The Strategy Den Blog Archives: Trade Facilitation in Central Asia
September 18th, 2010
I have been finding links discussing my work with USAID in Central Asia so I am updating them here.
Intellectual property protection in Kyrgyzstan. We are less worried about the fake Luis Vuitton bags proliferating in Central Asia capitals than fake medication and other dangerous products.
The American Chamber of Commerce in Tajikistan. I really hope they attract more members and those doing greater volumes of business. They are just starting and have about 25 members, but are positioned to do a lot of good things for the business community. Only place to go is up…
September 15th, 2010
I was looking for answers concerning the above and saw this article on economic reforms in Georgia in the Economist. I became enthralled with the quote by Georgian philosopher Merab Mamardashvili that can be found in that article. I was able to find an interview that Mamardashvili gave near the end of his and the Soviet Union’s life.
Mamardashvili describes civil society and democracy free from the political slogans so popular with lawmakers and agenda-setters these days. The condition of those living in Soviet society is best described by those who lived in it, and reflected upon it for many years. Since he’s writing at the height of the period of glasnost and East-West friendship, you’d expect more optimism.
All countries have to deal with organizing public life in ways that improve standards of living. Mamardashvili’s ideas form the basis for understanding how that can happen in the Former Soviet Union. In Central Asian nations, there is a level of centralized control that inhibits many positive develops: economic growth, education, art, culture and productive thought. Progress in these areas has been superficial, if present at all, and likely to be ephemeral. Leaders, power brokers and elites argue publicly that their countries need strong leaders, centralized control and other regressive elements that drive those with means to the visa lines at European and North American embassies.
Surely, I do not endorse the obtuse silliness and televangelist anti-intellectual style that characterized discussions of democracy under the Bush administration. Many citizens of Central Asian countries want to remove corruption and change their countries because they view society as fundamentally unfair. Why are they unable to change this? “Fairness” is more important than democracy.
There’s my slogan.
August 4th, 2010
I was excited to read this article in the New York Times.
It is edifying to see that Cohen and Ross can get peoples’ attention at State, and may even influence how people at embassies do their jobs. One thing to keep in mind is that in most dictatorships or countries characterized by a deficient civil society, people are media savvy. They assume that state sanctioned media outlets are, for the most part, tools to perpetuate presidential power or make money for elites served by those outlets. For a short time, people with unfettered Internet access in less democratic countries may look at Web sources like Twitter, Wiki Leaks or YouTube, but it is unlikely that they will view them as any more credible than other media sources. They are also aware that ruses and hoaxes exist on the Internet. Events portrayed in YouTube videos like that showing the death of Neda Agha-Soltan are not conclusive enough proof to many people. Videos, photos, provocative stories with little factual substance or just made up stuff… People don’t know what to believe anymore. In the countries where I work, I sense that educated and not so educated people feel that information from all sources is disseminated for the benefit of its creator.
September 15: UPDATE
Since this article came out I’ve seen more and more attempts by governments to control telecommunications, bandwidth and the newest means of disseminating information: Blackberry, Twitter, Skype and other channels have been subject to arbitrary shutdowns by certain ministries of communications due to security concerns. Some paranoia about the tremendous power of these channels.
Personally, I’d be more paranoid about the impending attacks on Net neutrality…
June 19th, 2010
While I work on some new drafts, all I have are these photos…
From Tashkent, Uzbek artisans reach out.
Fanta and Uzbek plov: the essence of globalization or just two great tastes.
June 7th, 2010
April 29th, 2010
I probably shouldn’t write too much about this topic right now, but this is the best analysis I’ve seen from the ICG. Download the whole report.
I wish my writing was less dull like these guys, but then I might need to get a new job.
Here is my June 20 update:
As much as I want to refrain from commenting on events in KG, I do not seem to be able to concentrate on any other professional issues. Looking at past scenarios that are somewhat similar, Lebanon and Bosnia come to mind. I would get peacekeepers in there ASAP to avoid further violence, and not just in the south.
April 15th, 2010
Civil society organizations, NGOs, journalists, providers of aid and assistance and multilateral development banks like the World Bank frequently take issue with the decisions of heads of states that are recipient countries. The greatest countries are those where leadership makes decisions in the best interest of their constituents, and multilateral development banks use conditionalities and conditions precedent to encourage this. These find their way into frameworks with results, milestones and benchmarks that must be attained for additional tranches of loans or concessional funds to be disbursed, or for one donor assistance project or another to continue. Some of these frameworks are constructive, maybe even good. Those that are aligned with reform efforts that high-level government officials are seen promoting on the evening news and in the newspapers are good. The World Bank ascribes key characteristics to conditionalities that are most likely to be successful. These are:
Ownership: Borrowers stand behind the reforms financed and intermediate steps towards their implementation.
