Monday, July 15, 2013

tuesdays in turkmenistan: the potential of Galkynysh

I have been sitting on this post for a couple weeks. Now that I'm back in the blogging spirit, this is a good time to post. It would have come out last week had it not been for my visit to Ashgabat last week. In fact, my visit was partially related to this subject, but alas, no further details can be provided on the matter.

There is a massive gas field in Turkmenistan called Galkynysh. The field, which used to be called Yoloten, is massive. One of the largest gas fields in the world ever to exist. If you have ever heard me speak about the potential of this country and where its financial future lies, it is this field I have in mind. It is the country's goal to produce gas from this field soon, and eventually reach quantities that will sustain pipelines to China, India, Europe and anywhere else they can find a market. Turkmenistan has the opportunity to become like some of the oil-rich Gulf nations. High resource wealth mixed with low local population means a very-high average standard of living can be achieved. There are two major social stumbling blocks in addition to the many technical and geopolitical ones. Only touching on the technical aspects briefly, I want to mention that this is not an easy field. Drilling will require a reasonably high level of technical sophistication. In terms of geopolitics, gas means pipelines for Turkmenistan as a land-locked nation (ignoring the Caspian). Pipelines need to be built and maintained. Ok, there's one to China now (in addition to the one through Kazakhstan and Russia). But building one to India, through Afghanistan and Pakistan, will not be easy and a trans-Caspian line to Azerbaijan and eventually Europe will also meet with resistance, mostly from Russia. I think these are actually all fixable problems. Some of it is technical, some is political, and money will carry the day to get things done.

Back to the social stumbling blocks. First, a high average standard of living does not mean a good standard of living for everyone. Some people will do very well, and there are always some who do exceedingly well for themselves in places like this, while others will do moderately well (ie: the future professional/middle class), and there will be those who do not fare so well. Perhaps progress will bypass their lives or social programs will not reach all corners of the country or perhaps plain old ethnic divisions will continue. Ashgabat has become a shining marble beacon already, but the rest of the country has yet to be so fortunate. How long and how extreme can the disparity become until it creates unrest? The next 10-20 years will be interesting to say the least.

The other social stumbling block is labor. As in, where does the labor come from? Does Turkmenistan want to go the same direction as some of the Gulf states and import significant amounts of expats? For its own sake, I think it should not and in practical terms, it may not be able to anyway. Countries like Bahrain and Qatar have less than one million citizens each, but have total populations that are more than half-expat. Saudi Arabia is the world's largest oil producer with less than a tenth the population of the U.S. (which itself produces more oil than most people realize). Turkmenistan, with 5-6 million residents does not seem eager to embrace significant amounts of outside labor. For sure it exists, as evidenced by significant numbers of Turkish construction projects. However, the Chinese, despite their investments into the country, have been rebuffed many times and only a limited number of visas are available for Chinese nationals to support the operations of the Chinese state company CNPC in the eastern part of Turkmenistan. And vast waves of cheap labor from India and Southeast Asia like you see in Bahrain, Qatar, and U.A.E., have yet to flood into the country. There are obvious hurdles in terms of getting visas, but additionally, local labor is still relatively cheap. The challenge lies with the quality of local labor. It would benefit the country to significantly invest in education and health services. The benefits are numerous: educated labor force, reduced population growth (which is rather high), and the ability to employ the nation's citizens in the nation's own projects. This allows more of the investment to stay in the country instead of going abroad with expats like myself.

There is so much potential here. Turkmenistan has before it so much opportunity, but fulfilling these opportunities depends on the people here, especially the political leaders.

Tuesday, July 09, 2013

tuesday in turkmenistan: neutrality monument (and a brief tour)

Finally! I have been in Ashgabat the last few days and a colleague who grew up in the city took me out on Friday after work to see some of the sights. One of our stops was the Neutrality Monument, formerly known as the Arch of Neutrality. It had been a place I wanted to visit since early on in my time here. It used to be in the city center, but was moved a couple years ago to its present location at the edge of the city. The construction company in charge of its move has some nice photos on their website. I took photos of my own, available upon request.

We went up to the observation deck near the top. There was also a museum level, but since we were there after 5pm, the museum was closed. The area is also surrounded by a nice park. Beyond the park, the area is part of the city where they have tried, with varying levels of success, to plant mass amounts of pine trees. This tree planting occurs in every city, but is particularly large in scale in Ashgabat. They are trying to green this desert landscape and it isn't easy. Regarding the monument, it is a bit absurd, though one could argue most monuments are absurd, especially from an outside perspective. I found the elevators that go up the legs to be quite interesting. The three legs are angled and two of them have a mechanical lift that goes up and down it like a very steep trolley. The third leg has actual stairs, though the stairs were closed during our visit. The lift is something like a cross between an elevator and an escalator (and it has no air conditioning). It also costs a reasonable 1 manat (about $0.35) per person. It's not clear if the stairs would have been free.

My colleague had a whole list of places to go, but some road closures prevented us from visiting some of them. In particular, we were turned away from the world's largest indoor Ferris wheel. It shall have to wait for another day. Instead, we went to a local park with statues of past historical figures from the country and did a driving tour of much of the city. There is a peculiar propensity to make official buildings in the shape of something related to its purpose. For example, the dentistry school has a curved top shaped a bit like a molar. The telecommunications building has the shape of something where you could hang a phone. The oil and gas building is shaped much like a cigarette lighter. The medical building has some twisting shapes similar to the serpents in the Cadeceus symbol.

