Guest Post: Exploding Myths About Kyrgyzstan’s Mining Industry

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by Joshua Foust on 9/1/2012 · 6 comments

This is a guest post by Farrell Styers, Director of Oxus International, a research and consulting firm based in Bishkek, Kyrgyzstan.

When news about the most recent blow to mining investment in Kyrgyzstan broke, it was hard to be surprised. A group of protesters shouting nationalist slogans broke into a TV studio preparing for a televised auction of several mining licenses and stopped the proceedings before they could start. Not only are such methods common as tools for political persuasion in Kyrgyzstan, but there are few topics more controversial or better-suited for a nationalist agenda than mining.

Mining has become among the most heated political topics in Kyrgyzstan since the 2010 revolution. A lot of post-revolution commentary about the situation has been irresponsible and poorly-informed (see this gem for a shining example of irresponsible research on the issue). However, as is often the case, reality is much more nuanced than many of these discussions would have you believe.

In the last two years an exploration company in Talas has had its camp attacked and burned down by torch-wielding horsemen – twice; another company had their license illegally revoked at the whim of a parliamentarian; protesters have blocked access to mining and exploration sites across the country over concerns with environmental damage and political corruption; and Kumtor – the queen bee of mining in Kyrgyzstan – has been threatened with nationalization by the parliament. Driving many of these actions and the debates surrounding them are a number of myths.

The first myth about mining in Kyrgyzstan is that it actually exists. Ok, yes, there is mining here, but it’s not what many people probably think. Since independence in 1991, there has been one – just one – new mining enterprise built in Kyrgyzstan. And while it contributes over 12% of the country’s GDP and makes up over half of its industrial output, it is not really something we can call an industry. Since the early 2000s, there have been several foreign exploration companies that have come to Kyrgyzstan with an interest in mining, but none of them have done anything but explore (unless you count the Chinese company that was caught illegally exporting ore this spring).

Another myth is that Kyrgyzstan is sitting on heaps of mineral wealth. Much like the ridiculous, perennial speculation about Afghanistan’s coming resource windfalls, media and politicians here discuss mineral wealth in Kyrgyzstan as if it could someday solve all of their economic ills. The country does indeed have resources that could become a larger part of the country’s overall economy, but from a technical perspective Kyrgyzstan is not a particularly attractive place to mine. Most of the mineral wealth is found in difficult-to-reach, high-altitude areas (much higher than equivalent deposits in much of the rest of the world). This limits access and makes extraction difficult, as seen in Kumtor’s recent experience with shifting ice slowing their project. The situation is further exacerbated by a difficult climate, poor local infrastructure, and poor access to export routes. Resource extraction will never make Kyrgyzstan the Qatar of Central Asia.

There is another information gap in the public debate – the real impacts of mining. Civil society organizations, mining companies, and the government have all weighed-in, but a lack of information or bad information still persists. It seems everyone has a vested interest in taking a position (either economic or political – or both) or at least appear to, leading to a lack of trust.

I have attended conferences meant to facilitate dialogue between mining companies, lawmakers, and locals, but these meetings generally end up with members of local environmental or youth organizations shouting about the “pure people of the mountains” being exploited by corrupt politicians and foreigners, or questioning the Kyrgyz language skills of other speakers, among other nationalist digressions.

Some politicians have latched onto this new resource nationalism and have exploited it for political gain, even to the significant detriment of the national economy. And in their defense, it is hard to deny the neo-colonial cast of being told you’re sitting on a pile of wealth but the skills and capital to retrieve it can only come from rich foreigners. Foreigners who of course promise to share the riches equitably.

There are several lawmakers in Kyrgyzstan with reasonable and moderate views about the matter but they are accused of being in the pockets of the mining companies. And as is always the case, nuanced views of a complex situation are not the way to endear oneself to a struggling populace.

For their part, many of the mining and exploration companies have not done a brilliant job of defending their positions. Rather than addressing the concerns of locals living near their sites, they often point to shadowy actors attempting to drive them off of their licenses or disrupt progress for political or economic gain. They see the grievances of the community as a symptom of corruption, and who can blame them? Corruption is present everywhere, and practices like paid protests are widely acknowledged to be common.

Even the government believes public grievances are driven by conspiracies. Responding to the protests that broke up last week’s license auction, the Director of the State Agency of Geology and Mining claimed, “This was the work of those who want to sell licenses under the carpet.” However, there has been little compelling evidence presented publicly to support these theories, and regardless, it ignores the larger issue of popular concern.

The assertion of the “shadowy actors” theory is not without merit. It is likely that there are some people paid to harass the mining companies and those who support them. However, focusing on this robs the populace of their agency and reduces their worries to a conspiracy theory rather than valid concerns.

