedated from their cooperation in that forum. CICA itself con-tinues its activities, and in September 1999 the foreign mem-bers of the participating countries agreed a “Declaration ofPrinciples”, of which the significance may in retrospect cometo rival that of the 1975 Final Act of the Conference on Secu-rity and Cooperation in Europe. CICA itself has also de-volved issue-specific cooperation to what are effectivelyspin-off formations, of which the Shanghai Forum (previ-ously the “Shanghai-5”) is one.4

4.3. OTHER REGIONAL INFLUENCES

4.3.1. CHINA

China and Russia have undertaken a rapprochement overthe last decade that makes Central Asia a region of commoninterest. Yet their designs are not held in common. Russialooks southward from the Eurasian landmass and sees Cen-tral Asia as a traditional sphere of influence and buffer zoneagainst social and political chaos. China looks westward fromthe Pacific Rim and sees Central Asia as a springboard to thegreater Caspian/Black Sea meta-region, opening onto South-

Russia’s re-assertion of influence inCentral Asia represents a move to fill

what appears from Moscow as a securityvacuum. It is part of a broader Eurasian

trend in Russian foreign policy thatincludes the development of limitedstrategic cooperation with China.


west Asia, the Middle East, and Southeast Europe. Xinjiangis the platform providing the run-up to that springboard.China’s aim is to make Xinjiang a “pole of attraction” foreconomic development, linking the South Caucasus andAsia Minor to the Chinese Pacific Rim via transportationinfrastructures passing through Central Asia.

The Central Asian countries, since they are the onesactually in region, have them-selves a more intensive interna-tional agenda than either Chinaor Russia. It is dominated bythree combined security andeconomic issues: energy devel-opment, counter-insurgency,and economic cooperation. Rus-sia is deeply involved in all threethroughout the region. China isthe only other country also in-volved in all three, though notso deeply as Russia. China’s at-tempts to promote energy devel-opment in Central Asia havemostly foundered but not forwant of trying. Its energy cooperation with Turkmenistanand Kazakhstan is tending to increase but remains still atvery low levels due to a general lack of capital. Long beforethe Shanghai Forum was convened to intensify anti-Islamicsecurity cooperation among its members, China had suc-cessfully pressured all these countries to abrogate their in-ternational treaty obligations with respect to treatment ofrefugees, and to return summarily to China any XinjiangUighurs found in their territory, even though Uighurs areperhaps the Turkic people in the region least likely to har-bor Islamic-militant sentiments. As for economic coopera-tion, China does not have the wherewithal to engage inforeign direct investment to any great degree but is seekingto piggyback its political influence upon Japan’s significantinvestments.

China’s demographic policy causes increasing socialtensions in the region. There is evidence of an officiallysanctioned policy to encourage emigration by young ethnicHan males to Kazakhstan in particular, where they acquireland and marry local women, much to the discontent ofyoung Kazakh males. Unofficial estimates put the level ofthis illegal immigration at several hundred thousand. Sincethe population of Kazakhstan is now about 15 million, andhalf of these are male, of whom we may assume half to beof working age, we may estimate that even only 350,000young Han males would represent one-tenth the size of thecorresponding ethnic Kazakh population. This is rather morethan a drop in the bucket.

4.3.2. IRAN AND TURKEY

Even Iran and Turkey, which form a perennial trio withRussia where the Central Asian security questions are con-cerned, are potentially influential in only one of the above-enumerated issue areas, energy. Turkey’s international po-sition declined along with the strategic importance of theBosphorus in the late 1980s, but the situation in Central

Asia in the 1990s was greatly to its advantage. Turkey’srelations with Central Asia are of three kinds: cultural, eco-nomic, and political. Cultural initiatives involve the spread ofthe Turkish language and of the Latin alphabet. Economicrelations include cooperation for development of infrastruc-ture and building-construction.

Iran’s relative lack of diplomatic and economic resourcesmeans that even its attempts topromote energy cooperation withthe Central Asian countries havefoundered. Nevertheless, there isa confluence of interests betweenIran and China on energy policy,as both seek to counter the vari-ous Russian and Western pipelineplans with alternative options.Iran also finds its interests coin-ciding with China’s on suchethno-nationalist related issues asethnic policy in Xinjiang, theresolution of the conflict inTajikistan, and anti-Talibanpolicy. The result has been a dip-

lomatic distancing of China from its long-standing friendPakistan.

4.3.3. PAKISTAN AND AFGHANISTAN

Recently, Pakistan’s regional policy has itself undergonean important shift, with direct implications for Central Asia.In May, General Pervaiz Musharraf, for the first time, pub-licly stated his country’s rationale for supporting the Talibanregime in Afghanistan. He specifically invoked the close eth-nic ties between Pakistan’s influential Pushtuns, who are hiscountry’s second largest ethnic group, and Afghanistan’sPushtuns, who are their country’s largest ethnic group.5 Thisstrategy, which we may call pan-Pushtunism, implicitly re-gards Central Asia as a Pakistani hinterland. In such a strat-egy, Pakistan seeks to carve out a sphere of influence in Cen-tral Asia by penetrating it through military proxies whoseethnic composition draws attention to the Pushtun “fact” inSouth Asia in general, and in Pakistan and Afghanistan inparticular. Seeking to co-opt his own country’s ethno-nation-alist Pushtuns, Musharraf does not concede security inter-ests in Afghanistan to any other country. This policy, whichhas weakened Pakistan’s credibility as a fair arbiter of theAfghanistan conflict, is therefore rightly called dangerous.

This pan-Pushtun policy is manifested in the summerand autumn of the year 2000. At that time, the Taliban-abet-ted Islamic Movement of Uzbekistan (IMU) sent fightersacross Tajikistan and Kyrgyzstan into eastern Uzbekistan andthe Ferghana valley. There they set up a network of basesand supplies as well as communications lines for agitationand propaganda work during subsequent months. This IMUoperation coincided with the Taliban’s successful drive in-side Afghanistan to capture the city of Taloqan, the head-quarters of the Northern Alliance that opposes the Kabulregime. The ensemble of these events has served to take outof political deep-freeze the (still less than likely) proposal tobuild a pipeline for Turkmenistan’s natural gas across Af-

China’s demographic policy causesincreasing social tensions in the region.

There is evidence of an officiallysanctioned policy to encourage

emigration by young ethnic Han males toKazakhstan in particular, where theyacquire land and marry local women,

much to the discontent of youngKazakh males.


Winter 2001

The worst-case scenario inKazakhstan is rather like that in

Uzbekistan, with presidential rulebecoming imperiled by the loss ofallegiance of counter-elites and

sub-elites.

ghanistan to Pakistan. Even more significant, after the Talibanvictory in Taloqan, first Karimov and then Nazarbaev re-ceived Musharraf in their respective capitals and articulateda more conciliatory line towards the Taliban regime in Kabul.

However, these means are unlikely to palliate the threatto the Central Asian regimes from Islamic militancy in theregion. It is unclear whetherUzbekistani rapprochement with Pa-kistan and conciliation with Afghani-stan will produce pan-Pushtun self-restraint. Even if the Afghanistanigovernment (and by implication theirPakistani allies) limit their logisticalsupport for the IMU, the latter is nei-ther entirely under their control northe only Islamic-militant organizationin the region, although it is the onlyimportant one having at present a strategy of armed con-frontation. The Hezbollah group in the Ferghana Valley is noless militant for refraining from immediate combat. The Hizb-e Tahrir group has a longer-term, more studious approach topropagating Islamic influence that seeks to penetrate thepolitical institutions with “agents of influence,” so as toestablish later a regional Islamic Caliphate. The group nev-ertheless concedes the eventual necessity of armed strugglebut parts company from the IMU concerning the latter’spresent tactics.

5. ONCE MORE ON UZBEKISTAN (AND KAZAKHSTAN)

The IMU is still the most immediate threat, yet Presi-dent Karimov of Uzbekistan has boxed himself in over thelast decade by eliminating options for both himself and thosewho stand against him. This hehas done through his uncompro-mising eradication of all opposi-tion, including Islamic-orientedgroups that might have articulatedplatforms for peaceful changewithin a tolerant political systemthat they would have beenthereby brought to support as asystem. However, the unambigu-ous failure of economic reform inthe country has only immiseratedmembers of what middle class thecountry has left. The alienation ofthis middle class has been com-pounded by such political mea-sures as increasingly draconianrestrictions on civil rights and thesummary arrest and detention ofthousands of citizens on suspicion of Islamic sympathies.

The danger to President Karimov in Uzbekistan is notnecessarily that a force of Talibanesque sympathizers willconquer his capital Tashkent, although a few armed clasheshave already occurred within a hundred miles of it. Rather,his ever-increasingly authoritarian rule may be underminedby a militarized crisis of civil control in one or more of theoutlying provinces, triggering a crisis of political authority

among the elites and especially the sub-elites in Tashkentand the regional centers, upon whose allegiance his author-ity rests.6 Since the political institutions in Uzbekistan haveno legitimacy independent of Karimov’s personal authority,such a challenge to his pre-eminence could, if successful,produce a vacuum of political power. Such a vacuum could

then spread throughout the coun-try as regional prefects and notablesshift their loyalty or, to forestalltheir own downfall, proclaim theirautonomy locally by decree.Counter-elites in Tashkent may seekto seize the commanding heights ofthe existing political regime in sucha crisis, but here is no future guar-antee of their success in being ableto command anything in the coun-

try from those heights.7

The outlook is both better and worse in Kazakhstan.Economically the Central Asian country most interdepen-dent with Russia, it is four times the size of Texas with lessthan three times the population of the District of Columbia.Mass social mobilization capable of overtly threatening theregime’s balance is unlikely. However, the ethno-nationalistand relatively densely populated southern region of the coun-try exerted a continual pull on Nazarbaev’s policies through-out the 1990s. Family and clan structures continue to bestrong there. Nazarbaev himself is from the south but fromone of the minor clans. That is one reason, among several,why he moved the capital from Almaty to Astana (formerlynamed Aqmola) in the center of the country. Influence fromsub-elites in the south is responsible for his discarding inpractice a “civic-nationalist” approach to Kazakhstani state

identity. He has continually hadto balance among the differentclan interests from this region.

The worst-case scenario inKazakhstan is rather like that inUzbekistan, with presidentialrule becoming imperiled by theloss of allegiance of counter-elites and sub-elites. However,this scenario in Kazakhstanholds still deeper implicationsfor the region. Already thenorth and east of the country,which have long been heavilysettled by ethnic Russians, havemade local political moves to-wards autonomy and, possibly,separatism. These moves havebeen repressed but not crushed.

There is a great deal of discontent in the oil-rich west of thecountry, because the president’s prefects have had their eyeon their constituency in Astana by which they are appointed,rather than the local population who view them as interestedinterlopers who send the energy revenue out of the regioninstead of improving local conditions. The center of the coun-try is largely desert.

Islamic sympathies have the best chance in southern


Kazakhstan, where they would be most dangerous. The popu-lation is highly impoverished and retains cohesive forms ofsocial organization inherited from the Kazakh cultural past.8

The south of the country continues to have rich agriculture,providing structures of political organization focused on themanagement of irrigation systems (like other great civiliza-tions of the East), as well as significant urban conglomera-tions, such as the industrial city of Shymkent, which havealready witnessed demonstrations of popular unrest oversocial conditions.

It also contains the historic city of Turkestan, whichcarries great weight in the popular consciousness. TheTurkestan area, not far from the Ferghana Valley, is histori-cally the cradle of empires in the region. It has been thecentral political and economic region of the Western Turkicempire (late 6th and early 7th centuries A.D.), theKharkhanid Empire (960-1210, the first Turkic Muslimstate), the Mongol state of Chagatai (13th-15th centuries.),the Kokand khanate and the Kazakh Elder Horde (18th-19thcenturies.), as well as the short-lived Kokand republic (apan-Turkic state that was born and died in 1917). Should theIslamic-militant movements now threatening Uzbekistan makepropaganda and breakthroughs insouthern Kazakhstan, the historicalcity and region of Turkestan wouldexercise a strong pull on historicallyinformed social consciousness. Thisregion is the rich under-belly ofKazakhstan, and its demonstratedpopular disaffection would signal athreat to the country’s political andsocial integrity. It is probably the areaultimately targeted by the strategistsamong Islamic militants in the region.

6. CONCLUSION

Continual low-level civil conflict is foreseeable, espe-cially given the impoverishment of populations throughoutthe region. Kazakhstan should begin to experience economicgrowth in the near future, but it is not certain that this willtrickle down to the society at large. The country suffers fromsuch serious corruption that virtually none of the large WorldBank grants from the early 1990s, targeted at modernizingthe south’s irrigation system, actually reached the region.Kyrgyzstan, once seemingly on course to becoming a modelof tolerant pluralism in the region, has succumbed to theascendance of incentive structures grounded in the specificinterests of particular elite groups, coupled with increasedpolitical intolerance, over a general sense of the commongood that would be linked to more liberal lines of politicaldevelopment.

Tajikistan is comparatively stable but has few hopes forsignificant economic development in the near future, and itssecurity concerns are threatened now not only by the cru-cible of the Ferghana Valley but also by the Taliban con-quest of northern Afghanistan up to their common border.Turkmenistan is politically stable, thanks to the iron fist ofTurkmenbashi (“leader of the Turkmens”) PresidentSaparmurat Niyazov. On the economic side of things, how-

ever, his domestic policies make it unlikely that the peopleof Turkmenistan will experience any economic benefit fromthe development and export of the country’s energy re-sources. Finally, as explained just above at greater length,the economic stagnation in Uzbekistan tends to cast its long-term political stability into doubt.

In the late twentieth century, it became evident that re-gional international systems may be organized around litto-rals (e.g., Asia-Pacific Rim) as well as continentally. Theevents of the last decade have shown the proliferation ofthis emergent characteristic of international politics. Withthe fall of the Soviet Union, there are now self-organizedregional systems around the Black Sea, the Caspian Sea andthe Aral Sea. Looking at a demographic map of Central Asia,what strikes the eye is how large a central part of the regionis desert. Central Asia, therefore, although a continental en-tity, is itself a sort of littoral as well. It is a regional demo-graphic littoral surrounding a mainly barren regional center.The populated areas are not closely connected enough forsomething like an Albanian-style insurrection to pass, aslike a wave, from one to another, thus threatening the region’spolitical constellation.

To be sure, the population islargely so concerned with obtain-ing the means to sustain physicalexistence on a daily basis, that sucha threat is at present peripheral.However, this population will grow,become more educated, and de-mand greater control over the cir-cumstances of their lives. Under-ground Islamic-based education isalready being propagated through-out the region by the Hizb-e Tahrirgroup.

The failure of state-based in-tegration may be compensated for by just such a kind oftransnational societal integration. We will not know until itbursts out, seemingly unanticipated. If this occurs, it maytake a generation, but the forerunner is already evident inthe Ferghana Valley. The states in the region are largelyunable to counter such a development on their own. Rather,it is Russia, China, Iran, Pakistan, Afghanistan, and perhapsIndia and Turkey, whose interplay, not only in the geopoliti-cal space but also in the issue-area space, will condition, butnot determine, the region’s future. The United States hasuntil now abnegated a serious role, and Europe will be pre-occupied with consolidating its enlargement for at least thenext decade or two. Low-profile “private” and voluntarygroups from the West, in for the long haul and operating atthe grass-roots level, may play a crucial palliative and inter-mediary role.

ENDNOTES

1 Five of the eight most densely populated provinces in theformer Soviet area are in Uzbekistan, including the capitalregion Tashkent. The others are Andijan, Ferghana,Namangan, and Khorezm.

In the late twentieth century, itbecame evident that regionalinternational systems may be

organized around littorals (e.g., Asia-Pacific Rim) as well as continentally.The events of the last decade have

shown the proliferation of thisemergent characteristic of

international politics.


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2 Giffen, an American industrialist-turned-lobbyist/advisornow based in Almaty, is publicly reported, based on Swissbank documents, to have possibly contravened U.S. law byplaying a role that facilitating exactly such types of fundtransfers to leading Kazakhstani politicians.3 Karimov used the conflict in Tajikistan as an excuse tosuppress domestic political opposition beginning in June1992. He also cited other foreign developments, such as thethreat of Islamic fundamentalism, to justify the suppressionof political rights.4 The Shanghai Forum includes Kazakhstan, Russia, China,Kyrgyzstan, and Tajikistan. Participants in CICA includethese five, plus Uzbekistan, Mongolia, Afghanistan, Paki-stan, India, Iran, Israel, Egypt, Turkey, Azerbaijan, and thePalestinian administration.5 However, the Pushtuns are not a majority of the popula-tion, they account for forty per cent of it.6 “Sub-elites” are middle-level administrative and politicalpersonnel who transmit instructions from the higher, au-thoritative decision-making elite to the lower executive lev-els, and who report back to the former on the results of thelatter’s implementation.7 “Counter-elites” are elites who represent themselves asalternatives to the elite in power, whom they usually seek toreplace. On infrequent occasion, a coherent and self-con-scious sub-elite can, in the absence of actual counter-elites,itself act as a counter-elite and become the new ruling power.An example is in the April 1974 Portuguese overthrow ofSalazar’s fascism, which had systematically prohibited allpolitical opposition. There, a cohesive and repesentativecollection of army majors and captains, long disenchantedwith the regime’s unending colonial wars in Africa, proclaimeda National Junta of Salvation and the old regime collapsedwithout bloodshed.8 Ethnic Kazakhs remained nomadic with traditional culturalstructures until only a few decades ago, when Stalin collec-tivized their animal husbandry and forced them into fixedsettlements.


‘ASIAN VALUES’ AND THE DEMOCRATICTRANSITION IN CENTRAL ASIA

BY GREGORY GLEASON

Gregory Gleason is an associate professor ofpolitical science and public administration at theUniversity of New Mexico and a Fellow-in-Residence of the J. Robert Oppenheimer Institutefor Science and International Cooperation.

Values, not institutions, have played the determining role in therecent systemic transitions in Central Asian states of the post-communist world. In each of the five countries of Central Asia—

Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan,political institutions of democratic government and market-orientedeconomies were adopted soon after these nations attained independencein 1991. As these countries began the first stages of transition, the lead-ers of each of the Central Asian countries spoke out, at least on a rhe-torical level, in favor of the establishment of democratic institutionsand secular government. Following independence, each of them adopteda constitutionally limited, representative form of government with aseparation of powers and a legal and regulatory framework in accor-dance with international standards. For a brief period during the firststages of national consolidation, there was a widespread assumption inthese countries and in the outside world that if the right democraticinstitutions could be transplanted to the fertile soils of post-communistreorganization, the processes of true democracy could be expected surelyto follow.

Today, nearly a decade after national independence, it is clear thatthe governments of Central Asia have indeed succeeded in adoptingmany of the structures of western style democracy. But they have notsucceeded in the subtler yet more significant transition to the spirit andprocesses of true democracy. All of them have established legislatures,yet none has succeeded in establishing a true, deliberative legislaturewith powers of the purse. All of them have adopted judicial systems foradjudication and dispute resolution, yet none has succeeded in creatingthe conditions for true judicial independence. All of them have adoptedconstitutional and legal statutes that purport to safeguard the rights ofindividuals, minorities, and to protect due process of law, yet none hasactually succeeded in providing functioning protections for fundamen-tal civil and human rights, including such basic freedoms as the right todue process, freedom of speech, freedom of assembly, and freedom ofreligious belief.

All the Central Asian countries now have “presidents.”1 But theseare leaders who came from the former Soviet apparat or high rungs ofthe Soviet establishment. They have established what they refer to as“presidential systems,” which give the executive branch the power torule by decree with the force of “constitutional law.” The executivebranch of these governments dominates the other branches, undercut-ting the separation of powers and checks and balances. All of themhave held elections, yet none of which has fully conformed to interna-tional standards for free and fair elections. Three of these governmentshave former communist leaders who have extended their mandate inextra-constitutional ways. Even in the most open and liberal of thesecountries—Kazakhstan and Kyrgyzstan, the parliaments have beenrouted by presidential decree.

In short, none of the countries can be said to have truly succeededin making the transition from democratic structure to democratic func-tion. As a consequence, many of the formal institutions of governmenthave acquired a showcase quality. The formal institutions exist but it is


Winter 2001

the informal institutions that actually guide the processes ofpolicy decision-making. The legal and regulatory frameworkexists and purports to protect the rights of individuals andlegal entities, but in reality many critical public decisions aremade on an ad hoc basis and with the interposition of indi-viduals whose interests are directly affected by the out-come. The existence of the formal institutions of democraticgovernance creates expectations that the government can-not realize, leading to disillusionment and cynicism. In sucha situation, it is, ironically, the least democratic of the lead-ers of the region who cynically take the greatest credit forprogress and reform. Turkmenistan’s president, SaparmuradNiyazov, has boasted that in Turkmenistan there are no vio-lations of civil liberties of thegovernment’s opponents becausethe government has no opponents.

The experience of these coun-tries in the past decade raises im-portant theoretical and urgent prac-tical questions. What accounts forthe resilience of authoritarian prac-tices in societies that have adopteddemocratic, market oriented institu-tions? What accounts for the yawn-ing divergence between structureand function? What public policy correctives are in orderunder these circumstances? What role can the good officesof outside institutions play in promoting democratic changeand reform? In addressing these questions, it is important tobegin by noting that, at least in the first decade of CentralAsian independence, values have played a more importantrole than institutions.

GLOBALIZATION, DEMOCRACY AND AUTHORITARIANISM

Globalization—the transition to a single, tightly inte-grated, global economic and communication space—is trans-forming public policy in the contemporary world. The evi-dence is clear that globalization rewards those countries thatpractice it well, but punishes those countries that fail to con-form to international standards. Many countries adapting tothe challenges of globalization enjoy the rewards of pros-perity and technological progress, and find that their publicinstitutions come under the influence of great forces for con-vergence and conformity. Major international institutions arenow basing their strategies and policy prescriptions on therecognition that globalization requires policy harmonizationon a worldwide basis. In fact, many of the more importantUN organizations have on an informal basis essentiallyadopted global policy harmonization as their institutionalgoal.

But not everyone shares the view that globalization im-plies democratization, at least in the respect that it impliesthe adoption of functioning western-style democratic insti-tutions as a precondition for effective integration into theinternational community. The political leadership of theCentral Asian states is clearly aware that the dominant in-ternational force at the beginning of the 21st century is glo-balization. But these leaders tend to see globalization as astate-empowering rather than state-limiting trend. They do

not regard globalization and policy conformance as imply-ing a need for internal democratic reforms, but rather viewintegration into the international community as requiring amore intensified and directed role for the state in managingsociety and focusing the energies of the citizenry on theachievement of national goals.

The Central Asians draw these conclusions not fromtraditions of political theory, but from the events taking placeimmediately around them. They point, first of all, to the con-trast between the failed development strategy of the Rus-sian Federation and what they see as a successful strategy inChina. The Russia strategy, as they understand it, was pre-mised upon the interdependence of economic and political

reform. The Chinese strategy as-sumes that economic reform is bestcarried out under the watchful eyeof a paternal and vigilant state. Onlyafter economic reform has createdprosperity, according to the latter,can political reform be expected tosucceed. Central Asian leaders andpolitical strategists also point to thesuccess of the Asian Tigers in har-nessing the capacities of the mod-ern, technological state to achieve

national objectives in ways that are consonant with theircultures.

The Central Asia states are currently experiencing a re-vival of “traditionalism,” which is visible throughout theregion in a variety of different forms. It is often expressed inpublic ceremonies and events designed to rekindle a senseof continuity with these countries’ historical achievementsand glorious past. Late in 1998, Uzbekistan’s president, Is-lam Karimov, was awarded the country’s newly establishedhighest honor, the “Order of Emir Timur” in a public cer-emony that was designed to dramatize the cultural roots ofUzbek society and to reinforce the government’s appealsfor discipline and dedication to national goals.

The revival of traditionalism is also expressed in refer-ence to the wisdom of ancient cultural traditions and prac-tices. In Turkmenistan, Uzbekistan’s neighbor to the south,president Saparmurad Niyazov recently reintroduced genea-logical descent as a criterion for public sector employment.He defended this new criterion of advancement by arguingthat Turkministan should rely on “the experience of our an-cestors, who chose their leaders, military commanders, andjudges from among the worthiest compatriots with high moralstandards.”2

THE ASIAN DEVELOPMENT PATH

Central Asia’s search for traditions and values from thepast invites comparisons with similar yearnings in some otherAsian societies. Anxieties created by the rapid pace of eventsand technological change in the contemporary world some-times cannot be assuaged by the thin reassurances of mod-ern cultural institutions. When confronted with risk, confu-sion, and rapid change, Central Asian societies, like otherAsian societies, have the advantage of having great histori-cal and cultural depth on which to draw.

When confronted with risk,confusion, and rapid change, Central

Asian societies, like other Asiansocieties, have the advantage of

having great historical and culturaldepth on which to draw.


To many Asian thinkers, western theories born of therationalist ideas of the European enlightenment thinkers pro-vided a foundation for society and state that was boundedby this very rationality. The predominant western concep-tions of the state reflect shared assumptions of the westernworld, rather than universal principles of human thought andbehavior. Neoclassical economics champions the virtues ofthe individual and emphasizes the ideal of a relatively lim-ited state. The ideal state plays a restrained role in markets,doing little more than providing a stable macroeconomicenvironment and a stable legal system that enforces privateproperty rights and contract law. This state operates inter-nally with reference to universalistic, rather than particular-istic criteria. In order to assure thatgovernment is responsive to a largeclass of undifferentiated actors inthe polity, the state utilizes abstractand rule-bound, rather than discre-tionary, methods for conductingbusiness. Precedents and rulessupplant personal preferences. Im-personal codes provide prescrip-tions for behavior.

Asian thinkers that rejectedthis minimalist conception of the state and the individual’srole in society could refer to the more collectivist traditionsof state-led development. Marxist and socialist models ofthe state called upon societal mobilization and internal re-distribution for social benefit. But such strong-state poli-cies had many evident disadvantages. For instance, stronggovernment is often associated with populism, import sub-stitution, regulatory manipulation of markets, and unsus-tainable redistributive goals. In many developing countries,the paternalistic role of government in organizing and subsi-dizing preferred industries could lead to direct social ben-efit, but it could also create avenues for rent seeking andbribe taking. The experience of many developing countrieshas tended to confirm the general principle that without well-defined property rights and a rule-regulated market,clientelism, informal decision structures, and secrecy couldeasily develop.

The experience of many developing countries also il-lustrates that governments often welcome state interven-tionist policies, which provide government leaders with waysto curry political support through constituency-buildinghandouts and favors. Expanding the state’s economic roleprovide the government with resources to reward its sup-porters. Privileges can be distributed in the form of specialinterest legislation, tariff protection, price supports, and di-rect fiscal and financial transfers. But these handouts alsotend in the long run to create an anticipation of rent seekingand favoritism. The resulting patronage, nepotism, and cor-ruption allow the state to be captured by narrow, privateinterest groups. Once captured, governments are unable todeliver policies that benefit the entire population

The Asian experience developed against the back-ground of these experiences and “models.” The Asian pathis different from other competing approaches in that it issynthetic—binding together the interests of the state, thesociety, the family, and the individual. There are of course

many Asian paths. One version that has gained a great dealof attention is the formula of Singapore associated with theefforts of Lee Kuan Yew, Singapore’s Prime Minister from1959 – 1990 and now Senior Minister of State. In evaluat-ing Singapore’s success, reference is often made to the factthat Singapore’s strategy was more than an economic model.It looks to historical traditions that, in turn, provide a stableguide to the future. The Confucian principles of filial pietythat emphasize rule by persons of moral authority over therule of law, paternalism over legalism, offer a unique ap-proach to the relationship between modern man and themodern state.

Citing Asian values and historical experiences, EastAsian leaders reject many of theconventional wisdoms of the neo-classical approach. They maintainedthat national development andshared growth require executive in-tervention in the market. They breakwith conventional international prac-tice by fostering land reform, sig-nificant investment in agricultureand rural infrastructure, consciousindustrial policy, encouragement of

small- and medium-sized enterprises, and limits on inflation.The East Asian success stories often hold it as self-evidentthat subsidized and directed finance should be made avail-able to promote investment and infant industries. The suc-cess of the Asia’s Little Tigers provides a good empiricalfoundation for the claim that values matter in developmentstrategies.

The contrasts between the western and eastern modelsexist in degree rather than in kind; but the differences arenonetheless significant in practice. The western model ofpolitical accommodation is based upon the assumption thatthe determination of individual rights is best played out inan adversarial process of open contestation, brokered bythe rule of law and the near universal acceptance of theimportance of the process as opposed to the outcome. Thesanctity of due process is much more important than anysingle ruling or outcome. If the adversarial process is pro-tected, the defeated parties always have an opportunity—and perhaps even an advantage—in returning to the con-test at a later point. The American business model reliesupon the preservation of impersonal, abstract legal rules toensure even-handed, fair, and freewheeling competition.

Contrast this approach to the more traditional Asianpractice. The Asian model conceives of politics as consist-ing in the first instance of personal obligation and duty; busi-ness relations depend in the first instance upon networksand social obligations. The western model stresses laissez-faire, open economics; the Asian one relies on national strat-egies, and entails the government’s actively supervising,monitoring, and even regimenting the competitors. The cor-nerstone of the former is individualism; that of the latter isloyalty. In the former, independence is expected and oppo-sition is considered a challenge. In the latter, disagreementis regarded as impolite and opposition treachery.

Asian thinkers who rejected thisminimalistic conception of the stateand the individual’s role in societycould refer to the more collectivisttraditions of state-led development.


