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Turkmenistan in 2018.

Tariq Saeedi

Ashgabat, 14 December 2017 (nCa) - The official New Year tree will light up tomorrow, marking the shift of the country into a festive mood in anticipation of 2018, a year that would be full of challenges and opportunities.

* * *

According to the Chinese astrology, 2018 would be the Year of the Dog. It is perhaps no coincidence that Turkmenistan has lately been highlighting its sheepdog Alabai, a superb breed known for its faithfulness, strength and intelligence.

Alabai was the mascot of the 5 th Asian Indoor and Martial Arts Games (Ashgabat 2017), held in Ashgabat in September this year.

President Berdymuhamedov, on his visit to Russia, presented an Alabai pup to President Putin.

Next year a separate organization on the pattern of Turkmenatlary (Turkmen Horses) could be established for the preservation and promotion of Alabai.

Astrology may arguably be an elaborate bunkum but there is no denying the fact that it continues to fascinate a large segment of the population - perhaps because we always need something to reassure us.

The Chinese astrology has a cycle of 12 years, each year represented by an animal or bird.

The Year of Dog has the lucky numbers 3, 4 and 9. The lucky colours are red, green, and purple. Lucky flowers are rose, cymbidium orchids.

The Chinese astrology is not a simple 12-bin cupboard. Each of the year, or zodiac sign is associated with one of the five elements: Gold (Metal), Wood, Water, Fire, and Earth. This creates 60 sets of possibilities.

The element for 2018 is Earth and zodiac sign is Dog. It would be a year of Earth Dog.

Earth Dog is supposed to be communicative, serious, and responsible in work.

The lucky directions for Earth Dog are East, South, and Northeast.

* * *

The astrology promises a good year.

Even though there are enormous challenges, the year 2018 can be turned into an exceptionally productive year for Turkmenistan and its foreign partners.

The key would be the adjustment in perceptions - in this case the fine tuning, continuous fine tuning, of the cause-and-effect patterns.

* * *

Turkmenistan has declared 2018 as the year 'Turkmenistan - Heart of Great Silk Road.'

This time around, the Silk Road is not just a patchwork of trails. This time it is a lot of things: It is the means of transport and transit by land, air, and sea. It is the overlapping networks of oil and gas pipelines. It is fiber optics links. It is electricity transmission lines. It is corridors. It is trade routes by whatever name. It is connectivity. -- Yes, CONNECTIVITY is the New Silk Road.

By this logic, TAPI, TUTAP, TAP500 are as much a part of the Great Silk Road as are the Lapis Lazuli Corridor, the North-South Corridor, the Central Asia-Middle East Corridor.

We shall return to the possibilities in this area a bit later.

* * *

First, the challenges facing the country:

The GDP growth this year would be 6.5% according to the official estimates. Some international financial institutions are projecting a somewhat lower figure. The difference could be in methodology. Regardless, the fact is that GDP growth alone is not a decisive factor when looking at the short-term prospects of the economy. For the purpose of worse-case scenario, let's assume that it is less than 6%.

The national currency Manat is under considerable pressure.

Throughout 2017 no mega-projects were awarded to the foreign companies.

The foreign partners are getting impatient because of uncertainty.

The new cases of bribery and corruption are being unearthed almost every week.

Some of the best equipment and technologies are installed in a number of facilities but there is the lack of the capacity to properly use and maintain those facilities.

Russia has still not clarified whether it would buy any natural gas from Turkmenistan in 2018, Iran is stubbornly sticking to its unreasonable stance of refusing to clear the debts it owes to Turkmenistan, and China is the only bulk buyer of gas at present.

* * *

These are the problems but the solutions to these problems are also close at hand.

The GDP growth is a misleading indicator because the slowdown is caused by the slump in the oil and gas markets globally, the worldwide banking and finance crisis, and the cash crunch that usually follows in their wake.

Considering the fact that Turkmenistan inherited almost nothing from the Soviet Union as far as the industrial base is concerned, the country has done exceptionally well since independence. There was little else besides the gas processing and piping infrastructure just a few years ago.

The current slump is a blessing in disguise.

The loss of revenues from the gas exports has encouraged Turkmenistan to widen its industrial sector and kick-start the import substitution drive.

As was reported last week during the cabinet meeting, the imports have already dropped by about 20%.

The bribery and corruption is being tackled in a big way - there are the plans to expand the scope of the state service for combating economic crimes. The parliament has been asked to ensure that the people sentenced for bribery and corruption are declared ineligible for pardon.

