Posted by: Borderless Borderguard | June 29, 2007

Tajiks Seek Permanent Gateway to China

Tajikistan’s isolated southeast has benefited from a new trade route to China, but locals say restrictions at the border crossing are making life harder than it needs to be.

By Saodat Asanova in Badakhshan and Dushanbe (RCA No. 495, 4-June-07)

Traders in Badakhshan are asking for the border crossing with China to be open more of the time so they can move freely back and forth and generate stronger economic growth in this remote mountain region of Tajikistan.

The Tajik-China trade route, opened in 2004, runs between from Khorog, the administrative centre of Badakhshan province in southeastern Tajikistan, over a high-altitude plateau and then down into China, where it ends in the city of Kashgar, 700 kilometres away. But because conditions are so tough at the Kulma border crossing – located on a mountain pass 4,400 metres high – the gateway only stays open 15 days out of every month, while from November through April it is closed altogether.

EASTWARD ROUTE OPENS UP NEW OPPORTUNITIES

The road has boosted external trade for Tajikistan, whose other neighbours are landlocked Afghanistan, Uzbekistan and Kyrgyzstan, and created employment for many people in Badakhshan. Bilateral trade in goods going via Kulma has gone from zero to reach 400 million US dollars in 2006. The main direction of trade is westwards – cheap Chinese consumer goods sell well in Tajikistan’s markets.

Badakhshan accounts for 45 per cent of Tajikistan’s land area but the inhospitable mountain terrain means it is very sparsely populated, and infrastructure is poorly developed.

In Soviet times the authorities would stockpile essential goods ahead of winter, when snowfalls cut the road from the capital Dushanbe, and Khorog can only be reached from Kyrgyzstan to the north. Declining economic conditions in post-independence Tajikistan made it harder to sustain Badakhshan, as the government’s priority was addressing economic problems in the more populated and easier-to-reach parts of the country.

But independence eventually created opportunities for warmer relations with China, and the Khorog-Kashgar road created a new channel for the movement of “shuttle traders” – people moving back and forth across the border with consignments of consumer goods – which characterises so much of trade between Central Asia and western China.

The boom in trade belies the fact that the road is little more than a dirt track in places, and so high that travellers risk getting altitude sickness. Vehicles also suffer frequent problems because engines do not run well on rarefied air. As Chinese trucks usually travel in convoy, if one breaks down the entire column grinds to a halt.

In April, officials from Badakhshan and Kashgar agreed there was a need to rebuild the section running from Khorog to Murgab to cope safely with larger vehicles.

PRESSURE FOR PERMANENT CROSSING

Residents of Badakhshan and the traders who use the border – both Tajik and Chinese – say the restricted opening times make it difficult to complete a round trip without getting stuck on the wrong side of an inhospitable frontier.

Most people here see the road and the traffic it has brought with it as an unmitigated success, but believe trade would really take off if the border crossing was kept open permanently. The regional government in Badakhshan has repeatedly urged the authorities in Dushanbe to open the route permanently.

The Badakhshan authorities have also recommended the opening of a Chinese consulate and a Tajik foreign ministry branch in Khorog to make it easier for locals to get visas. At the moment, Tajik traders have to travel 700 km in the other direction to collect a Chinese visa at the embassy in Dushanbe. Chinese and Tajik officials reached a verbal agreement to do this last year, but there are still documents to be drawn up to make this happen.

Boymamad Alibakhshev, head of the government department for investment and state property in Badakhshan, said that the opening restrictions are holding back trade.

“If the checkpoint functioned on a permanent basis, there would be an increase in Tajik-Chinese trade turnover, which has already increased sixfold in the last three years,” he told IWPR.

Khushomad Alidodov, deputy chairman of the Social Democratic Party’s branch in Badakhshan, said the local authorities’ unheeded appeals exemplified the lack of devolved power in Tajikistan.

“The centralisation of government in this country means the Badakhshan authorities do not have powers to resolve issues at a local level,” he said.

EMPLOYMENT AND OPPORTUNTIES

Apart from the abundance of Chinese-made goods, the hotels, cafés and warehouses which have sprung up in Badakhshan are evidence of the boost to the region’s economy. Whenever the Kulma crossing is open, casual employment doubles.

Some men find work loading freight on and off trucks for wages of 100 to 120 somoni, up to 35 US dollars, a day, while others ferry passengers and goods as far as the border and back to Khorog.

They cannot drive into China itself because of a clause in the agreement underpinning the crossing which stated that all goods vehicles have to travel laden. This disadvantages Tajik traders, who have little to sell and are therefore prevented from driving into China, while the Chinese are allowed to drive their own trucks to Khorog.