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CENTRAL ASIAN TRADITIONS

Are these contrasts applicable to Central Asian societ-ies? In addressing this question, it is important to note thatthere are many countries in Central Asia. The largest one isKazakhstan. Its oil wealth, mixed Kazakh and Russian popu-lations, and the fact that it possessed over one thousandnuclear warheads in its territory when it gained indepen-dence were the defining features of its domestic politicalcontext during the initial years of independence. TheKazakhstan communist party leader of the Soviet era,Nursultan Nazarbaev—previously one of the most articu-late and progressive of the Soviet leaders—soon became asteadfast defender of an independent Kazakhstan. Duringthe first years of his leadership, Nazarbaev pioneered theidea of Eurasian integrationbased on the community of cul-tural and economic linkagesamong the peoples of the Cen-tral Eurasian landmass.Kazakhstan’s foreign policy fol-lowed a careful line, balancingbetween China, Russia, and thewest but always geared towardKazakhstan’s future oil and gasdevelopment.

The most auspicious demo-cratic reforms took place in thesmall, remote, and mountainous country of Kyrgyzstan.Largely thanks to the efforts of its president, Askar Akaev,Kyrgyzstan initially became the wunderkind of the interna-tional donor community, attracting a disproportionately largeshare of humanitarian and technical assistance from donororganizations. Kyrgyzstan was the first post-Soviet state tofollow the advice of the international donor community andwithdrew from the ruble zone in 1993. It was also the firstpost-Soviet state to adopt a western style civil code, a mod-ern legal and regulatory framework, to liberalize prices, toprivatize industry, and to adopt at least the superficial trap-pings of an open and competitive political system.Kyrgyzstan was the first country of the Commonwealth ofIndependent States (CIS) to join the World Trade Organiza-tion. However, Kyrgyzstan’s limited resource endowmentand trade dependence on the outside world—there is littlemanufacturing in this small and remote mountainous state—constrained its progress. Important political reforms tookplace, but the promised benefits of rising prosperity remainedelusive for most of the population.

The smallest and poorest of the Central Asian coun-tries is Tajikistan. Tajikistan would also likely have moved inthe direction of reform if the country had not fallen prey toan internal contest for power in the first year of indepen-dence. The contest plunged the country into civil war.Tajikistan is a landlocked, mountainous country lacking goodtransportation routes. The war resulted in a blockade by itsneighbors, further compressing the already collapsingTajikistan economy. The modest level of civil normality main-tained in Tajikistan was largely a result of the presence offoreign (mainly Russian) peacekeeping forces. After a de-cade of independence, Tajikistan has become one of the

world’s poorest countries. The tiny economy is based largelyon subsistence barter relations and foreign assistance fromdonor organizations.

The most heavily populated of these Central Asian re-publics, Uzbekistan, quickly established itself as defiantlynationalist after independence. Upon independence,Uzbekistan’s strong-willed president, Islam Karimov, who,only a few years before had been a dutiful communist, rap-idly became an enthusiastic champion of an independentpolitical path and engineered the “Uzbek cultural renewal.”In ways reminiscent of the actions of Turkey’s KemalAtaturk, Karimov sought to create a national identity forgedfrom an alchemy of history and myth, and based upon a vi-sion of Uzbekistan’s playing a pivotal international role inthe 21st century. Government, economics, culture—the en-

tire spectrum of policy arenas—was subsumed into the drive toshape the future in the image of a“recovered” but largely apocry-phal past.

The uncompromising nation-alism of Uzbekistan, however,pales in comparison with thepolicy posture of its southernneighbor, Turkmenistan.Turkmenistan is a small tribal civi-lization on the southern fringe ofCentral Asia. The area was largely

undeveloped during the Soviet period. With the exceptionof gas and oil, the minimal economic activity that existedwas largely maintained by Soviet government central subsi-dies. Industry unrelated to the gas and oil complex was gen-erally not commercially viable. For instance, the country’sspecialization in cotton production was based upon mas-sive irrigation subsidies. When Soviet subsidies came to anend, most of the non-subsistence agriculture and industryimmediately became insolvent. Yet the country’s rich gasreserves furnished support for an intense, highly personal-istic nationalism revolving around the country’s Soviet eracommunist party boss, Saparmurad Niyazov. Niyazovadopted an assertive posture of national self-reliance basedon its gas and oil wealth, which he termed the policy ofTurkmenistan’s “positive neutrality.”

International human rights organizations have beenhighly critical of the Turkmenistan government for failingto make even minimal progress toward international stan-dards of policy and practice. The U.S. government and othermajor world powers have been criticized for turning a blindeye to Turkmenistan’s record so as not to obstruct their goalof promoting the development of Turkmenistan’s immensegas reserve. 3 However, Turkmenistan’s civil rights recordhas clearly had an effect upon the international community.The European Bank for Reconstruction and Development(EBRD), a highly diplomatic institution not given to grand-standing and histrionics, took the unusual step of suspend-ing its lending programs to the Turkmenistan government inApril 2000, citing its failure to make progress in governancereforms.4

Upon independence, Uzbekistan’sstrong-willed president, Islam Karimov,who, only a few years before had been a

dutiful communist, rapidly became anenthusiastic champion of an independentpolitical path and engineered the ‘Uzbek

cultural renewal.’


THE CASE OF UZBEKISTAN

Given the great variations among the Central Asiancountries, only in superficial respects can they be describedas having one culture. Generalizations seldom apply to all ofthem equally. Their peoples and cultures are varied, but in-termixed. None of these countries ever existed within theirpresent borders prior to the Soviet period. Their statehoodand borders are inventions of the Soviet regime.

At the heart of Central Asia lies the agricultural oasesand irrigated farm valleys of Uzbekistan. Uzbekistan is thelargest Central Asian country in terms of population. It isthe quintessential Central Asiancountry, defining the most impor-tant aspects of “Central Asian-ness.” The Uzbeks emerged at theend of the 15th century from a het-erogeneous mix of inhabitants ofthe region brought together by mili-tary leaders. The Uzbek nation his-torically was defined primarily bylocal, i.e. territorial and religious,differences rather than what wewould today call ethnic differ-ences. During the Soviet period,the Uzbek language was standardized around the Tashkentdialect. Efforts were made to eliminate many of the tradi-tional clan and regional differences.

The authoritarianism of the settled peoples ofUzbekistan has long been apparent to outsiders. Some schol-ars have sought explanation for these cultural differencesby noting that the functions of regimentation and centraliza-tion required by the nature of the irrigated oasis societyproduced an effect on public psychology. In a famous al-though now often dismissed interpretation of the origins of

“Oriental despotism,” KarlWittfogel argued that thenecessity of managing acentralized irrigation systemproduced a socio-politicalorganization whichWittfogel characterized asthe “hydraulic society.”5

Wittfogel’s thesis was thatunlike the individualisticpolitical culture in manywater-rich agrarian societ-ies, semi-arid agriculturalsocieties often required ahigh level of centralized de-cision making. The de-mands of the hydraulic so-ciety resulted in the forma-tion of a “managerial state.”The economic, administra-tive, and political functionsof the managerial state wereconcentrated in a rulingclass consisting of land-owners, land managers, and

the military.The authoritarian culture is not merely a political value,

but a deeply ensconced social value. The most visible as-pect of the public culture of these countries is the greatimportance associated with hurmat, the idea of “deference”or “respect.” In present day Uzbekistan, the origins of hurmatare not hard to find. Hurmat begins in the family. Personallife is family life in Uzbekistan. Property is communal, theuniversally preferred Uzbek meal, palov (rice pilaf) is eatenfrom a common bowl, elders are deferred to without ques-tion, and the subordinate position of women in society isreinforced through the family structure. Authority is a social

phenomenon.The hierarchies of political

life are merely a natural extensionof the structures of the family.Public political values are diffi-cult to distinguish from family val-ues. The structure of authority isemphatically patriarchal. In manyregions of Uzbekistan, the elderor most respected man is the headof the family. Grown adults oftenwill refrain from making importantprofessional or commercial deci-

sions until they have had an opportunity to consult theirparents. In the northern province of Tajikistan, the peoplerefer to Uzbekistan’s president Islam Karimov, whom theyregarded as their protector in the Tajikistan civil war, asIslam-aka (Father Islam).

Given the importance of elders, funerals are very impor-tant political gatherings. When a respectable figure in thecommunity dies, an important social position is vacated.Filling that position initiates a “vacancy chain” which influ-ences all positions of a lower order throughout the hierar-

The authoritarian culture is not merely apolitical value, but a deeply ensconcedsocial value. The most visible aspect ofthe public culture of these countries isthe great importance associated with

hurmat, the idea of ‘deference’ or‘respect’.


Winter 2001

chy in the community. Members of the community naturallygather at funerals to determine the reordering of the informalauthority structures.

A second aspect of Uzbekistan’s culture is personal-ism. In Central Asia in general and in Uzbekistan in particu-lar, power is often vested in the person, not the post. The all-powerful local official, the Hakim, presides over a Hakimiat.The terminology of European languages suggests that thispractice may once have existed in European societies aswell. For instance, the words we use for political structuresalso have associated with them words for the person whofills the leadership position of thatstructure. We have, for instance:Emperor—Empire, King—King-dom, Emir—Emirate, and evenAmbassador—Embassy. But theEuropean terminology only sug-gests the vestiges of the past. Incontemporary society, we tend tothink of “counties” as purely ad-ministrative structures, rarelybringing to mind the idea of a“Count.” We think of the presi-dent, but probably few of us haveever contemplated the idea of“Presidentia”, presumably an area over which a presidentwould preside. Steeped in liberal democratic traditions, wetend to automatically distinguish between the post and theperson who fills it. Some Central Asians find this distinctiondifficult to draw.

Today, Uzbekistan’s political leadership appeals to ele-ments of Central Asian values while harkening back histori-cal and cultural traditions of a halcyon and glorious (andlargely fictitious) past. Uzbek President Karimov has be-come an ardent advocate of Uzbek traditionalism. In his re-cently published Uzbekistan on the Threshold of the TwentyFirst Century, he argued:6

Our goal—as we outlined at the outset of the nine-ties—was not to lose that which has been createdwith the labor of many generations, to keep all thatis best, to rearrange that which does not meet ournational interests and our independence and to en-rich the existing structures with new contents. Therich culture of the Uzbek nation, its educationalsystem and its scientific establishment could notbe dismissed merely as the totalitarian heritage. Thecourse we have chosen is to reorient these systemstowards a new ideological platform based both onthe centuries old traditions, customs, culture andlanguage of the Uzbek people, and on the achieve-ments of world civilization.

Today Uzbekistan’s authoritarian leadership defends itspolicies as being necessary to maintain social consensusand political stability. It defends Uzbekistan’s neo-mercan-tilism as based on indigenous Uzbek cultural traditions andas following the successful model of the Asian Tigers.Uzbekistan’s spokesmen say that America values are basedon a revolutionary—that is, anti-imperial and anti-monarchi-

cal—doctrine of the preeminence of individual rights. TheAmerican beliefs in lateral management, citizen empower-ment, horizontal authority structures, and incentives maywork in America, these Uzbek critics argue, but these beliefscannot be expected to work a culture as accustomed to theheavy hand of top-down management and hierarchical so-cial structures as Uzbekistan.

DEMOCRATIZING DEMOCRATIC INSTITUTIONS

Judged by the benchmarkcriteria for measuring demo-cratic progress used by Free-dom House (a U.S. based phil-anthropic research organizationestablished in 1939), the Cen-tral Asian societies have not re-alized the full potential for demo-cratic change.7 What does thislack of progress portend fordemocracy’s future in CentralAsia? What do the features ofCentral Asian culture spell forattempts to promote democ-

racy? Does Uzbekistan’s personalism mean that it is futile topromote the organization of political parties? Does venera-tion of traditions mean that it is inappropriate to urge theprotection of the independence of the judiciary? Does thestrength of the family mean that individual civil rights arenot in need of legal protection? Does popular resignation inthe face of capricious use of political authority mean thatthere is no need to assist the development of an indepen-dent deliberative assembly? No. None of these is true. Whatis true is that the structures and procedures of democracydo not constitute democracy itself. If democracy is to growin Central Asia, it will grow from roots that already existthere.

There is growing recognition that the institutions ofdemocracy are not the sufficient conditions for democracy.The failed transplantation of western structures and institu-tions should lead the promoters of democracy to the conclu-sion that efforts to recreate the developing world in the im-age of Europe and North America is not likely to succeed,and may provoke counterproductive repercussions. Politi-cians, always sensitive to the politically desired and oppor-tune, are far better than scholars and analysts at recognizingthis. President Jacques Chirac told an audience in Congorecently that “democracy is plural”, inviting them to develop“in their countries and in their hearts a lively democracy inthe colors of Africa.”8 There is a growing recognition thatdemocratic universalism is possible without institutionaluniformity.

The complexities of promoting democracy in culturesso dramatically different from the European liberal traditionshave convinced some people that democracy is not appro-priate for Central Asia. Some have observed that CentralAsia is “not yet ready” for democracy, that Central Asia“will not see democracy in our lifetime.” Others have fallenback on more traditional arguments, maintaining that Ameri-

The failed transplantation of westernstructures and institutions should lead thepromoters of democracy to the conclusion

that efforts to recreate the developingworld in the image of Europe and North

America is not likely to succeed, and mayprovoke counterproductive repercussions.


can assistance in the end should be related to Americaninterests. America should help people help themselves, theysay, but it should do so when that also means helpingAmerica.

These arguments overlook a basic reality of the modernworld. Investment in democracy is not an investment in aform of government at all. It is an investment in good gover-nance. Without good government, no form of foreign assis-tance is likely to prove beneficial in the long run. The ratio-nale for promoting democracy is neither self-interest noraltruism. Malign dictators can just as easily appropriate fortheir own purposes the fruits of self-interested help as theycan the fruits of genuine altruism. Good governance is goodinvestment.

ENDNOTES

1 Nursultan Nazarbaev, now president of Kazakstan, is theformer first secretary of the Kazakhstan republic communistparty organization. Islam Karimov, now president ofUzbekistan, is the former first secretary of the Uzbekistanrepublic communist party organization. Saparmurad Niyazov,now president of Turkmenistan, is the former first secretaryof the Turkmenistan republic communist party organization.Imomali Rahmonov, now president of Tajikistan, is a formerKuliab region communist party official. His predecessor aspresident, Rakhmon Nabiev who died under mysterious cir-

cumstances in May 1993, was the former first secretary ofthe Tajikistan communist party. Among the Central Asianpresidents, only the president of Kyrgyzstan, Askar Akaev,does not belong to the former party nomenklatura althoughin some respects even Akaev, a physicist who was trained inLeningrad, can also be considered a member of the Sovietintellectual elite.2 Bruce Pannier, “Turkmen President Fires Scores of Offi-cials.” Radio Free Europe/ Radio Liberty (December 5, 2000).3 Statement of Christopher H. Smith, Chairman, Commis-sion on Security and Cooperation in Europe, Hearing onDemocratization and Human Rights in Turkmenistan, March21, 2000, Washington, DC.4 “EBRD Cuts Turkmen Loans, Slams Political System,”Reuters (18 April 2000).5 Karl A.. Wittfogel, Oriental Despotism New Haven: YaleUniversity Press, 1957.6 Islam Karimov, Uzbekistan on the Threshold of the TwentyFirst Century (New York: St. Martin’s Press, 1998), p. 112.7 The Freedom House annual surveys measure progresstoward democratic ideals on a seven-point scale for politicalrights and for civil liberties (with 1 representing the mostfree and 7 the least free). Changes in countries’ scores fromyear to year are monitored via annual surveys. The politicalrights measurement addresses the degree of free and fairelections, competitive political parties, opposition with animportant role and power, freedom from domination by apowerful group (e.g. military, foreign power, totalitarian par-

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Winter 2001


THE POLITICS OF HISTORY INTAJIKISTAN: REINVENTING THESAMANIDS

BY KIRILL NOURZHANOV

Kirill Nourzhanov received his Ph.D. from theAustralian National University in 1998 and iscurrently a Lecturer in the Centre for Arab andIslamic Studies (the Middle East and Central Asia)at ANU. He has published widely on Central Asianhistory and politics. During 2000-2001, he actedas an adviser to the Government of Tajikistan onparliamentary reform. His book Tajikistan: TheHistory of An Ethnic State will be published byHurst this year.

On 9 September 1999—the 8th anniversary of Tajikistan’s independence—President Rahmonov opened an imposing memorial complex in the center of Dushanbe to commemorate the

1,100th anniversary of the Samanid State. Its centerpiece is an 11-meterhigh statue of Amir Ismail Samanid (892 – 907), who is portrayed exit-ing a gilt arc while being guarded by two tamed lions. According to thevision of the creators of this monument, “the enlightened Amir is notput on a high pedestal; on the contrary, he is placed as close as possibleto the people … His body, draped in a flying cloak, projects the idea ofmoving forward. The noble arc … is a signpost, symbol, image of thenation”.1 The architectural composition also includes a museum-cum-pantheon of national dignitaries, fountains, a pedestrian esplanade, andthree alleys: the Alley of the Presidents, the Alley of the Heroes of theState, and the Alley of the Stars of Poetry of the East. The entire en-semble is aptly called Vahdati Milli (National Unity), and, as the Mayorof Dushanbe explained, its inauguration “underscores the unity of theTajik nation and all peoples living in Tajikistan, and is yet another tes-timony to the rallying of the people around the course conducted by thecountry’s leadership headed by the President of Tajikistan EmomaliRahmonov.”2

All governments use historical symbols and historiography to cul-tivate patriotism, explain and justify policies, and secure the acquies-cence and cooperation of the people in times of crises. Symbolic en-capsulation of the themes of regime legitimacy, common identity, andcultural revival through historical references is particularly crucial foremerging nations.3 The newly independent Central Asian countriespresent no exception from this pattern. President Islam Karimov ofUzbekistan has succintly summarized the views of the region’s leaderson the subject, “Historical memory, the restoration of an objective andtruthful history of the nation and its territory is given an extremely im-portant place in the revival and growth of national self-consciousnessand national pride … The deeds and feats of great ancestors enlivenhistorical memory, shape a new civil consciousness, and become a sourceof moral education and imitation.”4 However, as interpretation of thehistorical record invariably takes place under the patronage and vigi-lant control of the state, the restoration of “an objective and truthfulhistory” across Central Asia has, with ruthless inevitability, acquiredthe form of a series of symbolic myths, which “must be told (compul-sively) again and afresh, and are differently gratifying and terrifyingeach time.”5 Moreover, historical narrative as a political phenomenonis less concerned with uncovering new or suppressed information, orproviding a fresh angle on events in the bygone times based on profes-sional scholarship, as it is with constructing a rounded, systematic, anduniform vision of the past. To paraphrase Robert William Davies, thisis propaganda, as much as history.6

Because of the civil war and the ensuing fragility of the centralizedstate, the ruling elite of Tajikistan has been slow to develop a compre-hensive ethno-historical paradigm with elaborate mythology, didactic


Winter 2001

overlay, and a cohort of martyrs, prophets, and championsof the National Idea. However, the achievement of a sem-blance of stability and the beginning of the process of na-tional reconciliation in 1997 provided an impetus and a ra-tionale for movement in this direction. Rediscovery of theSamanids, which received official blessing by PresidentRahmonov in March 1997 and reached symbolic culmina-tion two and a half years later, has formed the foundation ofthe new official history in Tajikistan.

1. THE SAMANIDS IN CENTRAL ASIA

In 1925, V.V. Bartold expressed the view that a periodof more than one thousand years from Alexander the Greatto the advent of Islam passed almost unnoticed in terms ofstate formation and political organization in Transoxiana.7

This opinion, which obviously did not fit the Marxist con-ception of linear political evolution, was severely criticizedby Soviet scholars. However, there is no doubt that at thetime of the Arab invasion, the Central Asian lands were di-vided among as many as twenty-seven petty princedoms.8

Their rulers did not enjoy absolute authority, as real powerlay with the members of the traditional landed aristocracy(the dihqans), who had fortified castles and small privatearmies at their disposal. In times of trouble, princes had lit-erally to grovel for help from their supposed vassals.9 Thewhole picture bore a striking resem-blance to the post-Achaemenid pe-riod, where the political map of Cen-tral Asia was changing kaleido-scopically.

The Trans-Oxus principalitiesnever formed a viable confederacy.On top of mutual mistrust and hos-tility, religion and ethnicity createdfundamental divisions among localcommunities. Such conditions ofdisunion favoured the piecemealconquest of Transoxiana by theArabs. Beginning in 651 AD, theArabs organized periodic maraud-ing raids deep into the territory ofMawarannahr, but it was not until the appointment of Qutaibaas Governor of Khorasan in 705 AD, during the reign ofWalid I, that the Caliphate adopted the policy of annexingthe lands beyond the Oxus. Ten years later the task of an-nexation was accomplished.

The ascension of the Abbasids to rule the Caliphate (750- 1258) opened a new era in the history of Central Asia.While their predecessors the Omaiyads (661 - 750) werelittle more than leaders of a loose confederation of Arabtribes, the Abbasids set out to build a huge multi-ethnic cen-tralized state that would emulate and perfect the Sasaniangovernment machine. They gave the Near East andTransoxiana a unity, which they had been lacking since thetime of Alexander the Great. In the eighth century, “the enor-mous expansion in trade brought about an explosion in thegrowth of cities and market towns everywhere ... The inter-nationalism of the age burst into full bloom, as commerceand culture, hand-in-hand, flourished as never before.”10 The

Abbasid caliphate, as a territorial empire, succumbed to cen-trifugal tendencies and succession disputes soon after thefabled Harun ar-Rashid died in 809. Yet it left a mightylegacy, the Islamic civilization, which for centuries “was thereal centre of the ecumene, in contact (as Christianity wasnot, until the sixteenth century) with all other major societ-ies except, of course, those of America.”11

Islam spread rapidly in Mawarannahr. The new religionwas received mostly by popular acclaim, for it promisedgreater social mobility and created favourable conditionsfor trade. Islam provided the peoples of Central Asia with aspiritual and cultural bond and brought them closer to eachother as nothing had before. With Islam there came Ara-bic—not only the language of the Holy Quran and theAbbasid court, but also the language of science and poetryand the lingua franca of trade and diplomacy. It must alsohave stimulated the emergence of the Modern Persian lan-guage (Dari), in which the share of loan-words from Arabicfluctuated from ten percent in the vocabulary of Rudaki (9thto10th centuries) to forty percent in the writings of Baihaqi(11th century). All in all, “the volume of Arabic lexicon, itsshare in the vocabulary of the Dari language remained ex-ceptionally high until the first quarter of the nineteenth cen-tury.”12

Based on the region’s general economic rise and thecoexistence of and fruitful interaction between Arabic and

Persian literatures, the newlyemerged ecumenical Islamic culturereached its zenith during the rule ofthe Samanid dynasty (875 - 999).The Samanids, who originated froman old dihqan family in Khorasan,created a kingdom of their ownwhich stretched from the PersianGulf to India. The relatively stabledomestic and international situa-tion allowed them to encouragelearning and the arts. However, cul-tural renaissance in Khorasan andMawarannahr commenced long be-fore their ascendancy and contin-ued after their demise until the

Mongol invasion. Their centrality to this phenomenon hasto be treated with caution: “Spiritual, intellectual and artisticlife in the Samanid domains thrived, although it is impos-sible to isolate it from similar florescence in several otherparts of the Islamic world, beginning with the neighbouringKhwarazm.”13

The Samanid Empire was the last time that the bulk ofIranian lands became the domain of an Iranian ruler, in thetraditions of the Achaemenids and the Sasanians. TheSamanids were lucky to have carved a larger kingdom andheld it somewhat longer than other regional dynasties of Ira-nian extraction within the Caliphate; otherwise, they differedlittle from the Saffarids or the Tahirids. Their base was stilla clan, a small professional army, and a handful of big cit-ies. Within the Samanid administration there was a discern-ible ethno-religious division: an Iranian chancery, staffedwith recent converts par excellence, co-existed with the pre-dominantly Arab ulama, while the core of the army con-

Historical narrative as a politicalphenomenon is less concerned with

uncovering new or suppressedinformation, or providing a fresh

angle on events in the bygone timesbased on professional scholarship, as

it is with constructing a rounded,systematic, and uniform vision of

the past.


sisted of Turkic slaves or mercenaries. Given time, a coher-ent society might have evolved behind the Samanid empire,but the attack of the Qarakhanid Turks ended its reign in999, and dominance in Mawarannahr passed on to Turkicrulers for nine centuries to come.

2. THE PROBLEM OF ETHNOGENESIS OF THE TAJIKS UNDER THE

SAMANIDS

Prior to independence, Tajik scholars generally sub-scribed to Barthold’s judgment that “The Samanids … mightwell be called the epoch of ‘enlightened absolutism’. Themonarchs did not carry out any drastic social reforms, butstrove to institute a firm rule and peace within their posses-sions, to protect the lower classes from oppression, and toencourage the development of industry, trade and educa-tion.”14 The Samanids were treated as a quintessentialephemeral feudal empire, akin to the Saffarids or theGhaznavids, whose track record in efficient governance wasnot impressive. Their special place in textbooks was basedon the claim that “the formation of the Tajik nation was com-pleted during the rule of the Samanids.”15

In order to avoid the terminological quagmire associ-ated with the usage of the value-laden concept of ‘nation’, itwould be more appropriate to focus on the emergence of theprimary form of ethnic community—the ethnie, which, inAnthony Smith’s characterization, isa given population, a social group“whose members share a sense ofcommon origins, claim a commonand distinctive history and destiny,possess one or more distinctivecharacteristics, and feel a sense ofcollective uniqueness and solidar-ity.”16 In the case of the Tajiks, theproblem of collective cultural indi-viduality put in historical perspec-tive is twofold: (a) their distinctnessfrom non-Iranian peoples of CentralAsia and (b) their dissociation withthe peoples of Khorasan and Iran proper.

There can be little doubt about the existence of a potentcleavage between Iranians and Turkic tribes at the time ofIsmail Samani in Central Asia, complemented by religiousovertones: “The Samanids are also remembered … for thejihad that they waged on the northeastern frontier of theirterritories, in the Bilad al-Turk, the Turkestan of that pe-riod.”17 The second part of the equation, i.e. the separationof the Tajiks from other Iranian peoples, poses greater prob-lems.

The assumption of a collective, identifying name is oneof the most important attributes of a viable ethnic commu-nity. Usage of the word ‘Tajik’ as an ethnonym was not reg-istered before the second quarter of the 11th century.18 Ithas been generally accepted among scholars that the termwas initially used in Mawarannahr to refer to the Arabs (itwas probably derived from the Arab Tai tribal name). After-wards, it became a collective name for both Arabs and localconverts to Islam (predominantly Iranians), and only muchlater was this term transformed into the ethnonym of an en-

tity among Central Asian Iranians. A number of Tajik ex-perts adhere to a different theory which implies that the word‘Tajik’ originated from the Persian ‘Taj’ (meaning ‘crown’)and that as early as the eighth century, Iranians ofMawarannahr, especially in the mountainous areas, calledthemselves Tajiks, that is, the ‘Crown Headed’. By callingthemselves as such, these Iranians emphasized their supposedsuperiority over all other local peoples.19

Another important element in the making of an ethnieis an elaborate set of myths which explains the origins of acommunity in space and time, stresses the common fate ofits members, and provides legitimation for its policies inrelation to other communities. Called mythomoteur by JohnArmstrong, it “sustains a polity and enables it to create anidentity beyond that which can be imposed by force or pur-chased by peace and prosperity.”20 The mythology of anethnie finds its reflection in epic tradition. All ethnic groupsof Aryan descent in Iran and Central Asia had practicallyidentical mythomoteurs until the late Middle Ages. The my-thologies were first codified in Avesta, then in Middle Per-sian literary monuments, for example, Yadkari ArdashirPapakan, Ayatkar Zareran, Artavirnamak, and reached afelicitous epitome in Ferdowsi’s Shahnama, circa 1011 A.D.All major motifs and protagonists in Shahnama (as well asin Iskandarnama, Darabnama, Jamaspnama,Gushtaspnama and so on) are common for Tajiks and Irani-

ans. There might have been localdeviations from the canon, such asthe autochthonal cults of BibiSeshambe or White Div in the east-ern part of Tajikistan, but, gener-ally, as late as the eleventh cen-tury, there existed a collectivemythomoteur of Greater Iran, withthe struggle against the Turkicworld (Ferdowsi’s Turan) as its piv-otal point.

The ideas of Shahnama con-tinued to form the backbone of the‘state epos’ in Persia under the

Safavids. In contrast, the mythical tradition of Iranians inCentral Asia underwent a dramatic change by the secondhalf of the 16th century, as the Tajik epic poem Gurugli tes-tifies. Its very title is a replica of a cluster of Turkic folklorelegends (Kørogly in Azerbaijan, Gørogly in Turkmenistan,Gorogly in Uzbekistan), as is its plot. Behind the figure ofAvaz-khon, a fervent fighter, noble knight, and gifted com-mander of the Iranian (forget the Turkic name!) Shah Gurugli,there is the historical character of Ayaz, a Turkic slave andfavourite of Sultan Mahmud Ghaznavi (997 - 1030). However,having acquired the plot from their Turkic neighbours, theTajiks largely reiterated their own ancient epos on its basis.Gurugli has direct parallels with Shahnama’s Faridun and,unlike his Turkic counterparts, is more of a fair monarch thana pahlavan (a gallant and reckless warrior). Also, of course,Gurugli is a poetic work and “several times as big” as theprosaic Azerbaijani original.21

Language and religion are considered the most basictraits of an ethnie’s shared culture. Under the Samanids, or-dinary people continued to speak local dialects (Soghdian,

Another important element in themaking of an ethnie is an elaborate

set of myths which explains theorigins of a community in space andtime, stresses the common fate of itsmembers, and provides legitimation

for its policies in relation to othercommunities.


