FAIT Committee Report

…a new Central Asia is emerging, one that will reflect its Soviet past for decades to come but cannot return to it. Over time, this new Central Asia will be linked to the wider world, through air, land, and rail routes, as well as oil and gas pipelines. It will be linked by common cultural ties, but also divided — perhaps violently — by them. It may also be linked by the narcotics trafficker and the refugee. For some time to come, these countries will be marked by weak states, weak economies and weak civil societies. They will be seeking some form of return to the Islamic world, though its form remains murky. The outcome of these trends could well be different for each state. Russia will continue to play an important role but no longer that of the sole or dominant power. The new Central Asia will be part of a highly differentiated geopolitical space, with China, Iran, Turkey, Pakistan, and India interested and engaged.

            It is no simple matter to determine the paths that future Canadian foreign policy should take towards this vast and volatile region along the southern tier of the former Soviet Union. As the above citation suggests, an extremely complicated set of internal and external circumstances are in play, over which western democracies may have only limited influence. In accepting the argument that there are both good reasons and opportunities for Canada to increase its presence, the Committee also emphasizes that making such an effort will require developing a realistic, well-grounded approach for the long term. Expectations of quick "fixes" or paybacks should be avoided. That much has become apparent from the Committee’s public hearings and delegation study trip of May 5-17 to the three of five Central Asian countries — Kazakhstan, Uzbekistan, and Kyrgyzstan — which account for most of the very modest Canadian activity to date.

            Canada’s lack of historical baggage may, as Professor Neil MacFarlane suggested, give us an advantage of flexibility in approaching this region with positive intentions and objectives. Certainly the warmth of the reception accorded to Committee members in each of the countries visited is an indication that increased Canadian interest will be welcomed. However, sustaining a credible Canadian policy towards the region will also mean committing the resources necessary for its realization, while confronting the formidable challenges facing the governments and peoples of the region.

            The sections which follow accordingly begin by assessing current conditions, first regionally and then in terms of particular country circumstances, in order to better understand the context and policy environment for the furtherance of Canadian interests and values. That provides a basis for brief elaborations of some specific policy objectives to be pursued in the areas of: security and peacebuilding; democratic reform and human rights; economic cooperation and sustainable development; educational, cultural, and other forms of future cooperation. In this way, the Committee’s recommendations will address the regional, country, and sectoral levels of policy development.

I. CENTRAL ASIA IN TRANSITION: CONDITIONS, PROSPECTS, AND PRIORITIES FOR CANADA

Regional Profile in Brief

            Although the resource-rich Caspian basin links the two regions of the Committee’s study, the authors of the Trilateral report were "struck by the vast differences between the states of Central Asia and those of the South Caucasus". As in the Caucasus, however, a predominant feature of traditional clan-based Central Asian society has been an enormous local cultural diversity, all of which adds to the difficulty that Patrick Armstrong emphasized in his testimony of outsiders trying to understand the ongoing complexities of such regions from a distance. Central Asia in the western mind is perhaps best known for its fabled "Silk Road" heritage. As Shirin Akiner describes its turbulent crossroads: "Situated athwart the main north-south, east-west trans-Eurasian routes, Central Asia has throughout its history, been the point of contact, collision, and in varying degrees fusion, of peoples, languages, philosophies, technological and artistic innovations. The long chronicle of invaders includes various groups of Iranian peoples, various groups of Turks, White Huns, Greeks, Parthians, Arabs, and Mongols."

            This huge area of over 4 million square kilometers shares a storied past but has little real unity as it faces an uncertain future. Several centuries of Russian imperialism, with Tsarist followed by Soviet rule from Moscow, have left a legacy of often artificial borders and nationalities, along with the heavy burdens (as well as some achievements — high literacy rates, for example) of the record of Communist totalitarianism. Despite the Gorbachev reforms of the late 1980s, the Central Asian countries were generally completely unprepared for the dissolution of the USSR in 1991. Their level of political development at independence has been described as "not very different from that which had obtained seventy, or even a hundred, years earlier." Instead of there being an opportunity for an indigenous movement of political pluralism and liberalization to become established:

There was no transfer of power to new leaders: on the contrary, the ruling elites, far from being discredited on account of their umbilical links to the Communist regime, gained additional legitimacy since they were regarded as symbols of continuity in a time of flux and uncertainty. … there are clear socio-cultural parallels between the style of government of the Khans of traditional society and of the current Presidents of the Central Asian states. The terms and conditions under which the latter hold office have been defined, and in theory limited, by their respective state Constitutions. In practice, however, they enjoy powers that are tantamount to absolute.

            Ambassador Gerald Skinner confirmed the Committee’s own observation of the visible persistence of a cult of personality around leaders, and of many ingrained habits held over from the Soviet period. After almost a decade of independence, during which the regimes of the three countries visited have rhetorically adopted a western-oriented discourse of democratic and market reform, there is still "no culture of compromise", as he put it. As one of the tables below shows, only one country, Kyrgyzstan, merited even a marginal "partly free" rating in Freedom House’s 1999-2000 annual survey, and that country was the only one that was downgraded to "not free" in the 2000-2001 edition. While there are some signs of civil society development, it is autocratic conditions which have arguably been consolidated during the 1990s rather than an environment favouring multi-party democracy.

            Ms. Ria Holcak, Director of the Canadian Human Rights Foundation’s Central and Eastern Europe program, drew a troubling portrait for the Committee:

The euphoria that followed independence in the early nineties has been replaced by disillusionment, even nostalgia for the old system. There has been an increase in poverty and unemployment and a deterioration in governance and the rule of law….Attempts at transition in market economies have been painful and the adverse effects have been severest for the most vulnerable groups in society: the poor, pensioners, children, refugees, and the internally displaced. …

General deterioration in the standard of living for the vast majority of the population has led to widespread dissatisfaction with the governments of the region. All this provides fertile ground for human rights violations.

Upon independence, the newly established republics drafted constitutions that guaranteed the protection of human rights. To demonstrate their readiness to join the international community, they also moved quickly to ratify the most important United Nations human rights treaties. All the countries have joined the OSCE and have therefore accepted certain standards. Unfortunately these commitments on paper have not matched the action.

            Across the region, recent elections have tended to receive highly critical reviews from international observers. As Professor Neil MacFarlane noted in his testimony:" The situation is so bad in Central Asia that the OSCE is refusing to send electoral observers to states such as Kazakhstan, Uzbekistan, for fear that their presence will legitimise deeply distorted electoral processes." However, it is encouraging that at least some parliamentarians with whom Committee members met were prepared to acknowledge deficiencies, while seeking cooperation and assistance with reforms. We were also able to meet with non-governmental activists whose efforts attest to the need to keep democratic hopes alive.

            Moreover, as Ms. Holcak and many others have observed, these countries have had to cope with the unprecedented economic shocks of the Soviet collapse and with massive social upheavals, circumstances which realistically would challenge even the best policy intentions. The tables below giving selected indicators by country show some disturbing patterns. Uzbekistan is the only country which has not suffered a big decline from its Soviet-era economic output, but at the price of Western criticism that it is lagging behind on crucial economic reforms. All of the countries are at the lower end of the spectrum in terms of transition performance as measured by the European Bank for Reconstruction and Development (EBRD), the region’s largest source of external loans. Foreign investment flows are very unevenly distributed, with Kazakhstan and the non-renewable resource sector accounting for the largest share. Corruption, arbitrary regulations and poor public administration remain huge obstacles. While countries struggle to reorient unviable old economies to meet international market conditions, economic crime and illicit trade (notably drugs) are flourishing.

            In human terms, while a few have been enriched, most people have experienced an acute fall in living standards. Socio-economic pressures are exacerbated by high rates of population growth in all countries except Kazakhstan. In that country, the problem is more the brain drain from an exodus of ethnic Russian and European, notably German-speaking, minorities. (Indeed Russia had to absorb an out migration of several million ethnic Russians from Central Asia in the first five years following independence.) All of the countries fall within the "medium human development" group of the United Nations Human Development Report annual index. All rank considerably below the Russian Federation on the HDI scale. The best performer is Kazakhstan, which is also the only Central Asian country whose rating improved from the 1999 to the 2000 Report. At the same time, many social conditions in that country have been declining, with a recent UNDP report observing that "destitution in the rural areas is rapidly increasing." It is doubtful how many will share in the benefits from rising energy prices and exploitation of the petroleum-rich Caspian basin. Generally, human development indicators have deteriorated across the region over the past decade. By some accounts, despite pockets of prosperity in a few large urban centres, a large majority of the population is living in poverty.

Source: The New Central Asia, Trilateral Commission Task Force Report, 2000, Table I-1, p. 4.

Sources: European Bank for Reconstruction and Development, Transition Report 1999, "2000 Country Investment Profiles", and "Commentary on Central Asia" presented to the Committee by John Kur in Almaty, Kazakhstan, May 2000; United Nations Development Program, Human Development Report 2000, Human Development Index tables; UNICEF, The Progress of Nations 2000, statistical tables.

* PPP stands for "purchasing power parity". These data in the UNDP Report are provided by the World Bank and attempt to give a measure of real domestic buying power equivalents in US$ terms discounting for international exchange rate effects.

** The EBRD transition index measures overall country progress on reforms with scores rated on a scale ranging from 1 — little or no progress — to 4+ — well-functioning market economy. The average for Central Asia is only 2.17, which compares to 3.39 for post-Communist Central Europe.

Sources: UNDP, Human Development Report 2000; Transparency International 1999 "Corruption Perceptions Index"; EBRD, "Commentary on Central Asia", May 2000; Freedom House, Freedom in the World 1999-2000 Survey.

* The corruption preceptions index score is based on a scale ranging from 1 ? highly corrupt — to 10 — highly clean. (Canada’s score in 1999 was 9.2; Russia’s 2.4.)

** The Freedom House rankings for political rights and civil liberties are based on a scale ranging from 1 — most free — to 7 — least free.

Regional Prospects

            The immense resource potential and extraordinarily rich cultural heritage of Central Asia is certainly promising in the long term. But in the near term, the condition of overall "human security" across the region is worrying and deserves multilateral attention. Central Asia’s newly-independent countries are still coping with the fallout from Soviet military-industrial dependence as they search for new relationships among themselves, with their neighbours, and with the West. Jean Radvanyi observes that "the reassertion of identities in the aftermath of independence has rekindled nationalist fervour in each of these nascent states." At the same time, it is evident that many of the challenges they face call for integrated regional approaches — to economic adjustment and infrastructure development, resource management issues (of critical fresh water supplies in addition to energy), environmental rehabilitation (dealing, for example, with the shrinkage of the heavily-polluted Aral sea), nuclear non-proliferation, counter-terrorism, among just some of the concerns raised repeatedly with Committee members. The rhetoric of summits and various cooperation agreements aside, there is a great deal still to be done in this area.