During this year it was declared that most of the construction work has been completed and except for the industrial sector, hardly any major construction projects will be available for the foreign companies.

The development plan for the period 2018-2024 has been finalized and it will come into action with the start of 2018.

It is a comprehensive plan, giving the roadmap for step-by-step industrialization of the country, and in doing so, weaning the economy from the hydrocarbon revenues to a considerable extent.

Somewhere in the middle of this plan, the private sector will come into a position to contribute about 70% of the GDP.

Simultaneously, land reforms are taking place, and the state commission for food security has been established.

The land reforms, about three years down the line, will start giving tangible results: the farmers would be tilling their land with peace of mind that comes with long-term lease-holding agreement, and some of them will be free to sow the crops of their choice.

There is stress on greenhouse cultivation of fruit and vegetables in the vicinity of the major cities.

The parliament was supposed to complete its present term in December 2018 but the MPs have voted for making the last Sunday of March 2018 as the time of expiry of their term. This will be applicable to the future elections - on the completion of every 5-year term the fresh parliamentary elections would be held on the last Sunday of March. The early elections of the parliament would be a time of major transformation. Also, Ms. Akja Nurberdieva, the chairman of the parliament since 2006, and a member of the parliament for nearly 22 years, has turned 60 this year. Even though she is full of energy and carries rich experience of parliamentary affairs, she may decide to step down as the age of retirement for females in Turkmenistan is 57.

Halk Maslahaty (Peoples Council) has been revived at the national level. It will believably have wide powers and its own permanent secretariat in Ashgabat.

These are some of the major developments expected in 2018 that suggest that Turkmenistan is following a well planned strategy to restructure its national life and economy.

* * *

If the new parliament is taking shape in March, the Halk Maslahaty is about to emerge as the people's voice with real powers, and the seven-year development plan for the period 2018-2024 is about to be triggered, what are the prospects for the foreign partners?

What we know for sure that the era of mass award of construction contracts is over. Whatever construction work will take place in future will possibly go to the local companies who have adequate capacity in this sector. In case of rather complex projects, it could be a consortium of local and foreign partners.

With the fast-pace transformations taking place in Turkmenistan, the shape of partnership patterns is also in flux. Some of the new features are discernible already.

* * *

In 2018, we will see the start of what can be called the New Turkmenistan - a country reinventing and rebranding itself. It will be the year of the Great Silk Road.

There would be the need to build massive capacity for the use and maintenance of the existing and planned industrial and other facilities. This would best be done by organizing OJT (on the job training) here in Turkmenistan. This would enable large number of workers to get trained on the facilities where they would actually work. This is an important area for foreign partners.

The country is pursuing hi-tech and innovative solutions. This is understandable, considering the hype and romance associated with the cutting edge technologies.

Nevertheless, if we look at the fact that most of the population of Turkmenistan lives in small villages and settlements, it is clear that a big part of the industrialization drive should consist of medium-tech solutions - the production of such items that are commonly required in each household but are easily produced by the use of the machinery that is not very complicated and has the potential to provide employment to large number of people within their own localities. This is also in line with the spirit and aspirations of the seven-year development plan.

Banking, insurance and freight handling are the areas where Turkmenistan will benefit by partnership with the foreign companies. These solutions should be part of the industrialization proposals by the foreign partners.

It must be kept in mind that Turkmenistan is a small market with population of around six million. As such, very limited quantity of production can be absorbed locally. The foreign partners would have a better chance of clicking with Turkmenistan if their offers include the buy-back option for the surplus production. They can take advantage of the educated and disciplined workforce available at comparatively lower cost, peaceful environment, guaranteed availability of gas, electricity and water etc. at reasonable prices, and take a portion of the end product for sale wherever it is in demand. If you come here with the knowhow and technology, partner with Turkmenistan to produce something that is in demand locally and abroad, and take the surplus output to the markets where you can sell it, you are already looking at an idea that has a strong chance of success.

The present cash crunch, which will certainly linger for a while, is no hindrance against the development plan of Turkmenistan. As the president of Turkmenistan said recently, the stabilization fund is in robust health, able to generate and sustain the velocity for development.

* * *

Since we know that Turkmenistan doesn't look at things in isolation - in the worldview of Turkmenistan everything is connected with everything else - we can be sure that the current challenges are also the exciting possibilities in disguise.

From now on, it is the spirit of the Great Silk Road.

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Publication:News Central Asia (Ashgabat, Turkmenistan)
Geographic Code:9TURM
Date:Dec 14, 2017
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