Turkmenistan at a cross roads

Turkmenistan at a cross roads

Luke Coffey

The 64-year-old president of Turkmenistan, Gurbanguly Berdymukhammedov, last week announced that early elections will take place next month. Originally scheduled for 2024, the snap poll will likely result in his 40-year-old son, and deputy prime minister, Serdar Berdymukhammedov becoming president.
Considering that Turkmenistan sits in the heart of the Eurasian landmass, has the world’s fourth largest proven natural gas reserves and shares a 1,150 km border with Iran and an 800 km border with Afghanistan, one would think that what is happening there would be of interest to policymakers. Sadly, with so many other geopolitical challenges around the world, the announcement of the de facto handover of power barely registered in the international media.
The last presidential “elections” to take place were in 2017. President Berdymukhammedov won his third, and what appears to be final, seven-year term with 97 percent of the vote. Berdymukhammedov also holds the positions of prime minister and speaker of Turkmenistan’s upper house in parliament. He tightly controls the judiciary, the legislature, the economy, social services and the mass media. The government tends toward isolationism in international affairs. It pursues a foreign policy it describes as “permanent neutrality.”
Even though the country is blessed with an abundance of energy resources, food lines have been known to pop up around the country in recent years. Turkmenistan is one of just a handful of countries in the world (with North Korea being among the others) that has reported no cases of COVID-19 to the World Health Organization. Even so, experts believe that the country has already experienced at least three waves of the virus.
If Serdar does take power from his father next month, he will have a full in-tray. In theory, Turkmenistan should be one of the wealthiest countries in the world. In reality, it is one of the poorest. The biggest challenge will be getting the economic situation under control. A combination of political and economic mismanagement by Turkmenistan’s elites has left the country in a perpetual crisis. Currency depreciation, autarkic policies and limited spending on public services have led to economic stagnation. It is likely that the pandemic, even though officially not acknowledged by the government, has had a negative impact on society and the economy.
International investors that could enter the country are reluctant to do so because little has been done to improve the business climate and privatize state-owned industries. Rigid labor regulations and the near-complete absence of property rights further limit private sector activity. On an optimistic note, Turkmenistan is rich in natural resources. If correct policies are pursued by the next leader, then the country might be able to slowly but surely turn its dire economic situation around.
Turkmenistan holds some of the world’s largest natural gas reserves, but a lack of infrastructure, combined with an isolationist foreign policy, means there are only a few options for exporting these resources to the rest of the world. Currently, Turkmenistan’s gas exports rely heavily on China and, to a lesser extent, Russia. There are two potential pipeline projects that can help Turkmenistan diversify its gas exports and potentially boost the economy. The first is the Trans-Caspian Gas Pipeline that could connect it to European markets. This project is particularly important at a time when Europeans are looking to diversify their energy imports.
The second project is the Turkmenistan-Afghanistan-Pakistan-India Pipeline. This project has been in the works for years, but very little progress has been made due to a lack of security in Afghanistan. Although the de facto Taliban leadership in Kabul is supportive of the TAPI project, the pipeline is still many years away from becoming a reality. Serdar is President Berdymukhammedov’s only son. In recent years, he has held numerous positions in the armed forces and government. Most international observers have long believed that he has been groomed to take over the presidency.
Younger and new leadership at the very top might signal a change in Turkmenistan’s approach to economic policy and international affairs, but it will not be easy. Big changes are likely to take place in Turkmenistan in the coming months and years. Whether or not these changes will be positive is anyone’s guess. For the sake of the Turkmen people and the stability of the region, let us hope that they are.

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