            Caution must also be advised in regard to how countries are managing a cauldron of ethno-cultural and religious cleavages. With regard to the latter, we frequently heard about the need to counteract the threat posed by militant Islamic fundamentalist movements (such as so-called "Wahhabism"), pointing to terrorist incidents and recent armed incursions into southern Uzbekistan and Kyrgyzstan. There are real security concerns, of course, with Tajikistan having experienced civil war and the densely-populated Fergana valley remaining a focus of tensions among the three countries. One analyst concluded several years ago that: "The maintenance of order and stability will, for the foreseeable future, require measures that are not conducive to the fostering of Western-style political systems." However, many observers are now seeing the authorities increasingly using nationalism and national security as a dubious strategy to quell rising popular discontent and as a convenient broad pretext to crack down on political dissent. Human rights defenders are particularly concerned about mass arrests and the suppression of civil liberties and independent media. So a nuanced and critical judgement must be brought to bear on these regional security issues if "stability" is to be obtained through supporting the development of peaceful and pluralistic democratic societies rather than justifying or excusing further resorts to autocratic repression.

            An overriding concern is what comes next, since as the Trilateral report authors observe: "An additional source of instability is the fact that these regimes are over-personalized. They will in fact be sorely tested as the great leaders pass from the scene and the succession struggle emerges." A very pessimistic assessment by Boris Rumer of Harvard University, editor of Central Asia 2000: Critical Problems, Critical Choices, foresees serious conflicts ahead:

At the end of the 1990s, two distinct tendencies have emerged as the predominant features of contemporary Central Asia: degradation in the social and economic spheres and growing tensions among states in the region. The source of both problems is a profound economic crisis that the governing regimes cannot even contain, much less resolve. The resulting instability threatens to unleash a massive social explosion — all the more likely amidst the increasing importance of the Islamic factor — and also to trigger inter-state conflicts that could result in a general "Balkanization" of this vast region in central Eurasia.

            Committee members who travelled to the region came away with a much less negative impression than this exaggerated spectre of a "Eurasian Balkans" on the horizon. Nonetheless, we acknowledge that there is a risk of things going badly wrong, with significant consequences for wider security, and that therefore it is in the interests of the international community to watch developments closely. In that regard, Canada also needs to be in a position to make its own informed strategic assessments of the situation as it evolves. We are inclined to agree with the Trilateral report that: "though there is the chance of Balkans-like conflicts across a broad range from eastern Turkey into Mongolia, it will be crucial to understand the root causes of these conflicts. While common threads of state weakness, ethnic divisions and economic failure do exist, there are specific regional, country and even local ingredients that must be understood. … an appreciation of these unique factors is more likely to emerge from an examination of the new Central Asia."

            The key foreign policy question is: How can other countries help an emerging forward-looking Central Asia to escape from the long shadows of an oppressive past and to avoid the worst-case scenarios which have been suggested? The role of the larger powers appears to have been an ambiguous blessing to date. The most important country in that regard remains, of course, the Russian Federation. The path which it takes could be critically important to the region’s future. As Professor MacFarlane told the Committee: "the reactivation of Russian diplomacy … which is evident as we speak, raise a number of potentially disturbing questions about the future direction of the only great power, that is to say Russia, in a position to dominate the Caspian basin…"

            In the period following the disintegration of the USSR, the Central Asian states opted to join the Commonwealth of Independent States (CIS), whose founding documents were signed in Almaty, Kazakhstan in December 1991. There was a sense that what had been an isolated periphery of the Soviet empire could now begin to make its own way on the international stage. Post-independence realities have been less kind to those ambitions, however. The CIS has not proved very effective and progress on regional integration has also been painfully slow. The trend has been for Central Asian countries to gravitate back towards renewed relationships and alliances with Moscow.

            It is true that in meetings with Committee members, government officials stressed instead their efforts to join international organizations and their desire for stronger relations with western nations. The Trilateral study also observes a "decline of Russian military presence and influence in the region." Nonetheless, testimony from other witnesses as well as the evidence of President Putin’s first 15 months in office suggest that a reassertion of muscular Russian diplomacy is being well received by the region’s leaders. Russia’s economic interests have been boosted by recent announcements of major oil and gas discoveries in the Russian and Kazakh sectors of the north Caspian, with Russian companies very much involved in the various pipeline options under consideration.

            China is seen by some as emerging to vie with Russia and the U.S. in future energy developments. The Canadian position is that commercial considerations should predominate in matters such as determining pipeline routes; however, strategic geopolitical concerns are clearly a factor, with one analyst arguing that "it is the political decisions that will be made in many capitals regarding energy, not the economic forces acting on energy firms, that will decide the issue." China is also a key player with Russia in a Central Asian regional security and cooperation bloc which may be emerging under the auspices of the newly-named "Shanghai Forum". Its July 5, 2000 summit, attended by President Putin, approved the formation of a regional anti-terrorist centre and issued a joint declaration condemning interference in the domestic affairs of other countries "including under the pretext of humanitarian intervention and protection of human rights."

            In that context, it is interesting to observe the mixed messages from U.S. Secretary of State Madeleine Albright’s first official visit to Kazakhstan, Kyrgyzstan, and Uzbekistan, which took place only a few weeks before that of the Committee’s delegation in May 2000. While pressing their governments on the issues of democratic reform and human rights, she also announced US$ 3 million in military assistance to each country. (Although she described her trip as "pro-democracy, not anti-Russian", it elicited a prompt response from President Putin who promised to appoint a special representative for Central Asia.) Along with commercial and strategic interests in Caspian energy development, the U.S. has numerous programs and a large diplomatic presence in Central Asia. U.S. agencies have spent hundreds of millions of dollars on democracy and civil-society assistance to transition countries during the past decade. However, there are many questions as to its effectiveness. Experts who testified before a Congressional hearing on April 12, 2000, just prior to Mrs. Albright’s visit to Central Asia, generally agreed that the results have been disappointing, and that the political and civil rights situation is getting worse not better.

            Other major aid donors are Japan and the European Union. Although Central Asia has a low profile in Europe, the EU has undertaken major projects in Central Asia, notably through its technical assistance program for the CIS countries (TACIS) and the TRACECA (Transport Corridor Europe Caucasus Central Asia) program. In addition, in the summer of 1999, "Partnership and Cooperation Agreements" entered into force between the EU and Kazakhstan, Uzbekistan, and Kyrgyzstan, specifying optimistically that "respect for democracy, principles of international law and human rights as well as principles of market economy underpin the internal and external policies of the Parties and constitute a constant element of partnership".

            While Iran and Turkey are middle-level powers with ambitions to influence in the region, it is apparent that both have rather limited capabilities in that regard. Moreover, Iran is seen as largely oriented towards Russian interests, whereas NATO member Turkey — which has now also been accepted as a potential candidate for EU membership — is seen as aligned with US and European interests.

            Historical rivalries do not mean the stage is set for the revival of a 19th century "great game" competition for spheres of influence and the region’s riches. Increased international cooperation is supported by all of the players. But what seems to be lacking is an overall coherent multilateral approach towards the region. The Trilateral study wonders whether something along the lines of the "Stability Pact" in place for Southeastern European and proposed for the Caucasus might be contemplated for Central Asia. There has been a multiplication of plans and suggestions which "often overlap in ways that waste a lot of political energy and scarce financial resources. Coordination mechanisms between various institutions involved in Central Asian issues need to be created."

            A second explanation for the underwhelming record to date is that identified to the Committee by Professor MacFarlane as the "internally inconsistent" nature of the Western agenda:

I think it is fair to say that, although we have not been willing to articulate clearly a set of priorities regarding the liberal-democratic agenda, the locals have concluded that we care more about stability and economic opening than we do about rights and democracy. They have defined their own approaches to reform accordingly. … Western states have not been willing to put their money where their mouth is on the political and human rights sides and no external player has established effective political conditionality.

Where do Canada’s future interests and values fit into this complicated and cautionary picture?

Canadian Presence and Priorities

            To date Canada’s role in the region has been very low profile. The only reference to Canada in the Trilateral study, for example, is actually to our special responsibility for Ukraine within the G-7 context. And indeed, relations with Ukraine are normally a more important concern for the Ottawa-based DFAIT officer who also covers the five Central Asian countries and who travelled with the Committee delegation. In the field, coverage is almost as thin. As described by then DFAIT Director General Jim Wright:

Canada maintains only one embassy in the region, in Almaty, Kazakhstan. Accredited to the Kyrgyz Republic and Tajikistan, this small mission manned by two Canada-based officers was established initially as a trade post. This has evolved into a full service embassy, and this evolution will continue this summer when CIDA assign a Canada-based officer who will be responsible for the growing technical assistance program in Kazakhstan, Tajikistan and the Kyrgyz Republic.

            Two countries, Uzbekistan and Turkmenistan are covered from outside the region, from our embassies in Russia and Turkey respectively. Canada’s diplomatic representation is miniscule compared to other G-7 countries (see Table 4). That obviously limits what Canada can do, no matter how excellent the work of our foreign service officers. Trade flows remain relatively tiny, with Canada in a deficit position of just over $18 million in 2000 (see Table 6), and investments have been heavily concentrated in a few non-renewable energy and mineral resources sectors (principally hydrocarbons, gold, and uranium). Canada’s modest aid program of a few million dollars annually (Table 6), as explained by CIDA’s Director for the region, Stephen Wallace, must necessarily be very selective. Beyond a scattering of individual projects, CIDA still has to develop a regional policy framework that can support a broader level of programming. At the same time, Committee members were impressed by the Canada Fund micro-projects we visited, demonstrating how even a small expenditure, if well chosen and targeted, can have a large local impact and visibility.

Source: The New Central Asia, Trilateral Commission Task Force Report, Table IV-1, p. 67.

Sources: Statistics Canada; Canadian International Development Agency.

