10 most important events for Central Asia in 2019

Following the tradition of the analytical community, the Kazakhstan Council for International Relations (KCIR) herewith presents an overview of ten most important events in 2019 which are of key importance for the political, economic development, stability and security of the Central Asian states. This analytical overview is an attempt by the Kazakhstani experts to present own view of the main processes in the Central Asian region in 2019. We are hopeful that this material will be of immediate interest to the expert community, media and government agencies.

1. Increased geopolitical aftershocks

Rising tensions in the relations of key geopolitical players like the USA, Russia and China will directly and indirectly influence the processes in Central Asia in 2019. The increasing degree of confrontation between Russia-US in the context of newly introduced sanctions by the White House against Russia will indirectly affect and put sensitive pressure to the countries of Central Asia in their cooperation with the United States. In addition, the increasing volatility of local currencies of Central Asian states will be associated with uncertainty relations between Washington and Moscow, as well as with the expectation of additional sanctions package. Moreover, adopted in 2018, the US decision to withdraw from the Treaty on the Elimination of Intermediate-Range and Shorter-Range Missiles (INF) will lead to a further escalation of the military race between the United States and Russia, which will influence the further development of Moscow’s defense strategy in Central Asia in 2019.

In 2019, the US will increase its pressure on China in the field of trade, new technologies and the defense sector. Despite the agreement between the US and China, not to introduce additional tariffs from January 1st, 2019, trade relations between two countries will be tested. Eventually, the trade standoff between Beijing and Washington might become more serious, which can negatively affect global financial processes.

Under these circumstances, for the countries of Central Asia, the geographical proximity and close strategic cooperation with Russia and China, as well as partnership with the United States, will require timely maneuvering and adaptation of foreign policy to rapidly changing geopolitical environment. Accordingly, in 2019, the increasing confrontation of the US with China and Russia will motivate Beijing and Moscow to more actively cooperate in the region within the framework of the rapprochement of the Eurasian Economic Union (EAEU) and the Chinese “Belt and Road ”, initiative, as well as under the framework of Shanghai Cooperation Organization (SCO). It is important to emphasize that Chinese policy in Central Asia will be more ambivalent. Beijing will fluctuate between its own interests, dialogue with Russia in the region, and the prospect of a China-US deal.

2. Economic slowdown in Central Asia

According to the latest estimates, the leading international financial institutions expect the slowdown in global economic growth in 2019. This largely will be due to the uncertainty in the economic policies of major world powers, financial centers, the volatility of prices for petroleum products, which will significantly affect international capital flows and funding conditions for many states. The increase in the interest rate of the US Federal Reserve Service, and trade wars, which negatively affect the development of international economic relations, will only exacerbate the trade imbalance in the world.

In this regard, taking into account key global trends, current economic conditions and the situation in the region, it is predicted that economic growth rates in Central Asia in 2019 are most likely to be lower than in previous years. The average economic growth rates in Kazakhstan will be around 3-3.5%, in Kyrgyzstan 3.2-3.8%, in Uzbekistan 4.5-5%, in Tajikistan 5-5.5%, and in Turkmenistan around 5, 5-6%. For the region as a whole, the economic growth rate in 2019 will be 4-4.3%

At the same time, changes in energy prices and a slowdown in business activity could be a positive impulse for the development of the non-hydrocarbon sector in Central Asia, especially in Kazakhstan and Uzbekistan. It can be subject to the further implementation of structural reforms aimed at improving competitiveness and productivity, as well as mutually beneficial cooperation under the framework of the Chinese "Belt and Road" initiative.

3. Romanticism of regional integration

In 2019, the countries of Central Asia will continue a positive vector of strengthening and expanding interaction within the region. After the first consultative meeting of the leaders of the five Central Asian states held in Astana in 2018, the second working meeting of the heads of state of the region will be held in Tashkent in March this year. This initiative will give a positive impetus to the further development of cooperation in the field of regional security, the intensification of trade and economic relations and cross-border cooperation, the expansion of transit-transport potential, as well as the integrated use of water and energy resources in Central Asia. Besides, strengthening regional cooperation will also be filled with bilateral official visits and meetings of the heads of Central Asian countries.

Important enough, the element of growing cooperation in the region will be associated with the positive dynamics of interaction between Astana and Tashkent. In this context, the official celebration of 2019 as the “Year of Kazakhstan in Uzbekistan” is highly symbolic. One of the primary examples can be a mutually beneficial cooperation is the agreement on the mutual recognition of visas between certain countries in the region.

It should be noted that the chairmanship of Kyrgyzstan in the Shanghai Cooperation Organization (SCO) in 2019, and the SCO Summit in Bishkek, scheduled for June of this year, will focus on key regional issues and attract international attention to the region. This year, Turkmenistan will also chair the Commonwealth of Independent States (CIS) organization, while a regular meeting of the Council of Heads of State of the CIS will be held in Ashgabat in October 2019. In the first half of 2019, the European Union will identify a new strategy for Central Asia, which will also play a supporting role in promoting the agenda of intraregional cooperation.