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Khorezmian, and so on), while Dari was primarily the lan-guage of official documents and court life, only beginningto spread en masse in Bukhara, Samarkand, and Ferghana.22

Literary Modern Persian remained uniform in Western Iranand Mawarannahr until the 15th or even 16th century.23 Simi-larly, legal and educational systems based on shari’a stayedalmost identical across pax Iranica. The sunni – shi’a di-chotomy was yet to become a watershed among differentethnic communities, and to find its reflection in Guruglithrough the mediation of the Turkic text.24

According to Anthony Smith, “a strong sense of belong-ing and an active solidarity, which in time of stress and dan-ger can override class, factional, or religious divisions withinthe community”25 is the decisive factor for a durable ethniccommunity. This was not the case amongst Iranians inMawarannahr before, during and after the Samanid rule.Internal divisions in principalities, valley communities, orother territorial sub-units were more potent sources of iden-tity than affiliation with an ethnie. Khuttal, Chaganian,Isfijab, Khorezm and princedoms of Badakhshan nominallyacknowledged the supremacy of the Samanids, yet in prac-tice they “were ruled by local dynasties according to theirold traditions.”26 By the twelfth century, four distinct re-gions had formed in the territory of Tajikistan that werecharacterised by political and cultural autarchy: (1) North-ern Tokharistan and Khuttal; (2) the Zaravshon Valley; (3)the basin of Upper and Middle Syr-Darya, includingUstrushana, Khujand, and Western Ferghana; and (4) thePamirs. With some variations, these specific cultural-geo-graphic areas have survived until today. Prior to the Mongolinvasion, their populations never acted in unison to repelaggressors. Moreover, cases of mass resistance to aggres-sion were almost unheard of in Mawarannahr.

In summary, it is difficult to single out a distinct Tajikethnie in the 10th century. Central Asian Iranians remainedan integral part of a wider Iranian community that came intobeing in the Achaemenid era and from which they drew theirname, history, inspiration, and shared culture. However, theSamanid period can be regarded as an important landmarkin the process of the ethnogenesis of the Tajiks. It producedan encoded fund of myths, memories, values and symbols,the puissant core of the future ethnie in Tajikistan, whichshowed remarkable resilience in the face of countless inva-sions and eventually formed the backbone of the ‘Tajik So-viet nation’.

3. THE RISE OF NATIONALIST HISTORIOGRAPHY

Gorbachev’s perestroika ushered in a period of unprec-edented nationalist mobilization in Central Asia, and with itcame a new wave of reconsidering ‘official versions’ of thepast. As the Soviet Empire was losing its cohesion and eth-nic conflicts were flaring one after another, professional his-torians, members of the intelligentsia, and politicians set outto activate and refresh the Tajik mythomoteur. Nationalisthistoriography in the late 1980s and early 1990s was par-ticularly concerned with the following issues:

§ the establishment of a unique Tajik identity basedon a long and distinguished pre-history;

§ the identification of historical injustices inflictedupon the Tajiks by extraneous forces (Arabs, Turks,Mongols, Uzbeks, Russians and the Soviets);

§ the justification of claims to specific territories (‘his-torical homeland’).

History books made instant bestsellers. BobojonGhafurov’s monumental work The Tajiks: Archaic, Ancientand Mediaeval History (1970), in which he claimed most ofthe classical Persian canon for ‘Tajik culture’, was re-pub-lished in 1989 with a circulation of 60,000 copies. It quicklybecame the Bible of every Tajik intellectual. In 1989, 62percent of tertiary students of the titular nationality had thebook in their possession.27 Ghafurov gave rise to a wholeschool of academics that propagated the notion of thecivilizational superiority of the Tajiks and their Kulturträgermission in Central Asia. Professor Rahim Masov, then thedirector of the Institute of History of the Academy of Sci-ences of Tajikistan, insisted that “without the knowledge ofthe Tajik language, study of the cultural heritage of Turkicpeoples is impossible ... All pre-revolutionary spiritual cul-ture of the peoples of Central Asia can be comprehendedonly with the assistance of the Tajik language.”28

Crucial to the formation of a new historical belief-sys-tem was the direct association of modern-day Tajiks withthe indigenous Aryan population of Central Asia. In someextreme cases, any new addition to the pristine Zoroastrianheritage of the Aryans, including Islam, was treated as un-dermining the ethnic specificity of the Tajiks.29 However,the main source of grievances and misfortunes of the Tajikpeople was identified with the pernicious activities of areadily recognizable ‘other’. For Masov, the history of Cen-tral Asia has been “the struggle of sedentary populationagainst nomads, of the Iranian-speaking people who hadachieved a high level of cultural development against boor-ish and ignorant Turco-Mongol tribes … [The latter] floodedthe greater part of Central Asia, pushing the indigenous popu-lation south and into the mountain gorges.”30 Turks in allguises—the Qarakhanids, the Chingizids, the Manghyts,Uzbek Bolsheviks—were proclaimed the culprits behind theTajiks’ plight. The Russian conquerors of the 19th centuryand Soviet leaders of the 20th century were denounced notso much for their own destructive policies, as for being aux-iliary instruments in advancing the agenda of Turkicizationin Central Asia.31

The new theorists of ethnic revival asserted that thegreatest sin committed by the Uzbeks vis-à-vis the Tajikswas to rob the latter of the heartland of their civilization—Samarkand and Bukhara, and to assimilate the Tajik popu-lation remaining in Uzbekistan by force. Analysis of suchclaims is beyond the scope of this work,32 but it is plausibleto suggest that the efforts of Tajik nationalist historians wereat least partially inspired by the concurrent revision of his-tory instigated by Tashkent. In 1987, an Uzbek historian wentso far as to deny the Iranian presence in medievalMawarannahr altogether, maintaining that at the time of theSamanids, the entire Central Asia, including Samarkand andBukhara, was inhabited by Turks and that Arabic was thetongue of administration and learning, and “the ordinary,conversational language was the language of various Turkic


tribes.”33

Teaching materials used in Tajikistan in the early 1990ssuggest that a radical and comprehensive reassessment ofthe Samanids had not yet occurred. This dynasty continuedto be treated, in a Marxist tradition, as an object, not subjectof history. Ismail Samanid and his successors were still pic-tured as feudal overlordswhose empire was con-stantly weakened by theconflict between the rulerand the ruled.34 Nonethe-less, such leaders were be-ginning to acquire additionalsymbolic significance in themythology of restoring thegreatness of the Tajikswithin a particular historicalterrain. Shortly after inde-pendence, academicianNuman Negmatov wrote, “Ethnic-territorial nucleus of theTajik ethnos’ formation within the boundaries of the SamanidState … does not coincide with the territory of the present-day Republic of Tajikistan, which is now the bearer of theethnic name of the people and the nation. This logicallynecessitates the usage of the term of ‘Historical Tajikistan’to designate the ethno-cultural and historical habitat of theTajik people in the past.”35

There was but one step from ‘Historical Tajikistan’ ofthe Samanids to ‘Greater Tajikistan’ of today. However, aspecial reading of history based upon ethnic myths of de-scent and continuity did not result in an articulated programof nation-building. In May 1992, the country slipped intothe abyss of a five-year civil conflict. Regional elites in-volved in the confrontation began to develop local histo-ries, justifying the cultural (and hence political) supremacyof Khujandis, Gharmis, or Hissoris over other groups ofTajiks.36 Kulobis, who had won in the civil war, were par-ticularly active in glorifying ‘the pure land of Khatlon’.37

Upon the initiative of President Emomali Rahmonov, the680th anniversary of Mir Sayyed Ali Hamadani, a Sufi writerand philosopher who allegedly had been buried near Kulob,was celebrated as a national holiday in Tajikistan in Sep-tember 1994.38

Political stabilization and prospects of national recon-ciliation compelled Rahmonov’s regime to substantiate itslegitimacy symbolically, through historical narratives, schooltextbooks, holidays, dramas, and monuments that would beunderstood and accepted if not by the bulk of the popula-tion, then at least by the majority of the elites. This timearound, the Samanids proved to be an ideal choice for acomprehensive ethno-historical reconstruction.

4. REINTERPRETING THE SAMANIDS

“Collective memory is plastic, but its reshaping is usu-ally not produced by an arbitrary dictate from above.”39

President Rahmonov begged to disagree. On August 17,1996, he published an article headlined, “The Tajiks in theMirror of History,” that outlined a new philosophy of his-tory to undergird the nation-(re)building project. The article

formed the core of a book with the same title, which carried ameaningful sub-heading: “Teaching methodology for sec-ondary, secondary-vocational, and high schools.”40 It be-came clear that the wheels of the symbol-making factorywere rotating again.

Using simple yet powerful language, Rahmonov postu-lated the following axioms forpublic consumption:41

§ the Tajiks were theoriginal inhabitants of CentralAsia, renowned for their “wis-dom, love for freedom, exportof knowledge, dignity, andpure unblemished lifestyle,”who shared the fruits of civi-lization with all the latecom-ers in the region;

§ the words ‘Tajik’ and‘Aryan’ are synonyms. ‘Iranian’ also means ‘Aryan’, butonly in the context of modernity;

§ the Tajiks had to fight war— but those were ofpurely defensive nature, reflecting the eternal struggle toprotect their sublime culture and pure language from ag-gressors (Arabs, Turks, etc.);

§ the Tajiks had reached withering heights of sover-eign statehood prior to the Mongol invasion, from whichthey never recovered;

§ the Great October Socialist Revolution gave theTajik statehood a second life. Soviet rule, despite the mas-sive injustice of the national delimitation, was beneficial forthe rise of Tajik culture and self-awareness;

§ the independence gained in 1991 was a preciousgift that became hijacked by “power-hungry political ad-venturers, demagogues and careerists supported by externalforces that detested the existence of an independent and sov-ereign Tajikistan.”

The ethnic mythology of foundation, chosenness, home-land, trauma, and redemption received a tremendous boost;what was lacking was the all-important account of the GoldenAge. In the words of Anthony Smith, “the ideal of a goldenage is not simply a form of escapism or consolation forpresent tribulations. For later generations, the standards ofgolden ages come to define the normative character of theevolving community. They define what is, and what is not tobe admired and emulated … They define an ideal, which isnot so much to be resurrected … as to be recreated in mod-ern times.”42

In March 1997, addressing an assembly of Tajik intelli-gentsia, Rahmonov singled out the Samanid state as the onein which “the lofty tree of Tajik civilization flourished,bloomed and bore splendid fruit across Central Asia and theMiddle East.”43 He added that the Tajik government hadasked UNESCO to proclaim 1999 as the Year of the Samanids,and he called the literati to revitalize historical memory, par-ticularly reflected in the “sagacity of statehood and spiritualgreatness of our forefathers.”44

The message was heeded, and the next two and a halfyears witnessed a steady stream of works dedicated to the

Political stabilization and prospects of nationalreconciliation compelled Rahmonov’s regime tosubstantiate its legitimacy symbolically, throughhistorical narratives, school textbooks, holidays,

dramas, and monuments that would be understoodand accepted if not by the bulk of the population,

then at least by the majority of the elites.


Winter 2001

Samanids and their relevance to polity and society today.The historicists’ task was made easier by the fact that eventsduring their reign are fairly well documented (not least inthe works of the famous Ghaznavid chronicler Abu’l-Fazlal-Baihaqi, who openly admired this aristocratic dynasty45 ).Had Rahmonov selected the semi-legendary Keyanids foran ‘heroic age’ of the Tajiks, the blending of real figuresand occurrences with idealization and hyperbolization in aconvincing and palatable narrative would have been next toimpossible.

THE SAMANIDS AS GATHERERS AND PROTECTORS OF THE TAJIK

HOMELAND

In a break with the previous interpretation, the Samanidsare now treated as being qualita-tively different from the precedingand succeeding dynasties of Iranianextraction. They are not mere re-gional dynasts preoccupied withpersonal survival and exploitationof local populations. They are im-bued with the ‘Tajik Idea’, and alltheir conquests and territorial acqui-sitions are regarded as a mission tobring unity, prosperity, and securityto the ancient Aryan land: “TheSamanid epoch is comparable to European Renaissance inits significance to the Tajik people. It was marked by a stringof important historical and cultural processes, the most sa-lient of which were: the completion of the formation of theunified Tajik people; the wide proliferation of literary Farsi-Dari-Tajik; and the emergence of the first centralised state ofthe Tajik people, which assembled practically all territoriespopulated by the Tajiks.”46

The Samanids are juxtaposed with the Buyids—an Ira-nian dynasty, which successfully challenged the Abbasids atthe time of Nasr b Ahmad Samanid (914-944). Unlike theSamanids, the Buyids are considered to be selfish empire-builders, who, although reviving the old Iranian title ofShahanshah, “completely succumbed to the influence of theArabic language.”47 The idea of the ‘purity’ and ‘authentic-ity’ of the Samanids, which is popularized in speeches byTajik leaders today, runs contrary to the official line of the1996 vintage, when it was maintained that “harmonious na-tional development has nothing to do … with the strugglefor the nation’s ‘purity’.”48

A special connection is established between theSamanids and the sacred Tajik sites of Bukhara andSamarkand. Ismail Samanid’s apocryphic phrase ‘So longas I live, I am the wall of Bukhara’ is reproduced on anyopportune occasion.

THE SAMANID STATE AS A MODEL POLITY

The Samanid Golden Age is praised as a time of socialharmony, efficient governance, and dynamic development.Professor Karim Abdulov has been particularly succinct inproducing a schematic picture of the Samanid state that iscongruent with Rahmonov’s vision for a strong independent

Tajikistan; Abdulov’s usage of modern political science cli-ches makes the resemblance most uncanny:49

§ the Samanids “mobilized the masses using idealsof common good” and “strengthened the technical-materialbasis of the country”;

§ their success derived from a synthesis of secularand religious civilizational modes; they harnessed traditionsof many religions, particularly Islam, but pre-Islamic creedsas well;

§ the Samanids invested in agriculture, “on whichbasis light and food industry progressed rapidly”;

§ the dynasty concerned itself with the advancementof education, science and technology; the court had “utmostrespect for creative people and the intelligentsia.”

Less palatable aspects of theSamanid belle epoque, such as in-tra-dynastic struggle, incessantfeudal squabbles, devastatingpeasant revolts, and ruthless sup-pression of the Ismaili sect underNuh ibn-Nasr Samanid (943-954) arecarefully ignored. The Tajik GoldenAge is linked to the virtuous con-duct of the rulers, which derivesfrom the patrimonial nature of Tajik

society. Says President Emomali Rahmonov, “We can talk alot about the epoch of the Samanid state and find historicalparallels or note its distinctive features, but the most impor-tant thing to take into account is the ancient tradition ofstatehood, which we must recreate at full scale. The keyconcept here is ‘kadkhuda’50 … The revitalization of thestate tradition of kadkhuda is topical today.”51 The implica-tions are clear. It does not matter what title a ruler carries—Amir, General Secretary, or President—so long as this ruleris a true Father of the Nation, who takes care of his people asif they were all members of one big family. It is no coinci-dence that neo-patrimonial historical discourse in Tajikistanunfolds parallel to the general discussion on the importanceof preserving traditional family values in Tajik society.52

HEROES OF THE AGE

The Golden Age is a time of heroes, people whosethoughts and deeds can inspire admiration and hope amongsttheir enfeebled descendants, and whose virtuous examplemay show the ways to remedy contemporary decay. Heroesmirror “the best of the community’s traditions, its authenticvoice in the moment of its first flowering, so sadly silenttoday.”53

The figure of Ismail Samanid had been in the focus ofnationalist historians for some time before 1996, by virtueof his being the real founder of the dynasty’s grandeur. Hewas singled out as a “fair, law-abiding, enlightened, clever,politically astute, and militarily capable”54 Amir. However,this was not enough for the creation of an icon. PresidentRahmonov has taken the lead in discovering additional per-sonal qualities of the Amir that would account for the efflo-rescence of the medieval pax Ariana, “Ismoil ibn Ahmad

It does not matter what title a rulercarries -- Amir, General Secretary, orPresident -- so long as this ruler is atrue Father of the Nation, who takescare of his people as if they were all

members of one big family.


Somoni was an outstanding, wise, and sage politician. Hav-ing studied contemporary sciences, he honed his skills ofrunning the state from childhood … The young Amir lis-tened to the demands of the people and overcame the exist-ing difficulties through iron will and power of the mind, whichearned him love and respect of the people.”55 These charac-teristics are general enough to be easily transposed ontoday’s leaders of Tajikistan.

Ismail Samanid is endowed with superhuman abilities.He is hailed as a patron-saint of Bukhara, who even afterdeath continues to look after its Tajik-speaking residents.Timur Pulatov, a famous bilingual Bukharian writer, has ex-plored miraculous properties of the Amir’s mausoleum inBukhara and lamented the oppressed position of Tajiks,“Ismail Samanid is the only entity in Bukhara which one canaddress in Tajik and receive a replyin the same language …Turkicisation of the beyond has noteventuated … I shall never forgetone scene: an old Bukharian was re-penting, talking to Ismail Samanid,asking for forgiveness, because he,the Tajik, had allowed the police towrite ‘Uzbek’ in the ‘nationality’graph in his passport. This had beendone to all hereditary Tajiks by force, without exception.”56

There is a whole pantheon of cultural heroes who owetheir existence to the fact that “the Samanids saw in the sci-entific and creative activity an important mechanism of per-fecting society and elevating culture.”57 A tourist brochure,written in fractured English and distributed by TajikistanAirlines in 1998, had a section ‘Great Tajik Men’, whichinformed foreigners, “There are a few places in the world,which gave birth to so many great scientists and poets, tal-ented artists and architects as did the lands of Persian-Tajikpeople.” The list of ‘Great Tajik Men’ included, amongstothers, encyclopaedists and philosophers al-Khorazmi, al-Farabi, al-Razi, ibn Sina and al-Biruni, alongside poetsRudaki, Daqiqi and Ferdowsi. While the tussle for the pos-session of the brilliant minds of the Islamicate has a longhistory in Tajikistan-Uzbekistan relations, the new cycle ofexclusionist cultural appropriation by Dushanbe has causedan angry response even in Kazakstan. Taking exception toRahmonov’s characterisation of al-Farabi as a ‘glorious sonof the Tajik people’, one commentator wrote, “Rahmonovhas spat on the national sentiments of the Kazaks (and notonly them) … We don’t want to demonstrate the same arro-gance stemming from the overflowing feeling of nationalsuperiority. Maybe, Farabi is a Turk. Maybe a Tajik. But,perhaps, he is neither Turk nor Tajik, but Arab, as it is writ-ten in Western reference books. In any event, he was bornon the territory of today’s Kazakstan … And now his nameis one of the symbols of the Republic of Kazakstan.”58

The continuity of the great Tajik cultural tradition isstressed by the promotion of the ‘Ferdowsi – Aini –Ghafurov’ triad as the valiant champions of Tajik literatureand history. Abulqosim Ferdowsi is credited with codifyingthe entire cultural fund of pre-Samanid Aryans in the heroicepic Shahnama. Sadriddin Aini (1878-1954) is celebrated asthe classic writer of modern Tajik literature who revived the

canon after centuries of its being under the Manghyt yoke.Bobojan Ghafurov, who served as the First Secretary of theCentral Committee of the Communist Party of Tajikistan be-tween 1946 and 1956, is regarded as a patriot who stood upto Moscow and Tashkent in the noble cause of advancinghis republic’s culture and composed the first comprehen-sive history of his people. Throughout 1999, celebrations ofthe 1100th anniversary of the Samanid state were accompa-nied by laudations for Aini and Ghafurov. They receivedposthumous awards of the title of the Hero of Tajikistan, andboth gained the privilege of being represented in the mu-seum underneath the statue of Ismail Samanid.

EXPLAINING THE DECAY

Academician Ghafurov has lefta succinct and devastating accountof the demise of the Samanids:59

Class antagonism, as well asthe struggle between feudallords and central government,the quarrels between theSamanids and their Turk gen-erals, endless intrigues be-

tween representatives of the court and diwan offi-cials—all these shattered the Samanid state andled to a situation where by the end of the 10th cen-tury its might had left but a dream … The Samanidscouldn’t fend off external aggressors. The popu-lace of Mawarannahr which groaned under heavytaxation and had rebelled in the past, did not hurryto their defence. And the Turkic guard which re-mained the only pillar of the throne did not have aproper rear and was not in a position to parry theenemy’s thrust.

At present, this classic viewpoint is being thoroughlyreconsidered and refocused. Any reference to social unrestthat runs contrary to the myth of class harmony under theSamanids is being expunged. All other factors are verbal-ized in such manner as to make them equally applicable tothe recent civil war in independent Tajikistan. This concernsthe state of disunity in the ruling elite first and foremost: “Athousand years ago, just like during the events of 1991 and1992, appanage (udelnye) rulers of Tajik regions, profit-seek-ing intriguers and religious demagogues rose against thecentral government for the sake of greater power, rank andposition.”60 Accusations against the treacherous role of theMuslim establishment form a novel development in readingthe history of the Samanids. Their intensity and scope varyaccording to the current political moment, ranging from blan-ket indictments of the ‘reactionary Islamic clergy’ as a class(Rahim Masov) to criticisms of the “anti-national and sedi-tious activities of some religious groupings.”61

Another new motif that contributes to the explanationof the ignominious end of the Samanids is that of the loss oftraditional spiritual values, the diminished vigilance, theweakening of discipline, and the excessive luxury and out-right debauchery which enabled barbarian Turks to defeat

Any reference to social unrest thatruns contrary to the myth of class

harmony under the Samanids is beingexpunged.


Winter 2001

civilized Tajiks. “Turks and women interfered in the busi-ness of government, which led to the emasculation and de-cay of the Samanids.”62

5. WILL EMOMALI RAHMONOV BECOME THE ISMAIL SAMANID

OF TODAY?

The reconstructed history of the Samanid dynasty hasa dual didactic value for Tajik polity. First, it provides ex-amples of ethnic authenticity and regeneration that are tran-scendental in the Tajik community,and second, it produces concreterecipes for stability and prosperity.Unity, tolerance, cultural synthesis,non-aggressiveness, and emphasison human development are toutedas both innate features of the Tajikethnie and hallmarks of successfulgovernment policies. When Presi-dent Rahmonov delivers his visionof the Samanids, he wants the audi-ence to build instant associationswith his own regime, “In this mightystate representatives of many nation-alities lived together; everybody’s rights were protected.Plurality of opinion was cherished … The Samanids … wiselyjoined together and used in state administration spiritualnorms of Islam with Aryan heritage … And today we areconvinced that a multitude of views, and coexistence of vari-ous creeds in sovereign Tajikistan will facilitate the develop-ment of a secular democratic state and will assist the triumphof peace and concord on our ancient land.”63 If an idealconstruct based not so much on facts as on symbolicallyappealing and psychologically convincing myths is repeatedwith due consistency and reaches out to a sufficiently widestrata of the community, it may well evolve into a powerfullegitimising tool for the regime.

Objectively, Tajik society, which came close to irrepa-rable fragmentation between in 1992 and 1997, is in direneed of potent national symbols. It appears that the Samanidsrepresent a uniquely suitable signpost in the Tajiks’ collec-tive memory, and reconstruction of their history will servethe cause of national reconciliation and unification. At thesame time, this process is fraught with several possible dan-gers.

First of all, ethnic mobilization based on historical pre-cedent may result in the renewal of territorial claims. Presi-dent Rahmonov makes a special effort to refute such specu-lations.64 However, this did not prevent him from planting acapsule with the ‘sacred soil of Bukhara’ in the innards ofIsmail Samanid’s monument in Dushanbe. Second, monopolyon ethno-historical ‘truth’ is conducive to monopoly on po-litical power. Currently, the regime strictly controls the pro-cess of rewriting history, to the extent that in October 1998a presidential decree was adopted which prohibited the us-age of unauthorised images of Ismail Samanid on the terri-tory of Tajikistan. The officially prescribed portrait of theAmir bears certain resemblance to President Rahmonov,which contributes to fears of the third unwelcomed ramifi-cation of the drive to glorify the Samanids: it may contribute

to the nascent personality cult of President Rahmonov.Tajikistan is still at a fair distance from the full-blownsultanistic regimes of Turkmenistan, Uzbekistan and evenKazakstan, but there are signs of the excessive adulationand personification of power in that country.65

It is hard to ascertain what effect the campaign to rein-vent the Samanids has had on the people of Tajikistan. Newmyths take time to settle, and it seems that the high point ofsymbolic output was reached in 1999, when scores of streetswere renamed, the Peak of Communism in the Pamirs became

the Peak of Ismail Samanid, the Or-der of his name was established,and several high-profile confer-ences, symposia and lavish theat-rical productions were organised.The only event of any symbolicimport in 2000 has been the intro-duction of a new currency unitcalled somoni. It seems that thereis simply not enough money in thestate coffers to sustain the pro-cess.66 At the same time, RahimMasov—an academic who hasturned into a politician and a close

ally of President Rahmonov, continues to argue that “whocontrols the past, controls the future”,67 which promisesnew interesting developments in Tajikistan’s post-commu-nist historiography.

ENDNOTES

1 S. Yusufdzhanov, R. Mukimov, A. Hakimov, “Drevnie inovye pamiatniki Tadzhikistana.” Arkhitektura, stroitelstvo,dizain. No. 3, 2000, p. 32.2 Sadoi Mardum, 10 September 1999.3 See, for example, Lisa Anderson, “Legitimacy, Identity,and the Writing of History in Lybia.” In Eric Davis and NicolasGavrielides, eds. Statecraft in the Middle East: Oil, Histori-cal Memory, and Popular Culture. Miami: Florida Interna-tional University Press, 1991, pp. 71-91, on Libya; AndrewWilson, Ukrainian Nationalism in the1990s: A MinorityFaith. Cambridge: Cambridge University Press, 1997, onUkraine; Ronald Grigor Suny, The Making of the GeorgianNation. Bloomington and Indianapolis: Indiana UniversityPress, 1994, on Georgia.4 Islam Karimov, Uzbekistan on the Threshold of the Twenty-First Century. Challenges to Stability and Progress. NewYork: St. Martin’s Press, 1998, pp. 86-87. Similar pronounce-ments can be found in works by President Nazarbaev ofKazakstan (N.A. Nazarbaev, Evraziiskii soiuz: idei, praktika,perspektivy, 1994-1997. Moscow: Fond sodeistviia razvitiiusotsialnykh i politicheskikh nauk, 1997, esp. pp. 197-217),President Akaev of Kyrgyzstan (A. Akaev. Otkrovennyirazgovor. Moscow: Sovershenno sekretno, 1998), andTurkmenbashi (S.A. Niyazov. “Turkmenistan –voskhodiashchaia zvezda v sozvezdii mirovogosoobshchestva.” Turkmenskaia iskra, 7 November 1992).5 Homi K. Bhabha, The Location of Culture. London andNew York: Routledge, 1994, p. 77. For excellent critical analy-

The reconstructed history of theSamanid dynasty has a dual didactic

value for Tajik polity. First, itprovides examples of ethnic

authenticity and regeneration that aretranscendental in the Tajik

community, and second, it producesconcrete recipes for stability and

prosperity.


ses of political historical projects in Kazakstan andUzbekistan, see Azamat Sarsembayev, “Imagined Communi-ties: Kazak Nationalism and Kazakification in the 1990s.”Central Asian Survey, Vol. 18, No. 3, 1999, pp. 319-346; JohnSchoeberlein-Engel, “The Prospects for Uzbek National Iden-tity.” Central Asia Monitor, No. 2, 1996, pp. 12-20.6 R.W. Davies, Soviet History in the Yeltsin Era. Basingstoke:Macmillan Press, 1997, p. 219.7 V.V. Bartold, Sochineniia. Vol. II, Part 1, Moscow: Izdatelstvovostochnoi literatury, 1963, p. 117.8 H.A.R. Gibb, The Arab Conquests in Central Asia. NewYork: AMS Press, 1970, p. 8.9 IU. Yakubov, Pargar v VII - VIII vekakh nashei ery.Dushanbe: Donish, 1979, p. 41.10 Christopher Beckwith, “Tibet and the Early MedievalFlorissance in Eurasia. A Preliminary Note on the EconomicHistory of the Tibetan Empire.” Central Asiatic Journal, vol.XXI, No. 2, 1977, pp. 93-94.11 John A. Armstrong, Nations before Nationalism. ChapelHill: The University of North Carolina Press, 1982, p. 56.12 L.N. Kiseleva, Iazyk Dari Afganistana. Moscow: Nauka,1985, p. 40.13 Svat Soucek, A History of Inner Asia. Cambridge: Cam-bridge University Press, 2000, p. 75.14 V.V. Barthold, Four Studies On the History of Central Asia.Vol. I, Leiden: E.J. Brill, 1956, p. 70. For a concise account ofCentral Asian historiography under Soviet rule, see GrahamSmith, Vivien Law, Andrew Wilson, Annette Bohr and Ed-ward Allworth, Nation-Building in the Post-Soviet Border-lands. Cambridge: Cambridge University Press, 1998, Ch. 4.15 B.G. Ghafurov, Tojikon. Ta’rikhi qadimtarin, qadim vaasri miyona. Vol. 1, Dushanbe: Irfon, 1983, p. 494.16 Anthony D. Smith, The Ethnic Revival. Cambridge: Cam-bridge University Press, 1981, p. 66.17 Soucek, op. cit., p. 75.18 Abu al-Fazl Baihaki, Istoriia Mas’uda 1030 - 1041.Tashkent: Izdatelstvo AN Uzbekskoi SSR: , 1962, p. 725.19 For a very detailed and informative discussion, see anarticle by the classic of modern Tajik literature: SadriddinAini, “Ma’na-ye kalema-ye Tajik.” In Mirza Shukuzadeh, ed.,Tajikan dar masir-e ta’rikh. Tehran: Al-Hada, 1373 Y.H., pp.13-44.20 Armstrong, op. cit., p. 293.21 H. K. Korogly, Vzaimosviazi eposa narodov Srednei Azii,Irana i Azerbaidzhana. Moscow: Nauka, 1983, p. 179.22 David Christian. A History of Russia, Central Asia andMongolia. Oxford: Blackwell, 1998, p. 322.23 Sadriddin Aini, Vospominaniia. Moscow-Leningrad:Izdatelstvo AN SSSR, 1960, p. 963.24 G.M.H. Shoolbraid, The Oral Epic of Siberia and CentralAsia. Bloomington: Indiana University Publications, 1975,p. 103.25 Anthony D. Smith. The Ethnic Origins of Nations. NewYork: Basil Blackwell Inc., 1987, p. 137.26 N.N. Negmatov, Gosudarstvo Samanidov. Dushanbe:Donish, 1977, p. 30.27 Vuzovskaia molodezh: mirovozzrencheskie i tsennostnyeorientatsii. Vypusk 1. Dushanbe: Izdatelstvo TGU, 1990, p.29.28 Rahim Masov, Istoriia topornogo razdeleniia. Dushanbe:

Irfon, 1991, pp. 16-17.29 Davlat Khudonazarov, a presidential candidate in 1992,offered the following interpretation of the advent of Islam toMawarannahr: “Iranian peoples - the Tajiks’ ancestors - hadpossessed the highest culture and beautiful religion prior tothe Islamic conquest; Islamisation led to slowing down andalmost complete halting of social progress, destruction anddecay of culture.” (Quoted in S. Olimova, M. Olimov,“Obrazovannyi klass Tadzhikistana v peripetiiakh XXv.”Vostok, No. 5, 1991, p. 101.)30 Rahim Masov, “Vvedenie.” In R.M. Masov, ed., Rossiia vistoricheskikh sudbakh tadzhikskogo naroda. Dushanbe:Sharqi Ozod, 1998, pp. 6-7.31 The Program of the Union of Democratic Youth Bokhtar(1990) exposed a long-term ‘conspiracy’ between the Uzbeksand Moscow to tame ‘pure’ Mountain Tajiks: “Politics inTajikistan is all about the struggle between two varieties ofTajiks - the Northern and the mountain ones ... They [North-erners] are essentially Uzbeks in half-Tajik skins who havebeen planting pan-Turkism in Tajikistan for 70 years, tryingto transform Tajiks into Uzbeks ... Being at the helm, theyhave cardinally changed our native Persian language, theyhave bred hatred towards Iranians and Tajiks of Afghani-stan, they have maintained the cult of the Uzbek tongue. Butthey have achieved nothing, only stirred the wrath and furyof the Mountain Tajiks.” (Grazhdanskie dvizheniia vTadzhikistane. Moscow: TSIMO, 1990, pp. 64-65.)32 See R.R. Rahimov, “K voprosu o sovremennykhtadzhiksko-uzbekskikh mezhnatsionalnykh otnosheniiakh.”Sovetskaia etnografiia, No. 1, January-February 1991, pp.13-24; Richard Foltz, “Uzbekistan’s Tajiks: A Case of Re-pressed Identity?” Central Asia Monitor, No. 6, 1996, pp. 17-19.33 G.A. Abdurakhmanov, “The Ethnogenesis of the UzbekPeople and the Formation of the Uzbek Language.” InBakhtiyar A. Nazarov and Denis Sinor, eds., Essays on UzbekHistory, Culture, and Language. Bloomington: Research In-stitute for Inner Asian Studies, Indiana University, 1993, p.3.34 Programma fakultativnykh zaniatii po istorii TadzhikskoiSSR ‘Geroicheskoe proshloe tadzhikskogo naroda’.Dushanbe: Maorif, 1990, pp. 13-14.35 N. Negmatov, Tadzhiki. Istoricheskii Tadzhikistan.Sovremennyi Tadzhikistan. [No publisher]: Gissar, 1992, p.23. Emphasis in the original text.36 Cf. a peculiar Khujandi hagiography, which claims thatKhujand is the oldest surviving city on the planet, goingback 8,400 years. (Orifjon Yahyozodi Khujandi,Khujandnoma, yo qissaho az ta’rikhi Khujand vakhujandiyon. [No publisher]: Khujand, 1994). Hissor washailed as the repositary of pure Tajik culture, customs, andtraditions in Sh. Abdulloev, A. Mardonova, R. Jum’aev, M.Zabarova, E. Dustov, Dar justujui farhangi vodii Hisor.Dushanbe: Manu’gohi ta’rikhi-ma’danii Hisor, 1992.37 See, for example, Muzaffar Azizi, “Chun sabza umedibardamidan budi.” Daryo, No. 2, 1994, pp. 14-15.38 Rahmonov called Hamadani “one of the historical sign-posts of the human civilisation” and proposed him as a rolemodel for future generations, citing his versatile knowledge,stoical ethics, and moral integrity. (Emomali Rahmonov.