            Notwithstanding Canada’s minimal ties to date in the region, and the risks and reservations which can be associated with any increased involvement, private-sector and NGO witnesses were in agreement on the merits of proceeding with a substantial expansion of the Canadian presence. As Len Homeniuk, President of Cameco Gold, put it forcefully:

There is no doubt that Central Asia, a region in close proximity to the People’s Republic of China, Russia, the Caucasus, and several of the Islamic countries, is currently of concern to western nations from a geopolitical point of view and will become more so in the future…. Therefore a more visible role for Canada in Central Asia in our view is warranted, both in the private and in the public sector. … participation of Canadian companies in the development of the economy of Central Asia eventually results in substantial financial benefits back home…. However, significant business participation in the region is difficult without the support of a strong Canadian government presence. One of the areas in which current and potential business investors would benefit from strong Canadian government representation in the region is in assessing and understanding the political institutions. Although every substantial investor does its own due diligence and draws its own conclusions, a well-thought out political analysis conducted by experts is invaluable.

            In the field of supporting human rights and democratic development, furthering Canada’s role will also require additional foreign policy resources. The region’s most populous country, Uzbekistan, is still covered from Moscow. As Ria Holcak of the Canadian Human Rights Foundation told the Committee:

… I was very sad to find out, when I first started to go to the region, that Canadian diplomatic representation in the region is so small. There is a small embassy in Almaty that services four countries. There is no officer who is designated to work on human rights. They are very short-staffed. If we don’t have even a representation in the country, how can we have a pretty good foot in the door or on the ground? … Many times it’s very difficult to make out about different stories we hear if they are rumours, or [finding out] who is who. There is a lack of transparency many times. I think that diplomatic representation would help.

            Not surprisingly, those with whom we met in the countries themselves, both at the governmental and non-governmental level, warmly welcomed increased Canadian interest in terms of strengthened diplomatic contacts, responsible, mutually beneficial, investment and trade, and various forms of cooperation and assistance. We will be elaborating on those opportunities in more specific terms in the following sections. At this stage, what is of initial importance is to establish that Central Asia should become a more significant region of focus for Canadian foreign policy development, and to indicate generally some priority areas to be worked on.

            While a prudent assessment based on the foregoing analysis suggests that any expansion of Canadian activity should be of modest dimensions, the Committee is persuaded that Canada is under-represented, and its role therefore under-developed, in the Central Asian context. Drawing from the testimony of a number of witnesses, and Ambassador Skinner’s succinct distillation from our meetings in the region, we also see the following as primary dimensions of future policy development:

regional stability — including peace-building and human security initiatives;

broader, long-term economic relationships — including attention to small business development, issues of environmental sustainability and corporate responsibility;

democratic governance reforms — including support for strengthening human rights protections, the rule of law, independent media and civil-society capacities;

human resources development — including attention to education, the role of women, cultural promotion and exchanges.

            In that regard, we take to heart the advice of Professor MacFarlane that the formulation of future foreign policy ought to be a coherent reflection of Canada’s interests and values taken together. As he put it so well: "We do not support democracy, the rule of law, and economic reform simply because these are values that we embrace. They are intrinsic to our interests as well." Mr. Nazeer Ladhani, CEO of the Aga Khan Foundation of Canada made the complementary point that an integrated Canadian approach can be envisaged which matches Canadian strengths with Central Asian needs, nurturing what he referred to as "multicultural democracy". He suggested "five intervention points ? namely, promoting regional cohesion, economic development, development of human resources, sectoral reform, and local culture — are the ones in which Canadians and their institutions have excelled internationally. They are also of critical value to the countries of Central Asia as they undergo the difficult process of transition."

Recommendation 4

Canada should reinforce its diplomatic representation in Central Asia through additional resources to the embassy in Almaty and the establishment of a mission presence in at least one other country; Uzbekistan being a likely first choice since it has over 40% of the region’s population. The Government should also ensure that DFAIT and CIDA headquarters have adequate resources in place designated to monitor regional developments and capable of managing an enhanced program of Canadian activities in the region.

Recommendation 5

Canada should concentrate future policy and program development in strengthening relations with Central Asia in the following priority areas:

regional stability and peacebuilding;

broader long-term economic relationships and sustainable development;

democratic governance reforms, human rights and support to civil society;

human resources, education, and culture.

II. COUNTRY CIRCUMSTANCES AND CANADIAN INTERESTS

            The focus of this section is on the three countries visited by Committee members in May. However, the remaining two merit a brief comment. Turkmenistan was described as "totalitarian" by Cameco Gold president Len Homeniuk. Although it is a resource-rich state bordering the Caspian Sea, there are minimal prospects for furthering Canadian contacts until the political situation improves. The EBRD and OSCE have been endeavouring to engage Turkmenistan in dialogue on political reform, though without much success to date. We believe that in cases where there is no demonstrable commitment to reform on the part of the government, political conditionality should be firmly applied at the bilateral and multilateral levels.

            Tajikistan has been the most unstable state since independence and has probably suffered most from the post-Soviet breakup. It is at the bottom of the pack in terms of real economic output performance, per capita income and human development ranking. At the same time, the Committee is impressed by what the Aga Khan Foundation has been able to accomplish in the country in recent years. In Almaty, Mr. Hakim Feerasta briefed Committee members on the work of the Aga Khan Development Network in such worthwhile areas as agriculture and food security, community development, micro-credit, power generation, human resources training, and creation of a Central Asian university. He noted Tajikistan’s progress in being able to produce 90% of its food requirements, up from only 15% in the early years of independence. Further details are given in the testimony of Mr. Nazeer Ladhani, CEO of the Aga Khan Foundation of Canada (Evidence, 4 May, 2000). CIDA is the fifth largest donor to the Aga Khan Network, contributing some $3 million of technical assistance towards its regional program over a three year period. In light of the worthwhile results being achieved, this NGO-led effort merits continued Canadian support.

Recommendation 6

Canada should support the firm application of political reform conditionality in bilateral and multilateral relations with Central Asian countries, notably in the case of Turkmenistan. Development of any further contacts with that country should await evidence of substantial improvement in the political situation.

Recommendation 7

Canada should continue to give strong support to the work of the Aga Khan Development Network, notably its projects in Tajikistan. The Government should watch developments in that country with a view to further possibilities for collaboration with non-governmental organizations such as the Aga Kkan Foundation.

Kazakhstan

            The EBRD’s 2000 Country Investment Profile claims optimistically that: "Kazakhstan is making progress towards economic consolidation and improvement more rapidly than the other Central Asian republics." The country has received the lion’s share of foreign direct investment in Central Asia over the past decade. Currently it is also benefiting from high oil prices and recent discoveries could turn it into a major world energy exporter. Canada has a significant stake in this, notably through the firm Hurricane Hydrocarbons, the largest Canadian private investment in the country to date, operating in the Kumkol field. Hurricane has recently entered into an association with the country’s largest ShNOS oil refinery, which is also dealing with the China National United Petroleum Corporation as Kazakhstan seeks to diversify its oil export routes.

            Kazakhstan has the most extensive bilateral relationship with Canada, as indicated by the location of our sole embassy in the region in the former capital and largest city of Almaty near the borders with Kyrgyzstan and China. Much of the focus of attention has been commercial. In the Committee’s Ottawa hearings, and in meetings with officials of Hurricane and other members of the Canadian business community in Almaty, where a business roundtable meets monthly, a number of difficulties in the investment climate were observed — arbitrary regulations, punitive tax regimes, pervasive corruption being among those often mentioned. However, there was also indication of a long-term commitment and interest in continuing to develop economic partnerships. Relationships with Saskatchewan and Alberta have been particularly active in the agricultural, mining, energy, and human resources area. In regard to the latter, Committee members were present for the opening of the Almaty main office of the Caspian Training Centre, a project of the Southern Alberta Institute of Technology to establish a training facility for Kazakhstan’s energy industries.

            There are both positives and negatives in the circumstances and prospects for advancing bilateral relations. Ambassador Bolat Nurgaliyev told the Committee in Ottawa that "in just over eight years we have set the framework for a stable, pluralistic, and modern society. Undoubtedly our new nation is a work in progress, but measured against any objective historical standard, the pace of our development and the breadth and depth of our transformation has been truly extraordinary. This is especially true if you consider the extreme disabilities we inherited and the severe constraints under which we act." In contrast to that, a former Prime Minister, Akezhan Kazhegeldin, has written bitterly that:

Currently, the country is in a state of catastrophic economic crisis. … From 1993 to 1997 Kazakhstan was able to attract hundreds of Western, primarily US, companies. Their investments totalled US$ 9 billion. … However, during this period Kazakhstan failed to achieve its most important goal: creating a firm foundation for democracy. As a liberalized economy formed, an authoritarian and anti-democratic regime was emerging in Kazakhstan. … Economic development has suffered as well; foreign investors frequently find themselves in conflict with local administrations and always lose in the end. …The West must not let dictators stay in power.

            The Committee’s assessment of conditions is neither so sanguine nor so bleak. Clearly there are some critical problems to be addressed. Even companies which have had considerable success in their operations — Hurricane, Cameco, and SNC Lavalin being among those who testified — freely recounted the obstacles and frustrations they encounter. Paul Carroll, President and CEO of World Wide Minerals, raised the case of major losses which the company claims it has suffered on its investments, with a case against the Kazakhstan government still before the courts. He contended this unfortunate situation was not unique and that: "It seems there is an open invitation to come to the country and spend money, and once you’ve spent the initial money, then it’s tough luck for you." In a follow-up letter to the Committee Chair, he advised that: "To date, there has been no improvement in Kazakhstan’s treatment of foreign investors…. Canada should join with other like-minded nations and attach effective conditions to economic and social assistance to the countries of Central Asia, and particularly Kazakhstan."

            Another case raised during the Committee’s study involved 35 new automobiles exported to Kazakhstan in 1994 by Canadian investors. These vehicles were essentially stolen in Kazakhstan, and later vandalized while in police custody. While the Canadian investors were eventually successful in obtaining a substantial judgement in their favour, they have not been able to enforce it. When asked about this case by Committee members in May 2000, Kazakhstan’s ambassador to Canada replied that:

The case … is a combination of several factors. One is poor judgment in setting up a business transaction with an unreliable partner …

The second set of factors that I, as the representative of Government of Kazakhstan, will acknowledge is that the court system in this case was not performing up to the expected standard. The case was reviewed for too long by too many judges, and each was dragging his feet. That’s why, since 1994 until 2000, there was a lack of clear-cut judgment …

I know this case is being now started at the inter-agency level, with the involvement of the ministry of justice, and the solution will be found based on the existing legislation in Kazakhstan; that is, if a citizen or a commercial entity suffers material injury due to inaction of the government agency — and in this case it was the Kazakh police authorities whose custody these cars were under — then the government has to pay from the state budget. And I anticipate that this will be the outcome.

As for the judges who were guilty of not performing their duties, four of them were disciplined.

            While the Committee welcomed this information from the Ambassador ? including his condemnation of the speed of the justice system ? as of May 2001 this case had still not been satisfactorily resolved.