At the same time, it is necessary not to overestimate the set course for the Central Asian rapprochement. At this stage it is highly unlikely to mitigate the consequences of almost 25 years of disunity during 2-3 years of positive intraregional dialogue. The countries of the region are facing with a lot of challenges on systematization and solution of internal issues, primarily economic and social ones. At this stage, the “integration agenda” is largely supported by the statements of the heads of state and cooperation is mainly conducted at the bilateral level.

4. New reforms: focus on social sphere

The year 2019 in the countries of Central Asia will be marked by the beginning of the implementation of a number of reforms, with the main focus on social issues, as well as ensuring public order and security.

First of all, it is worth noting changes in the system of taxation and payment for certain groups of the population. Thus, in Kazakhstan in 2019 the minimum wage was increased by 1.5 times, the individual income tax for low-wage citizens was reduced, a single cumulative payment was introduced to attract the category of self-employed citizens to the pension system and the social insurance system on preferential terms. In Kyrgyzstan, an increase in wages is provided for workers in the field of health, culture, as well as for drivers and technical staff. In Uzbekistan, a single tax on income of 12% began to operate for individuals, insurance premiums to an extra budgetary pension fund were abolished, and wage increases are planned for education and health care workers.

In Kazakhstan and Kyrgyzstan, the current year will also be characterized by significant changes in the system of internal affairs agencies, due to the public demand for enhanced security. As part of the Roadmap for the modernization of the internal affairs bodies in Kazakhstan, the staff level of the Ministry of Internal Affairs will be optimized, it is planned that a new national police standard and use the service model of work with the public to be approved. In turn, in Kyrgyzstan, from January 1, five new codes came into force: criminal, misdemeanor, violation, criminal procedure, and criminal executive.

In general, the reaction of the authorities of the Central Asian states to the solution of social issues is positively perceived by the public; however, the subsequent implementation of measures does not always receive approval from citizens. It should be taken into account that the adopted innovations are focused on certain social groups and don not always meet a whole layer of increasing demands of the entire population. Nevertheless, all these measures demonstrate the renewal of a social contract between the state and society.

5. Anticipation of new electoral cycle

Processes in Central Asia in 2019 will be largely determined by the electoral factor. Presidential elections in Kazakhstan and Tajikistan are scheduled for 2020, as well as parliamentary elections in Kyrgyzstan.
At the end of this year, parliamentary elections are expected in Uzbekistan.

One of the main electoral events of the upcoming electoral cycle, of course, will be the parliamentary elections in Kyrgyzstan, which should be held in 2020. Given the increased role of parliament in the political system of the country, it should be understood that further alignment of forces in the medium term depends on their results, and therefore there is a high probability that one or other parties will go on a blitzkrieg and try to launch an early parliamentary elections. In addition, the scenario of an early election campaign is also not excluded in the expert discussions of Kazakhstan.

In this regard, the electoral narrative will be noticeable in the region - the authorities of most countries of Central Asia will, to a greater or lesser extent, prepare for the electoral procedure to confirm their legitimacy.

6. Growing attention to demographic trends

The last few years for the region have been marked by certain quantitative and qualitative changes in demography. In 2017, the population of Central Asia crossed the mark of 70 million people. The countries of the region are gradually approaching the threshold of old age on the UN scale of aging, which is largely due to the increase in life expectancy and a decrease in mortality. Along with this, in 2019 the growth of the number of children continues, whose share in the region is about 30%.

Structural changes in the demographic picture of countries have already begun to influence the formation of state policy. Evidence of this is projects implemented in the countries of Central Asia, which are primarily aimed at the younger generation. Thus, the year 2019 in Kazakhstan has been officially declared the “Year of Youth”. Initiatives are aimed at expanding social projects, building dormitories, supporting young talents, increasing educational preferences and scholarships, as well as digitalization and modernization of the medical and scientific sphere. In Uzbekistan, the El-Yurt Umidi Foundation was founded to train local specialists abroad and engage in dialogue with compatriots under the Cabinet of Ministers.

A separate trend can be identified related to the urbanization issues in Central Asia. Today the region is poorly urbanized, however, in the official government agendas; there is a focus on increasing the role of cities and increasing the proportion of urban population. In January 2019, the President of the Republic of Uzbekistan Shavkat Mirziyoyev signed the Decree “On measures to fundamentally improve the processes of urbanization”, which will become a sort of starting point for the formation of state regulation of the processes of urbanization and internal migration. In Kazakhstan, similar project is underway to prepare the Forecast Scheme for the Territorial and Spatial Development of the country until 2030. In Kyrgyzstan, in continuation of the implementation of regional policy measures, the year 2019 was declared as the year of development of the regions and the digitalization of the country.

