TAJIK CABINET SHUFFLE PLACES OLD RAHMONOV ALLY IN KEY ECON

C O N F I D E N T I A L DUSHANBE 000199 SIPDIS SIPDIS E.O. 12958: DECL: 1/31/2016 TAGS: PGOV ECON TI SUBJECT: TAJIK CABINET SHUFFLE PLACES OLD RAHMONOV ALLY IN KEY ECON POSITION CLASSIFIED BY: Richard Hoagland, Ambassador, US Embassy Dushanbe, State. REASON: 1.4 (b),(d) ¶1. (U) Tajik President Rahmonov appointed Matlubkhon Davlatov as State Advisor to the President for Economic Policy, replacing Faizullo Kholboboyev. The January 30 decree elevated Davlatov to the senior economic position in Tajikistan and named Kholboboyev Representative to the CIS and the Eurasian Economic Community (EAEC),a move considered a demotion. ¶2. (C) Davlatov comes from Rahmonov's hometown of Dangara and is reported to be Rahmonov's maternal uncle. According to some observers, Davlatov is one of Rahmonov's closest confidants. Starting in the early 1990s, he played various roles in Tajikistan's privatization efforts until appointed Chief of the Presidential Agency on Financial Control in 2001. Thought to be highly corrupt and anti-reform, the former Secretary of the Communist Party Committee of the Academy of Sciences may have made his fortune selling properties during the privatization schemes. Davlatov's son works for the Ministry of Security (MoS) and Davlatov allegedly has at least one MoS security officer with him at all times. ¶3. (C) Davlatov's appointment came as part of a larger shake-up of mid-level government officials, and may have been motivated by a personal conflict between Kholboboyev and National Bank (NBT) Chairman Murodali Alimardonov when the World Bank and IMF were inspecting the NBT's activities. A PhD in Economics, Kholboboyev has the reputation as being less rich, less corrupt and more reform-minded than most of Rahmonov's cabinet. ¶4. (C) COMMENT: Davlatov's appointment could signal a shift away from reform and towards a more Soviet way of approaching the economy, or it could be part of the on-going effort to consolidate power and wealth in the hands of the First Family. His reputation for corruption and incompetence has not inspired confidence on the street in Dushanbe and may not do much to pull in the Western investors Rahmonov wants to court. END COMMENT ¶5. (C) BIO: Matlubkhon Davlatov Born 17 January 1950 in Dangara. 1970 -- Graduated from Tajik State University. Candidate of Economic Sciences 1970-72 -- Served in Soviet Army 1972-83 -- Graduate Student, scientist at Institute of Economy, Academy of Sciences, Tajikistan 1983-88 -- Secretary of the Communist Party Committee of Academy of Sciences 1988-90 -- Leading Scientist at Institute of Economy, Academy of Sciences 1990-94 -- Chief Specialist, Deputy Chairman of the State Property Committee 1994-2004 -- Chairman of the State Property Committee 2005 -- Chairman of State Financial Control January 30, 2006 Economic Advisor to the President Davlatov is married and has six children. Speaks good Tajik and Russian, some English. ARMBRUSTER