            Mr. Carroll’s comment noted above suggests to us, not that Canada should pull back, in which case it would give up any opportunity for leverage, but rather that Canadian involvement, including in the commercial area, needs to carry with it a strong sense of Canadian values and of raising the bar in terms of standards of conduct. That means of course that Canadian enterprises must set an example in adhering to high standards of corporate governance, environmental and social responsibility in their operations, and in being as transparent as possible in their dealings with the public. The Committee takes note of the particular concerns which were raised in that regard by Mining Watch Canada in its testimony and submissions, including in regard to Cameco’s 60% stake in a proposed joint venture to mine one of the largest uranium deposits in the world.

            This could be an area where Canadian businesses should also be encouraged to explore possibilities for increasing contacts with indigenous reform-minded NGOs. That prospect was welcomed by Sergey Zlotnikov, head of the "Interlegal" Civic Foundation and Transparency Kazkhstan, during a roundtable discussion in Almaty; indeed when asked what the most useful Canadian contribution might be, he encouraged "more Canadian companies to work here to put pressure for rule of law improvements." Canadian policy should be attentive to how economic relations can be managed in ways which spur democratic governance reforms, adhere to environmentally sustainable development principles, and promote good practices generally.

            If there was one thing on which NGO spokespersons as well as government officials were agreed, though for different reasons, it was on the merits of expanding Canadian activity and exchanges both in the public and private sectors. The Committee is conscious of the fact that it is still very difficult for independent NGOs to exist in a tightly controlled environment which requires them to be officially registered and which is generally hostile to criticism of the government. Representatives of Amnesty International and the Canadian Human Rights Foundation had warned us of that. As Ms. Holcak testified:

Groups that document and monitor human rights abuses or elections face constant harassment and possible imprisonment. Surveillance by the state security service is common. For example, one of our partners in Kazakhstan reports that they are regularly asked for lists of participants in their programs by agents of the Committee for National Security, which reports directly to the president. During my trip to Almaty last November, the office of the Kazakhstan International Bureau for Human Rights was burned down. They lost all their files. The police investigation concluded that arson was the cause, but no suspects were identified and charged. Because the bureau has been an outspoken critic of the recent elections, the entire human rights community was shaken by the event.

            Local NGO resources are also very limited and therefore international assistance can make a vital contribution to their work. Rights are violated much more easily where people are not aware of their rights and where civil-society capacities are weak. In helping to strengthen those capacities, the Committee heard that it will be important to find solid local partners with which to work and to build up NGO networks.

            One area where Kazakhstan has provided some positive leadership is in nuclear non-proliferation and conflict resolution issues. Kazakhstan inherited an extensive Soviet nuclear infrastructure (including over 1,400 strategic warheads which were withdrawn to Russian territory), but has renounced the nuclear option, closed the fast-breeder reactor at Aktau, destroyed what was the world’s largest nuclear test site at Semipalatinsk, and promoted the idea of a Central Asian nuclear weapons-free zone. Committee members probed these issues in Almaty with Margarita Sevcik and Dastan Eleukenov, a former government official, from the Newly Independent States Representative Office of the Monterrey Institute of International Relations Centre for Nonproliferation Studies. While Eleukenov maintained that Kazakhstan has rid itself of nuclear-weapons materials, he also stressed that "it is very important to enforce export controls in the region." This is reinforced by the assessment of other analysts that "there are still safety leaks in the region’s nuclear facilities, despite ample efforts to safeguard the sites and the implementation of national export controls in Kazakhstan and other Central Asian states."

            In broader security terms, Kazakhstan has been in the forefront of regional cooperation initiatives, both at the governmental and non-governmental level. A very interesting NGO project which the Committee learned of in Almaty through the Centre for Conflict Management, is the formation of a Central Asian Conflict Management Network to develop peace-building capacities, including working with children and utilizing local traditions. This Centre has also worked with the Canadian Human Rights Foundation on a human rights education program for schools. These are some concrete examples of activities that are possible which support the goals of peaceful transition. We see educational and training components as being a key aspect of a long-term Canadian investment strategy which accompanies Kazakh society in the difficult transition process.

            The Committee appreciates that Kazakhstan still has a long way to go in terms of achieving a democratic political and legal culture. We hope that our meetings with key actors have underlined Canada’s interest in the reform process and in the development of effective parliamentary and market-economy institutions. We are concerned about a number of developments since our visit, in particular the passage of a law on June 27, 2000 granting President Nazarbayev certain lifelong powers and privileges. This has coincided with news of an international investigation into alleged money transfers from foreign oil companies to Kazakh officials including the president and his family. The Committee wishes to emphasize again that support for increasing official contacts with Kazakhstan will be tied to demonstrable progress on reform.

            Despite the many reasons to be critical of the current autocratic regime, as consultant Askar Duzenov pointed out, there are also strong affinities between Kazakhstan and Canada. There is a substantial basis for deepening relations, and the Committee’s meetings with the Kazakhstan authorities attest to their desire to do so. Occasions such as a possible visit of President’s Nazarbayev’s to Canada, and second visit to Saskatchewan, should be seen in that context as opportunities to pursue frank political dialogue at a high-level. In the longer term, Canada’s approach should focus on developing sustainable, responsible economic partnerships, on supporting civil-society development through collaboration with credible locally-based NGOs, and on mutual security cooperation in areas such as nuclear non-proliferation.

Recommendation 8

Canada should reciprocate Kazakhstan’s desire to deepen bilateral relations while pursuing a policy agenda which firmly asserts Canadian interests and values in the following areas in particular:

Improvements in the overall investment climate which are predicated on legal and public administration reforms and adherence to high standards of transparency and corporate responsibility.

Investments in education and training programs in areas of Canadian strength.

Support for democratic institution-building, human rights, and peace-building activities.

Cooperation in nuclear non-proliferation initiatives.

In addition, the Committee believes that a visit to Canada by President Nazarbayev would provide a useful opportunity to advance Canadian interests and values. Any such visit, however, should be preceded by the Government of Kazakhstan taking concrete steps to resolve such high profile cases as those referred to above.

Uzbekistan

            Although Uzbekistan is the region’s most populous country, and a major link in new "Silk Road" development plans, before the Committee’s visit in 2000 it had attracted only minor Canadian interest, mainly a few investments in the mining sector; in March 2001, the Canadian embassy organized and led a business development mission there. The lack of currency convertability has held back the country’s foreign investment potential. While its post-independence output performance has held up the best of any Central Asian country, economic conditions have been relatively stagnant. The government has made stability a priority over reform.

            Senior parliamentarians and foreign ministry officials with whom Committee members met were eager to increase ties with Canada. However, Uzbekistan’s commitment to democratic and market-oriented reform remains at best questionable. There is little tolerance of political opposition and an adequate functioning legal structure is lacking. President Islam Karimov won elections in January 2000, the first for the post in eight years, with 92% of the vote. As a recent analysis characterizes the situation:

Uzbekistan is in many respects less democratic today than during the glasnost period of the late 1980s. … On paper, Uzbekistan has some of the formal institutions of democracy. Indeed, the Constitution, official government documents and speeches by President Karimov are often steeped in the discourse of liberal democracy. The Constitution, for example, guarantees a number of civil and political rights, including freedom of the press and freedom of association. These rights are not however recognized in practice. … Nominally, Uzbekistan has held parliamentary and presidential elections, but open and democratic multi-party elections have been prevented by restrictions on political party formation and bureaucratic impediments.

            This analysis observes that NGOs, like any "public association", must go through an extremely bureaucratic and expensive process of registration with the Ministry of Justice. Tax laws make it hard for NGOs to raise funds. There is "almost no press freedom and it is difficult to find foreign publications." These problems were largely confirmed in discussions Committee members had in Tashkent with representatives of women’s NGOs, a spokesperson for a public education centre, and an independent dissident journalist and former parliamentarian. NGOs trying to cope with the heavy social burdens on vulnerable populations get almost no support from the government. Keeping alive a critical press is a constant struggle, and the parliament has not been able as yet to provide any meaningful opposition role.

            The Committee delegation also met with Mrs. Rashidova, Parliamentary Ombudsman for Human Rights, who expressed interest in learning further from Canadian experiences with such offices. Establishing national human rights bodies is a positive sign, but the Uzbekistan ombudsman office was described by Ms. Holcak of the Canadian Human Rights Foundation as "not yet living up to expectations". She added that, "in the absence of an independent judiciary, free media, and an active community of NGOs, these new institutions face an uphill battle. One suspects that the impetus for the creation of such institutions has more to do with appearances in the international community than genuine commitment to human rights at home."

            Indeed recent reports by Amnesty International and Human Rights Watch point to a grim situation, linked to religious and security issues. Just days after the Committee’s visit, on May 15, 2000, Human Rights Watch sent a letter to the UN High Commissioner for Human Rights decrying the government’s targeting of "persons suspected of affiliation with Islamic religious leaders, institutions and organizations unregistered by the state."

            In the name of cracking down on fundamentalist Islamic resistance, at least 5,000 people were arrested, some executed, and others allegedly tortured. There were concerns that 10,700 suspected religious "extremists" on a list compiled by the State Committee on Religion may have been targeted for future arrest. The impunity with which human rights activists have been arrested is seen as evidence of the limited influence of outside agencies, and also as "backfiring, creating a stronger and more extreme Islamic resistance."

            The Committee acknowledges that there have been serious terrorist incidents and that there are a number of legitimate cross-border security concerns. Foreign Minister Kamilov spoke to us about the "Afghan problem" of Islamic fundamentalism linked to transhipment of drugs and the illegal arms trade, referring to multilateral efforts to combat organized crime, including trafficking in nuclear materials. Although Uzbekistan has been seen as the most "anti-Russian" of the newly independent Central Asian states, such security issues seem to be playing into the hands of a reassertion of Russian influence in the region, a trend corroborated by Commander Terry Pinnell, Canada’s naval attaché in Moscow, accredited to Central Asia, who briefed Committee members in Almaty and accompanied the delegation to Tashkent. Russian President Putin seemed to make those intentions clear when he stated during an official visit to Tashkent in May 2000:

It is common knowledge that attempts are underway to carve up post-Soviet lands along criminal lines with the aid of religious extremism and international terrorism. An arc of instability has emerged in the republics on Russia’s doorstep. Speaking bluntly and practically, if we do not stop international terrorism here, we will face it at home.

