Déjà vu in Astana

We were midway through our tour of Astana, the shiny new capital of Kazakhstan, and our guide was convinced we had taken leave of our senses.

Our group had just been to the top of the Bayterek Monument, a strikingly modern tower that offered views over the attractively designed new buildings aligned along the capital district’s Avenue of the Republic, and it was clear this was our cue to make admiring comments about this city created on the otherwise featureless and treeless plains of the Central Asian steppe.

But for anyone coming from the UAE, that scenario – of the lesser-known capital city of a young but tolerant Islamic nation using its oil wealth to create a modern metropolis in a bleak and unforgiving environment – was a little too familiar to be impressive.

“We’re from Abu Dhabi,” we told our guide. “We don’t want to see new buildings. We want to see nature. We want to see the essence of Central Asia!”

The guide looked at us with blank incomprehension. With the help of the translator, we were told: “There is no nature – only steppe.”

The Astana people we had met so far had all been inestimably proud of this modern new city, basking in the proof they were just like Europe or America and not the Central Asian backwater of popular imagination. It was no wonder the authorities hated the film Borat so much.

So it took a degree of duress to convince our guide to abandon her standard route through the city’s modern architectural marvels and drive us out into the steppe that makes up most of Kazakhstan, the world’s ninth biggest nation.

We eventually found a nondescript village, prompting her to look at us with disbelief, as if to say: “Why on earth would they want to come here?” Instead of mirrored glass, there were sod roofs that traditionally helped the residents cope with temperatures that range from up to 40°C in summer down to -40°C in the depths of winter. Some of the homes had no roofs at all, suggesting a slow depopulation over many years.

But there were also some brand new homes, hinting at an influx of wealth that dated from 12 years ago when the government announced it was moving the capital from the nation’s biggest city, Almaty, in the far south of Kazakhstan, to the outskirts of this hitherto little-known provincial town in the north.

Had we been coming from somewhere other than the UAE, we probably would have been more impressed by how much had been achieved since 1997.

Sited on what had been fields across the river from the historic downtown, nearly everything in the capital district was complete, ranging from the parliament, the presidential palace, government ministries and landmark buildings such as the 77m-high glass pyramid of the multidenominational Palace of Peace and Harmony.

Although there were many international architects brought in (Norman Foster designed three of the buildings) there had also been attempts to incorporate Kazakh themes into the mix, such as the design of the Bayterek Monument, which has a gold-hued transparent orb where the viewing platform is located that is inspired by the ancient Kazakh legend of the samruk bird laying a golden egg containing the secrets to human desires and happiness.

Continue reading: The National: Déjà vu in Astana

US senator against publicizing details of Kazakh military expansion in Iraq

Excerpt from report by privately-owned Interfax-Kazakhstan news agency

Astana, 7 August: The leader of the US Senate democratic majority, Harry Reid, thinks that the details of negotiations between Washington and Astana on the issue of possible expansion of Kazakhstan's participation in peaceful operations in Iraq and Afghanistan should not be publicized.

"The US secretary of defence visited (the Central Asian) region and Afghanistan in particular, and this issue was discussed at length. This is why negotiations with the leadership of Kazakhstan on this issue (Kazakhstan's peacekeeping mission) should be held in private format, not for public," he told a news briefing in Astana today, answering a question by the Interfax-Kazakhstan news agency on how Kazakhstan reacted to a request by the USA on increasing Kazakh troops in Iraq.

[Passage omitted: on the presence of terror threat in Afghanistan; repeat of known details]

Source: Interfax-Kazakhstan news agency, Almaty, in Russian 1237 gmt 7 Aug 08

Kazakhstan Corruption: Exile Alleges New Details

A former member of the first family of oil-rich Kazakhstan is accusing its authoritarian ruler of extensive corruption, potentially complicating U.S. efforts to improve relations with the strategically important Central Asian state.

From a hiding place in Europe, the former son-in-law of Kazakh President Nursultan Nazarbayev asserted in interviews with The Wall Street Journal that Mr. Nazarbayev has diverted billions of dollars in state assets and long taken commissions from companies doing business in his mineral-rich land.

The ex-son-in-law, Rakhat Aliyev, who has had a bitter falling out with Mr. Nazarbayev, also said the regime has conducted an operation in the U.S. designed to investigate its critics, burnish its image and resolve legal problems. The operation brought the family confidential U.S. phone records and customs data, said Mr. Aliyev, who was once vice chairman of Kazakhstan's intelligence services.