Khorog resident Meralisho Mamadov earns up to 600 dollars for each 15-day stint of driving work.

“The opening of the road has simply been a miracle for me. Last year, I earned enough money not only to support my family, but also to send my children to university. This year, my son will work with me so he can build up his own capital,” he said.

Umed, a third-year student at Khorog university, earns up to 130 dollars for driving manufactured goods from Kulma all the way to Dushanbe.

“A rich businessman from the capital [Dushanbe] offered my friends and me a good wage if we’d drive his cars. The only thing we needed was a driving license. We pay for food ourselves while we’re on the road, and once we reach our destination we receive our pay. We manage two trips in each 15-day period,” he told IWPR.

Drivers like Umed sometimes have to wait several days at the border before their goods arrive on the other sides. They sleep in their cars or in yurts – traditional Kyrgyz tents which enterprising residents of Murgab, the nearest town, turn into makeshift hotels and canteens over the summer season.

STRANDED IN CHINA

Traders heading for China go as far as the Tajik checkpoint either in their own cars or in hired transport, walk across the frontier, and hire a Chinese car and driver on the other side. Then they have to move as quickly as they can to get their business done and get back before the border closes for two weeks.

“When we go to China, most of entrepreneurs think less about buying goods than about getting everything done on time and coming back across the border so as to avoid additional costs,” said Badakhshan resident Gulbegim Alibakhsheva.

According to another trader, Shavkat Otambekov, said getting caught out can be financially disastrous.

“The expenses for a trip to Kashgar and back, including accommodation and food for a stay of several days in the town, come to about 250 dollars per person, if you economise. If you go to Urumchi [administrative centre of Xinjiang province], the costs go up to 500 dollars. But if you don’t get back in time, these expenses double,” Shavkat said.

Many traders fund their business activities by taking out loans, for example from a microfinance bank branch which the Aga Khan Fund, AKF, has set up in Khorog. The AKF, founded by the Aga Khan, the spiritual leader of the Ismaili branch of Islam, has been a major donor and development agency in Badakhshan, where local people are traditionally Ismaili rather than Sunni as in the rest of Tajikistan.

A delayed return from China can upset a trader’s precarious financial planning. Madina Oripova, from the village of Barchid, took out a bank loan of around 2,000 dollars before setting out for China on a purchasing trip.

“It was my first trip outside Tajikistan,” she said. “The people travelling with me helped me, but I found it hard to get my bearings there and had trouble with the language. I bought goods and loaded them up, but unfortunately, time ran out and the border was closed.

“My goods ended up unsold, and I had to go into debt to pay off some of the bank loan. If the border had been open, this definitely wouldn’t have happened.”

The regular closures of the border crossing have an impact on the wider economy of Badakhshan, pushing up retail prices on local markets

“Whenever we don’t return from China on time, our income drops drastically and we have to raise the prices of the goods we sell,” said local businessman Nazrisho Mironov.

Not everyone wants to see the border opened all the time, as that would give the Chinese unrestricted access to Tajik markets, potentially swamping them with cut-price goods.

Olga Saifulloeva, head of the economics faculty at Khorog university, agrees that Badakhshan will benefit from access to foreign markets and investment inflows.

“If the highway functions permanently, the markets of Tajikistan will be inundated with low-quality goods, which goes against the interests of local manufacturers,” she said. “Restrictions should be imposed here to give local manufacturers a chance to sell their goods on the local market.”

OTHER ROUTES STILL VIABLE

In the meantime, many traders will continue to shy away from the obstacles of the Kulma crossing and opt for other, easier routes.

Despite the growth in trade via Kulma, the bulk of Chinese goods still entering Tajikistan come from large wholesale markets in Kyrgyzstan and Kazakstan.

Li Hin Wang has been selling cheap audio and video equipment at markets in Kyrgyzstan for the last three years, and when he heard about the Kashgar-Khorog route he considered moving his operation to Dushanbe. But he decided against it when, like so many others, he found his freight consignment held up at the border.

“It would have been more profitable for me to work with Tajik partners on a permanent basis. As in Kyrgyzstan and Kazakstan, the people here are very smart and know about trading. But because of the rules at the border, I suffered enormous losses and couldn’t carry on.

Sherkhon Azimov, a businessman from the Hatlon region of southern Tajikistan who travels to China to buy construction materials, still takes a long and costly detour via Uzbekistan and Kazakstan. The advantage is that he can travel by train, and whenever he arrives at the Kazak-Chinese border, he can be sure it will be open.

“At the moment I have no other option, because going by road via Badakhshan is too risky. Time is money for all my clients, and God knows how long you could be stuck on the border there,” he said.

Saodat Asanova is director of IWPR Tajikistan.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Categories

%d bloggers like this: