Despite being one of the world’s most autocratic and closed countries, even Turkmenistan cannot totally control the flow of information in the 21st century. Anonymous sources with knowledge of the matter have told both the Russian and opposition Turkmen media sources that President Gurbanguly Berdymukhamedov’s ire had been caused by the financial problems encountered by his Asian Indoor and Martial Arts Games pet project. The sports tournament is due to be held in Ashgabat in September 2017. Turkmenistan has already spent more than US$8 billion, including over US$5 billion on the brand new Olympic Village, and around US$2.3 billion on a new international airport near the capital. A substantial amount is believed to have been stolen by those in charge of the event, with the lion’s share potentially ending up in the presidential family’s pockets.

Prosecutor General Amanmyrat Khallyev reportedly received a personal order to collect money for the Games, in the context of budgetary shortfalls caused by low oil and gas prices. He then passed the order on to his subordinates in various parts of the country, instructing them to obtain the funds from wealthy businessmen under any plausible pretext. The amount that was collected and reported to the Presidential Administration was only a few tens of millions of dollars which is a drop in the ocean for such a massive project on which government spending has gone through the roof in recent years. Berdymukhamedov’s suspicions presumably made him open a secret investigation which resulted in the discovery of large-scale embezzlement and the subsequent arrests and raids.

Turkmenistan became the host of the 2017 Asian Games in late 2010 when international natural gas prices were still high. Since then, prices have more than halved. The country’s dependence on hydrocarbons makes it particularly vulnerable to such price shocks because it is unable to replace lost income with alternative sources of government revenue. Different methods have been tried to replenish the state coffers, including: the accumulation of public sector wage arrears; cuts in salaries and benefits; increased utilities prices; and other unprecedented steps. Berdymukhamedov is rumoured to have personally called Turkish businessman Erol Tabanca, the owner of the Polimeks İnşaat ve Sanayi A.Ş construction company, to ask for financial assistance.        … [article continues] …

This is an excerpt from an article in month’s Caspian Focus publication.