While by no means making the first claims of corruption in Kazakhstan, Mr. Aliyev alleged that its president personally profits from his country's economic riches to a much greater extent than previously documented. He painted a picture of a Kazakh economy in which the president not only routinely takes illicit commissions but also holds hidden stakes in the copper, uranium and hydrocarbon industries, and maintains a network of offshore bank accounts.

Although it wasn't possible to corroborate all of his assertions, Mr. Aliyev backed up some of them with bank statements from Lebanon and copies of checks drawn on banks in Indonesia and Liechtenstein. Documents made available by others with knowledge of the ruling family's finances support some of Mr. Aliyev's claims about the existence of a banking network and about monitoring critics.

Mr. Aliyev identified a Washington consultant named Alexander Mirtchev as the point man for President Nazarbayev, not only in seeking to resolve his legal problems but in helping to manage some of the fortune he has accumulated in 19 years in power.

The Federal Bureau of Investigation and the Manhattan district attorney are looking into Mr. Mirtchev's banking activities, according to lawyers and businessmen who have had contacts with investigators. The inquiries are said to be at an early stage. Representatives for the Justice Department and the district attorney's office had no comment.

The Kazakhstan government didn't respond to requests for comment. A lawyer who represents it in a long-running U.S. investigation of suspected oil-company bribery of Kazakh officials, Reid Weingarten, referred questions to the Kazakh government.

Mr. Aliyev last year lost a power struggle in Kazakhstan, a sprawling land of windy steppes whose oil boom has spawned luxury hotels and a casino zone. He wound up accused of kidnapping and other crimes. He took refuge in Austria, where he had been the ambassador.

Mr. Aliyev said he has firsthand knowledge of how the regime works because he took part in many of its operations. "I never said that I am an angel or that I didn't know what the regime was doing," he said. A Kazak court convicted him in absentia of racketeering, kidnapping and trying to overthrow the government, sentencing him to a long prison term. A court dissolved his marriage. Mr. Aliyev said his former father-in-law has adopted his two youngest children.

A squat and boyish 46-year-old with jet-black hair, Mr. Aliyev gave a detailed and sometimes self-serving account of his troubles, watched over by impassive bodyguards chain-smoking nearby. He described himself as a would-be reformer who grew disillusioned with Mr. Nazarbayev's autocratic rule. Other exiled Kazakhs say Mr. Aliyev is an ambitious tycoon who profited mightily from his family and official positions but ultimately overreached.

Mr. Aliyev claimed he was speaking out in hopes of striking a blow against the Nazarbayev regime. But his security would also be enhanced should he manage to obtain official protection from U.S.

Washington wants good relations with Mr. Nazarbayev because of his country's strategic location between Russia and China and its mineral riches, which include uranium, copper and iron ore as well as oil. But maintaining cordial ties has been difficult because of the regime's authoritarian rule and poor human-rights record. The new allegations, coming from someone recently so well connected, may make the balancing act even harder.

Mr. Aliyev asserted that Mr. Nazarbayev and his advisers routinely collect money when state industries are privatized and garner commissions from virtually anyone wanting to do large-scale business in the country. "Part of this money came from the United States, some came from other companies and countries," he said.

He said Mr. Nazarbayev has used some of his money to advance the regime's interests in Washington, using crisis-management consultants. Lobbying by foreign governments, of course, isn't necessarily illegal. But Mr. Aliyev produced what he said were consultants' extensive reports to the Nazarbayev family, telling how they had covertly enlisted think tanks and former U.S. officials to improve Mr. Nazarbayev's reputation and influence the bribery probe.

Consultants tracked Mr. Nazarbayev's critics when they were in the U.S., documents in Mr. Aliyev's possession appear to show. One is the text of an email that Mr. Aliyev said a London consulting firm called Krull Corp. (UK) Ltd. provided to the Nazarbayevs.

It described the passage of a Kazakh politician and potential Nazarbayev rival through Customs at New York's JFK airport. The email included the man's flight number, type of visa and U.S. hotel. Federal border-control agents collect such information but keep it in a restricted database.

The original shareholder of Krull UK after its founding in 1996 was Mr. Mirtchev -- the man Mr. Aliyev describes as Mr. Nazarbayev's point man -- according to U.K. records. (Krull isn't related to Kroll, the large consulting and investigative firm that is a unit of Marsh & McLennan Cos.)

Mr. Aliyev also displayed what appeared to be a report analyzing the cellphone records of a Washington lobbyist for the Kazakh political opposition. Mr. Aliyev said that Mr. Mirtchev provided President Nazarbayev with this report. Mr. Nazarbayev "was very much impressed when Mr. Mirtchev brought the copies of mobile and office phone" records, Mr. Aliyev said in the interviews. U.S. law prohibits unauthorized disclosure of phone records.

