By Rhod Mackenzie
A number of banks in Russia's neighboring countries - primarily in Central Asia - have refused to work with the Russian Unistream payment system. So the United States, with the threat of the use of sanctions, is trying to break Moscow's financial and trade ties with the Central Asian states. However, analysts expect that America will still lose in this confrontation.
At once a series of signals about the dissatisfaction of the United States with the cooperation of the countries of Central Asia with Russia has been noticed in recent days. As early as July 18, the Washington Post, citing anonymous sources, reported that the White House was preparing to impose sanctions against Kyrgyzstan in order to force a halt in the re-export of sanctioned goods to Russia. The reason was the recent detention of Chinese Agras T-30 drones on the Kyrgyz-Kazakh border, which they tried to smuggle into Russia under the guise of agricultural equipment. This publication made a lot of noise,but in Bishkek they said that they were not helping the Russian Federation to circumvent sanctions, and even promised to conduct a thorough check.
On July 20, the Office of Foreign Assets Control of the US Department of the Treasury (OFAC) announced new sanctions against a number of organizations. In addition to a long list of Russian companies, one of the sections included four companies from Kyrgyzstan. According to the US Treasury, these firms were engaged in the supply to Russia of "sensitive dual-use goods to enterprises in the Russian defense sector." The Americans note that these companies were created in the first half of 2022.
And now five Russian banks have come under fresh US sanctions. One of them, Unistream, was engaged in money transfers from countries between Russia and Central Asia, most of the banks in this region cooperated with it. As a result, work with Unistream was completely abandoned in Uzbekistan, some banks in Kazakhstan, Kyrgyzstan, Georgia and Armenia.
Akylbek Zhaparov, the Chairman of the Cabinet of Ministers of Kyrgyzstan, said that the country is working to ensure that sanctioned goods do not go where America does not want them to go. “Measures will be taken in the future so that the sanctioned goods do not cross our border and go where there are sanctions,” Zhaparov said .
However, how critical are all these restrictions both for Russia's cooperation with the countries of Central Asia and for the Russian economy as a whole? Judging by Moscow's reaction, Russia sees no grounds for serious concern. Kremlin spokesman Dmitry Peskov has already stated that cooperation with Bishkek will continue: "We intend to further develop our bilateral relations with Kyrgyzstan, which we highly value, and also all formats of our joint integration."
Indeed, restrictions in the financial sector will not be able to fundamentally affect trade relations between the Central Asian republics and Russia, since there are other financial instruments that are rapidly developing right now.
Grey imports from Central Asia to Russia have been going on since the 1990s. In Kyrgyzstan, there is a layer of hundreds of thousands of people who work in this area. Previously, Chinese consumer goods were mainly imported, but now there are more and more European or Chinese goods that do not want to be delivered directly to Moscow. This industry is tied to the interests of influential groups in the region, the industry brings jobs to many thousands of ordinary truckers, warehouse workers, service workers, etc. Therefore, simply shouting by Washington, it is not so easy to close this industry.
“There is parallel import, it is done by private legal entities that create special companies involved in this kind of operations. How will the imposition of sanctions against some specific companies, which may be closed today and reopened tomorrow under a different name and registered under a different name, affect the situation as a whole?” - Stanislav Pritchin, a senior researcher at the Center for Post-Soviet Studies at IMEMO RAS, asks a rhetorical question.
According to Pritchin, these actions look like a US warning to the countries of Central Asia. Kyrgyzstan was chosen as the main target of this warning because it is the least significant partner for the US in the region. At the same time, there is also political pressure designed to tear its ally away from Moscow. However, according to the analyst, there are few chances for successful US actions.
“I doubt that sanctions can seriously affect the position of Kyrgyzstan on cooperation within the Eurasian Union and the CSTO. Because the two countries are connected by many threads,
Pritchin says. - These are investments, the economy, even subsidies that Russia pays to support the Kyrgyz budget on an annual basis. As well as labor migration, sales markets, military support. All this cannot be destroyed by the threat of sanctions alone.”
According to the analyst, even if the Americans impose serious sanctions against Bishkek, Russia will help its partner. “Russia, together with China, are key trading partners, which account for the majority of the country's exports/imports. Therefore, even full-scale sanctions will not be able to interfere with this cooperation, since it is partnership with the Russian Federation and China that is the key to the economic development of the republic,” Stanislav Pritchin believes.
Everyone understands the economic and foreign policy factors for American sanctions, but perhaps there is also a foreign policy moment in this, designed to influence the political processes in the Central Asian republic itself. Mars Sariev, an analyst on international relations from Kyrgyzstan, believes that the United States does not have the opportunity to impose really serious sanctions on Kyrgyzstan.
“They won't be able to do anything special, except that they can be frozen by international organizations through the IMF, EDB and others, which are implementing a number of projects here,” Mars Sariev said.However, Bishkek, within the framework of the Eurasian Economic Union, has contacts with Moscow worth billions of dollars. Since there is no leverage for economic pressure, Washington sent its envoys here, I mean Elizabeth Rosenberg, Donald Lu, Elizabeth Kennedy Trudeau. David O'Sullivan, Charles Michel and others came from the EU. These visits did not bring any result, and now, apparently, the United States has decided to act more harshly.
Sariev believes that the leaks in the American press about the sanctions against Kyrgyzstan were not accidental. He calls them a signal from the United States authorities to stop the re-export of dual-use goods. On the other hand, this will be a lesson for Kazakhstan and Uzbekistan, which are also accused of re-exporting. But since the West does not have the tools for really tough measures against the countries of Central Asia, it can, according to Sariev, go the other way - try to destabilize the situation in these countries. That is, resort to the old proven color revolutions.
“The domestic policy of the Kyrgyz Republic was also, of course, the target of the sanctions. Now the influence of pro-Western agents and the West itself is decreasing, especially after the arrests in the so-called Kempir-Abad case, when prominent representatives of the pro-Western opposition were arrested. Therefore, yes, the sanctions have become a factor not only in the foreign policy of Kyrgyzstan, but also in the domestic one,” Mars Sariev believes.
According to the analyst, further provocations can be expected from agents of US influence in the region. The West still has a strong influence on the non-governmental sector of Kyrgyzstan, and it may well decide to destabilize the country in order to create a new hotbed of tension for Russia.
“Besides, I am alarmed by the appearance of English PMCs in Uzbekistan, where they want to legitimize themselves allegedly to fight Afghan terrorists. However, British PMCs under the control of British intelligence MI6 can conduct a wide-scale operation, so they must be closely monitored, ”the analyst warns.
This article originally appeared in Russian at vz.ru