            In light of the rather tenuous situation on several fronts, the Committee advises a prudent gradual approach in advancing bilateral relations, geared to encouraging democratic reforms. Small steps are possible. We note that a Canada Fund contribution helped the National Human Rights Centre of Uzbekistan to produce and distribute a booklet on the UN Universal Declaration of Human Rights. Cooperation with the parliamentary ombudsman office could be furthered. But it is difficult to see support proceeding for human rights activities and other aspects of civil-society development without an enhanced Canadian diplomatic presence in the country. It was in that context that Ms. Holcak told the Committee "it is specifically in Uzbekistan that I think we, Canada, need to have some representation." That consideration also applies to another interesting initiative, supported by CIDA, in which ten Uzbek students received management training at St. Mary’s University. As Denis Leclaire, director of international activities for the university, explained to the Committee: "For the Uzbek project, which is only eight weeks long, it took six weeks to get visas and then someone from Tashkent had to fly to Moscow to pick up the passports. There certainly wasn’t a lot of facilitation there as far as helping get the people into Canada."

            In raising the possibility of Uzbekistan opening an embassy or consulate in Ottawa, Foreign Minister Kamilov told Committee members in Tashkent that that would depend on success in being able "to activate our relations", as he put it. We agree that those relations should be upgraded in the coming years, bearing in mind, however, the concerns about the government’s commitment to reform highlighted in the foregoing.

Recommendation 9

The Government should explore options for establishing a permanent diplomatic presence in Tashkent. At the same time, Canadian policy should maintain a cautious critical stance towards the current regime, focusing on opportunities to encourage democratic and human rights reforms, the development of a legal and financial structure conducive to private investment, and on activities, such as education and training programs, which are of long-term practical benefit.

Kyrgyzstan

            The tiny mountainous Kyrgyz Republic was, along with Uzbekistan, the first of the Central Asian states to proclaim independence in 1991. Led since that time by a scientist and academician, President Askar Askayev, rather than a typical ex-Communist Party political boss, the country also initially embraced political liberalization along with market-oriented reforms. Gaining favour in the West as an "oasis of democacy" in the region, it has been the recipient of large amounts of bilateral and multilateral donor assistance. The EBRD’s Krygyzstan 2000 Country Investment Profile observed that it is the only CIS state which has accepted the IMF’s conditions for full capital and current account convertibility. In December 1998, Kyrgyzstan became the 133rd member of the World Trade Organization (WTO), the first post-Soviet state to do so. It is seen as having "implemented the most liberal and democratic transition path in Central Asia."

            But, and there are many buts, the socio-economic, political and security picture gives much cause for concern over where "transition" is headed. As one analyst puts it:

It is difficult to explain to people why the country that has been most eager to adopt Western models — Kyrgyzstan — is suffering the most (other than Tajikistan, which has survived a disastrous civil war). Kyrygyzstan has seen the most severe increase in poverty and social stratification, has an economy near total collapse with bleak prospects for recovery, and is severely afflicted by corruption and social catastrophes such as the massive migration to cities from the rural areas where people are no longer able to maintain a subsistence existence.

            The reality is of a very poor country, without an adequate social safety net and with serious internal tensions. As the pre-publication draft of the EBRD Profile itself frankly reported:

Despite growth in recent years, GDP per capita remains very low and about half the population are living at a subsistence level. Social reforms and increased tax collection will be necessary to ensure progress in alleviating poverty. … the country’s growing debt is now greater than its GDP. …

Efforts to attract foreign investment have included the development of a foreign investment law, special incentives for investors, establishing a liberal exchange rate regime, and an overall increase of support by the government. … However, investment remains very low, at an estimated net total of only US$ 64 million in 1999, and a cumulative net total of only US$ 440 million from 1994-99, far below the country’s capital requirements. It is unevenly distributed across the economy and largely concentrated in trading activities and large-scale mining. … the investment climate needs much improvement. General problems such as corruption, complex bureaucracy, bureaucratic interference, and poor legislation and tax systems are particularly acute in the former Soviet republic — Kyrgyzstan being no exception.

            The critical comments on investment problems, which do not appear in the published version, are significant because Canada’s main relationship with Kyrgyzstan to date has been an investment one. Indeed, Cameco’s one-third stake in the US$450-500 million Kumtor gold mining operation — a joint venture with the Kyrgyz government through the Kumtor Operating Company (KOC) — is to date the single largest Canadian private investment in the former Soviet Union. The Export Development Corporation (EDC) has also provided financing for the project, which directly employs over 1,500 local people and accounts for a substantial proportion of the country’s GDP. By virtue of that, Canada is the biggest foreign investor in Kyrgyzstan.

            The particular issues, notably in regard to environmental impacts and public process, which are raised by the Kumtor mining operation, which Committee members inspected on site, will be dealt with in more detail below. At this point, it should be noted that the testimony of Mr. Len Homeniuk, president of Cameco Gold and formerly of the KOC, corroborates the difficult situation of the country. For example, he indicated that "an average salary these days might be $60 US a month. It’s a very impoverished country. They have a very difficult time putting food on the table." Cameco has had to resist the ever-present challenges of corruption given the "incredibly low wages" paid to public officials. Although, after years of lobbying by the company, Kyrgysztan is revising mining regulations to be more in line with Canadian (specifically Saskatchewan provincial) standards, bureaucracy and regulatory matters are "held over from the Soviet times…. Operating a modern mine under these conditions has proven to be extremely frustrating and burdensome." Moreover: "Unfortunately, in contrast to earlier claims that the Kyrgyz Republic was the most democratic country in Central Asia … it too seems to be turning autocratic. The parliamentary election has been criticized by the Organization for Security and Cooperation in Europe for failing to meet international standards. Presidential elections scheduled for this fall will likely see President Akayev further tighten his grip on the country." As Ron Halpin of the Department of Foreign Affairs and International Trade noted before the Committee in April 2001, "The presidential elections in the Kyrgyz Republic in October 2000 were widely criticized by international observers, including Canada. To its credit, however, the Kyrgyz government is continuing to work with the OSCE and other international organizations to address the problems."

            In fact, the turning back towards autocracy goes back to at least the mid-1990s. As Fiona Adamson writes: "In 1994, President Akayev began to take anti-democratic measures such as closing down newspapers and shutting down parliament. In the 1995 elections, ‘fraud, corruption, and public anomie reigned’. Since 1995 Akayev has taken steps to consolidate power in the executive branch of government." Speaking of the democratic and human rights challenges facing Canada in Central Asia, DFAIT’s Jim Wright observed in 2000 that: "The preservation of clan privilege takes precedence over the national interest, and this colours much of the daily machinations of government. Even in the most reformed state, the Kyrgyz Republic, clan privilege is rarely far from the surface."

            Alex Neve, Secretary General of Amnesty International Canada, indicated their concerns that "human rights defenders, local organizations in Kyrgyszstan who seek to promote and defend human rights, are at some risk in their work." The registration of the Kyrgyz Committee for Human Rights was revoked in 1998 and only restored after strong international pressure and OSCE intervention. The much criticized parliamentary elections of February-March 2000 were followed by the arrest on spurious charges, and trial in a closed military court, of Felix Kulov, a popular former mayor of the capital Bishkek, seen as a potential rival to President Askayev. While Committee members were meeting with the president, the Committee’s research director was able to meet with one of the country’s leading human rights activists, Natalia Ablova, director of the Bureau on Human Rights and Rule of Law. She confirmed that the country’s elites have been moving away from earlier democratic reform intentions. It is those in power, she contended, not the population, that is not ready for real democracy: "People want changes but the opposition is very weak."

            Ms. Ablova also pointed to the links, as in neighboring Uzbekistan, of political repression to socio-economic deterioration, rising Islamic militancy, and a heightened security alert which has played into the hands of a reassertion of Russian influence in the region, where Kyrgyzstan "is the weakest link". In the summer of 2000, alarm bells went off when several hundred armed Islamic radicals, denounced as "Wahhabis" by the government, invaded southern Kyrgyzstan from adjacent areas of northern Afghanistan and Tajikistan and took hostages including four Japanese geologists. There were claims that thousands of guerrillas were being trained across the border and could stage new attacks. In addressing such security threats, it is important to deal with the internal as well as external causes. One analyst points to:

…increasing social stratification as a small segment of the population enjoys opulent wealth while the majority toil in squalor. According to the Social Foundation of Kyrgyzstan, 60 to 70 percent of the population is considered "low income", while 20 percent are classified as poor. The majority of the latter reside in the countryside, where the unemployment level is the highest. This problem is paramount for Kyrgyzstan, because the increasing stratification may lead to mass discontent and ultimately social upheaval. Many Communists and other presidential opponents play on the frustrations of the people in an effort to discredit efforts to democratize. In addition, Islamic groups can use the people’s poverty and disenchantment for its political purposes, as they did in Egypt and Algeria.

            Parliamentarians with whom the Committee met did not seem overly concerned that the Communist party had obtained the most votes of any party in the recent flawed elections. However, like the temptation to religious extremism, this is an indication of the reactionary as well as reformist potential of social discontent. Senior Kyrgyz officials and politicians sought to convey the message that these weaknesses are being acknowledged and addressed. For example, the Speaker of the People’s Representative Assembly, Mr. Borubaev, affirmed that: "we are completely committed to the building of a civil society based on law and the market economy … [we] have learned our lessons, taking into account the critiques of the OSCE and NGOs so that the next time elections will take place on a higher democratic level." There was an appreciation of political contacts, referring back to the visit by the Speaker of the Canadian Senate Gildas Molgat in 1998, and a desire to increase such exchanges in future. At the same time, as attested to by a Canadian parliamentary consultant who was in Bishkek at the time of the Committee’s visit, progress towards effective institutions of parliamentary democracy remains painfully slow, and the practical political will is sometimes questionable.

            On the bright side, there is no question from the Committee’s meetings that the Kyrgyz authorities, from the president on down, are very interested in pursuing close relations with Canada. Like Kazakhstan, there are already considerable ties with Saskatchewan in particular, through the Cameco investment and reinforced by a provincial trade mission in 1999. That may open the door to pro-reform influence through policy dialogue, private-sector opportunities, and cooperative assistance in a number of areas. One of these which should also be mentioned is the management of water resources, given that "Kyrgyzstan possesses large freshwater reserves of the highest quality." It has been said that the country, "which has no natural gas and oil reserves like its downstream neighbors, considers water its new currency". A 1997 presidential edict asserted Kyrgyzstan’s rights over water resources within its territory. Recognizing the potential for transboundary conflicts, however, the OSCE has tried to broker a regional water-sharing agreement.