Mr. Mirtchev isn't just a political adviser to the Nazarbayev family but one of its key financial managers, according to Mr. Aliyev and others with knowledge of the family's affairs. The Nazarbayev family has at least hundreds of millions of dollars in assets in banks around the world, according to Mr. Aliyev, an assertion that is seconded by current and former U.S. foreign policy officials. Last year, the Kazakh government named Mr. Mirtchev an adviser to the country's sovereign-wealth fund.

Brian Shaughnessy, a lawyer for Mr. Mirtchev, said in a letter that Mr. Aliyev's claims "are false and have clearly been manufactured as part of a public smear campaign secretly mounted by your source, a convicted criminal and a fugitive from justice . . . in an attempt to regain political power."

Later, Mr. Shaughnessy added: "Mr. Mirtchev has never contacted anyone in any branch of the U.S. government, U.S. public opinion, policy, and laws, or political parties or conducted 'investigations' on behalf of the Republic of Kazakhstan or senior officials of Kazakhstan." In addition, Mr. Shaughnessy said that Mr. Mirtchev "has never moved any money to any accounts on behalf of the government or senior officials of Kazakhstan."

Mr. Aliyev made available bank records showing funds moving from a Nazarbayev family member to Krull UK. The records show two 2004 transfers totaling $4 million from World Media Corp. SAL of Beirut. That firm is controlled by Mr. Nazarbayev's daughter Dariga Nazarbayeva -- Mr. Aliyev's ex-wife -- lawyers for the consultants have acknowledged.

Records made available by Mr. Aliyev also show other transfers totaling $3 million to Krull UK from another Beirut firm that, according to Mr. Aliyev, is also controlled by Ms. Nazarbayeva. The wire transfers were confirmed by people who have access to international bank-transfer data.

According to these people, Krull UK has conducted large financial transactions through an affiliated Gibraltar firm called Brookrange Ltd. People with knowledge of the Nazarbayev family finances say they believe Brookrange has been used to manage the Kazakh first family's assets.

In recent years, Brookrange has made large wire transfers -- ranging from a few million dollars to over $100 million -- to obscure companies around the world, according to people who have seen records of the transfers.

Corporate statements filed with British regulators state that Brookrange was the owner of Krull UK from 1998 to 2004. A lawyer for Brookrange didn't respond to a request for comment.

According to U.K. corporate records, one financial backer of Krull UK is a Kazakh banker who sits on the board of the Kazakh telephone company. That banker, Aigul Nurieva, is also an investor with the Kazakh prime minister in a company in Singapore, records show. Ms. Nurieva helps Mr. Mirtchev manage offshore assets of the Nazarbayev clan, according to Mr. Aliyev and to others with knowledge of Nazarbayev family finances.

A spokesman for Ms. Nurieva denied that she manages money for the Nazarbayevs.

As for Mr. Aliyev's claims of money being paid for the right to do business in Kazakhstan, a recent civil settlement bears on the issue. Last year, settling with the Justice Department and the Swiss government, the Kazakh government agreed it would no longer contest U.S. allegations that Mr. Nazarbayev and other top officials had received tens of millions of dollars in payments from U.S. oil companies a decade ago.

The settlement freed up, for use in Kazakh social programs, a portion of $1 billion in suspected bribe money long frozen in Swiss bank accounts.

Some of that money allegedly came via a middleman named James Giffen, who has been under U.S. indictment since 2003. His case is mired in a dispute over his claim that he was working for U.S. intelligence. Both Mr. Giffen and the oil companies deny involvement in bribery.

Filings by the Justice Department in U.S. courts and in Europe, as well as bank statements and other documents, lend further support to Mr. Aliyev's claims about payments for the right to do business in Kazakhstan. One such document states that in the mid-1990s, South Korea's Samsung Group, while seeking the right to mine copper ore in Kazakhstan, paid $1 million into a Swiss bank account controlled by Orel Capital Ltd. Orel was owned by Mr. Nazarbayev, the Justice Department said in a New York federal court filing.

A Samsung spokesman requested more details about the matter but didn't reply after receiving them. The record showing the payment was an analysis prepared for the Kazakh government by outside consultants.

In his interviews, Mr. Aliyev also said the Nazarbayev family secretly holds a stake in or financially benefits from two Indonesia-based companies that have extensive operations in Kazakhstan. Kazakh opposition figures have made a similar allegation, except they added that Mr. Aliyev himself was among those benefiting. He denied that. Efforts to reach the Indonesian companies were unsuccessful.

