Privatization Scandals of 2007

The Privatization Scandals of 2007 were a series of controversies over the sale of state assets by the government of the Democratic Republic of Irad in January and February 2007. They provoked protests in Talas and in the countryside and helped bring about the Second Iradi Civil War, although historians regard the Bill of Sale, the cabinet's secret drafts to partition Irad among its neighbors, as the war's main cause.^[1]^[3]

Facing a large budget deficit after US federal transfers stopped, the cabinet of Prime Minister Bakyt Orozbekov held rapid auctions of oil exploration concessions, antimony exploration rights, state grain elevators and mobile-telephone spectrum. It also tried to privatize communal pastures in the Chatkal valley. Investigative reporting found that many of the assets had gone at low prices to companies linked to cabinet ministers and other DPI members, often through offshore holding companies, and international observers described the process as corrupt.^[1]

Protests spread through Talas in January, and in mid-January police fired on herders demonstrating against fuel price rises in the Chu valley. Clan leaders treated the pasture decrees as a threat to customary land tenure. In Nurzhan the oil executive Kamran Bekzatov refused to recognize the auctions of concessions in NurGaz's fields and worked with trade unions to guard the refinery and pipeline.^[2] On February 25, 2007, Erlan Toktarov made public the partition drafts, which also promised concession shares in oil, antimony and the Toktogul complex to companies tied to Orozbekov and several ministers, seized control of the DPI and proclaimed the Irad Special Economic Zone from Nurzhan. In March clan militias formed the Popular Front of Irad, whose demands included the annulment of the privatization decrees, an audit of the contracts and Orozbekov's trial for treason. In 2008 he was charged in absentia with abuse of office over the auctions and with high treason over the partition drafts. The Front invested Talas from April 22 and stormed it on June 4 (see Storming of Talas (2007)). The ISEZ administration later cancelled some of the sales and confirmed others, and critics say that many of the assets remained with firms close to the party.^[3]

References

^ Human Rights Watch (2007). The Privatization Crisis and Political Turmoil in Talas. New York.
^ Eurasian Political Quarterly (2024). 'The Petroleum Oligarchy: Kamran Bekzatov and the Russo Faction.' Vol. 31, Iss. 2, pp. 88–104.
^ Central Asian Geopolitical Review (2024). 'The 2007 Succession War and the Partition of Irad.' Academic Press, pp. 78–95.