If you live in Ashgabat, then you see a dramatically different place than what existed 10-15 years ago. Like many capital cities, much of the money from the country flows this direction. New construction abounds and many of the places we saw did not exist 10 years ago. This is what visitors see, or at least what they see first, when coming to Turkmenistan. A city of boundless construction and record-setting numbers of marble buildings. This image contrasts very sharply with what the rest of the country looks like and what another colleague told me a couple days ago. He said that outside of Ashgabat, people are not as happy. The money goes one way, towards the capital, and there are not rows of gleaming marble buildings in the rest of the country. Not yet, though probably not ever.

Tuesday, July 02, 2013

tuesdays in turkmenistan: wither JLo

Turkmenistan made it into the U.S. news cycle! Albeit, only because it involved prominent popular culture figure, Jennifer Lopez, often known as JLo (or less desirably as Jenny from the Block).

As has been reported in many articles, JLo performed a concert at a hotel resort area known as Avaza which is near the city of Turkmenbasy (which is about a three hour drive north-northwest of Balkanabat). Of course, with the reputation Turkmenistan, JLo was roundly criticized for the performance, which some claim she was paid upwards of $1.5 million for.

Is the apparent outrage with her performance justified? Can she (or her management team) claim to have not realized the nature of the performance, what the country is like, and that the President would be there? Going back to that first question, I'm not sure I really care about the outrage or whether people should be upset. Partly because I also work here, thus lending credibility/support to the regime and partly because this is how capitalism works. You pay someone for a service or product and they provide said items. Is it blood money or something terrible? Well, probably, sort of, indirectly yes. The advantage for me is that I am but one tiny blip in the NSA's PRISM net and I do not work in an industry where public sentiment of me, as in my individual self, matters. JLo's professional well-being relies on her being popular and inoffensive enough to avoid any public outcry.

Now going back to that second question (or really set of questions) from the previous paragraph. Should JLo and her team have known better? I think so, but I am also far more familiar with the affairs of Turkmenistan than the average person, though that does not take much. Part of it will depend on just who they interacted with to organize the event. Was it with CNPC as most articles state? If that's the case, then they should have done some basic research into what CNPC does (oil and gas), where they are from (China), who owns them (Chinese government), and what specifically CNPC was doing organizing a party in Avaza. Perhaps not known to Team JLo, but CNPC operates on the other side of the country. But Avaza is the crown jewel of Turkmenistan vacation spots, or at least that's what the billions the Turkmen government puts into the project want it to be, so perhaps it's just a good place to have a party. What is generally well-known within Turkmenistan is that the President loves to have his picture taken. After all, he's on the front page (above the fold!) of the national paper every single day. He also likes to be at major events, in this case, the grand opening of recently-completed parts of Avaza. To everyone in Turkmenistan, it is totally logical and expected the President would be at such an event. To people on the outside, especially Americans, it seems odd, arguably unexpected. After all, U.S. Presidents do not show up to the grand openings of every major construction project. However, the comparison is best made to a state or large city, something with a population similar to Turkmenistan's roughly 5 million. Would the mayor or governor appear at such an event? Sure, there is a decent chance for an appearance. And is getting JLo to perform for the President effectively a subtle bribe by CNPC? Well, it's not even subtle, though not as blatant as gifting him a yacht or whoever bought him this Bugatti. JLo's presence both strokes his ego and gives him more legitimacy, as if to say, "See, big American stars sing Happy Birthday to me so I can't be a bad guy."

Quite interestingly is the reaction from people here who are reading about this. Understandably, many people, especially the younger women, were excited that JLo, as an internationally known entertainer, came to their country. This is a big deal to them as it somehow validates the importance of the country along with the validation it provides to the President. What locals here seem more surprised by is the characterization of their country as an oppressive dictatorship with in-name-only democracy and a poor human rights record. They find this so surprising because it is simply not true for much if the nation. Well, the in-name-only democracy part is true for everyone. After all, after the previous President died, the current one became interim President through the magic of having the person who was supposed to be the interim President arrested along with many others. Then, he changed the constitution to allow himself to run in the next election since the previous constitution forbade interim President's from becoming elected. And Bob's your uncle. Anyway, people here were surprised because conditions here are improving. In the immediate aftermath of the dissolution of the Soviet Union, the Central Asian countries in particular badly struggled. So far from everything, very poor, and often reliant on Russia for contact with the West. The country struggled for several years, but has slowly been gathering wealth from its natural resources. Of course the wealth is not evenly distributed, but most people are seeing basic needs (ie: housing, food, gas) provided so they are happy enough and certainly see the improvement in very real and important terms. Even if the political leadership siphons the vast majority of the money away and corruption is rampant, conditions today are still much improved from what they were 10-15 years ago.

As for JLo and her supposed moral dilemma. She can donate her concert fee to charity, take the write-off, reap the positive press benefits and move on. Or she can wait it out and Americans will find something else to care about for 15 minutes.

Monday, July 01, 2013

a June wash

Whelp, June has become a wash of no posts. This issue with the censorship and needing to do some VPN hoop-jumping has deeply dampened my interest in writing. I end up with all these ideas and then go to this page and of course it is blocked. I really need to be writing posts offline and then doing the hoop-jumping at a more convenient time. The problem is compounded by two other things. First, I was home part of June and I oddly don't blog much while home. It's a mix of being busy with more interesting things and simply from being incredibly tired. Finding energy while home is never easy since the work never quite goes away and is always there in the back of my mind. This brings me to the second item which is work itself. I am busy. Perhaps not in a way that translate to lots of revenue for the company, but it feels like I am much busier at work than I used to be. Things are always in transition, but this is more transition-y than usual and I feel like I'm running hard just to stay in place.