Wednesday, 04 September 2013

Tajikistan's Private Sector Loses Its Leader and Coordinating Council

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By Oleg Salimov (the 04/09/2013 issue of the CACI Analyst) 

The upcoming presidential elections in Tajikistan this fall will be a determinant of political developments in the country in coming years. There is little doubt that the current president Emomali Rakhmon will seize the opportunity to stay in power for a fourth presidential term secured by a 2003 referendum. While there has been no formal statement on whether Rakhmon will run again, his political opponents have recently experienced increased pressure, implying that Rakhmon is preparing the ground for a head start. The arrest of Zaid Saidov, a businessman and leader of the newly founded political party New Tajikistan, demonstrates the precautions taken by the Tajik government ahead of the presidential elections. 

BACKGROUND: Saidov, a former government official and head of Coordination Council of Business and Public Associations (CCBPA), was arrested on multiple charges in May ahead of November’s presidential elections. Shortly before his arrest, a special session of CCBPA members declared the council disbanded.

Rakhmon, known for his uncompromising tactics in dealing with the political opposition, has eliminated not only direct rivals but also former allies considered potential threats to his status. Over time, Rakhmon’s tactics towards his critics and challengers have toughened progressively. According to an Amnesty International report of July 3, 2013, Tajikistan's government has arrested domestic opponents on various charges and sentenced them to lengthy imprisonment terms, while expatriate critics have been tracked down and forcefully returned to Tajikistan.

Saidov was arrested in May 2013, a month after he announced the founding of the political party New Tajikistan. During the announcement, Saidov indicated that his party would not affiliate itself with either pro-government or opposition formations and would pursue compromise solutions for resolving economic and social issues through close cooperation with the general public and government. Saidov particularly stressed that he did not intend to run in the upcoming presidential elections, a claim that nevertheless failed to protect Saidov from arrest.

Following Saidov’s arrest, a special session of the CCBPA enacted the decision to dismantle the Council, stating that the organization had outlived its purpose and was used by Saidov as a platform for his personal political ambitions. Saidov headed the council for less than a year before his arrest and only a month after he announced his political party. The council, which gathered around 50 business associations, was formed in 2007 with the purpose of protecting the interests of its members, assisting in developing the private sector, and creating an attractive environment for investments.

IMPLICATIONS: The coincidence of such factors as the upcoming presidential election, Saidov’s proclaimed political independence and maturity, and Rakhmon’s intolerance to opposition on the one hand, and the range of Saidov’s charges from polygyny to corruption and the rapid dismantling of CCBPA on the other, suggest that Saidov’s arrest is politically motivated.

Initially, Dushanbe city prosecutor’s office accused Saidov of polygyny, which is illegal in Tajikistan. Shortly thereafter, Tajikistan's state anti-corruption agency incriminated Saidov of fraud based on a 2009 state audit of the construction tender fulfilled by Saidov’s company. These accusations were later amplified by charges of corruption, extortion, abuse of office, and rape and coercion to abortion of an underage person. According to Tajik officials, Saidov committed most of these crimes in 2002-2006 while he served as the Minister of Industry, while the rape allegedly took place in 2008. They explain the discrepancy in time between the committed crimes and the accusations by the late reaction of Saidov’s victims. The government's inactivity regarding Saidov’s alleged construction tender fraud revealed in 2009 remains an open question. Another controversy in Saidov’s case is the fact that, contrary to the law, his detention and arrest on May 19 preceded the revocation on May 20 of his immunity as a legislator of the city of Dushanbe legislative assembly.

The former chairman of CCBPA Nekrui Zabirov initiated the dismantling of the Council on May 13, motivating the measure by the Council's incompetency and violation of the principle of political neutrality. The official explanations also included leadership failure and Saidov's abuse of power by using CCBPA for his personal political ambitions. However, CCBPA members argue that these arguments are inconsistent: first, Saidov's alleged failures motivate the election of a new chairman and a revision of the CCBPA's charter, but not a complete liquidation of the Council that has existed for six years. Second, the accusation of Saidov’s exploitation of the Council for personal political ambitions is irrelevant to statements of the CCBPA's incompetency and political sway. Third, the dismissal of Saidov and liquidation of the CCBPA were not substantiated by evidence and sensible explanations. Observers have reported that the decision was made based on the demands of Zabirov and a few other Council members. The fact that a special CCBPA session was called two days after Saidov was publicly accused of polygyny and fraud suggests a premeditated and controlled scenario.

The developments involving Saidov and the CCBPA have two major implications. First, it is unlikely that Rakhmon’s ruthless elimination of a median political opponent will provoke a revolutionary mood among Tajikistan's public. On the one hand, Saidov's arrest constitutes a test of the public atmosphere preceding the elections. Hence, Rakhmon seeks to determine whether he has reached the peak of public compliancy or whether there is a need to adjust his pressure mechanisms. On the other hand, he leaves little room for dissent by restraining even nominal hints of opposition. Frequently described by critics as a talented conciliator but a poor manager, Rakhmon has neutralized a rival capable of accumulating support among those disillusioned with current policies. The two years until Tajikistan's next parliamentary elections in 2015 could have provided the business-minded Saidov and his New Tajikistan party with sufficient time to establish themselves as a viable alternative to the currently inert political parties. By arresting Saidov, Rakhmon has ensured that he remains in total control of Tajikistan's political process.

Second, the liquidation of CCBPA could have a negative impact on the country's economy. The Council was seen as a vital institution for Tajikistan’s fragile private sector. It was developing a culture of lobbying and protecting the interests of businesses in Tajikistan, while also performing regulative and informative tasks for business associations. It was a body, autonomous from the government, which coordinated the development of the country's business sphere. The instantaneous and abrupt decision to liquidate the Council disregarded years of laborious work aimed at expanding Tajikistan's private sector.

This decision can be seen as ill-considered for at least two reasons. The Council's founders were concerned over the difficulty in establishing trust in associations and the Council among its members. This trust will now be extremely difficult to restore. It also left the public sector scattered and dependent on the government.

The other reason is that the arrest of a high-profile entrepreneur and liquidation of the Council could intimidate foreign investors, who may interpret the developments as a threat to their business assets in Tajikistan and a limitation to the perspective of business development in the country. In 2005, the European Bank of Reconstruction and Development assessed investment input in Tajikistan as the weakest among the former Soviet republics, in part due to extensive government involvement in the private sector. The Bank’s most recent report from 2012 noticed a slim improvement of the business environment, which could reflect positively on the country’s investment outlook. Yet, instead of the expected improvement, the Tajik government's growing interference with the private sector, marked by Saidov’s arrest and the closure of CCBPA, can return a negative investment input.

CONCLUSIONS: The grounds for Saidov’s arrest and the following closure of CCBPA remain questionable. Both events can damage Tajikistan’s political image and investment portfolio. Saidov’s arrest demonstrates the arrival of a new phase of Tajikistan’s development. Saidov sensed the necessity in shifting state policy away from managing the aftermath of the civil war towards establishing market-oriented institutions and acted accordingly. Yet, Rakhmon has demonstrated that he will not shy from using his powers as president to extend his political longevity. Therefore, the breakdown or persecution of Saidov’s New Tajikistan party can be expected in a near future.

AUTHOR'S BIO: Oleg Salimov holds a PhD in Interdisciplinary Studies (Public Administration, Political Science, Education, Sociology) from The University of Montana.

Read 4305 times Last modified on Wednesday, 25 September 2013

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