TURKMENISTAN: DISCONTENT IN DASHOGUZ PROVINCE

UNCLAS SECTION 01 OF 02 ASHGABAT 000550 SIPDIS SIPDIS SENSITIVE STATE FOR SCA/CEN, DRL, EEB E.O. 12958: N/A TAGS: PGOV SCUL SOCI KPAO TX SUBJECT: TURKMENISTAN: DISCONTENT IN DASHOGUZ PROVINCE ¶1. (U) Sensitive but unclassified. Not for public Internet. ¶2. (SBU) SUMMARY: Misery is on the rise in Dashoguz, a mid-sized city and important cotton producing center near the Uzbek border. Central government policies to raise gas prices and devalue the dollar have led to inflation and made life harder in a city with more than 60 percent unemployment. Unable to voice their concern with city officials, many are registering their protest the only way they can: by leaving the country. END SUMMARY. HIGH UNEMPLOYMENT AND COST OF LIVING ¶3. (SBU) Dashoguz suffers from high unemployment. Over 60% of residents are without work. According to one local resident, of the 40 families living in his apartment building, only three or four people are working. According to another, no one is working in her family household of eight (nuclear and extended),but rather are living off the pension of their grandfather. There is little visible investment in the city. EmbOff noticed only one construction project. Dashoguz is a large cotton producing region, but the season is only from September to December. ¶4. (SBU) The city's large central bazaars, Bai Bazaar and Nygmat Bazaar, felt empty. There were few customers when EmbOff visited. There were often more shop and stand assistants than customers. Many of the bazaar workers sat in corners playing cards or chatting. Prices are rising rapidly, as one shop keeper told EmbOff. During one month, a kilogram of Turkmen rice went from 15,000 manat to 23,000 manat, or a 53% increase. Petrol prices have risen 800% since January. Some families are looking outside the city for small farming plots to grow their own food. DOLLAR DEVALUED ¶5. (U) The government's policy to combine the commercial and official dollar/manat exchange rate (officially unified May 1) has led to a steep devaluation of the dollar. In the course of two weeks, the dollar went from 19,800 manat to 14,215 manat, a 30% drop. In Dashoguz, city residents are highly dependent on remittances from family working abroad in Russia, Turkey, UAE, the United States, etc. and receive their money largely from the Western Union offices, which operate only in U.S. dollars. Local growers and farmers were paid by the government for their crops in both U.S. dollars and manats. 
¶6. (U) In Turkmenistan, there is a saying, "Save in dollars, spend in manats." Almost every family kept their savings at home and in dollars. Expensive items such as durable goods, motor vehicles, or real estate was priced in dollars. As the government lowered the dollar/manat exchange rate, it also limited banks to exchanging no more than $100 per day per person. Panic set in to spend the dollars before they lost value, and retailers and sellers switched their prices to manat. Inflationary pressure also took hold. According to local residents, a two bedroom apartment in the center of Dashoguz that cost $9,000 in March now costs $18,000. Similarly, they said there were long lines to buy TV sets, refrigerators, and carpets. GOVERNMENT BLAMED ¶7. (U) If polling were legal in Turkmenistan, President Berdimuhamedov would have a low approval rating. He is universally blamed for the financial problems afflicting the residents of Dashoguz. Residents told EmbOff that times were always hard in Dashoguz, but living conditions are worse under Berdimuhamedov. Few people care about Berdimuhamedov's initiative to remove the Ruhnama from the school curriculum when schools lack copy machines and computer printers. Residents laugh at the President's efforts to bring Internet to Dashoguz. The two Internet cafes in the city, they said, had unbearably slow connections and high 60,000 manat/hour usage fees (EmbOff noticed both were empty when he visited). Residents commented that the President's cultural reforms, such as returning opera and the circus, are meaningless for them when their financial situation remains poor. As one said, "When the pockets are empty, the mood is bad." ASHGABAT 00000550 002 OF 002 ¶8. (U) A large percentage of people living in Dashoguz are ethnic Uzbek. Ethnic Uzbek interlocutors told EmbOff that the government systematically, but quietly discriminates against them. They are barred from government jobs and entering higher education institutions. One Uzbek girl discussed her frustration. She cannot go to Uzbekistan because she is treated as a Turkmen, and in Turkmenistan as an Uzbek. She said that she cannot go find work in Ashgabat (where jobs are more plentiful),because the Ashgabat police routinely deport non-city residents back to their provinces. For many Uzbeks, she said, the answer is to work and study abroad, mainly in Russia. She said her friend is working three jobs while studying in St. Petersburg. She may do the same. ¶9. (U) COMMENT: While residents of Ashgabat complain about economic stresses and inflation, many in the provinces have it worse. The rising cost of living and the declining value of savings are creating discontent and frustration at government policies. As life gets harder, many people, both young and old, are deciding to leave the country for opportunity elsewhere. END COMMENT. CURRAN