The Pandemic Depression
The Global Economy Will Never Be the Same
Uzbekistan’s presidential elections have always been a charade. President Islam Karimov has ruled the country since 1989, when it was still part of the Soviet Union. It therefore wasn’t surprising that media around the world treated the outcome of the March 29 presidential election as a foregone conclusion far ahead of voting.
In a sign of his unapologetic autocracy, Karimov did not even bother to invent a pretext explaining how he could run for a fourth term in office when the country’s constitution limits the president to two. Even by regional standards, Uzbekistan is a rare case study in authoritarianism: Karimov’s 25-year tenure is a record in the region, and the president has treated Uzbekistan as a feudal kingdom working for his personal enrichment.
Although Karimov’s reelection was assured, the survival of the system he has created is not guaranteed. Uzbekistan’s future is increasingly uncertain: the Russian recession has brought a decline in remittances sent home from Uzbek laborers in Russia; religious repression has the potential to foment Islamic extremism; and fears of a leadership vacuum are becoming more pressing as the president—now 77 and allegedly in ill health—ages without a clear succession plan.
Uzbekistan’s financial system, more than that of any other post-Soviet nation, still bears the hallmarks of the command economy from whence it sprang. Karimov’s central government controls the hydrocarbons, mining, and agricultural sectors, which produce most of the country’s export revenues. Not surprisingly, these sectors are mismanaged, and the revenue they do generate goes to the ruling elites
Many Uzbeks have had to survive recent winters without natural gas as the government, in a bid to increase hard currency exports, has sold gas abroad instead of on the local market. The Karimov regime has also used a system based on forced labor to pull in everyone from students and teachers to public- and private-sector employees to help harvest cotton. Foreign investors such as General Motors and the Scandinavian Telecoms giant TeliSonera have also been shaken down to provide money and labor for the harvest, the proceeds of which then disappear into an extra-budgetary slush fund controlled by Uzbekistan’s top leadership.
Karimov’s influence on Uzbekistan’s economy is not limited to forced labor. His regime is also responsible for setting the national exchange rate, and it has limited foreign investors’ ability to repatriate profits legally. There are not enough jobs in the country to meet the needs of its young population (45 percent of Uzbeks are under the age of 24), leading millions of young men and women to seek work in Russia, Kazakhstan, South Korea, and Turkey. In turn, the Uzbek economy relies on remittances from foreign labor, accounting for 12 percent of the nation’s GDP. The decline of the Russian ruble, which has lost half its value in the past year, has therefore forced Uzbekistan’s economy to face down a two-pronged threat: a slowing stream of money from abroad and the potential of returning workers. Should large numbers of migrants be forced to return home as the Russian economy sags, disenchantment will grow—just as it did in the Fergana Valley prior to the 2005 Andijan massacre.
Frustration over Karimov’s policies came to a boiling point in Andijan in 2005, following the trial of a group local of businessmen who were accused of spreading Islamic extremism. The protests, which began peacefully, erupted into violence when a group of gunmen stormed the prison holding the accused. More than 10,000 Andijan residents took to the streets to vent frustrations about Karimov’s regime and economic policies, and an armed convoy responded by shooting indiscriminately into the crowd, resulting in hundreds—or perhaps thousands—of deaths. Many of the dead were buried in mass graves, or were thrown into the Karasu River.
After Andijan, the last vestiges of an independent, organized civil society were largely destroyed. With no genuine registered opposition parties and rampant torture throughout the nation’s law enforcement system, Uzbekistan is among the most repressive countries in the world, appearing as a perennial fixture on Freedom House’s Worst of the Worst list. Being charged with a crime is almost always a guarantee of conviction, and evidence of guilt comes through coerced confessions, beaten out of suspects when necessary. Religious persecution is rife, aimed at both religious minorities and Muslims who do not accept the state-controlled version of Islam. Yet as Karimov forbids Muslims to practice Islam outside the state-controlled religious system, he only bolsters the rhetoric of Islamic extremist groups such as the Islamic Movement of Uzbekistan, which claims allegiance to the Islamic State of Iraq and al-Sham (ISIS). It is estimated that Uzbek prisons currently hold up to 12,000 people who have been jailed for their political or religious beliefs and activities. Even Karimov’s formerly glamorous and Twitter-savvy daughter Gulnara Karimova is now under house arrest after falling out of her father’s favor.
Karimov has played his international cards well over the past decade, and Uzbekistan’s strategic position astride a major supply route for U.S. and NATO troops in Afghanistan has saved it from any serious censure. Although relations with the West cooled following the Andijan massacre, the European Union and U.S. sanctions that were placed on the country after the massacre—including bans on the sale of weapons to Uzbekistan—have long since been lifted.
Uzbekistan’s present is bleak, and its future may be even worse. Karimov faces myriad issues, both in the long and short term: Uzbekistan’s population is young and growing while jobs are lacking; the nation’s corrupt, inefficient economy has hamstrung growth; rampant income inequality has been exacerbated by the fall of the Russian economy; and a general sense of political disenfranchisement has only been further validated by sham elections. Karimov’s only answer to these problems has been distraction. He blames religious radicalization and Islamic extremism for the country’s troubles, but fails to address the root cause of the unrest within the country: his own decades-long kleptocracy.
Even if Tashkent will not face up to its own shortcomings, the West must. The U.S. and the EU need to refocus their policies toward Uzbekistan, acknowledging that the current regime’s actions are responsible for the country’s problems, and that Karimov’s repressive tendencies only increase the potential for unrest. The West must increase pressure on Uzbekistan’s authorities to change these policies and focus more on human security issues: creating jobs; providing education; reducing corruption and income inequality; and giving citizens space to exercise their rights, thereby encouraging them to contribute to the country’s future.
Karimov’s system is nothing if not resistant to change, and it is clear that changing the status quo in Uzbekistan will be no easy task. Uzbek authorities have reported that 91% of eligible voters participated in March’s elections, ignoring that in Russia alone there are now more than two million Uzbek citizens. Honest, critical public statements by the West about the farcical nature of Karimov’s last election win would be a good start toward placing pressure on the regime. From there, the West can push for real reforms—changes that could turn a Soviet relic into a functioning nation.