A round-table discussion was recently held in the Kyrgyz government, at which the current situation around Kyrgyz shuttle-trade business was discussed. The shuttle-traders who participated in the discussion said that their business is presently in a critical situation. They complained that buying and selling goods by crossing the borders of former Soviet republics has now become an unbearable burden and that the whole activity is under threat.

Shuttle-traders are crucial to Kyrgyzstan’s economy. Since the collapse of the Soviet Union most of the big state firms and factories have ceased their production and stopped functioning. Petty trading between the newly independent republics has become means of existence for hundreds of thousands of people. However, the number of these people is now falling. From 500,000 in 1996, the ranks of Kyrgyz shuttle-traders have dropped to less than 300,000 and many are on the verge of bankruptcy.

At the round-table discussion, Kyrgyz shuttle-traders named about 20 problems that are causing them difficulties in doing their business. According to them, the most significant problems are the absence of any laws regulating their activities and the pressures exerted upon them by customs officials on the borders.

The presence of these problems was highlighted by an incident in May on the Kazakh-Russian border, when Russian officials of the Petukhovo railway seized the stock of 1,500 Kyrgyz shuttle-traders, who were going from Bishkek to Ekaterinburg. The total amount of confiscated goods by customs officials equaled ca. half a million dollars. The traders immediately complained to the minister of the Sverdlovsk province administration, Alexander Lipetzkiy. However, the minister refused to consider their complaint until he received an official appeal from the Kyrgyz authorities. This 23 May incident at the Petukhovo railway frontier is not the first. Last fall a similar kind of incident happened to Kyrgyz shuttle-traders. That time, their goods, worth 2 million dollars, were confiscated by Ekaterinburg customs officials, an action blamed for the subsequent suicides of eight people.

Byubyuaisha Arstanbekova, who is the chair of a lobby group for the traders ‘Akikat Jolu’ and who also participated at the round-table discussion, complained that Russia has toughened its customs regime. Kyrgyz traders transporting goods by car avoid laws insisting they use container lorries. The Russian customs officials then confiscate their goods. The traders have no incentive of using container lorries. For example, to transport goods from Chaldovar to Bishkek by a container lorry, the trader needs to stop at least eight times at different checkpoints, where he has to bribe officials in order to get safely to his destination.

Such obstacles along the borders are weakening the potential of Kyrgyz traders, who could bring a significant amount of income to the state budget. Because of these difficulties, around 70% of Kyrgyz traders have already left for neighboring countries. Consequently, opportunities for selling Kyrgyz goods to neighboring countries have been dramatically reduced. This naturally means that along with the traders, income is also going away from Kyrgyzstan.

Arstanbekova told to the RFE/RL correspondent that about 90% of Kyrgyz shuttle-traders in Russia are facing bankruptcy. She also mentioned that she has been addressing the Kyrgyz government for eight months with the request to take some measures and to protect the traders’ rights. However, she complains of not having received a concrete response.

What is frightening is that the reduction of shuttle-trade could bring damaging consequences to a country like Kyrgyzstan, with an already damaged socio-economic situation. If 300,000 Kyrgyz small traders lose their jobs and return to their country, where there are no decent conditions for living and working, the immediate effect might be a social breakdown and the destabilization of the whole country.

By Gulzina Karym Kyzy