Despite the fact that Central Asian states use different tools and methods evaluate demographic trends and solve problems of territorial development, it is common that the states of the region are gradually moving towards an understanding of the need for centralized management of these processes.

7. China in Central Asia: growing economic cooperation and costs of perception

In recent years, the economic role of China has increased in Central Asia. This can be actually explained by objective reasons - the decline in investment activity of Russia and the West, the growth of the Chinese economy, the desire of the countries of Central Asia to diversify their geopolitical cases and others. The Silk Road Economic Belt has become an instrument for promoting Chinese economic interests. This project has institutionalized China as a serious economic player in Central Asia. At the same time, China emphatically presents its advancement with purely economic interests and on a mutually beneficial basis for the countries of the region.

At the same time, the intensification of the Chinese economic presence caused a natural reaction in the form of a discussion about the risks and threats of China's economic absorption of Central Asia.

All this naturally led to the fact that the Chinese factor began to acquire a political narrative. This is reflected in the use of the anti-Chinese factor in the domestic political struggle, as well as to mobilize opposition potential and trigger protest opinion. This politicization is largely manipulative and speculative in its nature. At the same time, public and expert discussions will increase the understanding that growing China’s economic role is a natural and objective process based on the raising role of China in the global economy.

Moving the Chinese factor into a positive direction will largely depend both on explanations by the Central Asian authorities about the need for investment to develop the economy, and on China's use of various forms and tools for positioning the activities of Chinese companies in correct and transparent form. In particular, the experience and work of Western companies in conducting active social policy in the countries of the region should be studied.

8. Intensification of political processes in Kyrgyzstan

One of the factors that will influence Central Asia in 2019 is the internal political situation in Kyrgyzstan. Its key factor will be built around confrontation between the teams of the current head of state and the ex-president, which will determine the nature of the political processes in Kyrgyzstan.

The trend for this confrontation was laid last year and was expressed in personnel cleansing of the state apparatus, in anti-corruption charges against members of the ex-president team, in launching the procedure for depriving him of legal immunity, in the split in the ruling party Social Democratic Party of Kyrgyzstan (SDPK), as well as in the narrative on corruption of the election campaign.

This conflict may lead to some polarization of political forces and confrontation between them. In any case, this year a high level of political activity is will shape the domestic agenda of Kyrgyzstan.

9. Preservation of the “yellow level” of the terrorist threat in the region

In 2019, the threat of terrorism remains one of the main challenges for the countries of Central Asia. A new phase of the war in Syria and the deterioration of the political-military situation in Afghanistan actualize the ongoing process of the return of Central Asian foreign fighters from military zones. Despite the loss of a significant part of the military force, the territory, sources of income, various terrorist groups that emerged as a result of the conflict in the Middle East today still pose a significant threat.

In particular, pushing radical groups out of zones of influence in Syria and Iraq can motivate the return of Central Asian foreign fighters back to the home region as an opportunity to reassert them. According to observers, over the past two years, in some Central Asian republics, the activities of small radical groups almost every month have been stopped, whose members have undergone military training in Syria and planned to commit terrorist acts in their own and neighboring countries.

Only in the first half of 2018, 12 members of international terrorist groups were detained in Kyrgyzstan, while in 2017 about 20 special operations were carried out. In July 2018 in Tajikistan, a group of Daesh sympathizers committed a terrorist act in which several foreign citizens were killed. This is the second case for which this group has assumed responsibility. The terrorist attack in Tajikistan demonstrates the continuing danger from sleeping radical cells within the region.

Currently, the fight against terrorism is particularly acute due to the complex geopolitical situation in Afghanistan and the Middle East, as well as the process of the return and activation of Central Asian militants in the region. All of these factors together will put serious pressure on the security system in Central Asia.

10. “Afghan knot”: presidential elections in the context of the growing threat of terrorism

In 2019, the difficult political-military situation in Afghanistan will be one of the main topics for regional security in Central Asia. According to the latest data from the Global Terrorism Index, Afghanistan retains its leading position in terms of terrorist activity in the world. Besides, according to estimates of the UN Mission in Afghanistan, the number of civilians killed in 2018 reached a record number of more than 8,000 people. In 2018, the government of Afghanistan controlled 55-60% of the country’s territory, while in 2015 the mark was about 70%. In this context, the terrorist activities of the Taliban and Daesh supporters in Afghanistan will pose a serious challenge in 2019.

In this context, the presidential elections scheduled for the middle of 2019 in Afghanistan will affect the country's further political stability and to some extent influence the security architecture in Central Asia. It is noteworthy that the upcoming election campaign, which has already been postponed several times, will take place under conditions of tough competition and latent friction within the Afghan elite.

It is important to note that the stability of the presidential election campaign will take place during the peace negotiations between the Government of Afghanistan, the United States and the Taliban. In this respect, the inclusion of Central Asian states is expected as an additional platform for resolving the Afghan process. However, it should be understood that attempts to initiate peace negotiations in Afghanistan will be accompanied by the outbreaks of terrorism.