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Tojikiston: chahor soli istiqloliyat va khudshinosi.Dushanbe: Irfon, 1995, pp. 154-155.) Prior to Rahmonov’seulogy, Ali ibn Shihab ad-din bin Mohammad al-Hamadanihad been primarily associated with the definitive establish-ment of Islam in Kashmir between 1372 and 1383, when heexpedited a migration of 700 Sufis fleeing from Timur to thatterritory. (J. Spencer Trimingham, The Sufi Orders in Islam.New York: Oxford University Press, 1998, p. 57.)39 Jerzy Jedlicki, “Historical Memory As a Source of Con-flicts in Eastern Europe.” Communist and Post-CommunistStudies, No. 32, 1999, p. 229.40 Emomali Rahmonov. Tojikon dar oinai ta’rikh. Dushanbe:Irfon, 1997.41 Ibid., pp. 4-11.42 Anthony D. Smith. Myths and Memories of the Nation.Oxford: Oxford University Press, 1999, p. 263.43 Jumhuriyat, 20 March 1997.44 Ibid.45 See Marilyn Robinson Waldman, Toward a Theory of His-torical Narrative. A Case Study in Perso-Islamicate Histori-ography. Columbus: Ohio State University Press, 1980.46 Viktor Dubovitskii, “Gosudarstvu Samanidov – 1100 let.”In Tadzhikistan – 2000. Dushanbe: Asia-Plus, 1999, p. 7.47 Emomali Rahmonov. “Tysiacha let v odnu zhizn’.”Nezavisimaia gazeta, 31 August 1999.48 K.N. Abdullaev, “Etnichnost’ i prava cheloveka vkontekste sovremennogo etapa razvitiia.” In The First TajikSociety Forum, Dushanbe: UNDP, 1996, p. 27.49 Karim Abdulov, “Unsurhoi davlati dunyavi dar davlatdoriiSomoniyon.” Charkhi gardun, No. 31 (103), 7 August 1998,p. 5.50 ‘Kadkhuda’ in modern Persian literally means ‘village head-man’. ‘Kad’ refers to an extended family; Barthold explainsthat “initially, the term kadkhuda was linked to the notion ofpower over families and offspring; in the Muslim era an idealkadkhuda was considered to be a caring lord. In this sense,a monarch is called ‘kadkhuda of the world’.” (Bartold, op.cit., p. 209.)51 Nezavisimaia gazeta, 31 August 1999.52 Cf. an article by the First Deputy Speaker of the TajikParliament, Abdulmajid Dostiev, entitled ‘The Purity of So-ciety Begins with the Purity of the Family.’ (“Pokizagii jomeaaz pokizagii oila oghoz meshavad.” Adabiyot va san’at, No.17-18 (942), 1998, pp. 1-2.)53 Smith, 1999, op. cit., p. 6654 Saidi Sa’di, Mukhtasari ta’rikhi siyosii TojikoniAfghoniston. Dushanbe: Intishoroti Oli Somon, 1995, p. 18.55 E.Sh. Rahmonov. “Tadzhikskaia gosudarstvennost’: otSamanidov do rubezha XXI veka.” 1999. http://tadjembs.newmail.ru/tajgosud.htm (8 September 2000).56 Timur Pulatov, “Chala – sostoianie dushi.” Nashsovremennik, No. 3, 1998, pp. 286-287.57 S. Sulaimoni, “Knigi vremen Samanidov.” Narodnaiagazeta, 7 August 1998, p. 3.58 D. Naiman, “Amerikantsy i Tsentralnaia Aziia v inter’ereaktualnoi mirovoi politiki.” Navigator, 1 August 2000. http://www.navigator.kz/articles/polit010800a.shtml (2 November2000).59 B.G. Gafurov, Tadzhiki: drevneishaia, drevniaia isrednevekovaia istoriia. Vol. II. Dushanbe: Irfon, 1989, p. 58.

60 Rahim Masov, Tadzhiki: istoriia s grifom ‘sovershennosekretno’. Dushanbe: Paivand, 1995, p. 125.61 E.Sh. Rahmonov, “Tadzhikskaia gosudarstvennost’: otSamanidov do rubezha XXI veka.” 1999. http://tadjembs.newmail.ru/tajgosud.htm (8 September 2000).62 Zabeulloh Safo, “Oli Somon.” Bahori Ajam, No. 1, June1998, p. 3.63 E.Sh. Rahmonov, “Tadzhikskaia gosudarstvennost’: otSamanidov do rubezha XXI veka.” 1999. http://tadjembs.newmail.ru/tajgosud.htm (8 September 2000).64 “The idea of celebrating in 1999 of the 1100th anniversaryof the creation of the Samanid state was right from the startaimed at overcoming regional cleavages [inside Tajikistan]and does not contain any historical or political claims withinCentral Asia … Emomali Rahmonov has particularlyemphasised that political geography of the past ought notto determine the realities of today.” (An excerpt from anunsolicited article penned by Rahmonov’s advisor and pub-lished in Moscow. Segodnya, 11 November 1997.)65 A high-profile politician, a member of the Commission onNational Reconciliation, wrote in 1998 that under the stew-ardship of Rahmonov “the new renaissance of the civilisationand statehood of the Tajik nation has commenced.”(Haftganj, No. 9 (11) 1998, p. 4.)66 The expenditure on the Vahdati Milli complex alone musthave been backbreaking. The exact amount is not known,but a manager of the construction site said in an interviewthat he had to budget monthly payments of 400 – 450 millionTajik roubles a month to contractors and workers, for theduration of a year. Put together, these figures amount to 3.5– 3.9% of the total government spending budgeted for 1998.(Adabiyot va san’at, NO. 15-16 (940) 1998, P. 3.)67 Vechernii Dushanbe, 7 August 1998.


FROM TAMERLANE TO TERRORISM:THE SHIFTING BASIS OF UZBEKFOREIGN POLICY

William D. Shingleton was a U.S. delegate to theJuly 1999 “Six plus Two” talks in Tashkent. He iscurrently a Senior Fellow at the National DefenseCouncil Foundation (NDCF) in Alexandria, Virginia.

John McConnell is a Research Analyst at NDCF.

BY WILLIAM D. SHINGLETON & JOHNMcCONNELL On the morning of February 16, 1999, a massive car bomb ex

ploded less than 200 meters away from Uzbekistan’s PresidentIslam Karimov’s motorcade as it approached Independence

Square in central Tashkent. Simultaneously, five other bombs detonatedat key points around the Uzbek capital, killing 16 people andinjuring 124.

Karimov quickly blamed Islamic militants for the bombings, threat-ening to “cut off their hands.” The bombings led to thousands of ar-rests, ending a period of reform that some diplomats called the ‘TashkentSpring’. The bombings also forced Karimov to change the focus ofUzbekistan’s foreign policy from one of ideology-based nationalism toone of combating Islamic extremism. This change in foreign policy ori-entation has profound implications for Uzbekistan’s 24 million people,and also for a Russia determined to dominate Central Asia and a Westinterested in the region for its rich natural resources.

IDEOLOGY

Upon attaching independence in 1991, the Karimov regime decidedto build national self-awareness through nationalism. The Karimov re-gime promoted the veneration of figures from Uzbekistan’s past, par-ticularly the 14th century conqueror Tamerlane. In seizing the mantle ofTamerlane’s heir, Karimov justified a resurgence of Tamerlane’sauthoritarianism and aggressiveness.

Claiming that “peace and stability are our most important accom-plishments”, the regime worked to create a discourse based upon theideas of national strength and stability. When that discourse was madeto look hollow by the bombings, Karimov’s foreign policy was shakento its foundations. Uzbekistan’s relationships with three key sets of coun-tries—“greater Uzbekistan”, other regional powers, and the West—changed radically as counter-terrorism replaced nationalism asTashkent’s main objective.

IN SEARCH OF “GREATER UZBEKISTAN”

Ethnic Uzbeks are spread throughout Central Asia, with particu-larly large diaspora populations in neighboring Tajikistan and Afghani-stan. For Uzbekistan, protection of this diaspora was a critical compo-nent of nationalist ideology, which held that Uzbeks as a people wereregaining their rightful place internationally. Tashkent acted to protectethnic Uzbeks, in the process ignoring Tajikistani and Afghanistani sov-ereignty. Nationalist Uzbek scholars supported this outlook by claim-ing that the Tajiks were just Uzbeks who had forgotten their mothertongue. Even today, Uzbek diplomats claim that Tajikistan andUzbekistan are “one nation speaking two languages”.

After Tajikistan’s government was overthrown in 1992 by the UnitedTajik Opposition (UTO), Tashkent worked to put into power ImmoliRahmonov, a former Soviet bureaucrat whom it was thought would be


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Rahmonov initially resisted pressuring the UTO to giveup IMU members. By the spring of 1999, Karimov andRahmonov apparently cut a deal whereby Uzbekistan wouldstop supporting the insurgents in exchange for Tajikistan’sexpelling the IMU. Rumors of this deal sparked an abortedIMU invasion of Uzbekistan in mid-1999. Tajikistan report-edly expelled the forces of the IMU to Afghanistan in late1999. However, Rahmonov’s animosity toward Karimov re-mained. When the IMU launched another invasion in thesummer of 2000, Tashkent was incredulous when Rahmonovdenied involvement in the invasion. “Where did they comefrom?” asked Uzbek Ambassador to Washington SodyqSafaev, “the moon?”

Uzbekistan’s relations with the Taliban mirror those withTajikistan. Karimov’s warm treatment of the Taliban del-egation during the July 1999 ‘Six plus Two’ peace talks inTashkent sparked rumors that Karimov would recognize theTaliban. In reality, Tashkent began secret contacts with theTaliban, sending Foreign Minister Kamilov to visit theTaliban’s Qandahar headquarters. The rapprochement ac-celerated in September 2000 when the Taliban capturedTaloqan, severing the Northern Alliance’s supply lines. InOctober, Karimov publicly renounced his prior condemna-tion of the Taliban, saying that they pose no threat to theregion. Later that month, Uzbekistan agreed to an exchangeof high-level delegations and opened the border, re-ignitingspeculations that a terrorist-for-recognition deal was in theworks.

UZBEKISTAN AND REGIONAL POWERS

According to Uzbek state ideology, Tashkent claimedthat the Uzbek nation was finally taking its rightful place asthe heirs of Tamerlane, and as such should be the leader ofCentral Asia. Since neighboring states, particularly Russia,

Kazakstan, and Turkey, had similar aspirations to regionalleadership, Uzbekistan’s ideology was a recipe for tension.

Uzbekistan moved in recent years to separate itself fromRussia. In 1991, Russia was Uzbekistan’s largest trading part-ner, the ruble was Uzbekistan’s official currency, and Rus-sian troops patrolled Uzbekistan’s borders. By 2000,Uzbekistan’s new currency and import-substituting policiescut trade with Russia to only 15% of total trade turnover.

Moreover, Uzbekistan is the onlyCentral Asian nation which is nothost to Russian troops. In February1999, Uzbekistan announced that itwould drop out of the Common-wealth of Independent States Col-lective Security Treaty—a majorslap on the face of Russia, for whomthe treaty is a vehicle by which itcan intervene in former Sovietstates. Indeed, when Tashkent was

bombed just days after Uzbekistan dropped out of the Treaty,many speculated that Moscow was responsible.

Uzbekistan’s pretensions to regional leadership particu-larly grated on Kazakstan, an oil-rich state that inheritedSoviet nuclear weapons. With Central Asia’s second-larg-est population and more political experience than Karimov,Kazak President Nazarbaev has had a tumultous relation-ship with Karimov. At times, the relationship has degener-ated into petty conflicts, for example, Karimov’s refusal tosign on to proposals made by Nazarbaev, and vice versa,and if Nazarbaev wins an award, Karimov has to win thesame award, and so on.

Many Western observers initially hoped that Turkeywould replace Russia as the region’s dominant power. How-ever, tensions between Uzbek and Turkish nationalistsquickly soured the bilateral relationship. Turks aroused ten-sions by calling the Uzbek language mispronounced Turk-ish, and undertook actions that led Uzbeks to believe thatTurkey simply sought to replace Russia. Tashkent chafed atTurkish chauvinism, while Turkey increasingly tried to por-tray itself as the ‘elder brother’ to the Turkic peoples ofCentral Asia. When the Islamist Refah party came to powerin Turkey, it ended any hope of cooperation with the secularKarimov regime.

In the post-bombing era, Uzbek relations with the re-gional powers increasingly depend on the willingness of thesepowers to help Karimov hunt down his opponents. For ex-ample, when Putin traveled to Tashkent after becoming presi-dent, Karimov commented that Uzbekistan sees “in Russiaa country, a power, which together with us is capable of re-sisting the expansion of international terrorism and religiousextremism.” Moscow, which claims that the perpetrators ofapartment bombings in Russia are connected to the Tashkentattack, warmed to the Karimov regime, arresting Uzbek fu-gitives in Russia and providing Tashkent with security as-sistance.

Uzbekistan’s relations with Kazakstan also improved.The Uzbeks and Kazaks participated in a joint raid on aradical Islamic training camp in Kazakstan, and the Kazaksdonated ammunition and other supplies to a Tajik-Uzbek-Kyrgyz effort against the IMU. However, Uzbek-Kazak re-

Tashkent chafed at Turkishchauvinism, while Turkey

increasingly tried to portray itself asthe ‘elder brother’ to the Turkish

peoples of Central Asia.

amenable to Uzbek interests. However, Rahmonov soonturned on Tajikistan’s ethnic Uzbek population, thereby elic-iting a second round of Uzbek interventions. Two incursionsfrom Uzbek territory in 1997 and 1998 respectively failedto oust Rahmonov.

In Afghanistan, Uzbekistan supported the ethnic Uzbekwarlord Rashid Dustum. After the mujahedin, who oustedthe Soviets, began to fight each other, Uzbekistan suppliedDustum military and logistical as-sistance. When the ethnic PathanTaliban overran opposition forcesfrom 1995-1997, Uzbekistan broad-ened its assistance to include themembers of the so-called NorthernAlliance, a coalition of Uzbek andTajik militias.

But Uzbekistan’s interven-tionism would come back to hauntKarimov. The UTO and later theTaliban welcomed the Islamic Movement of Uzbekistan(IMU), a militia dedicated to establishing an Islamic state inUzbekistan. According to the Uzbek government, the perpe-trators of the February bombings were recruited, trained,and equipped in UTO and Taliban-held territory. Since thebombings, the prime concern of the Uzbek government hasbeen neutralizing these bases.


lations continue to be tense. In January 2000, Uzbekistanunilaterally demarcated a disputed mutual border. Nonethe-less, compared with the situation in 1998, relations are dra-matically improved.

By contrast, Uzbekistan’s relations with Turkey dete-riorated because of Ankara’s resistance to Tashkent’s huntfor opponents. Uzbekistan recalled its students from Turk-ish universities and closed Turkish-run schools inUzbekistan. In turn, Ankara recalledits ambassador from Tashkent inmid-1999. Moreover, Turkey invitedMuhammed Solikh, the alleged mas-termind of the bombings, to the 1999Organization for Security and Co-operation in Europe (OSCE) summitin Istanbul. Since Ankara’s supportfor Solikh and other dissidents isrooted in domestic Turkish politics,Turkey and Uzbekistan seem to beon a permanent collision course.

UZBEKISTAN AND THE WEST

Recognition by the West was critical to the idea thatUzbekistan was taking its place in the first rank of sovereignnations. Uzbekistan quickly joined a series of Western orga-nizations, including the OSCE, the United Nations, andNATO’s Partnership for Peace. In 1998, Uzbekistan’s UNdelegation trailed only Micronesia and Israel in voting withthe United States 90.9% of the time. In a bizarre 1996 inci-dent, Uzbekistan’s UN delegation even cast an unautho-rized vote against the UN General Assembly’s annual con-demnation of the U.S. embargo on Cuba. Uzbekistan alsohosted an OSCE summit on human rights after U.S. diplo-mats warned that Uzbekistan’s human rights record was pre-venting a summit with President Clinton.

Uzbekistan chafed at Western criticism of its post-bomb-ing crackdown. Ambassador Safaev indirectly criticizedWestern pressure on human rights when he commented that“Russia supports all means of action against terrorists anddoes not lecture us on how to do it.” Currently, Uzbek dip-lomats often reply to Western criticism of its human rightsrecords by claiming that the West ignores the rights of thebombing victims. A sharp exchange between Foreign Min-ister Kamilov and Western delegates at the OSCE in July1999 is indicative of the current relationship. After beingquestioned about the beating of human rights activist MikhailArdzinov, Kamilov not only responded that Ardzinov waslying, but assailed the OSCE Secretariat for not sending acondolence message in response to the February bombings.

CONCLUSION

Uzbekistan is not unique among nations in its attemptto downplay ideology in its foreign relations. After the Rus-sian civil war in 1919-1921, the Soviets decided to build“socialism in one country” at the expense of global revolu-tion. The war with Iraq forced Iran to accept arms from theUnited States, which it had previously decried as “Great Sa-tan.” What is remarkable is that it took eight years for

In 1998, Uzbekistan’s UN delegationtrailed only Micronesia and Israel invoting with the United States 90.9%

of the time.

Uzbekistan to break from the ideological underpinnings ofits foreign policy — testimony to the relatively peacefulsecurity environment that initially followed the collapse ofthe Soviet Union. But as the security environment has be-come less stable, and as Uzbekistan is forced to deal withthreats ranging from narcotics traffickers to terrorists,Tashkent had to change its world outlook to survive.

The result is that the days of easy Western influenceover Tashkent are gone. Accusa-tions over Uzbekistan’s humanrights record are more likely to sourthe bilateral relationship than toprovide relief for dissidents. In con-trast, cooperation on counter-ter-rorism can open doors outside thesecurity sphere. American-Uzbekrelations recently warmed becausethe Secretary of State, CIA Direc-tor, and other security officials vis-

ited Tashkent to deliver counter-terrorism assistance. TheU.S. recently designated the IMU as a terrorist group. Like itor not, it is this help with counter-terrorism that must be thecornerstone of relations with Uzbekistan in the post-bomb-ing era.


Winter 2001

ELECTIONS IN CENTRAL ASIA: A NEWBEGINNING FOR A COMPREHENSIVEENVIRONMENTAL STRATEGY?

Daphne Biliouri is an environmental policyconsultant and analyst for Eurasia. She is currentlybased in the UK and is working on a variety ofprojects in the Central Asian region. She can becontacted at [email protected].

BY DAPHNE BILIOURI The democratization process that has followed the collapse of theSoviet Union has transformed the existing economic order andpolitical system within the five Central Asian republics. This

past decade, newly elected Central Asian heads of state have had todeal with economic challenges, the collapse of social welfare systems,high levels of corruption, and, most importantly, a damaged environmentand a non-existent environmental protection record. However, despitethese daunting problems, the new aura of independence, along with theassistance of the international community has brought the hope ofpolitical stability and economic prosperity. Unfortunately, the recentelections in Kazakhstan in 1999 and Kyrgyzstan and Uzbekistan in 2000have reinforced the authoritarian hold that the existing presidents haveon their people and increased Western concern over undemocraticpractices, including manipulated electoral processes in the region.

Criticism from the west, with the US at the forefront, has intensifiedduring the recent regional parliamentary and presidential elections. Thedream pursued by the US and large international organizations, such asthe OSCE, envisaged a Central Asia with a thriving free market economy,a strong civil society, and an extensive democratic regime. Manyperceive that this vision can be realized with the assistance of foreignaid and the inclusion of international donor agencies in the national andregional strategy of the Central Asian states. Yet, despite theseinternational perceptions, there is growing concern from within theregion that the republics are following the wrong path of development.Furthermore, much of the Central Asian leadership believes that doublestandards are being set with respect to how each individual state isbeing dealt with by the international community. On the one hand, stateslike Kazakhstan and Turkmenistan, with an abundance of naturalresources in the Caspian Basin, have attracted the business interest ofthe US and other western states, who have shown eagerness to ensurethat democratization and modernization of the political and economicclimate occurs. On the other hand, because they have little to offer inreturn, states like Kyrgyzstan and Tajikistan are battling to attract much-needed foreign investment. Based on this division, it can be argued thatthe west is ready to turn a blind eye to many of the undemocratictendencies expressed by Kazakh President Nazarbayev, while KyrgyzPresident Akayev’s re-election faced a disproportionate amount ofcriticism from the international community.

Based on this predicament, the following sections will address thecurrent state of national environmental policy in the Central Asian statesafter recent elections.

KAZAKHSTAN

While the new political regime allowed the development of politicalties with states that could provide Kazakhstan with modernenvironmental technologies, know-how, and advanced environmentallegislation and policy, the same ‘donor’ states have been prioritizing


their economic interests above environmental protection. InJanuary 1999, Nazarbayev was re-elected president in alandslide victory. Based on the Law on the First Presidentof Kazakhstan passed in June 2000, Nazarbayev has beengranted powers for life. After the parliamentary elections inNovember 1999, the new government established a NationalSecurity Strategy effective until 2005 covering the military,economic, political, social, environmental, and publicsectors. The new government hopes to maintain balancedeconomic development by enhancing the reform process andincreasing foreign investment in the form of “solidinvestors”. Nazarbayev is anauthoritarian ruler who is not afraidto crack down when he feels itnecessary. His model is that of aprosperous Asian state, expandingeconomically while remainingpolitically stable. Nazarbayev hasprofessed admiration for SouthKorea and Singapore, both of whichfollowed authoritarian styles ofgovernment. While repression is notas great as in other Central Asianstates, such as Uzbekistan andTurkmenistan, it appears as thoughKazakhstan will remain authoritarian throughout theforeseeable future.

After the elections in 1999, Nazarbayev has continuedto pursue a reformist approach regarding environmentallegislation. Since its independence in 1991, Kazakhstan hadto cope with a destructive environmental legacy left by theUSSR while at the same time pursuing an economic policybased on increased natural resource exploitation. Radioactiveand toxic chemical sites associated with former defenseindustries and test ranges are found throughout the countryand pose serious health risks. The nuclear site ofSemipalatinsk is one of the largest threats to the environment.Over the years, it has attracted the interest of the internationalcommunity, and gradually, efforts have been taken tominimize the environmental threat that it poses. However,the issue of nuclear and toxic waste remains a problem, as agrowing number of radioactive materials are being sold andtransported to other countries.

With reference to particular environmental problems, itis worth expanding on the situation in two areas of growingnational and international interest: the Aral Sea and theCaspian Sea. The Aral Sea is fed by the Amu Darya and theSyr Darya rivers, which pass desert areas that have beenturned into irrigated farmland. In the 1950s and 1960s,massive schemes to bring water to rice and cotton crops wereput in place to divert most of the fresh river waters feedingthe Aral Sea. Only 10 per cent of the water that once fed theAral now reaches it, now bringing with it large amounts ofpesticides and other chemicals. As a result, the Aral, oncethe fourth largest inland sea, has lost over half its surfacearea since 1960 and continues to shrink. It is estimated thatif immediate measures are not taken to control the drying ofthe Aral Sea, it will disappear by 2025. Islands have formedand the sea has split into several separate water bodies. Theloss of this body of water has also changed the climate,

leading to below average, freezing winters and summerswhere temperatures can soar to well over 40ºC. All of thishas subsequently taken its toll on human health.

The Caspian Sea has also attracted the attention of theinternational community for over a decade partly due to itslarge deposits of oil and gas, and partly because it is thebreeding ground for sturgeon, the source of caviar. Oil drill-ing and growing pollution (due to industrial and toxic wastereleased from the river Volga) has led to the steady declineof the production of sturgeon. More importantly, the dis-covery of major oil deposits in the northern Caspian will

lead to heavy exploitation and de-velopment of the area with poten-tially serious environmental con-sequences. Efforts to ensure envi-ronmental protection of theCaspian are dependent on the le-gal status of the Sea. As long asdebates continue over the divisionof the Caspian amongst the littoralstates, measures on ecological se-curity will not likely be taken any-time soon. The escalating pollutionof the Caspian Sea has had a dev-astating effect upon its ecology,

as reflected by the dwindling numbers of seal and fish. Forexample, in September 2000, eight tons of dead fish wereretrieved from a lake near Petropavlovsk—they had beenpoisoned by a chemical used as a weed killer in cotton pro-duction.

UZBEKISTAN

Due to an abundance of natural resources andenvironmental issues in common with Kazakhstan, such asthe Aral Sea and water distribution, Uzbekistan faces similarproblems. President Karimov’s re-election in early 2000indicated that despite the people’s concern that he wasresponsible for the economic crisis facing their country, heis perceived as the lesser of two evils. In an attempt to offsetdiscontent, Karimov has called for the development of astronger national ideology in order to cope with internalchanges. He therefore prioritized areas such as theachievement of a multiparty climate, battling of corruptionin public life, the freedom of the media, the facilitation ofNGO operations, and the continued integration of Uzbekistaninto the international community. Meanwhile, in an effort toensure the democratic nature of his government, Karimovsigned a decree on legal reform aimed at enshriningindividual, social, political, and economic rights. However,reform will be gradual without radical, immediate change.His style of governance resembles the old-guard communistapproach with the government being highly centralizedaround the president and a small circle of advisers andofficials.

Regarding environmental issues, the biggest problemfacing Uzbekistan has been the drying up of the Aral Seacaused by poor water management over an extended period.The large amounts of salt and dust that are blown from theexposed seabed have caused health hazards for the

The Caspian Sea has also attractedthe attention of the international

community for over a decade partlydue to its large deposits of oil andgas, and partly because it is the

breeding ground for sturgeon, thesource of caviar.


Winter 2001

surrounding population, extending as far as the PamirMountains. International efforts have commenced, but theimplementation of concrete measures is still not evident.Apart from the loss of water supplies, remaining waterresources are also faced with increasing levels of pollutionfrom agricultural chemicals and industrial waste carried tothe Aral Sea via the river network. In an effort to battle thenegative effects of the disappearance of the Aral Sea, thegovernment has implemented and supported the Aral SeaProgramme, aiming to address long term water and land usemanagement problems of the region while providing, on ashort term basis, support towards the immediate needs ofthe populations within the worst effected areas.