            The critical nature of water issues, and the need for regional and international cooperation around these, was highlighted by both Deputy Prime Minister Boris Silayev and NGO critic Natalia Ablova. Both also saw the densely populated Fergana valley as a potential flashpoint. Ms. Ablova’s Bureau on Human Rights and Rule of Law has been involved in major international conferences on water management and conflict resolution and was hoping to get CIDA support for peace-building projects in the Fergana valley. (Professors MacFarlane and Carment had referred very positively in their testimony to the engagement of a growing women’s movement in Kyrgyzstan as offering promise for Canadian participation in conflict prevention, early warning, and peace-building initiatives.) In Bishkek, Minister Silayev told Committee members that "we can definitely learn from you as far as water management is concerned." He added that there is a need for "constant monitoring of storage facilities" (for mine tailings and other waste materials) in environmentally sensitive areas, which raises the issue of impacts from large-scale mining operations.

            But while Mr. Silayev described the Kumtor project as "our pride and joy", strongly defending it against parliamentary and NGO attacks, Ms. Ablova was very critical about the way in which the KOC has handled environmental and public health concerns related to several widely-publicized accidents and in regard to the longer term consequences of this kind of development. Given that Kumtor represents such a significant Canadian investment, it raises several issues which merit closer attention.

The Kumtor Controversy and Future Canadian Policy Interests

            As mentioned above, the Kumtor gold mine is the largest Canadian investment in the former Soviet Union. In addition to the Cameco and EDC stake, financing has come from a consortium of private banks, the EBRD, and the International Finance Corporation (IFC) of the World Bank. Controversy erupted after a May 1998 truck accident on a road leading to the high-altitude mine site, which released sodium cyanide compounds into the Barskaun river and Lake Issyk-Kul. While the public reaction was extremely negative (described by Mr. Homeniuk as "mass hysteria"), and there have been many allegations of poisoning effects, the international scientific commission of inquiry which was promptly undertaken by Canmet, and included experts from Health Canada and Natural Resources Canada, found these to be relatively minimal in a report released in September 1998. Cameco accepted some responsibility for damages resulting from the accident and agreed to pay compensation of US$ 4.6 million to the Kyrgyz government.

            The Committee has heard a great deal of sometimes conflicting public testimony and received detailed written submissions, as well as relevant supporting material that is part of the documentary record, from company officials (Cameco and the KOC) and NGO critics (Mining Watch Canada, Natalia Ablova) in Canada and in Kyrgyzstan. In addition, a Committee delegation was also able to visit firsthand the accident site and tour all aspects of the actual mine operation. All things considered, we have to say that we were impressed by what we saw. We accept Cameco’s word that it is trying to be a responsible investor under often trying circumstances, which include in addition to all the logistical, environmental and political challenges, higher costs and lower profitability than was anticipated. At the same time, there are clearly some ongoing problems and legitimate questions about how successful the company has been in meeting the tests of high expectations and public scrutiny.

            While the May 1998 spill and several subsequent minor incidents have attracted most of the negative publicity, perhaps unfairly, the larger debate is on the overall impact of the mine — located in a slide-prone area and literally cutting into a glacier — the waste containment system, as well as long-term legacy following closure in another seven or eight years. As Joan Kuyek of Mining Watch put it to the Committee: "Cameco has a reputation as a responsible mine operator, but so did Esmeralda in Romania. I think it’s important to realize that gold mining in those circumstances is a recipe for disaster and that a mine that’s only going to be there for a few years is taking an incredible risk with the water supply and other things in Kyrgyzstan. … there’s been a lot of discussion about that one spill in May 1998. I don’t think that’s something that needs to be followed up. I think the question is much more around what they’re doing with the tailings and what their plans for closure are."

            Apart from technical issues relating to adequate environmental safeguards, there are issues here of transparency and sustainability involving public trust and long-term development impact for the country. An example of both the valid misapprehensions and potential for misinformation which can arise is the following passage from a recently published book on the region:

Kyrgyzstan still possesses areas untouched by human activity, including beautiful landscapes, pure water, and air. However, the economic crisis threatens Kyrgyzstan’s pristine environment as the population is pushed into irrational use of natural resources — clearing of forests, overcultivation of fertile land, violation of irrigation standards, etc. There are over 130 mining sites covering 1,950 hectares of land. Radioactive and non-ferrous metal sites are of the greatest concern. Most of them are located in zones known for mud and landslides, and along mountain rivers, thereby creating an ecological hazard involving territories of adjacent states and the entire Aral Sea basin. The need to strengthen control over the activities of industrial enterprises producing poisonous substances was proven again last year, when cyanides were dumped into Lake Issyk-Kul, causing mass poisoning of the population.

            While it is easy to agree with the concerns expressed about environmentally sustainable development, the latter statement, if an apparent reference to the Kumtor accident, is a grossly misleading exaggeration. The problem of perceptions and public confidence is nonetheless a real one. In his testimony, Mr. Homeniuk stated: "using Kumtor as an example, we have operated with the philosophy that we have no secrets, and have made all information, with the exception of the dealings with security issues, available to all project stakeholders, including the government, NGOs, and local communities." He went on to elaborate on the environmental impact statement that was done at the feasibility stage and on the project conditions specified in the environmental management action plan (EMAP):

At Kumtor we agreed to abide by the most stringent of the Kyrgyz, Canadian, and World Bank environmental regulations. So our operation is by far more environmentally sensitive than it would be in Canada, for instance, in terms of the regulations we follow.

Also, with regard to the EMAP, we have an outside auditor inspect our operation once every three years. Recently we have agreed with a committee of NGOs that they would have the right to monitor and inspect our facilities as they wished. So the environmental scrutiny is there, and the EDC has been part of all of these endeavours.

            At a KOC briefing for Committee members at Cholpon-Ata on the shores of Lake Issyk-Kul, the delegation was shown copies of the EMAP, which does contain specific public information provisions, and the Emergency Response Plan (ERP). However, we were told that both documents are confidential to the project partners, although a summary of the ERP was being prepared for public release under the auspices of the Community and Business Forum for Kyrgyzstan (CBFK). This is an EBRD-led initiative, with funding from the UK’s Department for International Development, and managed by the international NGO Flora and Fauna International with a project coordination office in Bishkek. However, Ms. Ablova, who was very suspicious of government or donor organized NGOs (known as GONGOs), dismissed this effort as a public relations exercise. Notwithstanding the official commitments, assurances and responses, Kumtor’s critics continued to claim that important matters related to the mine’s impact have not received a full and independent public accounting.

            The Committee appreciates the access and cooperation shown to us by Cameco and the KOC and we recognize that some critics may never be satisfied. However, in light of the above, we would hope that all reasonable requests for additional information to the public can be accommodated and that any legitimate remaining concerns related to the future of the Kumtor project can be addressed by the project partners in a transparent manner that has public credibility, above all among the affected population, as well as in Canada and internationally.

            The Committee confronted some similar issues in regard to adequate environmental review and public disclosure in the course of conducting our review of the legislation governing the Export Development Act. As EDC is one of the partners in Kumtor, this is also directly relevant to this case. We are pleased that the Government’s response to our recommendations promised "immediate action to involve the office of the

            Auditor General, which includes the Commissioner for Environment and Sustainable Development, to audit the adequacy of EDC’s environmental framework and EDC’s performance in implementing it when assessing specific projects", as well as additional statutory measures related to such oversight. Given the criticisms identified in the May 2001 report by the Office of the Auditor General on its review of the EDC’s environmental review framework, the Committee suggests that the circumstances of the EDC-supported Kumtor project could be referred to the Office of the Commissioner for an advisory opinion as to whether further action is warranted by Canadian government agencies and companies in this matter based on an objective review of all the pertinent facts.

Recommendation 10

Canada should continue to develop and diversify bilateral relations with Kyrgyzstan on a basis that strongly encourages reform processes and offers support for genuine democratization efforts. Consideration should also be given to expanding technical cooperation in areas, such as water resources management and conflict prevention, of demonstrated need and Canadian expertise.

Recommendation 11

The Government should work with the Canadian, Kyrgyz, and multilateral partners in the Kumtor mine project to ensure that all reasonable public concerns relating to its operation and environmental impact are addressed in an open and transparent manner. In respect of EDC’s involvement in particular, the circumstances of environmental assessment in this case could be referred to the Office of the Commissioner of the Environment and Sustainable Development for an advisory opinion as to whether any further action is warranted based on a review of all pertinent facts.

III. THEMATIC PRIORITIES: DIRECTIONS FOR FUTURE CANADIAN POLICY

Regional Stability, Security Cooperation and Peacebuilding

            The Committee agrees with Ambassador Skinner and many other analysts that stability has to be an overriding policy objective. As the Trilateral Commission Report argues: "The costs are high in the long run if weak states, corrupt gangs in an outside government, ethnic tensions, and outside aggressors make the region an exporter of tension and instability." Ambassador Skinner referred in Almaty to being situated at "the far end of an arc of instability" from the Balkans to Afghanistan. Interestingly, the same phrase has been used by Russian President Putin, who stated at the July 2000 G-8 Summit in Okinawa, Japan: "The centre of this arc … is Afghanistan and this affects not only Russia and Central Asia but many other countries too. The only solution is to widen the international system for combating terrorism and to raise its effectiveness."

            The dangers posed by terrorist activity linked to extremist Islamic movements and economic crime are real. For example, Afghanistan has become the world’s largest source of opium and Central Asia a major drug trafficking route. Central Asian countries
are using the security card to manoeuver among themselves and form alliances with Russian, and to a lesser extent Chinese, support. As one analysis puts it: "There is more at stake in Central Asia than eroding state structures amidst a Colombian-style breakdown of domestic order. There is also the survival of a tenuous geopolitical balance that has barely lasted a decade. Any logical rationale for the current borders disappeared with the collapse of the Soviet Union."

            The Committee cautions, however, against concluding that stability requires propping up the region’s increasingly discredited autocracies or playing along with great-power stratagems. In our view, the goal of stability must be pursued within an overall human security approach.

            Certainly there are areas where security cooperation with the existing regimes is warranted. One of these is arms control — in regard to both weapons of mass destruction and small arms-trafficking — and coping with the terrible fallout, in environmental and human health terms, from Soviet-era weapons programs. The latter concerns not only nuclear contamination, as in the Semipalatinsk test site in Kazakhstan, but also toxicity from chemical and biological weapons testing, notably from the former test site on Vozrozhdeniye island in the shrinking Aral Sea, jointly administered by Kazakhstan and Uzbekistan. Since Central Asia is virtually surrounded by larger nuclear capable states, it can be argued that it should be "their top priority to ensure the safety of weapons-usable fissile material through continuing upgrading of physical safeguards, training of security personnel, patrolling potential trafficking routes and the like". As well, "stabilising the regional security framework is pivotal in order to minimise latent demand for nuclear material for whatever purposes."