Harmonization: Work with other donors/partners to have uniform requirements, standards and expectations.
Customization: Canned solutions rarely work. Ask yourself what about this country’s environment will make this conditionality not work?
Criticality: Keep to what is essential to deliver results.
Transparency and Predictability: Clarity on what is being measured, how, when and by whom.
Donors are looking for a silver bullet to make heads of states, elites and decision makers do what they should. The problem is that the international aid, assistance and technical advice should go to countries that most need it, those that are the poorest and most dysfunctional. This should be the rule even when elites and the head of state are robbing and pillaging the treasury.
Donors do not get to chose what country is at the bottom, nor who runs those countries. They may wring their hands wondering what to do when the head of state of a recipient country does bad things. Often, the answer is to cut aid and assistance, decide to have nothing to do with the country, or try to channel funds directly to disadvantaged citizens. We must always find a way to engage in the worst run countries with the most corrupt regimes. This is especially true with regard to economic reform projects which take time as interests get worked out gradually. Stopping and starting them up again every time recipient country leadership falls out of favor gets nowhere. For the most part, these parts of the world have bad leadership because they are underdeveloped and they are underdeveloped because they have bad leadership. Those are the neighborhoods that need donor assistance. A country with a great government that makes the best decisions for its citizens and invests more in public goods than its elites haul off and hide in overseas banks will not be a country reliant on aid for very long.
February 24th, 2010
Countries in Central Asia, particularly Kazakhstan, are concerned with competitiveness. They seek some way to become wealthier, diversify their economies, and put in place reforms that will lead to sustained economic growth. A litany of studies have been undertaken to address the matter. Sectoral analyses have lauded the opportunities in industries as diverse as fruit cultivation, tourism and high technology. Governments proclaim initiatives to diversify the economy, create economic opportunities and unleash the entrepreneurial spirit of citizens.
I suggest that studies be undertaken to determine why these efforts have yielded so little. Economies in the region are still oriented towards natural resources. Small and medium sized business are not yet the bulwark of economic growth that they are in developed economies, and constituents are unclear what national competitiveness strategies have accomplished. Countries need to analyze why competitiveness strategies are not successful and what is it about policies, decision-making and elements of the business environment that limit improvement. Clearly, government structure is not fit for rapid improvement in these areas. Inertia, interests and simply how government works need to be remedied or competitiveness won’t be achieved.
There are many good reasons for countries to not rely on extractive industries. The most important is the environmental impact of these industries makes them unsustainable.
In addition, there are factors that are beyond the manageable interest of a single government or head of state to master alone. China and the former Soviet republics have different gauge train tracks: not a big deal if you can swap those cars quickly, and there actually are enough cars ready to take the containers… China is undergoing a number of trade-related reforms such as harmonizing protocols for foreign transport vehicles. Currently, Kazakhstani vehicles of all types cannot circulate in China. This impacts trade and economic growth. Kazakhstan can join the customs union with Russia and Belarus, but Kazakhstan alone cannot make delays at borders disappear. Water, energy, transport and trade require regional cooperation to overcome the formidable obstacles to growth faced by the region.
January 31st, 2010
Just back. I enjoyed “one of the world’s most secretive places.” Did not find it so secretive as the philosophy is made clear. Criticism is viewed as being impolite, and the government spends tons of money on basic utility service.
With a population of 5 million people and gas revenues at more than $1 billion a day, Turkmenistan can take care of its basic needs, but economic reform and investment in education are needed.
The infrastructure in this village 30 minutes from Ashgabat looks excellent.
Imagine the near-future with cars that get three times the fuel efficiency as today. Europe has severely cut growth in consumption of fossil fuels and will continue to do so. Demand in Europe not been growing over the past several years. India and China are the growth markets, but there are a lot of large producers. Technology may make deposits increasingly accessible. While Turkmenistan may eventually sell most of its gas to China, it may find competition from Russia and other suppliers. The deal with China was made possible largely because Russia didn’t have a customer for the Turkmen output in Europe or domestically (where Russian gas is sold below market rates).
I can get behind free gas for this greenhouse growing lemon trees and other tree crops.
Without a prolonged discussion about the extent to which economies based on extractive industries in the Former Soviet Union suffer from Dutch disease, suffice it to say that basing your economy on these can lead to environmental and societal retrograde. Countries are aware. The real “disease” is overcoming the inertia of a state apparatus subservient to these industries.