Crossroads Asia | Economy | Central Asia

Turkmenistan’s Latest Boondoggle: A New $1.5 Billion City

Turkmenistan plans to to build a $1.5-billion city amid spending cuts.

Catherine Putz
Turkmenistan’s Latest Boondoggle: A New $1.5 Billion City
Credit: Pixabay

Turkmen President Gurbanguly Berdymukhamedov has reportedly allocated $1.5 billion to build a new city; meanwhile, the government has cut social spending and the country’s economy is weakened by low global energy prices. 

Berdymukhamedov said in a decree the money would go toward paying for “foreign-made equipment and materials needed for construction,” Turkmenistan’s state-run media reported Tuesday. 

The city, which doesn’t have a name yet, is supposed to become an administrative center of the Ahal province — a region governed by the president’s only son, Serdar Berdymukhamedov. 

In January 2019, a presidential decree announced that Serdar would be leaving his deputy foreign minister post to become deputy governor of Ahal province. In June 2019, he was promoted to governor. Ahal is the native region of the Berdymukhamedovs and much of the Turkmen elite.

Ahal province borders Iran and Afghanistan, running through the south central portion of Turkmenistan. The province’s territory entirely surrounds the country’s capital, Ashgabat, although it is defined as a special capital district. Both Ashgabat and the provincial capital, Anau, are near the Iranian border.

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Serdar, 38, is presumed to be on the path to the presidency. The elder Berdymukhamedov, 62, has been Turkmenistan’s president since the 2006 death of the country’s first president, Saparmurat Niyazov.

As Eurasianet’s weekly Turkmenistan column, Akhal-Teke, has tracked, Serdar has been fronted in Turkmen state media. From a January 3 column: “Evening news bulletins regularly show Serdar opening factories, laying foundations to new construction projects, giving speeches or reporting to his father on developments in his province.”

The new city, reportedly to be located outside Ashgabat, has been referenced in Turkmen media before but only this week was a price tag mentioned. 

The new city project comes amid a domestic economic crisis in the gas-rich ex-Soviet Central Asian state and on the heels of several significant budget cuts. In 2018, Berdymukhamedov slashed state subsidies that allowed the country’s residents to use gas, electricity, and water for free. Last year, he ordered that funding of Turkmenistan’s Academy of Science be stopped. 

Berdymukhamedov has ruled Turkmenistan through an all-encompassing cult of personality. He is called Arkadag, a word meaning “protector,” and has featured in Western media often only when his personal eccentricities and absurdity truly shine. Last August, British comedian John Oliver did a 20-minute segment about Berdymukhamedov on his show, “Last Week Tonight,” after the Turkmen president appeared in state TV reports hefting a gold bar in honor of an upcoming weightlifting competition. Berdymukhamedov is also a music fan, appearing in videos DJing and rapping with his grandsons and performing at his own New Year’s party.

Under his rule, state-run media have been depicting Turkmenistan as a prosperous welfare state, but in recent years the nation reportedly has been struggling with low incomes and scarce food supplies. RFE/RL and various exile media sources paint a devastating picture: lines for bread in the capital, citizens dumpster diving, illness and a poor healthcare system, a possible tuberculosis outbreak last year, and more.

Meanwhile, Turkmenistan’s economic is largely built on its export of gas. It ranks among the world’s top gas-rich states but exports almost exclusively to China via pipelines built by Chinese companies and paid for with Chinese loans. Given cutbacks mentioned above, the prevailing assumption is that Ashgabat has money troubles but the reality is shrouded in the state’s purposeful secrecy. 

The $1.5 billion new city in Ahal joints other boondoggle mega-projects over the years, including $2.3 billion in 2016 for an airport few use; billions on tourist infrastructure — hotels, conference centers, and other amenities — at Avaza on the Caspian Sea; and $5 billion for an Olympic village complex for the fifth Asian Indoor and Martial Arts Games, hosted by Turkmenistan in 2017. There is also, of course, the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline, at a very unclear stage of completion and with an estimate pricetag of $10 billion.

With reporting from the Associated Press.