KYRGYZSTAN

Kyrgyzstan, unlike the otherCentral Asia states addressedabove, has insignificant reservesof natural resources and is highlydependent on its neighbours forits energy supply. It is, however,an upstream country, allowing it todevelop its use of water resourcesfor the development ofhydroelectricity. Currently,hydroelectricity meets one fourth of the country’s energyneeds, though estimates say more can be generated with theproper infrastructure and economic assistance.

The political climate that prevails in the country hascharacterized this small and fairly poor state—in comparisonto its neighbours—as an ‘island of democracy’ within theCentral Asian region. Over the past decade, President Akayevhas demonstrated signs of progressive leadership, andalthough the reforms that have been implemented over theyears were more on paper rather than in real terms, Akayevis likely to continue with these reforms. Akayev’s victoryduring the course of the 2000 presidential elections conductedin October was tarnished by reports of widespread electionviolations. The OSCE, the US and the European Union werequick to criticize the undemocratic nature of the electionsand question the liberalism that Akayev had shown so far,as he himself has started to question the democratic process.Despite this, following his electoral victory, PresidentAkayev addressed the nation calling for “fundamental”reform of the state administration system to allow for furtherpolitical and economic development. He stated that at least30 per cent of all civil servant jobs would be cut to fightincompetence and corruption. Furthermore, Akayev notedthat he plans to introduce a system of local self-governmentwith more power and funding going to local authorities.

This factor is of particular importance to thedevelopment of a plausible environmental strategy, as thestatus of the existing governmental agencies forenvironmental protection has proved inadequate andtarnished by unclear distribution of authority. An additionalpositive factor in Kyrgyzstan that has been missing from theexisting national strategy in the other Central Asian statesthat were mentioned above has been the rapid increase inthe number of non-governmental organizations (NGOs) since

1998, operating mainly in the areas of education, women’sissues, and the environment. Environmental NGOs have beencreated with the assistance of grants from international bodiesand have demonstrated the potential for effective work,particularly in their efforts to change people’s attitudetowards environmental problems. Needless to say, NGOsare also faced with a long list of problems, such as the lackof dissemination of information and cooperation betweenexisting interest groups, causing duplication of effortsamongst NGOs and competition for external financialsupport.

In reference to specific environmental issues, the mainKyrgyz concern has been the poorly maintained water

reservoirs—a legacy from the Sovietperiod—that have contaminated thewater supply, spreading waterbornediseases that affect the health of theentire population. Additionally, thelack of protected areas and theincreasing levels of illegal huntingand trading of endangered speciesalong with deforestation have ledto the loss of bio-diversity.However, the incident that mostattracted the interest of theinternational community was the

cyanide spill in Lake Issyk-Kul in May 1998. Caused by anaccident involving a truck carrying sodium cyanide for theKumtor gold mine, the spill led to the poisoning of 2,500people. Similar accidents have taken place and continue tooccur without receiving the appropriate publicity orgovernmental attention.

REGIONAL APPROACH

Overall, what these brief overviews of the Central Asianstates indicates is that despite a relatively diverse economicand political stance, they all have become increasingly awareof the importance of incorporating environmental strategywithin the realm of economic development. They have allestablished, or are in the process of establishing, a NationalEnvironmental Action Plan (NEAP) for environmentalprotection. Kazakhstan has been in the lead with a plan forsustainable development introduced as a priority in thegovernment’s Development Strategy while its NEAP hasbeen widely publicized and integrated in the social andeconomic reform process. The NEAP has set four prioritysectors: creation of a safe environment, balanced use ofnatural resources, conservation of bio-diversity, andenvironmental education. The NEAP is envisaged to developin four stages: 1998-2000; 2001-2010; 2011-2020; and 2021-2030.

Uzbekistan is also currently preparing, with theassistance of the World Bank, a NEAP. Major componentsof Uzbekistan’s Action Plan will be a strategy to sustain bio-diversity and a focus on unified planning in the promotionof environmental protection. The NEAP will set three tasks:improvement of environmental conditions in order to ensuresufficient social and health conditions for the people,effective use of natural resources, and protection of

The main Kyrgyz concern has beenthe poorly maintained water

reservoirs -- a legacy from the Sovietperiod -- that have contaminated thewater supply, spreading waterbornediseases that affect the health of the

entire population.


vulnerable ecosystems. Finally, on similar lines, a KyrgyzNEAP exists and will be reassessed in the aftermath of thepresidential elections to ensure coverage of natural resourcessustainability and the protection of bio-diversity.

In addition to the national programs, the Central Asianstates have also invested in the development of environmentalstrategies at a regional level. Although the states have diverseeconomic prospects for future development, most of theenvironmental issues that prevail in Central Asia are regionalin nature. A regional approach regarding environmentalaction is ready to be implemented alongside a country-specific line of action. This also shows once again thewillingness of the existing leaders to cooperate in certainareas that may enhance furtherpolitical and economic stability.

Despite criticism from theWest, it is possible that the existinggovernment regimes will ensure thefaster implementation ofenvironmental strategies within theshort and medium term.Corruption, inadequate legalstructures, economic constraints,and the limitations ofenvironmental governmentagencies to cope with existingproblems, however, may be someof the factors that delay furtherdevelopment. These reasons are why a regional approachhas been gradually developing and has finally become areality this year. The realization of a regional scheme wasseen in the formation of a Central Asian RegionalEnvironmental Centre (CAREC). On this basis, westerndonors have committed modest funds to create the regionalcentre. However, the interest of the donor agencies has itselfbeen more based on rhetoric than action. Since 1998 whenthe decision was reached to create the CAREC, it has taken2 years for the CAREC toestablish its headquarters inAlmaty, Kazakhstan. A boardof directors, consisting ofrepresentatives from the fivestates, the scientific and theNGO community and the donoragencies, has been aiming toestablish and carry out itsworking plan for 2000-2001 assoon as the legal issuesregarding its formation arefinalized.

THE ROLE OF INTERNATIONAL DONOR AGENCIES IN PROMOTING

THE ENVIRONMENT

Environmental problems in the region have created anopportunity for western states to intervene, because both theinternational community and the leadership of the CentralAsian states recognize the need for assistance in tacklingexisting environmental problems. Therefore, efforts havetaken place over the past decade to address the desiccation

of the Aral Sea and minimize the possibility of regionalconflict over the distribution of freshwater resources. Projectsinitiated by USAID (United States Agency for InternationalDevelopment) were perceived by the US as the leadingcomponent in ensuring regional co-operation and facilitatingthe exploration of energy resources in the Caspian Basin. Itis obvious that such interest over the regional environmentalissues was predicated on the economic interests of the US.Eager to show its commitment to stability in Central Asia, itset up projects to improve water quality and public healthconditions in the hardest hit regions near the Aral Sea. Aspart of these efforts, the State Department opened a regionalenvironmental office in Tashkent, Uzbekistan to coordinate

US environmental efforts.Nevertheless, no concreteimprovements have been observedin the region. Once it was ensuredthat economic advancement couldproceed without the necessity forenvironmental resolutions, concretemeasures to address some of themost serious environmental issueswere abandoned or postponed.

The World Bank Group hasprepared this year a newenvironmental strategy that willintegrate environmental concernsinto its mainstream efforts to

alleviate poverty and ensure economic development. Howand whether this new environmental strategy will beimplemented in Central Asia will have to be seen in the nextfew years. The strategy will try to combine advancements inliving and health conditions of the populations by addressingenvironmental issues, such as air pollution, toxic wastedisposal and water management. It will also try to reduceenvironmental risks created by natural disasters, such asdrought and desertification. Similar approaches based on

the alleviation of poverty inconjunction with environmentalprotection have been establishedby other international donoragencies. For example, the AsianDevelopment Bank aims tocomplete within 2001-2002 aproject on institutionaldevelopment and capacitybuilding that will allow theassessment and restructuring ofexisting national environmentalstrategies to cope with theincreasing degradation of the

Central Asian natural environment. Emphasis has been givento the incorporation of environmental sustainability into theeconomic activities of any body involved in the economicdevelopment of the region.

However, once again, concerns have been expressedabout how sincere these efforts have been particularly sincesome of these international agencies have been constantlycriticized for funding projects that have negative effects onthe environment. Additionally, any positive results that may

International donor agencies musttake measures to integrate

environmental considerations intotheir lending practices and allow thestates to reach a sufficient level ofeconomic development that will

permit them to proceed safely withthe repayments of any loans.


Winter 2001

arise from the implementation of aid projects areovershadowed by the pressure posed to the governmentsof Central Asia to repay the loans that were granted to themto facilitate economic development and modernization.International donor agencies must take measures to integrateenvironmental considerations into their lending practices andallow the states to reach a sufficient level of economicdevelopment that will permit them to proceed safely withthe repayments of any loans.

CONCLUSION

Based on the evidence that has been provided over theyears concerning the ruling regimes of the Central Asianstates and on the results of recent elections, it is only naturalto assume that regional environmental strategies will notachieve their goals in the near future. Saturated bydeficiencies in education, technical implementation andpolicy structure and inefficiencies concerning economicresources, environmental protection is still an idea presentedon paper that will slowly evolve into action. Despite theirinadequacies and controversial courses of action, the existinggovernments will intensify their efforts to addressenvironmental questions both on a national and regionallevel. The stakes are too high, and with economicdevelopment becoming increasingly dependent on

environmental stability, a concrete strategy must bedeveloped and implemented. The fact remains, however, thatnothing can be achieved without the support of theinternational community and its financial and technicalassistance. Pilot projects emphasizing natural resourcesmanagement will have to continue to be designed,implemented, and evaluated, while a growing need topromote stronger public support for better management andcommitment to the environmental improvement will be anessential and integral part for any success story.


BANKRUPTCY LAW IN CHINA:LESSONS IN THE PAST TWELVE YEARS

BY DR. LI SHUGUANG

Dr. Li is an associate professor at China Universityof Politics and Law and is currently a visitingprofessor at Harvard Law School. He formerlyserved as an expert advisor on bankruptcy and de-organization in China State Economic and TradeCommittee and as an expert advisor on enterprisemerger and bankruptcy for World Bank and AsianDevelopment Bank. Dr. Li also participated in thedrafting of new bankruptcy law and a series ofgovernmental policies regarding the reforms ofstate-owned enterprises.

Despite the long history of the Chinese legal system and its influ-ence on much of East Asia, the concept of “bankruptcy” wasnot formally recognized in Chinese law until the first bankruptcy

law was introduced in 1906, during the late Qing Dynasty. Until thattime, the role of bankruptcy law was filled by the legal and ethical tradi-tion that “the son pays for the debts of his father.”

In 1906, the Qing government followed the civil law system, espe-cially the law of China’s neighbor, Japan, and enacted bankruptcy law. Itwas later annulled in 1908 by Emperor Guang Xu due to difficulties inimplementation. In 1915, during the era of the Republic of China, thethen Northern Warlords Government drafted a bankruptcy law. In 1935,the Nationalist Government published and implemented a bankruptcylaw that is still in force in Taiwan today.1

After the founding of the People’s Republic of China in 1949, thenew government abolished all the laws the Nationalist Government hadenacted. As a consequence, China did not have an insolvency law formore than 30 years. During this period, the Chinese government prac-ticed a uniform policy of centralized assumption of profits and losses ofstate-owned enterprises under the planned economic system. The sys-tem was characterized by centralized financial revenue and expendi-tures, planned coordination of supply and demand in commercial distri-bution, and government-controlled labor supply and placement. Enter-prise profits were turned over to the state and all losses were subsidizedby the state. Enterprises with chronic and serious deficits either were“closed, suspended, consolidated or [had their] production changed” byadministrative orders, or went bankrupt automatically without goingthrough any legal procedure. The facts of bankruptcies had always beenkept secret.

In the early 1980s, Chinese economists, legal experts, and govern-ment officials began to realize the drawbacks in the way that the plannedeconomic system dealt with insolvent enterprises, and advocated thepromulgation of a law of enterprise insolvency. After the promotion ofbankruptcy law by experts and scholars and fierce debates in the Stand-ing Committee of the National People’s Congress (NPC), the Law of thePeople’s Republic of China on Enterprise Bankruptcy (LEB) was fi-nally promulgated by the 18th Session of the Standing Committee of the6th NPC on December 2, 1986.

TWELVE YEARS AFTER THE ENACTMENT OF THE BANKRUPTCY LAW:THE LAW IN PRACTICE

It has been over twelve years since the bankruptcy law first cameinto effect on November 1, 1988. The Law comprises six chapters, in-cluding General Principles, Proposal and Acceptance of Bankruptcy Ap-plications, Creditor’s Meetings, Conciliation and Consolidation, Bank-ruptcy Declaration and Liquidation. There are a total of 5400 words in43 articles. According to Article 2, the Law applies to enterprises whollyowned by the people, namely, state owned enterprises (SOEs), shatter-ing the traditional view that SOEs would not and could not go bankrupt.


Winter 2001

1. THE BANKRUPTCY LAW AS ONE OF SEVERAL BASES FOR

ENTERPRISE BANKRUPTCIES

However, the Bankruptcy Law is not the only basis forbankruptcy practice in China. After the Law was promul-gated, the NPC issued the amended 19th chapter of the Codeof Civil Procedure on April 9, 1991: Debt Repayment Or-der in Legal Entity Bankruptcy. The chapter, covering 8 ar-ticles (Articles 199 to 206), provides a direct basis for han-dling the bankruptcies of non-state-owned enterprises andbrought the bankruptcies of all legal entities (enterprises withlegal person status) in China into the legal system. It hasalso promoted the market competition mechanism of sur-vival of the fittest. Although the Code does not specify thedebt repayment procedure for bankruptcies of non-state-owned enterprises, it provides that the repayment proceduresspecified in the Bankruptcy Law are applicable to all legalentities. Therefore, in practice, many bankruptcy cases in-volving SOEs and non-SOEs follow the procedures.

Judicial interpretations of the Bankruptcy Law issuedby the Supreme People’s Court on November 7, 1991 and aseries of policies and other regulations implemented by theState Council also regulate and promote bankruptcy prac-tice in China. Some localities have promulgated their ownregional bankruptcy laws to promote bankruptcy work. Forexample, in August 1993, the Guangdong Provincial People’sCongress issued a series of regulations on company bank-ruptcy. In November 1993, the Shenzhen municipal people’scongress issued Regulations on Company Bankruptcy in theShenzhen Special Economic Zone.

2. A MAJOR INCREASE IN ENTERPRISE BANKRUPTCY CASES

Many Chinese and foreign scholars as well as membersof the business community share the common misconcep-tion that there are only few enterprise bankruptcies in China.In reality, since the Bankruptcy Law came into effect in No-vember 1988, the law has been invoked to close more than16,000 enterprises. After a slow start, the rate of bankrupt-cies has accelerated rapidly, particularly in the last severalyears (see table below). Bankruptcy has not been limited toailing state firms, but rather has applied to all types of enter-prises. In 1994, only 395 of the total 1,624 bankrupt enter-prises were state firms. Among the 5,396 bankruptcies in1997, 3,060-plus were SOEs (675 in the 111 experimentalcities);2 the rest were private, collectively owned or Sino-foreign joint ventures.

Bankruptcies Per Year:3

1989 981990 321991 1171992 4281993 7101994 1,6251995 2,5831996 5,8751997 5,396

3. TYPES OF BANKRUPTCY

Because the only bankruptcy law in China was designedfor SOEs, and because of the influence of the deep-rootedcentral control economic system on domestic perceptions,there is a general belief that bankruptcies are only limited toSOEs. In fact, as noted above, there has been a large num-ber of non-SOE bankruptcies in recent years. Among the 11bankruptcies in Zhanjiang, Guangdong Province in 1996,five were sino-foreign joint ventures. Among the 5,396 bank-ruptcy cases in the entire country in 1997, 3,735 concernedSOEs, and most of the rest concerned private, collectivelyowned or sino-foreign joint ventures. Since 1992, there hasbeen a number of bankruptcy cases involving other coun-tries. During the Asian financial crisis, difficulties in sev-eral Asian countries (such as Japan, South Korea, and HongKong) caused their investments in China to fail. For instance,the bankruptcy of the International Commercial Credit Bank(BCCI) led to the bankruptcy of its branch in Shenzhen.

Nonetheless, the serious bankruptcies (in terms of scale,amounts of debt, numbers of unemployed workers involvedand overall impact) have involved SOEs. The biggest caseto date is the closure of state-owned Shanxi Textile DyeingPlant in September 1996. In 1993, the plant of 18,000-workerwas one of China’s 500 largest enterprises. Three years laterit was insolvent with a total of 640 creditors and debts ofRMB880 million (US$106 million).4

4. IMPLEMENTATION OF THE CHINESE BANKRUPTCY POLICY INRECENT YEARS

Despite the fact that reforming SOEs has been the mainfocus of the Chinese economic reform in the last twenty years,they remain a hard nut to crack. Since 1994, the central gov-ernment has changed its approach to reforming SOEs fromattempting to revitalize every single SOE to saving only theviable ones and preserving the overall sector. One principalexperiment in this area has been a policy aimed at strength-ening enterprises through the improvement of capital struc-tures by encouraging mergers, restructuring, bankruptcies,asset sales, and the spin-off of non-productive units such asschools and hospitals. This experiment was first carried outin 18 cities, subsequently expanded to 56 cities, includingevery provincial capital, and is currently being run in 111cities. Together with this experiment, policies outlined in

Because the only bankruptcy law inChina was designed for SOEs, and

because of the influence of the deep-rooted central control economicsystem on domestic perceptions,

there is a general belief thatbankruptcies are only limited to

SOEs.


two State Council documents on mergers and bankruptcies(No. 59 issued in 1994 and No. 10 in 1997), and other policiesissued by government departments, constitute a key driv-ing force behind the increase in bankruptcies.

Some progress has been made since the start of the ex-periment in 1994. According to the State Economic andTrade Commission, some 1,192 enterprises merged and1,099 went through bankruptcy in the original 56 experi-mental cities in 1996. These enterprises employed 680,000workers and amassed a combinedcapital of RMB25 billion (US$3 bil-lion) and total debts ofRMBRMB43 billion (US$5.2 bil-lion), with a debt-to-assets ratio of172%. Altogether 5,908 non-pro-ductive units were separated fromtheir parent organizations, divert-ing 1.23 million people to other ar-eas. In 1997, with the total numberof experimental cities increased to 111 cities, 1,509 enter-prises were merged and 675 went through bankruptcy, af-fecting more than one million workers. It is estimated thatmore than 2,000 enterprises either merged or declared bank-ruptcy in 1998, mainly in hugely unprofitable sectors suchas textiles, machinery, light industry, defense industry, chemi-cals and coal.

Despite the progress, two main obstacles have pre-vented further increase of the bankruptcy rate. They areChina’s already substantial unemployment problem and thefragility of the financial system. Official statistics state thatChina had 5.76 million unemployed workers in urban areas in1997, giving rise to an unemployment rate of 3.1%. Thisfigure, however, hides at least another 10 million urban work-ers who are xiagang—a new term used to describe peoplewho got laid off from their employment but are nominallypaid (if they are lucky) a subsistence wage by their previousworking unit. A steep rise in the number of bankruptcieswould exacerbate the unemployment problem, threateningwidespread social unrest. A more immediate problem, espe-

cially in light of the Asian economic crisis, is the effect wide-spread bankruptcies could have on China’s rickety financialsystem. A multiplication of the loss of debt rights on thepart of the state banks could make financial institutions, thelargest creditors of SOEs, technically bankrupt, and thustrigger a financial crisis. In 1996, of the above-mentionedtotal debts of RMB43 billion, RMB26.1 billion (60%) was inthe form of bank loans. As a result of liquidations and merg-ers, the banks recovered only 10.1% of their loans, half in

cash and half in goods and debtrights.5 Of the bankruptcy casesalone, the banks wrote off RMB11.4billion, 43% of the total RMB26.1 bil-lion.

Aware of the problems associ-ated with bankruptcies, the govern-ment has adopted a policy of pro-moting mergers over bankruptcies.This new policy accounted for a

sharp decrease in the number of bankruptcies in the experi-mental cities in 1997 compared to 1996. While this approachmay prove to be a palliative in the short term, in the long run,it raises the question of who will merge with a bankrupt SOE.In addition, in the area of SOE bankruptcies, there are furtherobstacles such as an imperfect legal system, excessive ad-ministrative intervention, disordered guarantee arrange-ments, fraudulent bankruptcies, low benefits of liquidation,a shortage of bankruptcy professionals, local protection-ism, and difficulties in selling assets for cash. The perplex-ing auction of the government-owned Shanxi Textile DyeingPlant serves as a good example. In that case, the govern-ment initially attempted to force a merger by auctioning offthe plant. But no buyer was willing to pay the RMB550 mil-lion price set by the government. Eventually, the govern-ment had to set up a textile company for the sole purpose oftaking over the plant. The new government-owned companybought the plant for RMB 486 million. Recognizing the inef-ficiency of this approach, which results in mere shifting ofproblems from one enterprise to another, I proposed in 1998

Aware of the problems associatedwith bankruptcies, the governmenthas adopted a policy of promoting

mergers over bankruptcies.


Winter 2001

that bankruptcy be adopted as the preferred solution forinsolvent SOEs. Only bankruptcy, rather than merger, canprovide a complete cure. Indeed, in 2000, the central govern-ment began a new policy of “more bankruptcies, less merg-ers”.

KEY ISSUES IN CHINESE BANKRUPTCIES

1. THE GOVERNMENT’S ROLE IN BANKRUPTCIES

The Chinese government plays a special role in enter-prise bankruptcies in China. The government’s role is bothdominant and multi-faceted in SOEbankruptcies. It initiates thesebankruptcies, yet at the same time,is the policymaker, the leader, andthe direct operator in them. Thegovernment not only controls theirnumber, scale, and speed, but alsodecides what industries and tradesare covered under the bankruptcylaw. It also covers the costs of SOE bankruptcies. It shouldbe noted that the central and local governments play differ-ent roles in bankruptcies, some of which are conducted un-der, and some outside, the government’s planned program.In contrast, the government has little influence in the area ofnon-SOE bankruptcies since it is not the legal owner of thesecompanies.

2. THE COURTS’ ROLE IN BANKRUPTCIES

The courts’ role in SOE bankruptcies is derived fromthe power of the government and is thus limited in manyaspects. Since the government appoints judges and allo-cates budgets for courts, Chinese courts are hardly inde-pendent of the government. Chinese courts are divided intofour levels: the Supreme Court, High Court, IntermediateCourt and Local Court. Unlike the American system, in whichbankruptcy courts have exclusive jurisdiction over bank-ruptcy cases, there is no unified provision in China specify-ing which court (i.e. the court of which level) has jurisdictionover bankruptcy cases. Most of these cases are conductedby the Economic Trial Branch of Local Courts and Interme-diate Courts. Absent approval by the government, courtsare often hesitant to accept and hear bankruptcy cases.Judges are supposed to apply the existing bankruptcy lawwhen handling these cases. They are, however, restrainedby bankruptcy policies of governments of different levels,which at times conflict with the bankruptcy law. Moreover,the majority of Chinese judges are not experienced in deal-ing with bankruptcy cases because Chinese courts had neverdealt with a single bankruptcy case prior to the implementa-tion of the Bankruptcy Law in 1988.6

3. WHO’S THE REAL DEBTOR?

One complication in the current Chinese bankruptcyregime is that the ownership structure of SOEs is not clear,making it difficult to identify the real debtor. SOEs are tech-nically “own[ed] by the state”. However, it is unclear as towho represents the state in exercising its ownership, who

has the authority to grant approval and make decisions foran enterprise facing bankruptcy, who can apply for bank-ruptcy, and who takes the economic risk and bear the losses.Legal owners should theoretically bear all losses. Yet inreality in China, SOEs are often owned by multiple govern-mental entities that frequently evade their responsibilitieswhen a SOE is faced with bankruptcy. An effective mecha-nism is needed to establish clear ownership of SOEs.

Parent-subsidiary relationships add additional complex-ity. When a SOE is bankrupt, should its subsidiary enter-prise bear joint liability? Conversely, when a subsidiary en-

terprise is bankrupt, should its par-ent enterprise bear joint liability? Inpractice, many SOEs are not inde-pendent legal persons even thoughthey are powerful enterprises. It isoften the case that an SOE and itssubsidiaries have business relation-ships without ever establishing anyclear legal relationships. The ab-

sence of clear legal relationships makes it easier for parententerprises or subsidiaries to evade their financial responsi-bilities.

Other hotly debated bankruptcy issues arise from thecurrent transition from a planned economy to a marketeconomy. For instance, what does the bankruptcy propertyof a bankrupt SOE encompass? Does it include land, hospi-tal, school and employees’ living quarters, as well as assetsof the party committee and labor union of the SOE?

4. THE ANTI-BANKRUPTCY STANCE OF CREDITORS

Creditors often have difficulty recovering debts frombankrupt SOEs. Current policy requires that money recov-ered from a bankrupt SOE be used to settle employees first.And bank creditors have priority over non-bank creditorsfor the remaining money, if any. As there is often little moneyleft after employee settlement, state-owned banks, whichare the main creditors of SOEs, are often hit hard by SOEbankruptcies. These banks therefore often oppose SOEs’efforts to file for bankruptcy or will only accept bankruptcyunder the government’s planned program. Even for enter-prises whose financial situation warrants an application forbankruptcy, it is rare for banks or other creditors to initiatesuch an application. For non-bank creditors, the difficultiesare even more daunting. In many SOE bankruptcies, therights of these creditors are completely cancelled to allowfor settlement of employees. Other creditors fortunate enoughmay recover their debt at a very low rate. Legal mechanismsto guarantee creditor’s interests are weak at best.

5. DIFFICULTIES IN SETTLING EMPLOYEES

Employee settlement is the most difficult and thornyissue in SOE bankruptcies. The problem is manifold. First,SOE employees are reluctant to accept bankruptcy becausebankruptcy means that they lose their identity as state em-ployees. This identity is so important because there is aChinese tradition that a state employee is guaranteed an“Iron Rice Bowl”, or lifetime employment. Second, when an

Absent approval by the government,courts are often hesitant to accept and

hear bankruptcy cases.


enterprise is bankrupt, laid-off employees become a seriouspotential source of social instability. This is further exacer-bated by the lack of government funding for employee settle-ment and the inadequacies of the social welfare system.Third, questions remain concerning the logistics and termsof settlement. How should employees be settled? Where doesthe money for employee settlement come from? Should thegovernment be responsible for the settlement or should theemployees find their own way out? Fourth, the legal rightsand interest of employees of the bankrupt enterprises arenot protected due to the lack of contract enforcement mecha-nisms. The government frequentlyuses boilerplate employee settle-ment plans, which place employeesfrom bankrupt SOEs into a secondenterprise (either state owned orprivately owned). These employ-ees often are forced to enter intolabor contracts that infringe upontheir rights as guaranteed by theemployee settlement plans. Sucharrangements are fraught with le-gal problems.

6. ONLY A FEW PROFESSIONAL INTERMEDIARY SERVICE ORGA-NIZATIONS ARE INVOLVED IN BANKRUPTCY CASES

Professional services for handling bankruptcy cases areuncommon and rudimentary in China. The majority of Chi-nese liquidation professionals lack experience in handlingcomplicated bankruptcies, resulting in low efficiency andhigh cost for their work. Only a few law firms and account-ing firms have been involved in bankruptcy cases. More-over, there is no trustee system for handling bankruptcies.

7. THE BANKRUPTCY LAW AND POLICIES ARE INADEQUATE

The existing Bankruptcy Law is hard to implement.Much of its content does not adequately address the com-plex economic realities of China. SOE bankruptcy proce-dures are vague and those governing non-SOE bankrupt-cies are deficient. There is no legal basis for filing bank-ruptcy for a natural person, partnership, or corporation.Since there is no reorganization procedure for insolvententerprises, it is difficult to determine where the responsi-bility of the managers of the bankrupt enterprises lies. Inaddition, there are conflicts and inconsistencies betweenthe Bankruptcy Law and existing government policies.

8. FAKE BANKRUPTCY CASES

Some enterprises dodge their liabilities by declaringbankruptcy after dividing their businesses and changinglicenses. Such practices are often supported by localprotectionism. A large number of enterprises practice ill-will bankruptcy—a “disappearance act from an entangledsituation”—they shift their assets and repudiate their debtsby taking advantage of the bankruptcy procedure.

9. CONFUSING GUARANTEE RELATIONS

In China, enterprises often give unsubstantiatedguarantees to each other, resulting in duplicate pledges ofthe same asset. Guarantees are often given without carefuldocumentation, creating hidden liabilities that lead to chainreaction bankruptcies. One reason for such confusingguarantee relations is that governmental administrativeagencies designate guarantees. Guarantee relations are alsoaffected by the policy that any proceeds from bankruptcyproceedings must be used for employee settlement first. For

example, proceeds from transferringland-use-rights, no matter whetherthe right has been given out inpledge or not, must first be used forsettling employee. The mortgagorsare thus unable to enjoy theirrightful repayment priority.

10. CREDITOR’S RIGHTS ANDLIABILITIES ARE DIFFICULT TOEVALUATE

The unsound accounting system for SOEs makes itdifficult to evaluate creditor’s rights and liabilities accurately.Because enterprises often keep two books—their ownaccounting books and their “official” books, it is extremelyburdensome for creditors to produce concrete evidence fromaccounting records to substantiate their claims. Furthermore,there is a two-year statute of limitations for asserting creditorrights in courts. Unaware of their legal rights, creditors ofteneither miss the two-year time limit or fail to produce evidencethat tolls the statute of limitations. To complicate thingsfurther, government funding to SOEs could be convertedinto debt upon the occurrence of certain triggering events.The nature of liabilities is often unclear.

Twelve years of practice withbankruptcy laws, combined with thedeepening of the SOE reform and thedevelopment of the market economy,have persuaded many Chinese of the

country’s need for a newbankruptcy law.


