Kyrgyz government collapses after two coalition parties resign; Tajikistan president to visit Turkmenistan for bilateral talks; Kazakhstan aims to diversify exports to China; Kazakhstan forces to participate in anti-terror drills in Russia; Kazakhstan Pre
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  • According to reports, the Kyrgyz coalition government has collapsed due to two factions walking out over accusations that Prime Minister Omurbek Babanov had abused his power and was involved in corrupt practices. Trouble had been brewing in the coalition for weeks, as the Ata-Meken party, a junior partner, accused Babanov of accepting a $1.5 million racehorse from a Turkish company in exchange for a building contract. 1

    In another development, reports noted that Tajik President is scheduled to visit Turkmenistan for bilateral talks. Amongst the issues slated for discussion are drug trafficking, stability in neighbouring Afghanistan and organized crime. 2

    According to reports, Kazakhstan is looking to diversify its exports from the predominant hydrocarbon mode. The total trade between the two countries in 2011 was US$ 25 billion with a majority of it coming from the hydrocarbon exports. The two neighbours are also working on creating a trans-border free trade center at Khorgos, on the Chinese-Kazakh border.3 Meanwhile, Kazakhstan is participating in anti-terrorism exercises with Russia and Ukraine in the southern Russian region of Rostov. 4

    Reports noted that Kazakhstan President Nazarbayev is scheduled to visit Kyrgyzstan on an official visit with trade and economic relations topping the discussions agenda. Kazakhstan has already committed US$110 million for supporting new industries in Kyrgyzstan and they have also reached agreement on implementation of four new joint-venture projects. Two-day trade reached $470 million in the first five months of 2012. 5

    In a sign that the tripartite customs union has not worked out quite as well as originally envisioned, a Kazakh official has accused Russian firms of ‘dumping’ goods on Kazakhstan to intentionally undercut Kazakh producers. 6

    According to reports, Russia will support the bids of customs union partners Kazakhstan and Belarus to enter the World Trade Organization (WTO) after its own bid for membership was finally accepted. The entry of Russia into the global trade body means that Russia will have to relax its borders and import restrictions to competing nations’ products, which will in turn force Russian manufacturers and producers to improve their products to compete in their own markets. This will then have a domino effect on Kazakh and Belarusian economies, as the customs union means that goods can freely flow across borders of the three states. 7

    In other developments, according to reports, trade between Vietnam and customs union partners Russia, Kazakhstan and Belarus increased substantially in the first seven months of the year 2012. Bilateral trade with Kazakhstan increased by 91.3% with total trade for the period being US$ 41 million, with Russia it was US$ 1.34 billion and with Belarus the trade figure was US$ 100 million. 8

    Separately, the Kyrgyz government has recalled its ambassador to Belarus following the discovery of photos of deposed President Kurmanbek Bakiev’s brother in the Belarusian capital Minsk. He is wanted in Kyrgyzstan to stand trial for felonies. However, Belarus has stated that it will not extradite Bakiev’s brother since it believed that were issued for political purposes. 9

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