Mr. Aliyev also said President Nazarbayev had an interest in a 2005 uranium-mining deal with a Canadian businessman named Frank Giustra. It was signed in the days following a meeting the Kazakh president had with Mr. Giustra. The uranium deal was with the Kazakh national nuclear-energy company, called Kazatomprom.

Mr. Nazarbayev himself owns that company, through offshore entities, Mr. Aliyev asserted.

Kazakhstan beyond Borat

A British journalist offers a colorful look at an ancient land and its people.

Apples Are from Kazakhstan: The Land that Disappeared By Christopher Robbins Atlas Co. 296 pp., $24

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Ask any Western family heading to Kazakhstan to adopt a child: It’s hard to scare up readable English books on the Central Asian nation, and even harder to find an upbeat one. Like the rolling Kazakh steppe, the few existing volumes tend to be dry and bleak.
Into this landscape comes Christopher Robbins’s Apples Are From Kazakhstan: The Land That Disappeared, a colorful, whimsically illustrated travelogue about the past and present of an ancient land and its people.

Many foreigners couldn’t find Kazakhstan, a nation the size of Western Europe, on a map – and the country’s history is just as mysterious.

“Modern Kazakhstan occupies a region of Central Asia that is not only a lacuna in the knowledge of most of the West, but has also been shrouded in mystery from the beginning of time,” Robbins writes. “To the ancients it was an unexplored and inaccessible world more myth than reality.” For today’s average Westerner, little has changed, but Robbins aims to alter that.

As his title suggests, along with the rich artistic and social legacies of its once nomadic inhabitants, and the vital role it played as a Silk Road caravan route, the land is thought to have given the world apples, tulips, and possibly even King Arthur.

From the hat-shaped airport in the former Kazakh capital, Almaty, to the spiky, oil-funded grandeur of its present one, Astana, the book shatters the pervasive image of today’s Kazakhstan as a backward land of bigotry and Borat.

“I took to Almaty, the apple city, from the beginning,” Robbins writes – despite the pounding of an all-night disco under his hotel room and some evocatively Soviet encounters with the hotel staff. Once installed in a cozy apartment near Russian revolutionary Leon Trotsky’s former exile digs, Robbins spends his days visiting golden eagle hunters, Kazakh antiquities experts, and of course the famous apple orchards.

When he leaves Almaty to travel to Astana, he seems to share the regrets of legions of bureaucrats who’ve been ordered to relocate to the odd new capital. This shiny $10-billion metropolis “bang in the middle of nowhere” is so thick with construction cranes, “so spanking new, so lacking in a settled identity, it seems unreal.”

From there Robbins heads northeast, finally hitting the southern edge of Siberia in the “scruffy” city of Semipalatinsk. Once home to exiled novelist Fyodor Dostoevsky. the area later became the nerve center of Soviet nuclear weapons testing. Kazakhstan was the USSR’s Nevada, and its citizens were unwittting human guinea pigs in radiation experiments that poisoned the people and their land for 40 years.

Throughout his journey, Robbins also meanders through Kazakhstan’s past and politics: from the military might of Genghis Khan; to the collectivising policies of “The Great Gardener,” Joseph Stalin; to the modern ambitions of Kazakh President Nursultan Nazarbayev.

Nearly two decades into his presidency, foreign observers remain divided about Nazarbayev. His celebrated decision to dismantle the country’s Soviet nuclear stockpile touched off an explosion of investment in Kazakhstan’s vast oil and mineral resources. But corruption charges and high-profile murders of opposition journalists have left many skeptical.

Robbins, though, takes to the president, enjoying access unprecedented for a Western writer. Together the men travel by helicopter to remote holy sites, spend evenings listening to Kazakh music (even played, with delicacy, by Nazarbayev himself), and share traditional meals of horseflesh and boiled sheep’s head. Along the way, the author gets rare insight into the president’s own life and the birth of independent Kazakhstan.

Though Robbins’s generalizations are at times too general, and his remembered conversations sometimes improbable (what “gentle but unworldly redneck” from Arkansas would call a shopping cart a “supermarket trolley”?), his writing is lively, and his storytelling informed and captivating. The sum may indeed, as he hoped aloud to Nazarbayev, make for “a book on Kazakhstan that will be read for many years to come.”

Mary Wiltenburg traveled to Kazakhstan in 2005 on an International Reporting Project Fellowship from Johns Hopkins University’s School of Advanced International Studies.