Winter 2001

11. THE DIFFICULTY OF CONVERTING BANKRUPTCYASSETS TO CASH

There is often a discrepancybetween the appraisal value ofbankruptcy property and its marketvalue. Property values are currentlydetermined by governmentalassessment agencies, often at levelssubstantially higher than marketvalues. It is thus difficult to sellbankrupt property to settleemployee and creditor claims. To solve this problem,bankruptcy property should be assessed by experts in linewith its real value, and sold through auctions to realize theirmarket values.

12. BANKRUPTCY CONCERNING ENTERPRISES WITH FOREIGNPARTICIPATION

Myriad problems arise in the bankruptcy of Sino-foreignjoint ventures. It is unclear who bears the responsibility afterthe bankruptcy of such joint ventures because there is noadequate bankruptcy procedure for enterprises with foreigninvestment or participation. The current bankruptcy law doesnot provide sufficient protections for foreign investors. Thislack of protection partly stems from the fact that detailedprovisions regarding foreign creditors are missing from theexisting bankruptcy law. The 1999 bankruptcy case ofGuangdong International Trust and Investment Company(GITIC) illustrates this problem. Foreign investors madeloans to GITIC, on which GITIC defaulted when it declaredbankruptcy. In the bankruptcy proceeding, it became apparentthat the existing bankruptcy law provided little guidance onthese foreign creditors’ rights and how these foreign investorsshould proceed.

13. UNFAIR PREFERENTIAL POLICIES ON BANKRUPTCY

Only SOEs in the 111 pilot cities (out of 665 citiesnationwide) that are covered by the government’sexperimental program can benefit from preferentialbankruptcy policies, such as the ability to write off bad debts.All enterprises in non-pilot cities and non-SOEs in pilot citiesare denied such preferential treatment.

FUTURE PROSPECTS FOR THE APPLICATION OF BANKRUPTCY

LAW IN CHINA

China has encountered numerous difficulties in carry-ing out SOE bankruptcies because the existing bankruptcylaw is fraught with ambiguities and deficiencies. However,after twelve years of practice and experimentation, especiallyafter the establishment of a framework for market economicreform in China in 1993, a macro environment for broaden-ing bankruptcy practice has emerged.

1. CHINA NEEDS A BANKRUPTCY SYSTEM

Some scholars argue that bankruptcy law is not suit-able for the national conditions in China. Nevertheless,

twelve years of practice with bankruptcy law, combined withthe deepening of the SOE reform and the development of themarket economy, have persuaded many Chinese of the

country’s need for a new bank-ruptcy law. Bankruptcies have be-come an inevitable economic real-ity. Recently, many scholars and en-trepreneurs, particularly creditors,have advocated the replacement ofthe existing bankruptcy law with anew bankruptcy law that is moresuitable for the new market

economy.The original bankruptcy law is out of date with current

realities. First, a large number of companies not owned bythe government have been established under the rules ofthe new market economy in the twenty years since economicreforms began. These companies expect to operate within alegal framework more suited for a market economy. Clearly,the original bankruptcy law cannot apply to these compa-nies. Second, even for money-losing SOEs that still carrythe inertia of the planned economic system, the inevitabletransition to market economy has made the existing bank-ruptcy law inadequate.

2. GREAT ATTENTION PAID BY THE TOP CHINESE LEADERSHIP

TO THE IMPLEMENTATION OF A BANKRUPTCY SYSTEM

In the report of the 15th Party Congress of Autumn 1997and by the central government led by Premier Zhu Rongji,much emphasis was placed on “well-regulated bankruptcies,implementation of the re-employment program and improv-ing the work on the SOE bankruptcy experiment”. The cen-tral government has also decided to set aside more thanRMB100 billion (US$12 billion) in bad-loan deposit fundsfor state banks to write off losses caused by mergers andbankruptcies from 1997 to 2000. The government has is-sued a series of specific bankruptcy policies in 111 pilotcities. In 2000, the application of these new bankruptcypolicies has been extended to all cities.

3. A LEGAL SYSTEM RELEVANT TO THE BANKRUPTCY LAW IS

GRADUALLY IMPROVING

In recent years, China has issued a number of new lawsand regulations such as the Corporation Law, the Partner-ship Law, the Labor Law, the Commercial Banking Law, theGuarantee Law, the Insurance Law, the Regulations on theUnemployment Insurance of SOE Employees and the Secu-rities Law. These laws provide new legal bases for creditorsand debtors to file for bankruptcy. The Chinese governmenthas also sped up reform in the social security system forunemployment, health, housing, and seniors. However, thesenew laws often conflict with the existing Bankruptcy Lawbecause it was enacted earlier and lacks corresponding pro-visions.

There is every reason to believe thatthe future of the enforcement of

bankruptcy law is bright, despite thechallenges that lie ahead.


4. A NEW BANKRUPTCY LEGISLATION HAS BEEN DRAFTED AND

PLACED ON THE LEGISLATION AGENDA OF THE CHINESE LEGIS-LATURE

Drawing on the experience of developed countries andincorporating global trends in bankruptcy law, the draft ofthe new bankruptcy legislation is intended to adapt to thenew market economy in China. It contains detailed provi-sions that broaden the scope of bankruptcy application, setup simple and streamlined bankruptcy procedures, improvethe court’s standing in bankruptcy case hearings, better pro-tect the creditors’ interests, establish a trustee system, re-create a reorganization mechanism, and establish a specialprocedure for SOE bankruptcies.6

After twelve years, a new stage in bankruptcy practicehas arrived. It will have far-reaching impact on the deepen-ing of China’s economic reforms, in particular SOE reform,and on the establishment of an improved market economy.There is every reason to believe that the future of the en-forcement of bankruptcy law is bright, despite the challengesthat lie ahead.

ENDNOTES

1 See Li Shuguang, et al, Bankruptcies and Mergers in Chi-nese Enterprises, at 4, People’s Daily Publisher, Sept. 1996ed.2 See State Economic and Trade Commission: Working GuideOn the Optimization of Capital Structure in Pilot Cities,Beijing, 1998.3 See Supreme Court Annual Work Report4 See Selected Case Studies from Bankruptcy Conference,compiled by Yanze River Enterprise Bankruptcy Commis-sion based on the materials from the National BankruptcyConference held in Zhanjian City, Guangdong Province in1997.5 See SETC: Working Guide On the Optimization of CapitalStructure in Pilot Cities, Beijing, 1998.6 See Li Shuguang, Field Study Report on the Chinese Bank-ruptcy Law State Enterprise Insolvency Reform Project,T.A.No. 2271-P.R.C., Asian Development Bank, Beijing, 1996.7 See The Law of the People’s Republic of China on Enter-prise Bankruptcy (Trial Implementation).See also Materials for the International Conference on Bank-ruptcies and Mergers, Beijing, 1996.


Winter 2001

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WAS WORLD BANK SUPPORT FOR THEQINGHAI ANTI-POVERTY PROJECT INCHINA ILL-CONSIDERED?

BY PIETER BOTTELIER

Pieter Bottelier is a faculty member at the John F.Kennedy School of Government at Harvard. Heworked in the World Bank from 1970-98. He servedin many different functions, including as Chief ofMission in Beijing (1993-97) and as Senior Advisorin the East Asia Region (1997-98).

This article is based on a talk presented by Mr.Bottelier at the Harvard University Asia Center onOctober 20, 2000.

The Qinghai anti-poverty project is one of the most controversialprojects in the 54-year history of the World Bank. In July 2000,after a detailed investigation by the Bank’s independent Inspec-

tion Panel and periods of serious tension between the Bank, its largestclient, China, and its largest shareholder, the U.S., China withdrew itsrequest for Bank financing in a stormy board meeting. The decision towithdraw was made by the Chinese Prime Minister Zhu Rongji person-ally. The episode has put additional strain on the relationship betweenChina and the Bank. It has also left the impression that the Bank wasincompetent, insensitive, or terribly naïve in undertaking this project.The purpose of this article is to correct misinformation about this projectand to develop a more balanced perspective on the case.

As Chief of the World Bank’s mission in Beijing (1993-1997), Iknew the poverty conditions in parts of Qinghai well and was involvedin early project discussions in 1997. I was not involved in actual projectpreparation or appraisal work. The outcome of the fascinating but sadsaga that is the subject of this article left me and many of my formercolleagues in the World Bank very uncomfortable at different levels. Itseems to me that a potentially good anti-poverty project was killed forthe wrong reasons.

Although China and many senior staff members in the Bank wereprofoundly dissatisfied with the work of the Inspection Panel, Chinawas, for the sake of maintaining harmonious relations with the Bank,willing to go along with recommendations by Management for furtherstudies and consultations, as the Panel had deemed necessary. Chinawas not prepared, however, to re-submit the Qinghai project for Boardapproval after completion of the extra work. China felt that a technicaldecision to unblock disbursements was all that was required.

The U.S. and Japan were in the end the only two member countriesthat opposed the project. All other shareholders supported it in prin-ciple, but some (including European shareholders, Canada and Austra-lia) required that it be re-submitted for Board approval after completionof additional studies and assessments. China refused to accept this con-dition on the grounds that: (a) the Board had already approved the projectin June 1999, before Panel investigation; and (b) Bank management hadofficially certified (after the protests by outside agencies, but beforePanel investigation) that, contrary to allegations that had been made,Bank policies and procedures had been properly observed in the prepa-ration of this project.

The project and the unusual circumstances surrounding it were dis-cussed in national parliaments around the world. China is proceedingwith the project, but all financing will now come from domestic resourcesand there will be no external supervision of project implementation.

Long-term implications of this unusual episode for the Bank and itsPart II members1 are on balance likely to be negative. They go wellbeyond the project that triggered the crisis. The Bank’s capacity to helpmember countries reduce poverty—its main job and purpose—has beenimpaired. The Bank’s credibility as a non-political institution has suf-


Winter 2001

fered. Operational costs of the Bank are likely to increasefurther as a result of additional reviews and safeguards thatmay be required by Part I member countries. Bank opera-tional staff has become more risk-averse and less inclined toexercise professional judgment without first consulting in-ternal lawyers. Possible positive consequences are that theBank may become more sensitive to political realities andthat in the future there will be less room for confusion overthe interpretation of environmental and social safeguard poli-cies.

The project and the crisis it provoked raise questionsabout the role and procedures of the Bank’s independentInspection Panel, the Bank’s relations with outside agenciesthat have a political agenda, the use of resettlement in pov-erty alleviation, and the apparent unwillingness of the U.S.and some other shareholders to protect the Bank’s politicalneutrality more forcefully. This is also an interesting casestudy in how the Bank and its shareholders can inadvert-ently become entangled in an internal political conflict in amember country through the actions of influential NGOs.

In this case, the underlying conflict that led to the crisisis the political struggle between the Tibetan “government inexile” and the government in Beijing. More precisely, theconflict was over alleged efforts by Beijing to “dilute” Ti-betan culture in Qinghai with Bank support through resettle-ment. The controversy over this project was not anticipatedby the Bank or by China. The Bank walked into a politicalmine field without realizing it until the explosions went off.The international campaign against the project was led bythe International Campaign for Tibet (ICT) in the U.S. andTibetan support groups around the world. The opposition tothe project was in my view essentially political in nature,but the conflict took the form of a proxy battle over compli-ance with Bank operational guidelines and safeguard poli-cies.

THE PROJECT

The Qinghai project is a component of the WesternPoverty Reduction Project (WPRP) aimed at poverty alle-viation in Gansu, Inner Mongolia and Qinghai, three poor,semi-desertic provinces in West and Northwest China. Onlythe Qinghai component, on which international oppositionexclusively focused, involves significant resettlement andTibetan interests. Under that project, some 58,000 extremelypoor farmers living in the largely barren and overcrowdedmountains of Eastern Qinghai, without prospect of in-situeconomic development, would be assisted, on a voluntarybasis, to resettle on irrigated land about 500 km to the westwithin the same province.

The resettlement site is one of the last remaining unde-veloped areas in Qinghai that is suitable for irrigated agri-culture. Most other relatively flat areas with adequate waterresources in this mountainous, arid, and thinly populatedprovince have already been developed over the past half acentury. The share of the Tibetan population in the threeprefectures affected by this project (in move-out and move-in areas) ranges from four to eleven percent. They are the“least” Tibetan prefectures in Qinghai and the only threenot designated solely as “Tibetan Autonomous”; the other

five prefectures in the province are all designated as “Ti-betan Autonomous”. The project area narrowly defined,which includes land to be irrigated and villages to be estab-lished, occupies a little over 200 sq. km.

The project area broadly defined, which includes ruralroads, irrigation canals, and open space between non-con-tiguous irrigation areas, occupies about 2,000 sq. km, orabout four percent of Dulan County. At present, the area ispoor quality grassland, and is primarily used by the Mongo-lian cattle herders for winter grazing. Only 63 families pres-ently live (part of the year) in the actual project settlementareas. They are semi-nomadic and all are Mongolian. Oth-ers use the area merely for the transit of cattle between sum-mer and winter grazing. Another 248 households farm nearbyamidst an old dilapidated irrigation scheme. All affected localpeople would be entitled to full compensation under theproject or have to option to participate in it as direct benefi-ciaries. Transit rights through the project area would be fullyprotected. A grievance mechanism would be introduced todeal with concerns and complaints of affected local people.

A few Tibetan villages dot the project area broadly de-fined, but most local Tibetans live higher up in the moun-tains with their yak and their sheep, not in the project area.The inconvenience of the project on those mountain peoplewould be minimal. Indirectly, they would benefit from alarger market for their products. Tibetans living near theproject area, like other minorities, would have the option toparticipate in the project as direct beneficiaries or receivecompensation if they were negatively affected and preferrednot to participate. The Bank’s appraisal report indicates thatBank staff responsible for the project’s preparation and ap-praisal were aware of Tibetan dilution concerns and the per-ceived risk that Tibetan culture in the area might weakenthrough the replacement of a herding lifestyle with that offarming. However, since nobody would be forced to adopt adifferent lifestyle, while a large majority of the local peopleseemed to be in favor of the project, the Bank’s team foundthat these risks were manageable.

The ethnic composition of the 58,000 target populationin the move-out area is about 42% Han, 36% Hui, 9% Tu,7% Salar, and 6% Tibetan. The majority is therefore non-Han. All are chronically poor and many are illiterate. Para-doxically, the proportion of Tibetans living in the move-outareas would increase as a result of the project, because theproportion of Tibetans in the target group is much smallerthan the proportion of Tibetans in the total population of themove-out areas. The relatively low (voluntary) participationrate of Tibetans in the target group was thought to be relatedto the fact that the move-out areas are located in the vicinityof the birth places of the Dalai Lama and the Panchen Lama.These are areas to which many Tibetans are for that reasondeeply attached.

To protect the social fabric of villages in the move-outarea, people would resettle on a village-by-village basis. TheQinghai provincial government originally proposed to moveall 120,000 people who had applied for resettlement. How-ever, the World Bank team persuaded the borrower to limitthe number to a little under 58,000 so as not to overload themove-in area. The government also agreed to include in theproject certain investments in the move-out area for the ben-


The World Bank estimates that morethan 60,000 people, including settlersand people who stay put in the move-out areas, would directly benefit from

the project.

efit of those left behind.The amount of Bank and IDA financing for the Qinghai

component of the WPRP would have been about $40 mil-lion. Typically, the Bank does not finance more than 50% oftotal project costs in China; the rest is financed by the bor-rower. In China, projects proposed for World Bank financ-ing are usually prepared by the bor-rower before they are submitted forthe Bank’s consideration. The Chi-nese typically have a high degreeof project “ownership” and imple-mentation is well supervised. Thequality of the Bank’s project port-folio in China is rated as one of thebest in the world.2

The proposed resettlementarea for the Qinghai project is mostlyuninhabited, semi-desert country.The elevation is 3000 meters and the climate is harsh, as it isin the move-out areas. The growing season is only about100 days per year. Natural vegetation and wildlife are limited.Most of the land is leased on a long-term basis to herders forseasonal grazing. A few irrigated plots in the area developedunder some small, earlier projects are leased to sedentaryfamilies in small villages. The project provides for the reha-bilitation of an old dam and the construction of a new one tocapture seasonal snowmelt from the nearby Kunlun Moun-tains. The water currently flows off in small streams intomarshes in the desert. The reservoir behind the dam will bevery small, only about 1.3 sq. km (0.5 sq. mile). Nobody livesin the reservoir area. About 25% of the reliable water supplycreated under the project would be needed for human andanimal needs and for the irrigation of 19,200 hectares (about47,000 acres) of land. The rest of the water would continueto flow off into the desert.

The project would also provide for land and rural roadimprovement, simple housing, electricity, as well as healthand education services in local languages as well as Manda-rin for all settlers. Local people who wished to take advan-tage of the project, including Tibetans, would have full ac-cess to social services to be provided under the project. Localfarmers and pastoralists would have the option to receive apiece of irrigated land under the project, like the settlersfrom Eastern Qinghai. The settlement area is located in DulanCounty, which is part of the Haixi Mongol and Tibetan Au-tonomous Prefecture. Dulan County, with about 23% of itspopulation Tibetan, has a higher concentration of Tibetansthan most areas in Haixi Prefecture.

With a surface area of 52,000 sq. km, Dulan County islarger than New Hampshire and Vermont added together. Itscurrent population is only about 60,000, many of whom arenomads. The project would just about double the popula-tion of Dulan County. The additional population would livein a relatively small section of the County and leave the vastmajority of the current population undisturbed. The settlerswould live in small villages and not in big towns as was latersuggested by the Inspection Panel.3 The current ethnic com-position of the County’s population is 53% Han, 23% Ti-betan, 14% Mongolian, 7% Hui, and 3% other minorities.There are at present no Tibetans living in the project settle-

ment area, narrowly defined. Ironically, among the move-insettlers would be about 3,500 Tibetans from Eastern Qinghai.Many of those do not speak Tibetan, however, and are re-garded by some as non-Tibetans for that reason.

The project would reduce the share of Han Chinese inDulan County from 53% to 48%, of Tibetans from 23% to

14%, and of Mongolians from 14%to 7%. Other minorities would in-crease their share as follows: Huifrom 7% to 22%, Salar from 1.5% to4%, and Tu from 1% to 5%.The“dilution” of the Tibetan popu-lation in Dulan County would bebalanced by an increase of the shareof Tibetans in the move-out areas.Moreover, 3500 Tibetans wouldsettle in a part of Dulan Countrywhere no Tibetans are living at

present. Since all movement of people would take place withinQinghai, the project has zero impact on the ethnic composi-tion of the population in the province as a whole.

The World Bank estimates that more than 60,000 people,including settlers and people who stay put in the move-outareas, would directly benefit from the project. Many morewould benefit indirectly. Productivity of the irrigated landin the settlement area would increase by well over 1,000%.Settlers would be able to triple or quadruple their income ina few years, receive health care and send their children tonearby schools. The economic rate of return of the Qinghaiproject, not including benefits resulting from improved healthand education, was estimated by the Bank at about 20%,which is not unusually high for this kind of project.

To reduce the risks associated with any large-scale re-settlement, the World Bank proposed and the Chinese gov-ernment agreed to begin the Qinghai project with the pilotsettlement of only 200 families and to make design adjust-ments, if necessary, on the basis of lessons learned. Twohundred families represent about the scale of a similar re-settlement project in a neighboring county that was supportedby the World Food Programme twelve years ago and thatremains successful today. About 1,000 settlers from EasternQinghai moved to Dulan County spontaneously about a de-cade ago and are doing well on irrigated land. No NGOshad ever protested against the WFP project or against twoother large and successful World Bank-supported resettle-ment projects involving minority populations in nearbyGansu and Ningxia (see footnote 2).

TIBET AND QINGHAI

Qinghai Province is somewhat smaller in area than theTibet Autonomous Region (TAR), but larger than the stateof Texas. The history of Qinghai is relevant in light of Ti-betan opposition to the Qinghai project. Tibetans currentlyaccount for 21%, and Han Chinese for 57%, of Qinghai’stotal population of a little over 5 million, which is aboutdouble the TAR population. The concentration of Tibetansin Qinghai used to be much higher many years ago. Large-scale Han settlement in Qinghai started in the 1920s andaccelerated in the 1950s under Mao. Han settlement in


Winter 2001

Qinghai is in many ways different from and much older thanHan settlement in what is now Tibet Autonomous Region.Some members of the local Han population in Qinghai areformer prisoners of the provincial Laogai prison system, or“left-over” exiles from China’s Cultural Revolution (1966-76). Dulan County, like most of Qinghai, is regarded part ofthe “Tibetan Plateau” or “Greater Tibet” by the Tibetan “gov-ernment in exile”. No foreign government recognizes Tibetas a separate state. The U.S. Congress, however, passed anon-binding resolution recognizing Qinghai as part of Ti-bet. The resolution is reflected in political maps of Chinaused by some.

The last time Tibetan rulers had full control over thearea that is now Qinghai Province was more than 1,000 yearsago. The areas had been conquered by Tibet during the sev-enth and eighth centuries A.D. Prior to that there were king-doms subordinate to China. The great Tibetan empire disin-tegrated towards the end of the first millennium, and wasnever fully restored. However, from time to time, Tibet ex-ercised jurisdiction in certain parts of the old empire (out-side TAR) until the twentieth century, and Tibetan culture insome of these areas remains strong.4 Though part of the“Tibetan Plateau”, Qinghai is very different from Tibet, how-ever, historically and in many other ways.

CAMPAIGN AGAINST THE PROJECT AND REQUEST FOR INSPEC-TION

The start of the protest campaign against this project—shortly after project negotiations between the Bank and Chinahad been completed in April 1999—was carefully timed. Itenhanced political impact. The campaign was led by ICT,which also provides guidance to other Tibetan support groupsin the U.S. and elsewhere. ICT shares offices in WashingtonD.C. with the Special Envoy of the Dalai Lama in the U.S.The campaign was supported by the Center for InternationalEnvironmental Law (CIEL), the Inner Mongolian People’sParty (a Mongolian support group based in New Jersey),several other NGOs, and by many individuals. The Presi-dent of the World Bank, James Wolfensohn, and Bank Di-rectors were inundated by thousands of letters and emailsfrom all over the world, protesting the Qinghai project andthe proposed World Bank support for it. Mr. Wolfensohnwas also urged to drop the project by 60 members of theU.S. Congress in a joint letter, and by the U.S. Secretary ofthe Treasury as the U.S. representative on the Bank’s Boardof Governors.

The ICT-led campaign appears to have been triggeredby a “News Update and Special Report” on the Qinghaiproject from the London-based Tibetan Information Network(TIN), dated April 27, 1999. The 7-page TIN report citedGabriel Lafitte, Aid and Development Coordinator for theAustralia Tibet Council, as its main source. Mr. Lafitte hadobserved World Bank missions in Qinghai. Unfortunately,the TIN report contained a number of errors and unsubstan-tiated allegations by Lafitte against the Chinese governmentand against Bank staff that may have contributed to the in-ternational furor over the project. The TIN report was ob-jective and balanced in tone and appearance, but it nonethe-less presented a misleading picture of the project and the

Bank’s role in it. The large amount of detail in the TIN re-port about internal Bank procedures and policies suggestthat the campaign against the project had been under prepa-ration for some time.

Bank staff members and managers dealing with theBank’s China program were tied up for months trying torespond to the numerous complaints, attending meetings withprotest groups and later, when the Inspection Panel (IP) hadstarted its work, responding to requests for information fromthe IP. The Chinese government set up a 24-hour hotline,both in Beijing and in Qinghai, to answer questions that wereraised by different parties.

The protests focused mainly on the proposed resettle-ment of large number of non-Tibetans in Dulan County andon the alleged environmental damage that the project wouldcause. The arguments used in most correspondence receivedby the Bank were generally the same and the language oftenidentical. Most letters received were form letters. This wasclearly a centrally led campaign. Some letters were highlyemotional in tone and reflected deep suspicions of the in-tentions of the Chinese government. Tibetan people and Ti-betan culture were allegedly being ‘swamped by hordes ofChinese’. Many letter writers were evidently not well in-formed about the project, but nonetheless protested loudly.

ICT was strongly supported by CIEL. Both agenciesclaimed that the Bank had not followed its own operationalprocedures and guidelines in the design and appraisal of theQinghai project. These policy violations were thought torepresent a “serious threat to the lives and the livelihoods ofaffected peoples in the area and will result in irreparabledamage to the environment, causing locally affected peoplematerial harm”. ICT’s formal request for inspection wasdated June 18, 1999. The request focused on complianceissues, because it was evidently well understood that theBank’s independent Inspection Panel cannot express judg-ment on the merits of a project per se. It can only determinewhether, in its judgment, the Bank has properly followed itsown project policies and procedures. When the ICT requestfor inspection was first submitted to the Panel, China madeit clear that it could not cooperate, because the request was,in China’s opinion, politically motivated and as such noteligible under Panel rules.

Many protesters also complained that the Bank wasnaively allowing itself to be used as a tool by the Chinesegovernment to legitimize the dilution of Tibetan culture andidentity. Protesters raised doubts about the Bank’s claim thatmigration from the move-out area would be voluntary. Itwas claimed that prison labor would be used during projectconstruction (which is contrary to Bank rules) and that theproject would benefit a nearby Laogai prison camp and/orgovernment mining projects elsewhere in Qinghai.

THE BOARD DECISION OF JUNE 24, 1999 AND THE

MANAGEMENT’S RESPONSE TO THE REQUEST FOR INSPECTION

Protests and request for inspection notwithstanding, theBank’s Board of Executive Directors approved WPRDproject on June 24, six days after receipt of ICT’s requestfor inspection. The Board stipulated, however, that therewould be no disbursements for the Qinghai component of


In its request for inspection [ofaspects of the Qinghai project], theInternational Campaign for Tibet

claimed to represent affected peoplein the project areas who could not

speak for themselves....

the project pending review of the IP report that was for-mally authorized by the Board on September 9. Only theU.S. and Germany voted against the project at that Boardmeeting.5 Just prior to the meeting, Bank management hadsent a special team of very experienced Bank staff who hadnot been directly involved in the Qinghai project, to theproject areas to investigate the claims made by ICT, CIELand others. The team reported that the allegations were notsufficiently robust to justify further delay in Board consid-eration. It was in part on the basis of this report that Bankmanagement decided to go forward with the project, subjectas always, to Board approval.

In its request for inspection ICT claimed to representaffected people in the project areas who could not openlyspeak for themselves, because of China’s repressive politi-cal climate. ICT had received letters from people in Qinghaiwho opposed the project mainly onthe ground that it was perceivedas a threat to Tibetan culture andinterests. Resentment againstChina remains strong among Ti-betan people and Tibetan supportgroups outside China. Unfortu-nately the Qinghai project, whichwas otherwise a promising anti-poverty project, became a light-ning rod for those sentiments andwas seized upon by agents suchas ICT as an instrument to further perceived Tibetan as wellas their own institutional and political interests.

ICT’s legal representation claim presented an awkwarddilemma for the Bank. China was for many years the Bank’slargest customer and China’s reputation as a high qualityborrower with a strong commitment to poverty reductionwas not in doubt. Under Panel rules, the Board can onlyaccept representation claims of the kind made by ICT if therepresentative produces satisfactory evidence that the af-fected people cannot openly speak for themselves. In aneffort to diffuse the crisis, Management inquired if Chinawould be willing to withdraw its request for Bank financingor use the concessionary funds for another anti-povertyproject. Characteristically, China refused on grounds of prin-ciple. To avoid the awkward dilemma presented by ICT’srepresentation claim, the Board decided to ignore ICT’s re-quest and to instruct the Panel on its own authority to con-duct an investigation. The Board must have been sufficientlyimpressed by the protest campaign to feel that an investiga-tion was warranted.

The Board’s terms of reference for the Panel fully re-flected ICT’s request for inspection, even though the origi-nal request was not mentioned. On that basis, China wasable to agree with the inspection and offered full coopera-tion with the inspection team. At the same time China in-vited foreign journalists to come to the project areas to seefor themselves, before, during, or after the inspection. Manydid.

After receipt of ICT’s inspection request, the Bank’sManagement prepared a detailed report for the Board, re-sponding to all allegations and concerns expressed in therequest. The report, dated 19 July, 1999, essentially con-

firmed the conclusions of the special high-level staff mis-sion to Qinghai just before the Board meeting of June 24. Itconceded though, that Bank staff responsible for project ap-praisal could have done certain things better, that some re-finements in project design could and would be made, andthat the Bank should have provided more timely and morecomplete information on the project to the general public.Management firmly rejected the thrust of ICT’s claims, how-ever. It confirmed that Bank policies and procedures hadessentially been followed. It reaffirmed its belief that thiswas a sound anti-poverty project that would bring consider-able benefits to the poor target population while adequatelyprotecting the interests of people in the move-in area andthat the project would not be harmful to the local environ-ment.

The report also confirmed that resettlement was volun-tary, that prison labor would defi-nitely not be used in project con-struction, and that the project’s“B”rating6 for environmental as-sessment purposes was justified,although this was essentiallythought to be a “question of judg-ment”. It also disagreed with ICT’sview that a separate “IndigenousPeoples Development Plan” shouldhave been prepared for each of theethnic minorities affected by the

project. Citing Bank guidelines, Bank Management arguedthat, since the majority of project beneficiaries belong toethnic minorities, the project itself is the plan, making sepa-rate plans for each minority unnecessary. Management stoodby its opinion that the Qinghai anti-poverty project had beenreasonably well prepared, and that it would adequately pro-tect the interests of affected people in the move-in area.

THE INSPECTION PANEL AND ITS REPORT

The World Bank’s independent Inspection Panel wasestablished in 1994 following the upheaval surrounding theNarmada project in the early 1990s7 and lessons learnedfrom the Wapenhans report.8 The World Bank is the firstand so far the only multilateral organization to have such aPanel. In the original concept of the Panel it was meant toserve as a kind of “ombudsman” on the quality of Bank-supported projects and their implementation. This conceptwas later—but well before the Qinghai project—narrowedat the insistence on Part II member countries who did notwant the Panel to express judgment on the quality of theirprojects or policies. The current Panel concept is focusedexclusively on the inspection of compliance with Bank poli-cies and guidelines.

