Novaya Gazeta on where the power lies in Uzbekistan

Novaya Gazeta - home to, among others, Anna Politkovskaya, perhaps the most accomplished chronicler of Russian war crimes in Chechnya - had an interesting article yesterday on the extent of the power wielded by the State Security Service, or SNB, in Uzbekistan. Reporter Rustam Murzaev seems to have done a good job of "following the money" - to use a phrase from American journalistic history - but of course some might conclude that this article, coming so soon after the announcement that the US is getting unceremoniously kicked out of its airbase in Uzbekistan (which I've discussed here and here), was planted by vindictive US agents. All I've done is translate the article into English from the original, which is available here on Novaya Gazeta's website. We translate, you decide.

Cotton Without a Single Gunshot
Rustam Murzaev, Novaya Gazeta, August 11, 2005.

A “quiet revolution” has taken place in Uzbekistan: power is now in the hands of the chairman of the National Security Service.

The chief security guard rarely becomes a grey cardinal. That is just too dangerous for the head of state. As a rule, the role of the special services in all CIS countries has been limited to the opportunity to provide mafia-style protection (kryshevat’) to various commercial enterprises. The one exception is the National Security Service (SNB) of Uzbekistan, the head of which has concentrated in his hands all real levers of state power.

Power shifts like this are known as “creeping coups.” At the time of his appointment ten years ago, few would have thought that SNB Chairman Rustam Inoyatov would be able to circumvent the system of checks and balances put into place by President Karimov and become the second most influential person in the country. Today he is the person who determines the government’s personnel policy, which means he bears personal responsibility for the actions of the people he’s put in place - including in Andijan.

Nationwide HR officer

In matters of politics Tashkent has always been slightly ahead of Moscow. It was here during the Soviet era that the first party corruption scandal took place, which in large part spurred on the perestroika movement. Uzbekistan was one of the first countries in the CIS where the authorities purged the political opposition by banning a couple of political parties. What’s happened in the country today is what democratic society has been warning us about for some time: the de facto authority has passed over to the siloviki. Moreover, this has happened in a way that’s quite consistent with recent trends in Russia: in the name of fighting corruption and terrorism.

The methods of running a country are little different from the laws of the free market. In order to control an enterprise or a country, it’s not necessary at all to officially occupy the top managerial position. It’s quite sufficient to gain control over the leading middle managers or government officials. Or you can get the personnel department under your thumb and install your people in the key management positions.

There’s no such thing as a former intelligence agent. Upon attaining power, modest KGB officer Inoyatov executed a standard “penetration” operation. Put more simply, he installed his own people in all government positions of any importance whatsoever. The top of the management pyramid is in Karimov's presidential staff [apparat]. That’s where State Advisor to the President on Personnel Affairs and SNB General Ravshan Shamshiev works, along with his deputy Umar Ismailov. The post of Secretary of the Council on National Security is occupied by another SNB General, Ruslan Mirzaev. The field offices are composed of the appropriate operational divisions of the SNB. Beyond this are the rank-and-file employees and reservists who work in the ministries and government departments. The network of this “secret service” covers practically all government organizations. And, wherever they may be, SNB employees are also occupied with their primary duties, i.e., the collection of information.

Agents correspond in coded notes only in the movies. SNB employees have a different reporting procedure – so-called obezlichki [from the Russian word obezlichka, which refers to a system of work where there is no individual responsibility for specific portions of work product - trans.]. In essence, these are run-of-the-mill denunciations [donosy] – unsigned and untitled. Everything goes into the file – from the ill-advised statements of this or that government official to his specific actions. And then, these obezlichki serve on the basis for personnel decisions. The fine sieve of constant scrutiny doesn’t let any dissident thinkers pass through. Any newly discovered opponents of Inoyatov are immediately recorded as such, with all of the consequences that follow from this. “The President trusts paperwork,” they say in Uzbekistan. And the paperwork is drawn up by the SNB. And not for free, either.

Bureaucratic price list

It’s possible that the system constructed by Inoyatov could actually strengthen the state, if it were not for corruption. The same corruption that the SNB is supposed to be fighting. The system of obezlichki, which is practically impervious to outside control, functions as a profitable commercial enterprise.

It’s a known fact that the appointment of a district [raion] administration head costs from 50,000 to 200,000 US dollars. The post of regional [oblast] head is more expensive – here the prices start at half a million “green.” Ministerial positions and management positions in government departments and other organizations are all for sale. For example, the presidential staff has the authority to designate the directors of district oil depots – these appointments are made personally by one of three SNB generals. In order to get someone appointed a rank-and-file refueler [at one of these depots], though, all that’s required is the approval of the “agency.” The volume of this market can be measured in the millions – a favorable obezlichka costs upwards of 5,000 US dollars, and Uzbekistan long ago surpassed its Central Asian neighbors in the amount of government officials it employs.

