Vol. 2, No. 20 (October 15, 2009)

Turkmenistan’s ‘mixed’ signals

Kenyon S. Weaver
Caspian Business Journal
Over the two months, Turkmenistan has sent Azerbaijan and the world decidedly mixed signals.  In August, President Gurbanguly Berdymukhammadov announced that Ashgabat would build a new naval base on the shores of the Caspian Sea in order to protect his country’s borders and to protect it and its coastline “from evil-minded foreigners,” but then in September, at the United Nations General Assembly session in New York, he called for “an international conference on disarmament issues in the region of Central Asia and the Caspian Basin,” saying that his government “would also welcome constructive proposals of the international community and individual nations to promote disarmament processes.”
The Turkmenistan president’s first declaration came only weeks after he declared on July 24th that Ashgabat would go to the International Court of Arbitration to get a ruling on the ownership of disputed sections of the Caspian Sea, including Sardar/Kapaz and what Turkmenistan calls Oman and Osman.  As of this writing, the Turkmenistan government has not yet filed this case, apparently because the country’s foreign ministry has not yet succeeded in finding “the international experts” and “qualified lawyers” the president told his chief diplomat Rashid Meredov to assemble in order to examine documents dating back to Soviet times. 
It is of course possible that this International Court would conclude that it lacks jurisdiction unless Azerbaijan were to voluntarily submit to that body’s ruling.  Ashgabat may face yet another problem: its own lack of clear-cut standing.  But if Turkmenistan does follow through and files a brief, Baku almost certainly will have its own lawyers working just as hard to counter the Turkmenistan appeal. 
What do all these moves mean for Baku?  An answer to that question lies with Turkmenistan’s policy of bitaraplyk, or “neutrality.”  That concept, which is repeated constantly, is an essential part of Turkmenistan’s national psychology, of its sense of what in fact the country is.  It helps to explain why Ashgabat is so proud of its hosting of the UN Regional Center for Preventive Diplomacy in Central Asia, why it avoids both joining the Shanghai Cooperation Organization despite Russian pressure or having an American base, which some in the United States have proposed.
Given that set of attitudes, it appears likely that the Turkmenistan president’s announcement of plans to set up a naval base was intended as a bargaining chip in negotiations over projects like the Nabucco pipeline.  Some actually saw the decision to arbitrate as a progressive option.  Ilham Shaban, for example, an Azerbaijan-based energy expert, has told RFE/RL that a court verdict – if “fair,” of course – would be a “natural step,” and that arbitral resolution could actually help relations between the two countries and could even stabilize the political ground for a project of the size and scope of Nabucco. 
Another part of the explanation for this set of mixed messages reflects Ashgabat’s shift in its economic policies from the time of former president Saparmurat “Turkmenbashy” Niyazov.  This December will mark the third anniversary of the death of Niyazov who kept the country isolated, and in that intervening period, his successors have shown themselves to be far more open to foreign investment than he was.  Given that new openness, Turkmenistan clearly enjoys the interest it has attracted because of its resources and location. 
Many countries, not least of which is the People’s Republic of China, have manifested an interest in developing Turkmenistan’s South Yolotan-Osman gas field, the full extent of which has only recently been announced.  China has been involved in Turkmenistan for many years and now would like to expand its position and has built a new gas pipeline from Turkmenistan’s Eastern fields to China.  That links Ashgabat to Beijing and helps to explain why Turkmenistan has resisted Russian pressure to join a new gas cartel.  And together with the China pipeline, the Nabucco project, if it is realized, will also link Turkmenistan into a broader web of interrelationships than it has had at any time since 1991. 
An accident last April not only opened a window of opportunity for the United States and Europe but also provided hints about Turkmenistan’s new pragmatism.  The April 14th explosion ruptured Ashgabat’s main pipeline to Russia.  That line is now close to being repaired, but the damage done to Ashgabat’s bottom line appears to have been far more significant and longer-lasting than many had expected.  While the pipeline to Russia has been repaired, it is far from clear whether relations with Russia’s Gazprom have been rebuilt as well. 
Because it was not able to export gas for an extended period, Turkmenistan suffered significant losses, and those losses in turn have led Ashgabat to a new appreciation of the value of diversification of routes lest it suffer again.  That pragmatism has little to do with any anti-Russian sentiment as some have thought but rather reflects a very sober calculation of the country’s best interests as a gas exporter.
Indeed, Ashgabat continues to work with Russian firms like the independent Itera which in early September announced that it had reached agreement with Turkmenistan to develop an offshore block in the Caspian.  Itera has a long history in the Turkmenistan and Russian petroleum markets, and the composition of its management team – technocrats and politicians from Soviet Turkmenistan – gives it advantages as a middleman for Turkmenistan in reaching Western markets via Russia. 
At the same time and reflecting Turkmenistan’s new pragmatism and appreciation of its own natural wealth, Ashgabat has reached out to other firms, including Germany’s Rheinisch-Westfaelische Elektrizitaetswerk (RWE), to gain access to Western expertise and markets and guaranteeing that Turkmenistan will never again be dependent on a single route or a single firm.  That approach helps to explain why some of Turkmenistan’s statements and actions appear contradictory: In fact, together they suggest that for all the attention any one of them may receive, Ashgabat will pursue the very best deals it can for the development of its hydrocarbon reserves.