The Qinghai project was the first occasion for the Panelto conduct a full-scale inspection. The Panel consists of threerespected international figures appointed by the Board. Thechairman of the panel is a well-known Canadian environ-mental expert. The other two members are a Ghanaian bi-ologist and a Dutch parliamentarian/community developmentexpert. Requests for inspection may be submitted by two ormore people affected by a World Bank-supported project or


Winter 2001

their representative, by technical experts, or by members ofthe Board. The Panel is assisted by consultants.

Given the rather severe limitations imposed on the scopeof Panel investigations, it is not surprising that in the case ofthe Qinghai project, the Panel only looked at complianceissues. The IP report does not confirm or deny the claim byICT and other protesters that the project would risk disasterfor the environment or Tibetan people in the move-in area.In some sense, the narrow “legal” role of the Panel defeatsthe broader objective for which it was originally created.

The panel’s 160-page report came out at the end of April2000. Because of its technical nature, it diffused somewhatthe sensitive Tibetan issue, but the report was nonethelessvery critical of the Bank. It essentially agreed with the alle-gation that several important Bank procedures and policieshad been violated. The panel’s main conclusions were that:

1. The project area had been defined too narrowly bythe Bank and, as a result, “the Assessments fail to addressmany significant social and environmental impacts of theProject, including impacts on potentially affected membersof minority nationalities.” Many additional assessments andstudies were deemed necessary.

2. Surveys used in the move-out area had not beenstrictly confidential and people in both the move-out andmove-in areas had been insufficiently informed and consultedabout the project. Moreover, expressed opinions of thosewho were consulted could not necessarily be trusted, be-cause “full and informed consultation is impossible if thoseconsulted even perceive that they could be adversely affectedfor expressing their opposition to, or honest opinions about,a Bank-financed project.” The Panel indicated a “need forfar greater efforts to obtain public consultation under ad-equate conditions.” This conclusion was based on the Panel’sobservation of local opposition to the project.

3. Insufficient efforts had been made by the Bank tostudy possible alternative ways of achieving project objec-tives. For example, through alternative investment plans,alternative sites, alternative project designs, or alternativedevelopment plans for the indigenous peoples affected onthe move-in area.

4. The environmental assessment that had been madewas inadequate in many respects and the project should havebeen rated “A”, implying the need for supplementary envi-ronmental studies and reviews. (For an explanation of envi-ronmental ratings, see footnote 6). The Panel also found thatthere was a need for “considerably more detailed analysisof the social and environmental problems of the Move-outvillages and how these will be addressed by the Project.” Inthe paragraphs on energy, the Panel observes that houses tobe provided in the settlement area will have two to four lightbulbs, but no power points for heating or domestic appli-ances. Because of the scarcity of biomass or other suitablefuels in the area, at least until agricultural production underthe project comes on stream, the Panel concluded that “at aminimum, the potential advantages as well as the cost impli-cations of electric heating should have been examined.”

5. Bank Management is not in full compliance withits policy on pest management, because the project docu-ments do not specify the details of the integrated pest man-

agement program for the project which the staff had assuredthe panel would be provided.

6. That a broader view should have been taken “ofthe fate of the various ecosystems” in the Qinghai-TibetanPlateau, not just in or adjacent to the project area. This im-plies the need for biodiversity and wildlife studies in a largearea. With apparent endorsement, the Panel cites the opin-ion of the International Crane Foundation that “if the WorldBank decides to go forward with the Dulan County project,we believe that it is critical that a baseline study on Black-necked Cranes be conducted.” The Foundation based thisopinion on a report that local informants to “two scientificexpeditions that passed briefly through the area in 1979”had told the scientists that the Black-necked Crane bred inthe local marshes.

7. Bank Management’s opinion that separate Indig-enous Peoples Development Plans for each of the ethnicminorities affected by the project were not required in thiscase, “because the project itself is the Plan” (Management’sopinion), is unacceptable.

8. Bank Management appears to have underestimatedthe number of people involuntarily affected by the projectin the move-in areas, because some pastoralists in the re-gion who, according to the Panel, sometimes use the landfor grazing, had not been included. Moreover, no allowancehad been made for the possible inconvenience to existinglocal villages that might result from the 85 km of irrigationcanals that would be constructed under the project. (ThePanel report notes, however, that the latter omission wasdue to the fact that the exact routing of the irrigation canalshad not been determined at the time of project appraisal bythe Bank.)

9. The method of compensation offered to affectedpastoralists in the move-in area—they have the option toreceive other pasture land or irrigated plots under theproject—is inadequate. The reason for this complaint is that,unlike the settlers from East Qinghai, who are already farm-ers and have the option under the project to return to theiroriginal homes within two years if things do not work outfor them in the settlement areas, “converted” local pastoralistsdo not have the option to revert to their old lifestyle as herd-ers. The Panel also finds that the basis for compensationoffered to affected pastoralists was insufficiently studied.

10. The quality and the timeliness of public informa-tion on the project provided during the preparatory stageswere inadequate, as had already been admitted by the Bankmanagement.

In the introductory chapter, the Panel notes that there isconsiderable uncertainty and disagreement within the Bankon the precise interpretation on key project policies and pro-cedures. The Panel concluded, and many staff agreed, thatdifferences in staff opinion are so significant that this “raisesserious questions about the ability of the Bank Managementto apply them with any reasonable degree of consistency.”This is indeed a problem in the Bank. Efforts to reduce thescope for confusion and disagreements within the Bank onthe interpretation of project policies and guidelines areneeded. Given the infinite variety of project and country cir-cumstances, this is a major challenge. Complete black-and-


white certainty for all project situations cannot be achieved,but the Bank can do better on this score than it has in thepast.

One of the consultants engaged by the IP for this par-ticular investigation, an American political scientist, pub-licly disagreed with the main thrust of the IP’s conclusionsand stated that the project should go forward with Bank sup-port. Bank staff members who had worked on the projectfelt that the IP report reflected many errors in judgment andfact. Most disagreed strongly with the main implication ofthe IP report, namely that the project had been so poorlyprepared and was so risky that major revisions (based onadditional studies) would be needed before it could proceed.Many staff would have welcomed an opportunity to discussa draft report with the Panel and complained about Panelprocedures which they saw as less than transparent.

MANAGEMENT AND STAFF RESPONSES TO THE IP REPORT

Most staff members conceded that a number of smallimprovements in project design should be made, as had al-ready been suggested in the Management report of 19 July1999. Some agreed that the environmental assessments thathad been prepared for the project were indeed rather thinand that the project should have been rated “A”. A largenumber of experienced Bank staff, however, felt negativelyabout the IP report. An unpublished internal staff report re-sponding point-by-point to the IP report was intensely criti-cal and identified many factual errors and misunderstand-ings by the Panel. Some errors and misunderstandings werethought to be so serious so as to invalidate several of thereport’s main conclusions.

For example, the staff pointed out that, contrary to astatement in the IP report that Mongolian pastoralists peri-odically passing through the project area with their herdshad not been consulted, they had in fact been consulted byBank staff, and that these people had expressed strong inter-est in joining the project as beneficiaries. Another responseconcerns the alleged absence of studies on possible projectalternatives. The Bank’s project team maintained that Chinahad in fact conducted serious studies of possible project al-ternatives over a period of years. The information had notbeen included in project documents as there seemed to beno purposes in that.

Although staff generally agreed with the introductorychapter in which the Panel complains about the confusionwithin the Bank on the interpretation of policies and guide-lines, they found the Panel’s interpretation of its own termsof reference excessively narrow and legalistic. It was feltthat if Panel criteria used for the inspection of the Qinghaiproject were to be applied across-the-board, few if any Bankproject would pass muster. Put it differently, if Panel require-ments were to be met, Bank operational costs would gothrough the ceiling and preparation time would become solong as to make it essentially impossible for the Bank tosupport this kind of anti-poverty projects anywhere.

The Chinese government was extremely dissatisfied withthe IP report and felt that the Panel had misjudged or misun-derstood much of the information that it had provided atconsiderable cost of time and effort.

The unpublished internal staff report did not form thebasis for the official Management response to the IP reportsubmitted to the Board on June 19, 2000. According to Bankrules, the Panel has the last word. The Panel reports to theBoard and its conclusions are final. They cannot be appealedor rejected by Management. In its final recommendations tothe Board, Management stood by the project, but agreed toreclassify the project as “A”. It recommended moreoverthat:

1. A number of supplemental and deeper environmen-tal impact studies would be conducted.

2. Additional consultations with affected peoplewould be undertaken, with special attention to be given tothe confidentiality and integrity of the process.

3. Separate Indigenous Peoples Development Planswould be prepared for several, but not all, of the differentethnic groups affected. Reports on these plans would be madeavailable to each group in their own language.

The Chinese government reluctantly agreed to acceptthese recommendations and the extra work and costs thatacceptance by the Board would entail. Management did notpropose to undertake additional studies of project alterna-tives on the ground that adequate studies had already beenconducted. Management agreed with the Panel that infor-mation on these studies should have been included in theproject documents. The Management report also pointed outthat implementation of its recommendations to the Boardwould cost no less than $2,125,000 and would take 12 to 15months. Acceptance and implementation of all Panel rec-ommendations would have cost over $3 million and wouldhave taken 15 to 18 months. For comparison, the Bank’soriginal operational budget for the Western Provinces Pov-erty Reduction Project, of which the Qinghai componentaccounted for about one third, was about $0.5 million. In-cluding expenditures financed from supplementary TrustFunds, the total cost of preparing and appraising the Qinghaicomponent prior to Panel inspection had been under $0.3million, which, in the World Bank, is about normal forprojects of this kind.

THE BOARD MEETING OF JULY 6, 2000

Management’s recommendations were broadly accept-able to the Board, except for the U.S. and Japan who votedagainst the project. The negative Japan vote was an unpleas-ant surprise for China and was seen as a political gesture.Germany had apparently modified its position and was will-ing to go along with other European members, who sug-gested that Management’s recommendations should be ac-cepted, but that the project should be re-submitted for Boardapproval after the additional studies and assessments hadbeen completed. This proposal was not acceptable to Chinaon the ground that the project had already been approved bythe Board a year earlier; only disbursements had beenblocked pending an investigation by the IP. In China’s view,all that was required, upon completion of the additional stud-ies and assessments, was a recommendation from Manage-ment to the Board to lift the disbursement restriction.


Winter 2001

The Bank should not shy away fromsupporting well-designed resettlement

projects if they are the best way tohelp target populations escapehopeless poverty, difficult and

controversial as such a policy may be.

China and the Bank had already incurred substantialadditional expenditures responding to the protests and re-quests for supplementary information from the IP. BecauseChina did not want the Qinghai project to become a perma-nent target for international protests and felt that it had donemore than enough to accommodate the concerns that hadbeen expressed, it decided “enough is enough”, and with-drew its request for Bank financing. China had come to theconclusion that the Bank could not be an effective partner inthis project and simply gave up.

Formally, this was the end of the story. But the episodeleft many in the Bank and in China deeply frustrated. Theprotest campaign and the IP reporthad made it effectively impossibleto support what was essentiallygood anti-poverty project or couldhave easily been turned into agood project. Some staff felt thatthe Bank had been naïve andshould never even have contem-plated supporting a project in suchcomplex and controversial politi-cal circumstances. Others felt thatthe Bank deserved to be put downby the IP, because the environmental assessments had in-deed been marginal at best. Almost everybody was shocked.A thing like this had never happened before.

CONCLUSIONS AND ISSUES

1. It is hard to accept ICT’s claim that the Qinghaiproject was “a serious threat to the lives and livelihoods ofaffected people in the area and will result in irreparable dam-age to the environment, causing locally affected people ma-terial harm”. If not preposterous, the allegation is at leastgrossly overblown. It can in my opinion only be explainedin terms of political motivations that contributed to the cam-paign. The project’s impact on the economic well-being ofthe relatively few Tibetans living in the project area, broadlydefined, would in all likelihood be positive, through im-proved water supply and other infrastructure, health andeducation services, and income growth. What is at issue hereis in my view not in the first place the project, but the broaderissue of China-Tibet relations. The project was a lightningrod. The campaign against it also served political interests.Suppose the poor people from Eastern Qinghai had a for-eign lobby to launch a campaign on their behalf, like ICTdid on behalf of the Tibetan cause….Qinghai is not Tibet.

2. It is also hard to see how the project would under-mine Tibetan culture in Dulan County, the main concern ofmany protesters. Surely, development does not leave projectareas and affected populations unchanged, but change doesnot have to be equated with cultural damage. Even if therewere to be changes in Tibetan culture as a result of the project,why is that necessarily a bad thing? Such changes have to beweighed against the economic benefits that the project wouldbring to the area and its contribution to poverty reduction inQinghai Province. They should also be weighed against thegreater concentration of Tibetans in move-out areas thatwould result from the project and the fact that some 3500

Tibetans from Eastern Qinghai would move to an area ofDulan County where no Tibetans live at present.

3. Bank staff should have rated the Qinghai project“A” for environmental assessment purposes from the begin-ning. Also, more ex-ante studies of various minority groupsin the move-in areas should have been undertaken. WorldBank staff should have been more alert to the political di-mensions of this project. A more sensitive World Bank is abetter World Bank, provided such sensitivity does not standin the way of supporting poor minorities who need help buthave nowhere else to turn.

4. The World Bank’s internal budget procedures shouldbe modified so as to ensure that pro-fessional judgments regarding thekind and extent of environmentaland social assessments necessaryfor project preparation and ap-praisal purposes are budget-neu-tral. That is not the case at present.A decision to rate a project “A”rather than “B” does not give theproject team automatic access to ad-ditional resources.

5. An independent inspectionPanel is an important instrument for an institution like theWorld Bank, provided it can meaningfully inspect the qual-ity and likely effectiveness or harmfulness of a project. APanel that is only empowered to look at compliance issues istoo narrow in scope. Professional biases may be unavoid-able in any Panel, but such biases risk becoming strongerwhen the terms of reference are too narrow. In my opinion,the IP gave its terms of reference in this particular case anarrow, even legalistic interpretation. Several of the Panel’srecommendations seem unnecessary or even questionable.The studies regarding electric heating of settler houses andthe Black-necked Crane illustrate a tendency for perfection-ism that seems to be strangely at odds with the reality ofpoverty reduction efforts in Qinghai.

6. Since no Panel is infallible, a prior discussion ofPanel recommendations with senior Bank staff would beadvisable. Even the U.S. Supreme Court holds public hear-ings before deciding a case. In the case of the Qinghai project,Panel procedures have contributed greatly to tensions withinthe Bank.

7. It is strange that the IP does not have to considertrade-offs between the costs and benefits of additional as-sessments and studies it recommends. This may explain atendency towards unrealistic perfectionism in parts of theIP report. Bank staff and borrowers have to make trade-offscontinuously in the real world and they have to work withina budget. It would have cost the Bank (i.e. its Part II share-holders) more than ten times the original cost of projectpreparation and appraisal if all panel recommendations hadbeen implemented.

8. Bank staff and Management had good reasons tobelieve that the Qinghai project as originally approved bythe Board on June 24, 1999 (subject to a temporary suspen-sion of disbursements) was essentially a good anti-povertyproject, and that it would be well implemented. There is noevidence of insidious intentions behind the project. The


World Bank acted in accordance with its mandate and prin-cipal institutional purpose. The experience gained from atleast half a dozen similar projects elsewhere in China (ofteninvolving minorities, though not Tibetans) and earlier,smaller projects of this kind in nearby areas in Qinghai, hadalso been taken into account.

9. During the past six and a half years, the World Bankhas actively pursued a policy of much greater openness. Fewmultilateral agencies have done more in this regard. TheWorld Bank is the first and so far the only multilateral agencyto establish an independent Inspection Panel. This wasneeded to make the Bank more responsive and more account-able. However, there is a limit to how responsive the Bankcan be to outside agencies with a political agenda, withoutcompromising the interests of its borrowers or its own po-litical neutrality.

10. Large-scale resettlement of people for developmentpurposes, especially minorities, is always difficult and oftencontroversial, even when the resettlement is voluntary, as inthe case of the Qinghai project. In-situ, endogenous devel-opment for poverty alleviation is nearly always preferable,if it can be achieved. There are situations, such as the caseof the desperately poor living in the overcrowded, barrenmountains of Eastern Qinghai, where resettlement is the onlyviable option. There are not many agencies in the world withthe resources and the experience to design and support suchprojects. The Bank should not shy away from supportingwell-designed resettlement projects if they are the best wayto help target population escape hopeless poverty, difficultand controversial as such a policy may be.

11. Protecting the Bank’s statutory “political neutral-ity” has always been a struggle. Situations in which share-holders - Part I and Part II countries alike- feel inclined totake political positions on project proposals or Bank poli-cies cannot be avoided. The responsibility for protecting theinstitution’s political neutrality is shared by Management andBoard. It falls more heavily on big shareholders than on smallones. Unfortunately, some of the Bank’s largest sharehold-ers, including the U.S., seem to have lost interest in the prin-ciple of political neutrality. Once the Bank is perceived tobe used by major shareholders as an instrument to serve theirpolitical agendas, the nature of the institution changesquickly. The same happens when Management or sharehold-ers permit outside agencies with a political agenda to havetoo much influence on the institution. While I recognize thatthe Bank has to operate in a political world, a renewed dedi-cation to the principle of its political neutrality is in my viewurgently needed

ENDNOTES

1 In World Bank parlance, Part II members are the poor andmiddle-income countries who borrow from the Bank. Theycover the Bank’s administrative costs through loan charges.Part I members are the rich countries who do not borrowfrom the Bank and who contribute to the Bank’s conces-sionary credit program IDA (International Development As-sociation).2 Over the past 20 years, the Bank has supported about 30

large projects in China directly aimed at poverty alleviation.Five of those are similar to the Gansu and Inner Mongoliacomponents of WPRP and 2 are virtually identical in con-cept to the Qinghai project, including the resettlement ofminority populations, but not involving Tibetans. MostBank-supported anti-poverty projects in China have enjoyedhigh success ratings, including the two that involved large-scale resettlement of minority and mixed minority/Han popu-lations in Gansu and Ningxia. Since China resumed member-ship in the World Bank in May 1980, the Bank has supported226 projects for a total of more than $ 34 billion.3 Melvyn C. Goldstein, The Snow Lion and the Dragon.China, Tibet and the Dalai Lama. University of CaliforniaPress 1997.4 Under the Human Rights Section of the 1977 InternationalFinancial Institutions Act (as amended), as applied to Chinaby the U.S. Administration since Tiananmen, the U.S. repre-sentative on the World Bank’s Board must oppose or ab-stain from all projects for China except those that serve ba-sic human needs. Since the Qinghai project presumablyqualifies as a “basic human needs” project, U.S. oppositionappears to have been discretionary. Germany’s Green coali-tion government appears to have modified its position later;at the final Board meeting on July 6, 2000 it accepted theproject in principle subject to further studies and assess-ments and final Board approval after completion of the stud-ies and assessments.5

The Western Poverty Reduction Project (of which theQinghai project is a component) was rated “B” [is this an Ato F scale: describe the significance of the difference be-tween an A and a B rating], because staff responsible for theproject believed that the project was unlikely to have “sig-nificant adverse impacts that may be sensitive, irreversibleand diverse”. Diverging opinions expressed in the Bank atthat time did not prevail. “A” projects require much moreextensive environmental assessment and review than “B”projects. Even “B” projects, however, are subjected to asubstantive environmental assessment, as the Qinghaiproject was.6 The 1992 Narmada report by an ad-hoc independent panelwas triggered by complaints by and on behalf of poor villag-ers in India who did not receive adequate support for theirinvoluntary resettlement to accommodate a reservoir thatwas part of a Bank-supported dam/irrigation/resettlementproject. The report was very critical of the Bank and of theIndian government. The Bank withdrew its support from theproject, but the Indian government continued implementa-tion.7 This 1992 report aimed at assessing the quality of theWorld Bank’s project portfolio and at identifying reasonsand cures for systemic problems. It was produced by anexpert team under the direction of a retired World Bank VicePresident, Willy Wapenhans.


Winter 2001

THE US-VIETNAM TRADE AGREEMENT

BY TAI VAN TA

Tai Van Ta is a graduate from Saigon (Vietnam) LawSchool (LL.B.), University of Virginia (M.A. andPh.D.) and Harvard Law School (LL.M.). Since 1975,he has been a research associate, and at timesadjunct lecturer of Vietnamese law at Harvard LawSchool, and in that capacity, he has publishedbooks and articles on Vietnamese law, among themThe Vietnamese Tradition of Human Rights (1988)and Investment Law and Practice in Vietnam (1990)(co-authored with Prof. Jerome Cohen). He hasbeen a practicing attorney in Massachusetts since1986.

On July 13, 2000, in remarks from the South Lawn of the WhiteHouse, President Clinton hailed the signing of a trade agreement between the United States and Vietnam as “another his-

toric step in the process of normalization, reconciliation and healingbetween our two nations.” In November 2000, he became the first sit-ting U.S. President to visit Vietnam since President Nixon arrived inSouth Vietnam more than 30 years ago. By making this visit, Clintonwill be likely to go down in history as the U.S. president to have closedthe last symbolic chapter of the Vietnam War. Moreover, with the U.S.-Vietnam trade agreement signed after the U.S.-China trade agreement,he will leave a legacy of expanding relations with two large communistcountries, facilitating China’s and Vietnam’s eventual admission intothe World Trade Organization and integration into the world commu-nity.

This article will illuminate: 1) how the U.S.-Vietnam Trade Agree-ment developed as a logical step in the context of American-Vietnam-ese relations; 2) how its provisions promote American interest; 3) howits provisions promote Vietnamese interest and simultaneously forceVietnam to face up to its economic weaknesses; and 4) why Vietnamwas postponing its signing of the Agreement for nearly a year and theprospect for implementation of the Agreement.

I. THE TRADE AGREEMENT IN THE PROCESS OF NORMALIZATION AND RECON-CILIATION BETWEEN THE U.S. AND VIETNAM.

The process of normalization has been accomplished in a step-by-step manner, leading to the bilateral trade agreement. During the Bushadministration, the U.S. issued a so-called “road map”, according towhich Vietnam had to take a number of steps for the U.S. to reciprocatein the process of normalization. One condition was Vietnam’s with-drawal from Cambodia, which was accomplished in 1989. Followingthat, Vietnam took another required step by seeking admission intoregional organizations, showing that it intended to play a positive rolein regional security and economic liberalization. Accordingly, in 1993,President Clinton began a policy of normalization with Vietnam bycommencing American support of international lending to Vietnam andallowing U.S. firms to join in development projects. At the same time,the U.S. was able to secure full cooperation from Vietnam in account-ing for the POW-MIAs of the War (the highest American priority in therelations between the two countries), with 39 joint field activities withVietnam, repatriation of 288 possible sets of remains, and identifica-tion of the remains of 135 unaccounted for American servicemen.

Then, in 1994, the U.S. lifted the economic embargo to allow U.S.firms to export to Vietnam and invest in business opportunities there.A year later, the U.S. normalized diplomatic relations with Vietnamand later exchanged ambassadors with Hanoi. This policy of normal-ization has led to further progress in other fields such as resettlement ofhundreds of thousands of Vietnamese refugees and immigrants in theU.S. (closing yet another painful chapter for Vietnamese families whowere torn apart during and after the War); enhanced cooperation incombating narcotics trafficking; and promotion of human rights through


dialogue that has led to the release of prisoners and addi-tional improvements in the human rights situation in Viet-nam.

Vietnam opened its economy and moved toward inte-gration in the world community by joining the Associationof Southeast Asian Nations (ASEAN) in 1995 and the AsiaPacific Economic Cooperation (APEC) forum in 1998. Fo-cusing on U.S.-Vietnam trade relations, the White Housestated that the decision to pursue the trade agreement wasmade after Vietnam had established a record of cooperationin accounting for the POW-MIAs. In 1998, the U.S. grantedthe first waiver of the requirement of Jackson-Vanick Amend-ment, extending U.S. export promotion and investment sup-port programs to Vietnam. Then, in the following year, theU.S. and Vietnam reached an agreement in principle on keyprovisions of the trade agreement. Finally, in 2000, the U.S.and Vietnam reached final agreement on the bilateral tradeagreement. President Clinton described both the economicand political implications of the trade agreement as follows:

The Agreement we signed today will dramaticallyopen Vietnam’s markets on everything from agri-culture to industrial goods to telecommunicationsproducts, while creating jobs both in Vietnam andin the United States. With this agreement, Vietnamhas agreed to speed its opening to the world; tosubject important decisions to the rule of law andthe international trading system; to increase the flowof information to its people; by inviting competi-tion in, to accelerate the rise of a free marketeconomy and the private sector within Vietnam, it-self. We hope expanded trade will go hand in handwith strength and respect for human rights and la-bor standards. For we live in an age where wealthis generated by the free exchange of ideas and sta-

bility depends ondemocratic choices.

The President empha-sized the impact of thegreement on reconciliationbetween the two countries,stating: “This agreement isone more reminder thatformer adversaries cancome together to find com-mon ground in a way thatbenefits all their people, tolet go of the past and em-brace the future, to forgiveand to reconcile.”

Fifty American corpo-rate executives joinedPresident Clinton during histrip to Vietnam. They par-ticipated in a business fo-rum in Ho Chi Minh Cityand some signed ten busi-ness contracts involvingsignificant capital values.The President also an-

nounced a US$200 million fund for OPIC program of in-vestment guarantees and loans in Vietnam.

II. HOW THE PROVISIONS OF THE BILATERAL TRADE AGREE-MENT PROMOTE AMERICAN INTERESTS

The agreement has five major sections: equal marketaccess for agricultural and industrial goods, intellectual prop-erty rights protection, market access for services, investmentprotection, and transparency by publishing and making avail-able laws and regulations. The preamble to the bilateral tradeagreement states that the U.S. and Vietnamese Governmentsdesire to develop mutually beneficial and equitable economicand trade relations on the basis of mutual respect for theirrespective independence and sovereignty; and that they ac-knowledge the adoption of international trade norms andstandards by which the two parties will aid in the develop-ment of mutually beneficial trade relations.

However, the preamble also notes that Vietnam is a de-veloping country at a low level of development, is in theprocess of economic transition, and is taking steps to inte-grate into the regional and world economy by joiningASEAN, the ASEAN Free Trade Area, APEC forum, andworking toward membership in the World Trade Organiza-tion (WTO).

Although the preamble announces the principle of mu-tually beneficial and equitable relations, the provisions inthe five major sections of the agreement mostly benefit theUnited States. On the one hand, Vietnam’s low level of de-velopment does not enable it to benefit much from the pro-visions on market access for goods, intellectual propertyrights protection, investment protection, and transparencymeasures. On the other hand, because the United States al-ready adheres to international trade norms and standards of


Winter 2001

the World Trade Organization, one receives the impressionwhen reading the provisions of the agreement, especially asexplained by the White House, that it mainly imposes obli-gations on Vietnam to implement the provisions of the agree-ment and to comply with the international trade norms andstandards.

However, the Agreement does recognize Vietnam’sweak economy and the country’s need to reserve the right toadopt and maintain many exceptions to national treatment.

1. DRAMATIC NEW MARKET ACCESS FOR AGRICULTURAL AND

INDUSTRIAL GOODS FOR AMERICAN CITIZENS AND COMPANIES.

Upon the entry into force of the agreement, Vietnamagrees to allow all Vietnamese enterprises, and, within threeto seven years, U.S. persons and firms, the right to importinto and export from the borders of Vietnam without restric-tion. Vietnamagrees to givemost favored na-tion treatmentand nationaltreatment to U.S.citizens and firmsin all matters re-lating to cus-toms duties,methods of pay-ment for importand export, laws,rules and for-malities, taxesand fees.

Vietnam hasagreed to lowertariffs sharply inthree years onthe full range ofU.S. industrialand agricultural exports, and to phase out in three to sevenyears all non-tariff measures (such as quantitative restric-tions), and to adhere to the World Trade Organization stan-dards in customs duties, import licensing, state trading, tech-nical standards, and sanitary measures.

Vietnam also gives to U.S. citizens and firms nationaltreatment in access to competent courts and administrativebodies as well as arbitration under internationally recognizedarbitration rules, including UNCITRAL rules.

2. INCREASED INTELLECTUAL PROPERTY RIGHTS PROTECTION

Intellectual property rights refer to copyrights and re-lated rights, trademarks, patents, layout designs of integratedcircuits, encrypted program-carrying satellite signals, con-fidential information (trade secrets), industrial designs andrights in plant varieties.

Vietnam agrees to adopt the WTO standards for intel-lectual property rights protection within twelve months fortrademarks and patents, within eighteen months for copy-rights and trade secrets, and within thirty months for

phonograms/satellite signals respectively; or, if possible, toimmediately comply with this agreement. Vietnam agrees toabide by the substantive economic provisions of the variousinternational conventions, such as the 1971 Geneva Con-vention for the Protection of Phonograms, the 1971 BerneConvention for the Protection of Literary and Artistic Works,the 1967 Paris Convention for the Protection of IndustrialProperty, the 1974 Convention on Program-carrying Satel-lite Signals, the 1989 Treaty on Intellectual Property in Re-spect of Integrated Circuits.

Vietnam accords to U.S. persons and firms national treat-ment with regard to the acquisition, protection, enjoyment,and enforcement of all intellectual property rights and anybenefits derived therefrom.

As there has been rampant infringement of U.S. indus-trial property rights in Vietnam in the areas of computer pro-grams and audio-visual recordings, the agreement has paid

particular attention tothese property rightsand stipulates thatcomputer programsand sound recordingsare literary workswithin the meaning ofthe Berne Convention.

As for enforce-ment, Vietnam shallprovide procedures inits domestic law thatpermit effective actionagainst infringement,expeditious, and notunnecessarily compli-cated or costly proce-dures to prevent viola-tions, as well as sub-stantial remedies to de-ter future infringement(damages, restitution

of profits, and destruction of infringing goods, and alsocriminal penalties for willful infringement). Decisions in judi-cial and administrative enforcement proceedings must be inwriting, state the reasons and evidence therefor, and mustbe made available without delay. Final administrative deci-sions must be reviewed by a judicial authority.