Of course, the SNB doesn't get by just on obezlichki. Providing mafia-style protection (kryshevanie) to the state as a whole does not preclude doing the same for certain sectors of the state’s economy. The method of making money is the same. To use the lingo of mystery novels, the SNB works through agents of influence. What’s more, some of these agents are high-placed government officials. For instance, the head of the country’s flour-milling industry Anvar Rakhimberdyev, former head of the Andijan regional Security Service Directorate and former chief SNB personnel officer, is a member of the SNB’s active reserve. The postal service is headed up by Rafkat Migmanov, former SNB chief of intelligence and counterintelligence. And the precious metals mining industry is controlled by former SNB Deputy Chairman Utkur Kamilov.

But the most important link in the management structure is SNB General Eler Ganiev, the current Minister of Foreign Affairs. The country’s entire foreign trade and foreign policy complex is in his hands, including large-scale investment programs. This means that he controls all of the country’s foreign currency inflows.

Dispute resolution, SNB-style

Converting one’s official position into personal income can only be done using commercial structures. In Uzbekistan, formerly the center of the USSR’s cotton production, serious money can be made only on the export of this product. Here the head of the SNB acted directly, without involving agents. Ganiev helped out – thanks to his protection, a company called Baltazia, which is controlled by Inoyatov’s relatives, quickly found its way onto the market of cotton sales to the Baltic states. According to some reports, in order to take care of this, the Minister even had to pay a visit to the capital of Estonia along with Inoyatov’s nephew. The competition took itself out of the game – a company belonging to Bakhadyr Ismailov, which had been active in this market, quickly shut down after a criminal case was opened against Ismailov.

The cotton business is a super-profitable one. It’s not so much the obvious demand for this product in northern countries. Aside from everything else, importers make money on simple category misallocation [peresortitsa], indicating low-quality cotton fiber in tax and customs documents instead of the actual higher-quality fibers involved.

This was not a particularly original scheme. For instance, in 2003-2005, US-registered companies called Suncape LLC and Texcom LLC signed contracts with the state foreign trade company Uzmarkazimpex, which is run by Kamalov, a close relative of SNB General Ismailov – contracts № 2003/06/39-Е and № 983/04/01/DBX for the delivery of fourth- and fifth-quality cotton fiber. The amount of each contract was 13.3 million US dollars. After that, it was simple sleight-of-hand – instead of the low-grade cotton indicated in the contracts, the buyer received first- and second-quality cotton fiber. The profit resulting from the category misallocation was around 10 million US dollars, completely tax-free.

Of course, those transactions were not entirely victimless. The SNB staff employee responsible for Uzkhlopkoprom, who tried to stop the deals from going forward, was fired inside of a day with no explanation. The head of the SNB’s directorate for fighting corruption, Colonel Vladimir Radjabov, was also driven out of the SNB, after trying to get to the bottom of the particulars of a contract between Belgian company Louis Dreyfus and the foreign trade company Uzprommashimpex, which is run by the brother of SNB personnel directorate head Guzairov. Here there was a larger sum of money at stake – according to specialists, around 15 million US dollars.

The siloviki do not live by cotton alone. According to some reports, the country’s security services are directly involved in supplying Uzbekistan with counterfeit cigarettes sold under the Pine brand, which are manufactured in underground factories in Afghanistan. According to the most minor estimates, the profit from trade in these counterfeit goods amounts to tens of millions of US dollars. There’s also a company called Benif, which is run by the brother of Inoyatov’s wife, Ergashev, whose deputy is his son Sharif. This company, with the support of the head of the SNB, has practically monopolized the supply of petroleum products, natural gas, and construction materials to Afghanistan. And the SNB does not shy away from simple mafia-style protection rackets. For example, a company called Fertex, which imports chemicals, suffered a classic shakedown – the head of the company was first frightened with audits and then easily convinced to pay a bribe.

The bottom line

There’s probably no point in focusing so much attention at Rustam Inoyatov’s business dealings. Representatives of many CIS countries’ security services are involved in “entrepreneurship.” What’s more important is that in creating an arrangement that works to his own benefit, the head of Uzbekistan’s SNB has built up the entire system of government around it. President Karimov is, practically speaking, cut off from any sources of objective information. Having lost the ability to react quickly to the changing situation in the regions, the president has become a captive of his “chief security guard.” At the same time, each additional outburst of popular anger only strengthens Inoyatov’s personal power.

Strong security services cannot work in a weak state. Sooner or later, they begin to dictate their conditions to the politicians. This is why it’s misguided to call the events in Andijan a “first Uzbek revolution.” A change in power in Uzbekistan has already taken place without demonstrations and gunfire – practically speaking, for several years all power here has already been in the hands of the special services.

[Update - Turns out there's another English-language version of this article online, here at Ferghana.ru. Thanks to Laurence for pointing this out.]