by Nathan Hamm on 5/8/2008 · 8 comments

podshokarimov.jpgPresident Karimov has asserted greater control over the Navoi Mining and Metallurgical Works (NGMK), the company that runs Uzbekistan’s largest gold and uranium mines.

… Karimov has appointed a Supervisory Council to manage the mine. Its members will serve one-year terms.

Preparations for the Presidential take-over began in April when a special resolution of the cabinet proclaimed the Uzbek government the owner of the mining colossus. The resolution, entitled, “On the Charter of the State Enterprise Navoi Mining and Metallurgical Works”, became law when signed by President Karimov at the end of April.

Information in the report suggests that Karimov began preparing the way for this move since January, placing this part and parcel in Karimov’s post-election power consolidation moves which themselves are probably a preparation for, well, something or other. I would say an eventual transition to a new president, but it’s far from clear that someone is eagerly waiting in the wings for Karimov’s job.

What makes this move particularly interesting and kind of an outlier from the string of removals from office is that Navoi is kind of a region apart in Uzbekistan. I can’t recall citations off the top of my head, but I’ve read articles noting it as having a very different relationship with Tashkent than any other regions. And that is certainly because NGMK is Navoi. The company generates quite a bit of money and, at least when I lived there, NGMK owned everything in Navoi worth owning. Also during my time in Navoi, I found that NGMK had a lot more power than the local government. It took a while to figure out, but once we eventually learned that NGMK had the ability to get things done at incredible speed. Most of the reason why, from what I’ve been told, is that the central government mostly kept its distance so as not to screw up a very large, fairly well-run business venture.

The takeover is significant for at least one reason. It is a reminder that in spite of a handful of well-publicized gestures designed to give the appearance that Islom Karimov is willing to let the pendulum slowly swing back toward reform, the executive has very much been consolidating power since the latest presidential election. I think it is debatable whether or not a tighter grip on elite politics really means that opportunities will further narrow for civil society. (It’s not as if elites have wanted open space for political debate even if they oppose Karimov.) But, it is worth keeping in mind that the subsurface trend in Uzbek politics is one of executive consolidation of power, likely, were I to wager, in preparation for an eventual hand-off of the presidency.

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Nathan is the founder and Principal Analyst for Registan, which he launched in 2003. He was a Peace Corps Volunteer in Uzbekistan 2000-2001 and received his MA in Central Asian Studies from the University of Washington in 2007. Since 2007, he has worked full-time as an analyst, consulting with private and government clients on Central Asian affairs, specializing in how socio-cultural and political factors shape risks and opportunities and how organizations can adjust their strategic and operational plans to account for these variables. More information on Registan's services can be found here, and Nathan can be contacted via Twitter or email.

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student May 9, 2008 at 7:05 pm

According to Uzbek RFE/RL “Ozodlik” Nikolai Kuchersky, the general director of NGMK, has denied all the statements about the takeover.

These are what he told during the phone conversation with RFE/RL:

“Everything might come to one’s head. All these are lies. Now the complex is operating normally as it did before. Information about President’s taking control over the complex is fable. He has many other jobs to do. If we didn’t do good job, it would be other words.
There are supervisory councils in other branches such as chemical, oil and gas, aviation, and transport and communication fields. And now the supervisory council was established also for us to accelerate resolving our problems with the government’s aid. Supervisory councils like in all countries will help us to win over current bureaucratic barriers.
I think someone from outside is fed up with me. But inside is peace. I even go to Moscow with the permission of the government. That’s why I had been in the clinic hospital #83 for 4 days. They checked the level of my blood sugar and sore in my stomach. I spent exactly four days in Moscow and on the fifth day I was at the Prime Minister’s office in Tashkent.”


Nathan May 9, 2008 at 7:36 pm

The situation he’s describing doesn’t sound too different from what Ferghana.ru was describing. He’s putting a positive spin on things, but it’s clear there was some change. Things may be running more or less as normal, but there does in fact appear to be a new set of eyes watching NGMK.