The U.S. is so determined to protect its intellectual prop-erty that it agrees to provide Vietnam with technical assis-tance to strengthen Vietnam’s regime for the protection andenforcement of intellectual property rights.

3. MARKET ACCESS IN A BROAD ARRAY OF SERVICE SECTORS

Vietnam accords immediately and unconditionally mostfavored nation treatment to U.S. persons and firms. Viet-nam agrees to grant national treatment to U.S. persons andfirms, and to permit them to enter within three to five yearsits markets in the full range of service industries, includingfinancial services (insurance and banking), telecommunica-tions, distribution, audio-visual, legal, accounting, engineer-ing, computer and related services, market research, con-


By implementing the Trade Agreement,Vietnam may be able to recapture theconfidence of foreign investors, whichhas been badly shaken in recent years.

struction, education, health and related services, and tour-ism.

The agreement incorporates the Annexes to the WTOGeneral Agreement on Trade in Services (GATS): Annexon Financial Services, on Movement of Natural Persons, onTelecommunications and Telecommunications ReferencePaper.

All discriminatory measures must be eliminated and aparty cannot apply licensing and qualification requirementsand technical standards that nullify or impair the specificcommitments of free trade in services. Nor shall a party adoptmeasures on limitations on the number of service providers,on the total value of service transactions, on the total num-ber of natural persons that may be employed in a particularservice sector or that a service supplier may employ, or onthe type of legal entity or joint venture through which a ser-vice supplier may supply a service, or on the participation offoreign capital in terms of maximum percentage limit on for-eign shareholding.

Judicial, arbitral and adminis-trative tribunals or procedures shallbe established to provide promptreview of, and appropriate remediesfor, administrative decisions affect-ing trade in services.

4. DEVELOPMENT OF INVESTMENT RE-LATIONS

Investment has many forms: enterprise, stocks andbonds, contractual rights (construction, management, or pro-duction sharing contracts), tangible property and intangibleproperty (leases, mortgages, intellectual property rights, li-censes, permits, etc.).

Vietnam, whether represented by the Vietnamese gov-ernment or a state enterprise, accords to U.S. investmentsnational treatment, most favored nation treatment, and fullprotection and security required by customary internationallaw. However, Vietnam, as well as the U.S., may adopt ex-ceptions in certain sectors, as provided in Annex H, below.Vietnam agrees to protect U.S. investments from expropria-tion (except for cases of public purpose, upon payment ofprompt and adequate compensation, in accordance with dueprocess of law). It will eliminate local content and exportperformance requirements and phase out its investment li-censing regime for many sectors.

Vietnam permits the entry, sojourn, and employment ofalien managers, executives, and persons of specializedknowledge.

For investment dispute settlement, the agreement pro-vides for consultation and negotiation, administrative tribu-nals and competent courts, and binding arbitration at theInternational Center for Settlement of Investment Disputes,in accordance with UNCITRAL Arbitration Rules and theUN Convention for the Recognition and Enforcement of For-eign Arbitral Award.

5. TRANSPARENCY PROVISIONS AND RIGHT TO APPEAL

To alleviate concerns about bureaucratic obstruction-

ism and corruption in Vietnam, the U.S. requires that Viet-nam adopt a fully transparent regime with respect to each ofthe four substantive areas mentioned above (market accessfor agricultural and industrial goods, intellectual propertyprotection, service industry market access, and investmentrelations), by publishing and making readily available, on aregular and prompt basis, all laws, regulations, and proce-dures pertaining to them, so that enterprises and personsengaged in business can become acquainted with them be-fore they come into effect, and be given an opportunity tocomment. Each publication shall include the effective dateof the measures, the products or services affected by themeasures, all authorities that must be consulted in the imple-mentation, and provide a contact point within each author-ity from which relevant information can be obtained. Theagreement provides that only laws, regulations, and admin-istrative procedures that are published and readily availablewill be enforceable and enforced, and that such enforcement

will occur in a uniform, impartial andreasonable manner. An official jour-nal or journals must be designatedfor the publication of laws, regula-tions, and administrative proce-dures. Administrative and judicialtribunals and procedures will bemaintained for the prompt reviewand correction of administrative ac-

tion; these procedures include an opportunity to appeal,without penalty, to successive levels of appellate jurisdic-tion.

Additionally, the agreement provides for business fa-cilitation measures such as access to office and living ac-commodations, non-discriminatory pricing on government-provided services and products (such as utilities), freedomto hire agents and consultants, and freedom to maintain for-eign currency accounts to make payments/transfers of cur-rencies at market rate of exchange (for profit remittance,capital repatriation, liquidation, payment of royalty, inter-est, management fees, loans and contract obligations, andcompensation in investment disputes).

III. THE TRADE AGREEMENT BRINGS BENEFITS TO VIETNAM BUT

FORCES IT TO FACE UP TO ITS ECONOMIC WEAKNESSES AND CARRY

OUT REFORMS.

At present, Vietnam does not have any intellectual prop-erty rights or investments in the U.S. worthy of protection inthe American market. Vietnamese services cannot competein the United States, but Vietnam can benefit from export-ing goods to the United States. At the present time, Vietnamproduces only a few goods that American consumers wantto buy (products such as coffee, wooden furniture, seafood,handicraft, footwear, and clothing—but existing and futuretextile agreements of the United States would not be affectedby this trade agreement). Nonetheless, in October 2000,Vietnam’s Deputy Trade Minister predicted that Vietnam-ese exports to the U.S. could balloon from $204 million in1996 and $504 million in 1999 to $800 million in 2001,$2.8 to 3 billion by 2005, and $11 billion by 2010. He saidmore than 1000 Vietnamese businesses are already apply-


Winter 2001

ing for export permits.Also, by implementing the trade agreement, Vietnam

may be able to recapture the confidence of foreign inves-tors, which has been badly shaken in recent years to such anextent that foreign investment slumped from U.S. $2.8 bil-lion in 1997 to only $500 million in 1999.

The trade agreement awakens Vietnam to address itseconomic weaknesses and recognize the economic chal-lenges facing the country. Vietnam has not engaged in suffi-cient capital formation, nor has it reached the stage of mak-ing investments in the UnitedStates, as China has been able todo. Accordingly, it will be sometime before Vietnam will be able tocrack the service market in theUnited States.

Even if we consider only thetrade in goods with the UnitedStates, the quality and standardsof Vietnamese goods must improve.The Deputy Trade Ministerpointed out that only 100 export items from Vietnam havemet ISO quality codes. Many of the products of the 5,000state-owned enterprises and 2,000 joint ventures in Vietnamcontinue to fail American standards.

Given the above situation, the most important reform isthat of state enterprises in order to make them more com-petitive. Inefficient, unproductive and corrupt firms that can-not compete on the international market must be dismantledthrough sale, privatization (equitization), or bankruptcy. Thereforms are necessary not only for improving export poten-tial but also for survival within Vietnam itself in confrontingcompetition from the American traders and investors.

In the years ahead, the United States has taken intoaccount the economic weaknesses of Vietnam and made con-cessions by allowing Vietnam

(a) to phase out the trade restrictions (tariffs and non-tariff restrictions) over several years and,

(b) in the areas of investment, to reserve the right toadopt and maintain exceptions to national treatment withrespect to broadcasting, television, production and distri-bution of cultural products, investment in insurance, bank-ing, brokerage in securities and currency values, mineralexploitation, construction and operation of telecommunica-tions facility, construction and operation of inland water,sea and air ports, transportation by railway, air, road, sea andinland waterway, fishery, and real estate.

In addition,(1) Vietnam may, for up to five years, require local raw

material sources in: processing of paper, vegetable oil, milk,cane sugar, and wood;

(2) Vietnam may, for up to seven years, require 80%export performance in cement production, paints, toiletrytiles and ceramics, plastics, footwear, clothing, steel, tires,fertilizer, alcoholic products, tobacco, and papers;

(3) Vietnam may, during the first three years of theagreement, require that U.S. persons and firms must con-tribute at least 30% of the legal capital of a joint venture,and give the right of first refusal to the Vietnamese party forthe transfer of an interest in the joint venture. U.S. nationals

and companies are not yet allowed to issue bonds and sharesto the public in Vietnam, and shall not acquire more than30% of the shares in a state enterprise;

(4) For three years, the general director of a joint ven-ture must be Vietnamese, and decision on a limited numberof important matters must be by unanimity;

(5) U.S. persons and companies are not allowed to ownland and residence, and can only lease, and mortgage landuse rights relating to the investments.

The U.S., in turn, may adopt exceptions to national treat-ment to Vietnamese investments inthe U.S., in the sectors of atomic en-ergy, licenses for broadcast, com-mon carrier, subsidies or grants,submarine cables, fisheries, air andmaritime transport, banking, insur-ance, securities and other financialservices, satellite transmissions anddigital audio services.

IV. WHY VIETNAM DRAGGED ITS FEET

BEFORE SIGNING THE AGREEMENT AND PROSPECTS FOR IMPLE-MENTATION OF THE AGREEMENT

The Vietnamese government postponed the signing ofthe agreement from 1999 to July 2000 due to tremendousdebate within the leadership about whether the signing wasworthwhile. Conservatives viewed the agreement as surren-dering their control of the economy and feared that stateenterprises could not survive competition with the Ameri-can traders and investors. Former Party General SecretaryDo Muoi stated that to sign the agreement is to betray thefatherland. Probably to mollify the conservative elements,Prime Minister Phan Van Khai declared that the agreement isbased on principles of respect for the respective countries’independence and sovereignty, non-interference in eachother’s internal affairs, and a manifestation of the Vietnam-ese Party’s foreign policy of independence, self-reliance,diversification, and multilateralization. There was also anindication that the Chinese had suggested that the Vietnam-ese wait for them to sign the trade agreement with the U.S.first. It turns out that following that proposal was inimical toVietnam’s national interest because China was able to pre-cede Vietnam by accessing the U.S. market earlier. Indeed,some liberal Vietnamese blamed the conservative leadershipfor being manipulated by the Chinese.

Mr. Hauser, Deputy Under-Secretary For InternationalTrade of the U.S. Department of Commerce, describedVietnam’s signing of the Trade Agreement as a “bold deci-sion” that “proved conclusively that the significant portionsof the Vietnamese leadership which are favorably disposedtoward a more liberal economic regime are alive and well,and have won support for the Trade Agreement.”

However, much work remains to be done for the imple-mentation of the agreement. Under the Jackson-VanickAmendment to the 1974 Trade Act, the U.S. Congress mustratify the trade agreement, and the President must then cer-tify freedom of emigration from Vietnam in order for theU.S. to grant Normal Trade Relations status to Vietnam.

The ultimate result of the trade agreement implementa-

Vietnam has not engaged in sufficientcapital formation, nor has it reached the

stage of making investments in theUnited States, as China has been able to

do.


tion will be in the interest of the United States, since its imple-mentation will lock Vietnam into a broad band of commit-ments that will strengthen its private sector and the freedomof the Vietnamese to make individual economic decisions,which will enhance their human rights in general. Until Viet-nam secures membership in the World Trade Organization,the annual renewal by the U.S. Congress of Normal TradeRelations status for Vietnam will entail a yearly battle overVietnam’s human rights record, constituting a mechanismfor pressuring Vietnam into better human rights performance.


Winter 2001

INTERVIEW WITH DOAN VIET HOAT

On December 8, 2000, HAQ editor Michou Nguyenconducted an interview with Vietnamese humanrights observer Doan Viet Hoat.

1. HAQ: You’ve stated in other forums that President Clinton shoulduse his trip as an opportunity to send a clear message to Vietnam con-cerning political freedom and human rights. However, it seemed thatthe President’s focus rested instead on economic development and thefuture of the Vietnamese economy. Do you think that this focus on eco-nomics overshadowed issues concerning human rights and political free-dom?

DVH: Before President Bill Clinton went to Vietnam his staff madesome efforts to brief prominent activists of the Vietnamese communityabout the trip and to seek ideas and suggestions from them. The Viet-namese diaspora in the United States so far has focused their concern onthe totalitarian policy of the present communist government in Vietnamand its violations of basic human rights. The Vietnamese community, atthe present stage of their involvement in Vietnam, is not opposed toeconomic renovation and free trade. However, they do not believe thatfree trade and economic renovation will succeed within the frameworkof the present closed and monopolistic political system. I believe that the United States should adopt the policy of “balancedengagement” with such countries as Vietnam and China, in which assis-tance in opening up the country should embrace both a free market anda free society. I believe that today no one seriously contends that a freemarket alone will eventually lead to a free society. Without effectiveefforts to help bring about an open society, free trade and a free marketsystem can hardly take shape, which, consequently, will lead to popularfrustration and social unrest. In his visit to Vietnam, President Clinton conveyed a clear, thoughnot strong, message of support for human rights and freedom. He touchedon some non-economic and sensitive issues—the war of the past and thebasic rights of the present. He also tried to add to the bright prospects offree trade and free market economic system by remarking on the “irre-versible trend” of liberalization of society. He spoke openly that “guar-anteeing the right to religious worship and the right to political dissentdoes not threaten the stability of a society.” He also expressed his beliefthat it is better off for Vietnamese young people to “have a say in choos-ing their governmental leaders and having a government that is account-able to those it serves”. His positive attitude toward the war, his re-marks on the important role of the Vietnamese-Americans, and finally,the unexpected enthusiastic mass gathering to welcome him both in Hanoiand Saigon—all these factors rendered his visit both historical and sig-nificant. However, it is also clear that the President believes strongly inopening Vietnam to the world as the best way to liberalize Vietnam.Therefore, his visit should be viewed as a starting point for a new stageof engagement.

2. HAQ: Assuming that President Clinton was successful in conveyinga message supporting political freedom and human rights to the Viet-namese people, how successful do you think the people will be in initi-ating change in light of the authoritarian control exercised by the Polit-


Protests continue and have intensifiedboth in the provinces and in Saigon and

Hanoi... More religious leaders andfollowers raise protests against the

government’s persecution; some evenengage in hunger strikes in Hue and in

the Mekong Delta.

buro? How can President Clinton or the United States facili-tate the implementation of change?

DVH: Although the President did not meet with any dis-sidents, Rep. Loretta Sanchez met with four prominent dis-sidents in Hanoi and two in Saigon. I believe that the peoplewill become more active and more vocal in their demandfor change. In fact, right after Clinton’s visit, one of the lead-ers, the Deputy Minister of Defense, warned against “peace-ful evolution”. Protests continueand have intensified both in theprovinces and in Saigon and Hanoi.In the provinces, during the last fewweeks, hundreds of peasants trav-eled to provincial government head-quarters to file their complaints,though in vain.1 More religiousleaders and followers raise protestsagainst the government’s persecu-tion; some even engage in hungerstrikes in Hue and in the MekongDelta. Political dissidents have in-tensified their activities. Dr. Nguyen Dan Que, a prominentdissident in Saigon, announced the forming of Get-TogetherFor Democracy (Tap Hop Vi Nen Dan Chu) three days beforePresident Clinton’s visit. 2 The discontent of the people hasbecome more open and more vocal, as people recognize thatthey can receive American and international recognition andsupport.

The next step that the American government and publiccan take to promote freedom and human rights in Vietnamis to focus on helping to strengthen the people and the pri-vate sector in all areas of activities, including economic, cul-tural, educational, and informational realms. I think that thenext Administration should support public as well as pri-vate programs and activities to promote the emergence ofan open civil society. At least, pressure for more opennessand changes on the part of the government should go handin hand with strengthening the people’s economic and cul-tural opportunities and power.

3. HAQ: You suggested in your comments that freetrade and economic stability cannot occur withoutthe guarantee of basic freedoms. Do you think thatthe Politburo shares this view or do they believeeconomic prosperity can exist without basic free-doms?

DVH: There are two major differences betweenthe Politburo and the dissenting democrats. First,the Politburo does not want to develop a free mar-ket system. Le Kha Phieu, Secretary General of theCPVN, told President Clinton: “The doi moi (reno-vation) goal is to achieve an independent, sover-eign, socialist-oriented economy….Vietnam hasprivate economy, but Vietnam is not privatizing theeconomy…the State and co-operative economic sec-tors play a significant role.” Second, Le Kha Phieuconsistently reaffirms the ideological nature of theVietnamese political system. He told President

Clinton: “The US Secretary of State the other day asked mewhether socialism would continue to exist. I replied thatsocialism would not only exist but continue to develop suc-cessfully.” And he informed the President that he made simi-lar statements during his visits in France, Italy, and the Eu-ropean Union.3

In short, the free market system and democracy are notin the present Politburo’s agenda, at least for the next tenyears. Their priority is not prosperity for the country but

consolidation of their power in thename of “socialism”. Will they suc-ceed? I doubt that they will. Theyare facing a dilemma: In the con-temporary context of globalization,prosperity for the people must ac-company openness in society andtransparency in the government. Ivisualize the following scenario:Under the pressure of the time, theparty leaders will have to acceptmore openness and more loosen-ing of their control. This irrevers-

ible process will finally lead to a critical point when the mo-nopolistic power of the party will be brought to an end. Theparty strategists and leaders fully understand this scenario,and they have been seeking to avoid this fatal close of theirpower. This is the dilemma, both for the party and for thecountry. To avoid the end of the monopolistic political sys-tem means both to scale down and to slow down the pro-cess of reformation and development.

4. HAQ: Do you think that the President’s visit had animpact on the rural population of Vietnam, considering thatthey have less ready access to the media and as a result lessinformation about the President’s visit?

DVH: In the rural areas some families have TVs andmany have radios. Many villagers heard about Mr. Clinton’svisit, and certainly this is the most important news in Viet-nam at the present time. However, the visit will not have animmediate impact on the northern rural population, who had


Winter 2001

no direct contact with Americans in the past. For manypeasants in the South, especially for older people, the visitmay kindle some expectation for drastic changes and a bet-ter future. Before 1975 the South had enjoyed the beginningof a free market economy, which was later disrupted by thecommunist northerners. Right before Mr. Clinton’s visit toSaigon, the police disengaged about 100 peasants who hadstaged a demonstration in front of the Office of the CentralGovernment for more than two months. In the Mekong Delta,where the peasants have recently suffered the most severeflood in 70 years, the government has encountered strongprotests by the Hoa Hao religious group, whose leader waskilled in 1946 by the communists.

5. HAQ: Would you say that the President’s visit was asuccess from the viewpoint of the Politburo? the Vietnam-ese people? the United States?

DVH: I think that each of the three parties benefits dif-ferently from President Clinton’s visit. The Politburo mayenhance its political prestige in having Mr. Clinton visit Viet-nam while the communist party still holds power. Closer rela-tions with the US also help to create a balance of power inthe context of sensitive regional security problems. For theVietnamese people, Mr. Clinton’s visit may give a boost bothto their expectations and to popular discontent. Political andreligious dissidents will become more confident of their ac-tivities and will expect stronger support from American andinternational circles. For the United States, President Clintongave to his Vietnam agenda a historical ending. However,whether the visit will be a success in reality for all threeparties is still unclear. From the viewpoint of the Vietnam-ese and Americans who want to see a new Vietnam emerge,the road ahead is full of expectation and uncertainty.

6. HAQ: What else do you think President Clinton shouldhave done but did not do during his visit?

DVH: The President should have talked more directly ofpolitical and religious prisoners. He should have met someprominent dissidents. He did see Archbishop Pham MinhMan of Saigon, but only for 10 minutes. He should have metRev. Thich Quang Do, the internationally renowned leaderof the banned Unified Buddhist Church. He was rather softin his remarks on human rights and freedom. Perhaps he isusing his “carrot” more than his “stick” in his first visit tounified Vietnam under the communist regime.

7. HAQ: Do you think that the First Lady made any signifi-cant contribution during her visit?

DVH: Mrs. Hillary Clinton offered a more human, lesspolitical touch on the President’s visit. She certainly wonthe hearts of the people on the street and thus left a greatimpact on young and ordinary Vietnamese people. However,her meeting with the Vietnamese Women Association helpedto promote government-controlled organizations rather thanindependent NGOs (non-governmental organizations), whichhave yet to develop in Vietnam.

ENDNOTES

1 Far Eastern Economic Review Online, Dec. 7.2 He even registered an email address for his move

ment: [email protected] Nhan Dan (People) Online, 20.11.200, p.1.


THE MEANING OF PRESIDENTCLINTON’S TRIP TO VIETNAM

BY CHAN TRAN

Chan Tran is editor of the Vietnam Insightpublication and Internet service, which promoteshuman rights, freedom, and democracy forVietnam.

President Clinton visited Vietnam at last and succeeded in a veryimportant mission: establishing diplomacy. Appealing to themasses has been the President’s strong suit throughout his term

in office. But appealing to people who have persistently heard propa-ganda against American “Imperialists” would not be easy. Nonethe-less, President Clinton articulated his powerful message effectively andwith warmth, tact, and diplomacy.

The large crowds of enthusiastic people pouring into the streets togreet President Clinton wherever he went in Vietnam were both un-precedented and unexpected, especially because the Hanoi governmentlimited dissemination of information to the public regarding Mr.Clinton’s visit. In contrast, when Fidel Castro visited Vietnam yearsearlier, few people showed up for the welcoming event despite thegovernment’s efforts to urge people onto buses and shuttle them to thegathering site.

There were signs that the Hanoi leadership feared that the U.S.president’s influence could serve as a catalyst for a democratic revolu-tion in Vietnam. Such fear was certainly well founded considering themounting political upheaval in the past few years, which was markedby protests, labor strikes, religious demonstrations, and rising dissentfrom both intellectuals and high-ranking senior Communist Party mem-bers. The visit by the leader of the free world offered the people in-creased encouragement and momentum for their cause.

By offering President Clinton a welcome warmer than any Hanoileader has ever received, the people of Vietnam painted a stark con-trast to the dry receptions they usually give to the Hanoi leaders. In-deed, the people enthusiastically tuned in to the President’s speech andreached out to shake hands along the streets of Saigon and Hanoi. Whatappealed to the people was the friendly way in which the Presidentcarried himself, in contrast to the manner and messages the Hanoi lead-ers often send. But more than that, it was the dream and hope for a lifeof liberty that President Clinton represents that is so compelling to allwho hear his message.

It is somewhat ironic that Hanoi leaders initially thought Presi-dent Clinton’s visit would enhance their trade opportunities and thusenthusiastically embraced the idea. As the visit approached, the lead-ers became threatened by the President’s influence on their control andaggressively returned to old rhetoric against American “Imperialists”,downplayed his visit, demanded an apology for the war, and scannedfor possible revolts from the people. But revolt they did by embracingClinton and his message of the democratic path that Vietnam must travelto fully realize its potential. Dissidents such as Dr. Nguyen Dan Que,Venerable Thich Quang Do, and Hao Hao leader Le Quang Liem alsotook the opportunity to call for religious freedom and respect for civilliberties.

I have been following the Clinton Administration’s Vietnam policythroughout the years with keen interest, not only because I am a Viet-namese American but also because I am a human rights activist whoawaits the day that Vietnam will join the rest of the world on the pathtoward democracy. Despite my desire to witness Vietnam join the world


Winter 2001

community and benefit from democracy and technologicalknowledge, and to see my native and adopted homelandsembrace each other, I believe that the U.S. has exercised apolicy that is too passive toward the regime in Hanoi. IfAmerica is interested in a healthy and long-term relation-ship with Vietnam, we must exercise our leverage againstthe Hanoi dictatorship in order to bring about meaningfulchanges in Vietnam.

Based on previous U.S. policy towards Vietnam, I didnot have much hope for President Clinton’s visit. I expectedit to be another public relations trip that would promote tradeand help strengthen Hanoi’s legitimacy in the eyes of theworld. I was surprised to learn that the President prior to histrip invited 35 members of the Vietnamese American com-munity to advise him on the situation in Vietnam and to learnof our shared aspirations with the people in Vietnam. Themeeting marked the first official recognition of the Vietnam-ese Americans’ role in the relations between the two na-tions. This role is critical as long as the people of Vietnamhave no effective voice within their country.

When I heard the President’s speech at Hanoi Univer-sity, I felt as if he had spoken on my behalf, expressing theideas and dreams I have always wanted to share with mypeople but never got the chance. Many of my friends alsoexpressed favorable comments for the President’s remarks.Even the most traditional Vietnamese elder I know praisedPresident Clinton’s astute appreciation of Vietnamese cul-ture, including his reference to the two famous scholars andpatriots, Ho Xuan Huong and Nguyen Trai, in a state dinnerin Hanoi.

I believe that the President’s success with the people ofVietnam would not have been so great without the input fromVietnamese Americans who want to serve the mutual inter-ests of both nations. It was both the Vietnamese Ameri-cans’ efforts to contribute realistic values to the U.S. policy

toward Vietnam and the quality of a great leader to listenthat has created the opportunity for Vietnamese Americansto take part in the U.S. policy-making process. I hope fu-ture administrations and lawmakers will recognize this part-nership so that U.S. policy will effectively serve both na-tions and avoid the losses and conflicts of the past.

The historic three-day visit has already passed, and theClinton presidency has come to an end. But its impact andhistorical contribution will remain. Bill Clinton will be re-membered as the President who reached out and touchedthe people of Vietnam, whose trip has helped to highlightthe cause of human rights and Vietnamese aspirations. ThePresident’s last action regarding Vietnam spoke much louderand more meaningfully than his earlier policies: It is thepeople and not the Communist dictatorship with whom theU.S. wishes to cultivate relations. And in the days ahead,the people of Vietnam should be able to count on Americanfriendship, manifested through wise policy.


BOOK REVIEW: “THE QUEST FORIDENTITY: INTERNATIONAL RELATIONSOF SOUTHEAST ASIA”

BY PHAR KIM BENG

Phar Kim Beng is a Senior Correspondent of TheStraits Times, Singapore. He is currently based inBoston, where he publishes a weekly feature onAsian-Pacific affairs.

BOOK INFORMATIONAuthor: Amitav ArcharyaTitle: The Quest for Identity: International Relationsof Southeast AsiaPublisher: Oxford University Press

By his own admission, Amitav Archarya, a professor at York University (Canada) is not an Asianist. Rather, his niche is “AsianPacific regionalism”. Two questions obviously emerge: Can an

entity as diverse as Asia-Pacific be labeled a “region” without skewingthe meaning of the term? More importantly, have contemporary socialsciences developed the necessary tools and lenses to examine it?

“The Quest for Identity: International Relations of Southeast Asia”provides affirmative answers to both queries, albeit with the analyticalscope restricted to Southeast Asia alone, rather than Northeast Asia.Indeed, the book is Amitav Archarya’s first attempt to define, if not todefend, the “existence” of Southeast Asia, and he performed the jobimmensely well.

For what it is worth, this book is extremely insightful, timely, andinstructive. For years, political scientists have tended to look at South-east Asia either as a colonial construct—alas, a geographical space thatis devoid of its own indigenous identity, political network, trade ma-trix, and common culture—or a region too diverse to be deemed a “re-gion” in the first place.

Bringing historical materials to bear, Amitav Archarya marshaledhis resources and facts well to affirm categorically that prior to theonset of colonialism in Southeast Asia in the early 16th century, an-cient dynasties and kingdoms had already existed. Not only did theyexist, but they held various forms of ties that mirror contemporary in-ternational relations in Southeast Asia too. Dynasties such as Funan,Champa, Pagan, Srivijaya, Angkor, Majapahit and Ayutthya, just toname a few, were known as thriving centers of commerce and powerfrom as early as 1st century A.D.

History, however, is not the forte of this book. Much of the discus-sions on history were drawn from the works of other historians whohad studied the region. Thus, there is not much use of new or primaryresearch materials. What makes Amitav’s contribution to the regionalstudies of Southeast Asia an important one, however, is his foray intothe region’s attempt, especially since 1967, to foster a common identity— such as through the creation of ASEAN (Association of SoutheastAsian Nations), now comprised of 10 members that form what is col-lectively known as Southeast Asia.

Be that as it may, Amitav’s book did not seriously ponder whetherwhat regionalism achieved through what constructivists called iden-tity-formation can overcome regime differences too. Myammar, forinstance, has become bolder in asserting its different standard of gov-ernance after becoming a member of ASEAN. Does this imply thatASEAN has failed in drawing Myammar into accepting a minimum setof values? Indeed, if ASEAN is creating a common identity, a key the-sis of this book, what is stopping Myammar, or for that matter, Viet-nam, in liberalizing their regimes further? After all, if the external en-vironment is made safer through their membership in ASEAN, shouldn’tthese countries be more receptive to suggestions and initiatives for change?


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The above questions are important because tacklingthem would avail us an understanding of whether region-alism, as promoted by ASEAN, is real or fictional. In otherwords, is Southeast Asia growing closer together becauseit is a region simply discovering “lost roots”—one of thekey premises of the book—or is it becoming “regional-ized” due to a panoply of other causes, which include therise of China, the advent of globalization, and the imbal-ance of power between Northeast and Southeast Asia? Anycombination of the latter would of course aggravate theinsecurity of certain member states in Southeast Asia, ratherthan to assuage it. Therefore, attempts to turn SoutheastAsia into a single region, for better or for worse, are in-duced probably as a result of negative forces of fear ratherthan positive forces of peace. Just as it is plausible to pointto the growing integration of Southeast Asia as a result ofidentity formation, a skilled realist scholar such as MichaelLeifer of the London School of Economics, for instance,could turn the same claim on its head by looking at power-related variables.

In any case, this book has done an exceptional job ingetting the debate going. But for a more thorough under-standing of the growing bond of Southeast Asia, othercauses cannot be discounted. Realist scholarship that hasdominated the study of Southeast Asia may yet live to seeanother day.

That said, it is a testament to Amitav’s originality andscholarship that he chose to study Southeast Asia from thestandpoint of identity formation, hence indirectly social-constructivism. It is a promising approach, though onethat is still in need of greater analysis.

Documents

Harvard Asia Quarterly Winter 2001