Exacerbating this is the lack of information given to locals, so that many of their concerns – radiation, cattle deformation, heart attacks caused by blasting – do not have any basis on science or the actual impacts of mining, which are real and require careful oversight and management.

This burden of education rests with the government, civil society organizations, and the mining companies – none of which are widely trusted by either the public or each other. And in an environment of surging nationalism, a north-south divide, and an unstable government, it will be difficult to get all these people together to agree on a reasonable path forward. That is not to say that it is without hope, but it will take years of effort and lots of hard work. It remains to be seen if everyone is ready to commit to that.


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This post was written by...

– author of 1849 posts on Registan.net.

Joshua Foust is a Fellow at the American Security Project and the author of Afghanistan Journal: Selections from Registan.net. His research focuses primarily on Central and South Asia. Joshua is a correspondent for The Atlantic and a columnist for PBS Need to Know. Joshua appears regularly on the BBC World News, Aljazeera, and international public radio. Joshua's writing has appeared in the Columbia Journalism Review, Foreign Policy’s AfPak Channel, the New York Times, Reuters, and the Christian Science Monitor. Follow him on twitter: @joshuafoust

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{ 6 comments }

DT September 1, 2012 at 7:19 am

Why do you say the Moran report is irresponsible and poorly informed? Can you explain why it is lacking? Thanks.

Mehrdad Nazari September 1, 2012 at 8:15 pm

Just noted Joshua’s interesting blog today. Having seen the challenges of miscommunication and deliberate misinformation firsthand, I find myself in agreement with a lot of Joshua’s post. With regard to the Moran/CEE Bankwatch comments, there has been a review of his opinions and assertions. I have also blogged about some of those myth and produced a report that addressed the Moan Comments as part of a review of a Government-requested inspection by a commission involving several NGOs. Examples of myths include attributing the vanishing snow leopards or other impacts in a nature reserve to Kumtor Gold while most (luckily not all snow leopards) were poached by the park’s own ranger. Given efforts by the mine, multilateral financial institutions and inerantional NGOs, snow leopards are actually back. Allow me to invite you to visit some related blogs at http://www.prizmasolutions.com where you can also find the report that addressed the Moran comments.

Bakhrom September 2, 2012 at 10:27 pm

The case of breaking into TV studio and stopping televised auction really looks like some ones job, how could these folks knew about auction? Or it was announced prior to the event? The article is good, but disappointing. Its disappointing because it is mentioning the difficult conditions which hinder to investment and development of mineral industry….

farrell September 3, 2012 at 5:30 am

DT, I think the big issue with the Moran report is that it is activism disguised as science. The accompanying video made it incredibly clear. It’s not to absolve Kumtor of misdeeds – there may indeed be real reasons for concern – but I think the public debate is muddled by that sort of stuff.

Schwartz September 4, 2012 at 2:19 am

Hi Farrell,

Since NewEurasia ran two posts on the Bankwatch report and its associated video documentary (cf. http://www.neweurasia.net/business-and-economics/rare-photos-of-kumtor-mine-and-environs/ + http://www.neweurasia.net/business-and-economics/kumtor-truck-convoys-in-barskayn-unhappy-new-hydrology-report/), as its editor in chief, instinctively I want to make sure I did my proper due diligence after reading your post here.

Could you take a moment to point out the activistic elements of the report, for myself and I think the larger Registan readership? I mean, beyond the fact that the documentary’s geologist is wearing a Kyrgyz kulpak. ;-)

As I read it, it concerned mostly the difficulties of getting the compay to submit to an ecological and technological audit. Perhaps such an audit is ideologically-motivated, but then, the company is still dealing in a very sensitive matter (particularly if it contributes to over 12% of Kyrgyzstan’s GDP). Moreover, I think it’s fair to say that the widespread impression has long been that the company is not really communicative or transparent. This issue may probably be a chicken and egg problem with its roots in the Barskayn disaster, if not further into eve the Soviet past, but it’s nonetheless key.

I would be inclined to agree that some of Moran’s assertions lack proper foundation. For example, he does not source his claim that “the Kyrgyz media is inundated with mostly pro-Kumtor stories”, especially if the political climate is more as you describe it (and toward which I, myself, am inclined to describe it, too). There is also indeed a black/white tone to his report. Nevertheless, does his framework fundamentally contradict the data he presents or undermine his overall argument?

Again, this isn’t to say that Bankwatch et al have the complete truth. So, toward precisely achieving that truth, I would really like to hear your responses.

-Chris

Daniel September 4, 2012 at 10:39 pm

A word limit might be stopping my post coming up, so please see my comment as a google doc pdf here:

https://docs.google.com/open?id=0B2KPxjhpw2RIRjc4N0JpOHc2dUU

Kind Regards,

Daniel

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