Brian May 9, 2008 at 9:52 pm

Mr. Kuchersky sounds a bit defensive about the subject, don’t he?

student May 10, 2008 at 7:52 am

Yes he does, Brian. And he has to, because he is inside. ๐Ÿ™‚

Nathan, you are right. Kuchersky is more popular and powerful than any hokims of the city or province.

I have just remembered one thing:
During my high school years, while walking home from school, we saw sometimes the coolest car in the city, which was very rare even in Uzb. Then, of course, we guys started arguing whose car is this. Some said it was hokim’s, some said Kuchersky’s. But most of us agreed that it was Kuchersky’s car. ๐Ÿ™‚ I am not sure, whether it was his or not, but the point is he was the powerful man in people’s minds too.

Brian May 10, 2008 at 9:21 pm

Almost an hour away from Bukhara, across a bit of desert and through some poverty stricken villages there’s Lake Tutagul. On the shores of this lake is a ridiculously posh, near first-world quality resort complete with a beach, waterpark, a small zoo (complete with a little mini-train), luxury hotel, hot-spring medicinal spa, sauna, pool, restaurants and bars. Pine trees are planted around the hotel and irrigated to keep them alive. To keep the riff-raff out the place is surrounded by guard towers and a double-fence and is patrolled by numerous police. There’s hardly anything else nearby so all the security seems overkill. Tourists don’t know about this place because it’s not open for tourists – or locals for that matter – at any price. However I was fortunate enough to have the opportunity to spend a couple afternoons there (a friend of a friend of the owner’s relative). I was told the purpose of this resort is a playground for the bigwigs who run the Zarafshon gold mine, and indeed all of the few guests I spoke to there said they were either from Zarafshon or Navoi.

The huge lake itself is beautiful in the summer, and would make a perfect getaway for families nearby during the hot summer months, but it’s a real shame that the only real access to the lake is obtainable only if you’re a mining elite.

jonathan p May 12, 2008 at 11:12 am

There are a few such “resorts” at Tudakul. Each is “owned” by a different branch of the company. The one I stayed at several times is owned by the Navoi branch of the company and is operated by NMZ, the metalworking factory in Navoi. These places are indeed very nice.

There is access to the reservoir elsewhere (for the locals, I mean). Mostly on the south and west sides. Somebody told me there’s even a small fishing company. But access to these little fiefdoms is restricted, of course. You know, Tudakul is not particularly clean. It’s salty and has pretty high concentrations of gunk from agricultural runoff. I wouldn’t want to spend much time in the water…

jonathan p May 12, 2008 at 11:24 am

Here’s my point of confusion: Correct me if I’m wrong, but hasn’t NGMK always been a state-owned entity, at least in part? To call this move a “takeover” is a little much, don’t you think? Granted, portions of the company were privately held during the last 15 years (mostly by foreign entities), but it was my understanding that NGMK was always majority controlled by the government. … Kuchersky was/is on the cabinet of ministers, after all.

By the way, Kuchersky has actually been in ill health. That part of the story is legit.

I think what’s happening here is that the government (or Karimov, via his appointees) is becoming more actively involved, probably in a bid to wrest away some of NGMK’s significant power. NGMK/Kuchersly truly has been the de facto government of Navoi Region (particularly the company’s three cities), and exercises a degree of influence outside the region as well.

The thing is, however, that this has been a good thing for the locals (as long as you have an association with the company). Navoi region is in pretty good shape (relatively speaking, of course) and the locals enjoy some nice perks of living in proximity to the NGMK cash cow. It’ll be interesting to see what, if anything, changes as a result of the closer involvement of Karimov and Co.

Nathan May 12, 2008 at 11:51 am

Yes and yes. It has always been a de jure state enterprise, but it’s also, as you note, been a fairly independent one. Like you say, the change here is that it looks like the state is becoming more involved for some reason.

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