Problems With Current U.S. Policy.

Even though the U.S. government sought to help mitigate the Aral Sea crisis, its well-intentioned efforts have conflicted with other donors' programs. First, AID did not actively coordinate with other donors, even though its regional cooperation program was established after the others. For example, during the spring of 1993, the World Bank (in conjunction with the UNEP and the UNDP) met with the Central Asians to devise a program framework for the Aral Sea Basin. One of its primary objectives was to strengthen the institutional capacity of the two new interstate organizations for water management constituted by the Central Asian governments in 1993--the International Fund for the Aral Sea (IFAS) and the Interstate Council for Addressing the Aral Sea Crisis (ICAS). In 1997, these groups merged to become IFAS. But AID, unlike the World Bank, has concentrated its efforts outside this framework.

Second, rather than collaborating with the World Bank, the UNDP, or the European Union, AID pursued its own set of negotiations with the Central Asian states to foster regional cooperation. For example, AID offered its assistance in late summer 1996 to the Interstate Council for Kazakhstan, Kyrgyzstan, and Uzbekistan (ICKKU)--an organization that was created in 1993 to foster economic cooperation among the three Syr Darya states. Instead of approaching the Aral Sea Basin as an integrated water system, it sought to deal with the Syr Darya River Basin and the Amu Darya River Basin separately in hopes of breaking the impasse between the Syr Darya states, who each year were having to renegotiate barter exchanges between water and energy resources.

Due to competing aid programs, the Central Asians found themselves having to balance different sets of negotiations that often were dealing with similar issues but were conducted in isolation from one another. Over time, it became unclear which interstate organization was responsible for water allocation decisions and which was supposed to develop programs to mitigate the overall Aral Sea crisis.

Third, AID's decision to work outside the other donor initiatives caused much confusion, redundancy, and overlap among the donor programs. AID argued that the World Bank's program only propped up the former water nomenklatura (state bureaucracy) instead of undertaking real reform. However, it was necessary to work with the former water nomenklatura right after independence, since the scientists and bureaucrats comprising ICAS/IFAS and other affiliated organizations could have subverted donor attempts at reforming the water sector by refusing to cooperate with other initiatives. AID's decision to support ICKKU rather than IFAS, in short, helped bolster yet another organization claiming authority for water management and competing for donor assistance.

Multiple donor programs have also led to the development of multiple interstate and draft agreements that are decoupled from each other. For example AID has helped produce a limited water sharing agreement over the Syr Darya, while the European Union's project has produced three draft agreements dealing with institutional structure, water use under present conditions, and joint planning.

Fourth, since AID's goals are broader than just environmental protection, several of its other aid programs have also conflicted with its water and environment programs. On the one hand, AID is concerned about interstate water cooperation, but on the other, it wants to see the Central Asian states undertake market reforms. As a result, it has encouraged privatization projects in Kyrgyzstan's and Kazakhstan's energy sectors. However, when Kazakhstan sold off its state-owned coal reserves in Karaganda, the new buyer refused to honor a barter agreement between Kazakhstan and Kyrgyzstan in which Kyrgyzstan received coal in exchange for allowing water to flow downstream during the summer. Similarly, privatization programs in Kyrgyzstan have inspired its policymakers to ask Uzbekistan and Kazakhstan to pay for the water it receives from Kyrgyzstan, which has made coordination much more difficult among the Syr Darya states. Since the downstream states are largely unwilling to pay directly for water, AID has had to develop alternative solutions in which the downstream and upstream states might exchange energy and water resources. These have included compensation arrangements for the wintertime water storage and summer releases from the main reservoir in Kyrgyzstan.

Finally, market reforms have taken precedence over democracy building efforts. Whereas in many parts of the world, nongovernmental organizations (NGOs) have been leading the fight to develop programs for ameliorating environmental degradation, NGO activity in Central Asia has decreased since independence. NGOs such as Union for Defense of the Aral Sea and Amu Darya are struggling to raise donor awareness for local initiatives to resolve the Aral Sea crisis. Although AID has funded Western NGOs such as ISAR (Initiative for Social Action and Renewal in Eurasia) to support the development of environmental NGOs in Central Asia, the Central Asian governments have over time become less receptive to international democracy building efforts. The most glaring example is Kazakhstan's Civil Code limiting NGO participation in political activity. In tandem with the Central Asian leaders' crackdown on the press and political parties and movements, U.S. foreign policy has shifted its emphasis away from civil society enhancement to the promotion of economic reform. As a result, Central Asian NGOs rarely focus on political activity and policy reform but rather on education, health, and awareness building.

Key Problems

* U.S. efforts at regional cooperation in the Aral Sea Basin have conflicted with other donor programs.

* Since U.S. foreign policy has a broad agenda in Central Asia, one set of programs may have unintended consequences for other programs.

* With time, U.S. foreign policy has shifted away from democracy building efforts toward economic issues.