            Canada should contribute to international assistance efforts on non-proliferation —encouraging the Central Asian countries to bring to fruition their treaty to establish a Central Asia Nuclear Weapons Free Zone — and responding to other security threats, including of an environmental nature. The OSCE and NATO’s Partnership for Peace are several multilateral vehicles for providing support. The Trilateral report calls for, in addition, "the formation of a Central Asian Roundtable as a means to encourage senior-level dialogue between trilateral countries, states of the region and key neighbours like China, Russia, Turkey, and Iran". It also proposes a "High Authority on Central Asian Water" as part of creating a regional cooperation framework to deal with such critical joint management issues and to defuse potential conflicts over vital resources. The UK Government’s response to the British parliamentary report on the region argues that the OSCE should take the lead in that regard.

            While endorsing high-level multilateral initiatives of this sort, the Committee is convinced that long-term stability also depends on the development of pluralist political cultures and peace-building capacities within Central Asian societies. This highlights the importance of working with non-governmental partners committed to democratic reforms and to ethnic and religious tolerance. Examples such as the Central Asian Conflict Management Network and the human rights education carried out in conjunction with the Canadian Human Rights Foundation are first steps which could be expanded. Professor David Carment raised the possibilities to "train people in the areas of conflict prevention, conflict analysis, and peace-building, focusing on bottom-up approaches integrating NGOs into Canadian practices of peace-building and conflict prevention and working multilaterally with agencies supported through CIDA."

            Crucially, security objectives must also be linked to real improvements in living conditions for the region’s people. That means responding directly to what the Trilateral report properly points to as ongoing internal sources of instability:

The shocking decline in public health and education, the decay or even absence of basic transportation and other social infrastructure and the emergence of a wide range of religious and other social organizations create targets for trilateral assistance. A broad range of public health and civil society programs would both meet real needs and foster a lasting link between trilateral countries and the populations of these emerging states.

            Accordingly, future Canadian assistance should focus on security needs at the societal level and specifically on efforts which promote peaceful pluralism.

Recommendation 12

Canada should strongly support arms control and non-proliferation initiatives, including the establishment of a Central Asia Nuclear Free Zone. Canada should pursue broader security objectives, including environmental security, multilaterally through the OSCE in particular, and consider whether creating additional regional cooperation frameworks may be useful. As part of an overall human security approach, Canada should target its assistance to civil-society development which fosters ethnic and religious tolerance, conflict resolution and peace-building.

Economic Cooperation and Sustainable Development

            Approaching the tenth anniversary of independence and post-Communist transition, Central Asian states, like those of the South Caucasus, have, in the words of a recent international conference report, "failed to establish sustainable strategies for economic development, and particularly for the exploitation of the region’s energy reserves." Estimates of Caspian reserves will continue to vary. While Rob Sobhani and Robert Cutler provided the Committee with more optimistic projections, a recent estimate of oil and gas reserves sees them as still "marginal, with an importance roughly double that of the North Sea."

            More importantly, the promise of resource wealth will create more problems than solutions if revenues are not used wisely, if they reinforce distorted and inequitable patterns of development rather than encourage reforms and sharing of benefits, and if they leave behind a polluted environment for future generations. As a special National Geographic survey put it: "While international deal-makers focus on Caspian oil, the millions who live there struggle to meet everyday challenges — establishing reliable food and fuel supplies, providing medical care and education, and reclaiming a healthy environment." The Trilateral study along with others supports "pipeline diversification" in the commercial development of the region’s energy potential. But at the same time, it urges Western assistance "to focus on pressing social needs from declining education and literacy to the decline in healthcare."

            What this suggests to the Committee is that we should look to a broader and more diversified approach to the region which integrates economic and social development goals with those of long-term sustainability. Ambassador Skinner observed in Almaty that Canada’s existing economic relationship with Central Asia is "totally asymmetric". Mainly the flow is one-way, consisting of a few large investments going into the extractive non-renewable resource sector. It is important to look beyond that, to wider trade and small business development, the potential for exporting environmentally friendly technologies, for fostering community economic development, and so on.

            Of course, large companies already operating in the region must be involved in this development effort. Mr. Cutler argued that Western companies were making progress in becoming better adapted to local conditions: "They have had to learn to new ways of doing things and even come up with new methods of management and new forms of inter-cultural and multinational organization." Mr. Homeniuk of Cameco told the Committee: "We have had to invest substantial effort in understanding and learning to function within the cultural environment of Central Asia, and particularly the Kyrgyz Republic. Too often, in our view, foreign investors underestimate and misunderstand the challenges of operating in a foreign culture. … We strive to make Kumtor a good corporate citizen of the Kyrgyz Republic, participating actively in its social, artistic, economic and cultural life, building what we refer to as a golden partnership; a long lasting relationship based on mutual respect and common goals."

            We take a positive view of the contribution that Canadian business can make to Central Asia’s development in a manner that promotes reform and democratic transition. We agree with Professor MacFarlane’s remarks that economic expansion and export initiatives should be seen as complementary with democratization initiatives: "It’s possible to do both. … the federal government has a responsibility to promote the interests of the country’s private sector. I don’t see any contradiction in this." As DFAIT’s Jim Wright stated: "Canadian companies are obviously going there to do business. They’re going there to make money for Canadians. That’s not a bad thing, and if it can be done in a way that benefits the local society, that improves their quality of life, that contributes to these countries becoming more successful and being able to offer a level of service to their own people, that’s a very good thing."

            Both business and NGO witnesses reminded the Committee, however, that a number of challenges need to be squarely faced in order that these mutual benefits are actually realized in practice. Some argued for stronger pressures to improve the investment climate. For example, Paul Carroll of World Wide Minerals recommended making further IMF, World Bank, or EBRD funding conditional on "resolution of outstanding trade and investment disputes", and enacting Canadian legislation to include such conditionality in financial assistance to the region. Professor MacFarlane made the point that the absence of a clear message on political and governance reforms has been a weakness of Western policy to date. Indeed, the British House of Commons Foreign Affairs Committee report criticized the EBRD’s lack of firmness in that regard, and recommended that: "The release of further funds by the EBRD should be made conditional upon improvements in the respect shown by governments of the region to multiparty democracy and pluralism." In terms of Canadian policies, Mining Watch Canada argued that tax and regulatory regimes should incorporate conditionality based on standards of responsible corporate practice, and that any official support for international business activities (such as through EDC) "should be tied to strong and effective environmental and human rights standards."

            Apart from more effective conditionality, there is a positive role for technical cooperation assistance to promote a responsible and sustainable path of private-sector development. CIDA’s Stephen Wallace affirmed that the Agency "has a particular role to play to ensure that policies, laws and regulations make sense and are applied fairly and transparently, that basic economic institutions work, and that workers are equipped to meet the demands of the global economy. These … are the basic building blocks of sustainable trade and investment and they are the basis for addressing key aspects of governance and corruption." Daniel Grabowski of SNC-Lavalin welcomed an increase in CIDA assistance, especially in areas of management expertise and training, some of which he suggested could be done on a repayable basis with funds "recycled back to CIDA for reuse in the country and in the region." Kyrgyzstan’s Deputy Prime Minister Silayev pointed to resource management, notably of water, to transportation and tourism development, and to WTO implementation issues. In regard to developing trade expertise, the kind of work on WTO accession that the Centre for Trade Policy and Law has been carrying out in the South Caucasus might be extended to Central Asia, learning from Kyrgyzstan’s experience. Other promising areas for economic development assistance would include agriculture, basic infrastructure, and micro-credit that particularly increases opportunities for women’s participation.

            Nazeer Ladhani of the Aga Khan Foundation posed the issue of supporting economic development and job creation as follows: "…what can Canada do to make the Central Asian states effective and sustainable trading partners, in a way that promotes a multicultural democracy? Canadian expertise in private enterprise could prove critical in assisting the region’s economies to make the successful transition to an internationally competitive free-market orientation. Private enterprise remains poorly developed in most parts of the region. This is partly due to culture and ideological traditions and the scarcity of qualified free-market entrepreneurs. But it’s mainly the result of the tremendous effort required to restructure an entire society."

            The Committee agrees that Canada’s economic relations with Central Asia need to be broadened and intensified, with a focus on creating conditions for responsible investment and developing local private-sector capacities which will be of long-term social benefit.

Recommendation 13

Canada’s multilateral and bilateral economic assistance policies towards Central Asia should clearly and firmly link levels of official support to demonstrable progress on economic and political reform. In addition, the Government should take whatever measures are necessary to ensure that Canadian firms active in the region adhere to high standards of socially and environmentally responsible behaviour. Canadian policy should also seek to diversify economic relations, expanding technical cooperation in areas where there is the most potential to build sustainable partnerships and to encourage local private-sector development.

Support for Human Rights, Democratic Development and Good Governance

            By almost any assessment, current conditions in Central Asia range from unsatisfactory to awful. DFAIT’s Jim Wright acknowledged as much when he stated in his opening presentation to the Committee in 2000 that the region "represents a major human rights challenge for the international community and for Canada." It is distressing to think that the promises of post-Communist transition and the obligations of OSCE membership, which go much beyond those contained in the Soviet-era Helsinki Accords, are being honoured more in the breach than the observance in Central Asia. Cassandra Cavanaugh of Human Rights Watch puts the situation sharply: "Twenty-five years after Helsinki, human rights activists in Central Asia encounter repression as harsh as any Czech or Polish dissident ever faced. But while the West lionized anti-Communist agitators, it pays little attention to the Central Asian men and women who are exiled, jailed and tortured."

            Democratic development clearly faces a long uphill road. There is no indigenous democratic tradition; even compared with Russia or other CIS states, "the political culture of Central Asia is highly conservative". And there are concerns that the post-independence departure of more educated European minorities along with declining living standards and a loss of Soviet educational achievements could impede the democratization process. Despite the trappings of elections and other nominally democratic institutions since 1991, authoritarianism prevails while the construction of a democratic civil society has been marginalized. Observes one analyst: "As far as autonomous organizations are concerned, there is no sign of a break with the Soviet era. In Central Asia today genuine political parties either do not exist at all or their routine activities are blocked by a great variety of obstacles introduced by the government. … In all Central Asian countries, without exception, the formation of any autonomous organization is interpreted as an act of conspiracy to overthrow the government."

