Most people haven't heard of Turkmenistan. Those who have heard of it couldn't place it on a map and consider it something of a joke country run by a crazy dictator, Saparmurat Niyazov. The "Turkmenbashi's" increasingly eccentric edicts make colourful copy: he banned ballet, gold teeth and recorded music, he ordered the construction of a lake in the midst of the desert and a ski resort on the snowless foothills of the Iranian border.
With a comparatively small population of 5 million and the world's fifth largest gas reserves, Turkmenistan has potential to be one of volatile central Asia's good-news stories. Today's reality is very different. Life-expectancy for women is the lowest in the region. Infant mortality is on a par with war torn countries in Africa. The culture of secrecy extends so far as to ban the reporting of infectious diseases. The basic functions of state have all but collapsed, and the people live (and die) in fear and poverty, but Turkmenistan is playing an ever more important role in the European economy.
On 21 March, the European parliament's foreign-affairs committee approved a proposal for an interim trade agreement with Turkmenistan, and "made in Turkmenistan" is an increasingly common sight on labels of cotton products available across the European Union. What economy there is inside Turkmenistan is highly dependent on forced labour. Given that the government refuses to cooperate with international bodies (United Nations, World Health Organisation) in the provision of statistics such as infant mortality or life expectancy, and considers its population an expendable resource, an unwelcome drain on the budget, it is not hard to imagine what the working conditions in these factories are like.
There is no option but to imagine, as the Turkmen authorities exempt themselves from international scrutiny as easily as they suppress domestic criticism. This lack of basic information is one of main problems when talking about Turkmenistan. Government data resembles the Soviet fantasy statistics and is widely considered unreliable, though there are people on the ground in Turkmenistan who risk their lives to ensure that some of their reality gets out.
A report published on 24 April by the non-governmental organisation Global Witness gets to the heart of the contradiction between the country's vast potential for wealth and its grim reality: gas.
The report makes the point that the European Union is ever more dependent on gas imports from Turkmenistan, but that this trade is essentially unregulated and dominated by shady middlemen. The profits go anywhere but back to the state coffers of Turkmenistan, where there has been wave after wave of budget cutbacks: pensions cut leaving 100,000 people destitute, public-sector workers unpaid for at least six months (arrears stand at $286 million), and the healthcare system severely underfunded and verging on collapse. 75% of state spending also seems to take place "off budget" so there is a kind of equity here, though it could more accurately be called pillage. This report's message is clear: should the EU really turn a blind eye to corruption on this scale, should it fund the further collapse of a near-failed state?
Global Witness gives one particularly apt example of what this lack of fiscal transparency means. It reads like a modern fairytale.
Once upon a time, Turkmenistan earned $2 billion per annum from natural-gas sales. One day in September 2002 more than $41 million went missing from Turkmenistan's central bank. President Niyazov, "father of the Turkmen", called for an investigation. Russia's legal brains suggested that the funds had been siphoned off without permission into banks in Russia and Latvia by a shady group of individuals. One of these alleged thieves was found stabbed to death in a flat in St Petersburg, but two others had a more conventional trial. Although it seemed that $41 million had gone missing, this could not be confirmed, as there was no corroboration of $20 million of this money ever having belonged to the Turkmen state in the first place.
Two equally bizarre sagas involved twelve million pairs of galoshes received by Turkmenistan in exchange for TV sets exported to Ukraine, and the 3,000 spruce trees Ukraine used as part-payment for gas debts. Such incidents could be seen as farce, but if anything they should be read as tragedy. The gas trade involves Russian gas giant Gazprom, Austrian Raiffeisen Bank and Deutsche Bank, in addition to the Ukraine based intermediary companies, all with close links to senior Ukrainian political officials past and present, and is being investigated by the organised-crime section of the US justice department.
Such widespread concerns about the transparency and ethics of the gas trade with Turkmenistan notwithstanding, Global Witness's timely report points out that the European Union is binding itself ever more closely to that particular supply. The lust for cheap gas outweighs the humanitarian concerns for the people of what is, alongside North Korea and Burma, one of the most repressive and secretive place on earth. The gas may seem cheap, but for the people of Turkmenistan the true cost is significantly higher.