            The record of external democracy assistance is also sobering, despite very substantial funding from U.S. and European sources. Some deficiencies found in recent evaluations include:

A concentration on urban areas, while neglecting the needs of rural areas where the majority of the population lives.

A proliferation of NGOs, many of them of dubious character and merit, in response to donor funding availability.

A dependence on donor aid and therefore donor agendas, resulting in things such as time and resources spent on production of English-language newsletters which cannot be read by local constituencies.

A series of policy-related lessons drawn from one such careful evaluation of Central Asian democracy programs are listed in Box 1.

*Source: Fiona Adamson, "Building Civil Society From the Outside: An Evaluation of Democracy Assistance Strategies in Uzbekistan and Kyrgyzstan", New York, Report prepared for the Columbia University Project on Evaluating Western NGO Strategies for Democratization and the Reduction of Ethnic Conflict in the Former Communist States, 2000, p. 36.

            In working with civil-society groups, it is important that donors choose their partners carefully. Professor MacFarlane observed "a flavour-of-the-month quality to NGO activity … they read about what the MacArthur Foundation, the Ford Foundation, the Bank, CIDA and whatever have as their priorities, and then they become the priorities, because this is an income generator." He suggested that integration into international networks of concern and exposure to multilateral selection processes could help to sort out which groups are serious and soundly-based. Being able to critically assess the credibility and autonomy of NGOs was also a point underlined by human rights activist Natalia Ablova in Bishkek. Even a former Prime Minister of Kazakhstan warns that: "Central Asia’s new dictators are extremely resourceful. For the benefit of the West, they create large numbers of seemingly non-governmental and quite democratic organizations: trade unions, environmental movements, women’s movements, and political parties, all of which are really in the regime’s pockets. A foreigner would be incapable of telling a genuine human-rights advocate from a false one, a real democratic movement from a fictional one." His litmus test is being willing to openly criticize presidential rule.

            The Committee is aware from its delegation’s encounters in the region, that governmental interference and manipulation are all too common, and that much work also needs to be done to reform electoral laws and to strengthen genuinely democratic parliamentary institutions so that they can provide for an effective opposition within a system of checks and balances and as part of the accountability structures required for better governance. With these cautions and commitments to reform in mind, we see opportunities to increase support for democratic development activities, including through utilizing parliamentary exchanges and inter-parliamentary channels, as Mr. Cutler emphasized in his testimony.

            As noted in Part 1, Ms. Holcak of the Canadian Human Rights Foundation endorsed institution-building and public administration reforms — including human rights training for state officials, police, prison guards, and security forces — but added a crucial caveat. Her argument is worth repeating:

Support is needed for strengthening the democratic functioning of parliaments, reinforcing the independence of the judiciary, and establishing independent and effective human rights institutions. Given Canada’s particular experience in this field, it makes sense for Canada to support the creation of independent ombudsman offices in the region.

However, strengthening institutions is not enough. No matter how much effort is put into parliaments, the judiciary or human rights institutions, these energies will be wasted unless a similar effort is put into the emergence of a vibrant civil society capable of mobilizing the public to protect their own interests.

            She referred in that regard to developing civil-society capacities, including through independent media, to monitor human rights performance and seek redress for violations, to advocate for democratic changes, and to network locally, regionally, and internationally. Once again: "One of the most effective ways for Canada to contribute to the democratization process is to support the human rights education initiatives that target schools and state officials. It is particularly important for the long term to target the younger generation by incorporating effective human rights education programs in the schools. Canada can provide support for training teachers and developing appropriate curriculum materials. In addition to any support provided through ministries of education, Canada should not ignore the important role NGOs are already playing in this area."

            Finally, at the diplomatic level, the Committee agrees with Ms. Holcak that Canada’s voice needs to be clearly heard:

Canada should use its bilateral and multilateral relations with the countries of the region to express its concerns about human rights and to lift repressive legislation and policies. Canada’s membership in the UN Security Council, the UN Commission on Human Rights, and the IMF give it considerable opportunities to exert influence at the multilateral level. Unfortunately our bilateral influence is limited by the low level of diplomatic representation in the region. Nonetheless, when the opportunities arise, Canadian diplomats should urge the governments in the region to take concrete action to remove restrictions on freedom of association and expression and to improve the overall human rights situation.

Recommendation 14

Canada should increase its support for human rights monitoring and human rights education and training initiatives in Central Asia, working through partnerships with credible locally-based non-governmental organizations. Canada should use bilateral diplomacy and international forums wherever possible to raise concerns about gross violations and to pressure the region’s governments to respect their OSCE and UN human rights obligations. The Government, through CIDA, should provide democratization and good governance assistance, including for strengthening parliamentary institutions, based on an approach that is specific to the region and fully takes into account the lessons of donor experience, giving particular attention to ensuring that the local partnership is based on a genuine commitment to democratic reform.

Educational, Cultural and Future Forms of Cooperation

            A theme which emerged repeatedly in the Committee’s hearings and discussions in the region is the need to broaden relations in ways which take account of the human dimension. It may be a truism to say that Central Asia’s future depends on its young people, the first generation of the transition era. But we do see investment in human resources, contacts and inter-cultural exchanges as among the most promising for building mutually profitable relationships over the long term.

            Education is obviously a key component of a progressive human-centred approach to international cooperation. As Professor MacFarlane observed:

What does it mean to support society from below? What does it mean to build capacity? What do we mean by educational opportunity? … In my view the most successful component of American assistance programming in the region has been conducted through the Eurasia Foundation. Basically, it is targeted in two directions. One is getting promising young people out of the region and educating them in American universities. The second is supporting the development of quasi-modern educational institutions within the region itself. It doesn’t cost a lot of money and you are actually creating the cultural basis for change.

According to Denis Leclaire of St. Mary’s University, Canada is also well placed to provide that:

Canadian universities large and small can play a major role in the transformation process taking place in the countries of the former Soviet Union. Canadian universities have requisite geographical and sectoral expertise … and can act as agents of change to build capacity and change attitudes and strategies that are in place in many of the countries of Central Asia. Capacity-building is what Canadian universities do well internationally, and capacity-building in such sectors as management training, governance, gender, and the environment is required to create a new ethos ….

            Reference was made earlier in the Report to the specific project involving management trainees from Uzbekistan that St. Mary’s University conducted with the Canadian Bureau for International Education, supported by CIDA. Patrick Armstrong also urged increasing the kinds of scholarships that CIDA offers: "I believe in working on a small scale with people. … Invest in the future … young people. Bring them out here, get them to Canada, teach them something useful…." Educational cooperation was specifically mentioned as a high priority in the meeting that Committee members had with Uzbekistan’s Foreign Minister Abdulaziz Kamilov, who indicated that another 25 people were due to go to Canada on study programs, and who described this activity as "key to further development of bilateral relations". However, as Mr. Leclaire pointed out, they have had considerable difficulties in arranging visas for students, compounded by the lack of Canadian diplomatic presence in the country. Instead of facilitation there has been frustration. He observed that: "Visas to Canada are much more difficult to obtain than to the U.S. or to Europe." In our view, this is a situation which calls for prompt government attention.

            There are a number of areas in which educational and training activities oriented towards public management, private-sector and civil-society development could be enhanced as a policy objective of Canada. In the previous section we referred to human rights education at various levels and support for independent media. Earlier in the Report we mentioned the opening of the Southern Alberta Institute of Technology (SAIT) Caspian Training Centre which coincided with Committee members’ visit to Almaty. Geared to the needs of Kazakhstan’s energy industries, as Canadian expertise is transferred, it is intended that the Centre will eventually become financially self-sustaining and locally run. We agree with the remarks of SAIT spokespersons Ron Talbot and Ed Evancio made to a meeting of the Canadian business roundtable in Almaty that projects must be designed to be "sustainable for the peoples of the countries in which we work."

            In the Committee’s view, there should be more such projects which build practical linkages through educational and training networks. Government support is essential. In addition to CIDA, Robert Cutler also mentioned possibilities for International Development Research Centre (IDRC) involvement in regional environment and energy development, peace-building and conflict-prevention activities. We would also encourage Canadian businesses to take into account the human factor in the Central Asian environment and specifically to maximize the human resources development benefits to the region from their investments.

            There is much scope for Canadian contributions to fostering what Nazeer Ladhani of the Aga Khan Foundation termed "multicultural democracy." Referring to support for reorientation and development of human resources, he observed that: "The development of new language and human skills that are appropriate to the environment in which they live and to a new and globalized economy are urgently needed. Otherwise, millions of Central Asians, particularly the young, will face unemployment, thereby increasing the chances for future social unrest." He encouraged further Canadian involvement in educational initiatives, including the establishment of a Central Asian university, in the reform and rehabilitation of the health care as well as education sectors, where Canadian expertise is highly regarded, and not least, in "learning from and promoting the rich cultural heritage of the region." In regard to the latter, he mentioned the AKF’s Cultural Humanities Project for Central Asia, which "employs civilization as an orienting principle to promote and strengthen cultural pluralism and the foundations of civil society", and the related Silk Road Project, "an international effort to promote the region’s past and present cultural contributions to the world, primarily in the field of secular and devotional music."

            In sum, looking ahead to the second decade of post-Soviet independence and transition, it is a good time for Canadian policy to take stock of its limited presence to date in the region and to enlarge its horizons. The challenges facing Central Asia are great, but so are the opportunities to be explored, not only for exploiting energy and mineral resources, but also for working on environmental preservation, contributing to peaceful pluralism and the emergence of democratic civil societies, supporting overall human and cultural development. In that respect, Mr. Ladhani’s hopeful message to the Committee provides an apt conclusion to this Report:

Canadian participation in these endeavours would enable them to become new and important pillars of the region’s cultural future. Indeed, in today’s world only the nearly blind could ignore the striking need for and importance of cultural diplomacy. […] by helping Central Asians understand the strength of their cultural diversity, and anchoring this concept in the national education systems and artistic constituencies, we engender ethnic harmony and contribute to the creation of multicultural democracy.

In conclusion, Canada’s active engagement can promote multicultural democracy, the sine qua non for successful development ? politically, economically, and socially ? of the Central Asian republics. This in turn will enhance investment opportunities and benefit Canadian foreign policy interests in the region.

Recommendation 15

Canada should increase its support to educational and training initiatives in Central Asia, including through more CIDA scholarships. The Government should facilitate visa requirements to that effect, and should encourage additional private-sector and NGO efforts which have an educational and local capacity-building component. Following up the Aga Khan Foundation’s suggestions for future cooperation, the Government should also explore participation in initiatives to promote cultural diversity and inter-cultural exchanges.