In a rigged election, in a country that is economically insignificant, voters went to the polls not to elect a new leader, but to vote on a referendum that would allow the current corrupt leader to remain in power for life thus giving him ample time to further damage the economy. That country is Tajikistan, which was once a part of the Soviet Union but is now in the Russian orbit.
But back to the referendum, because I know you can’t stand the suspense any longer. The vote was close, with 94.5% in favor; the other 5.5% haven’t been heard from since that fateful day. For those really wanting to know more, please check out Reid Standish’s foreignpolicy.com article titled, “How Tajikistan’s President Extended his Term—for Life.”
Interestingly enough, both Russia and the U.S. have strategic interests in that part of the world due to the country’s geographic location. During the Afghanistan war, the U.S. considered setting up an air base in Tajikistan, but decided against it in favor of neighboring Kyrgyzstan.
As a consolation, the U.S. funded a bridge across the Punj River which separates Afghanistan from Tajikistan. Just as an aside, those that jumped for joy when the bridge was built were Afghan drug traffickers who could now carry larger loads of opium to Central Asia and Western Europe.
Recently Russia committed to investing $2 billion in the Tajik economy, with United Company RUSAL (HKG:0486) investing $560 million to construct a hydro power plant which will provide electricity for the new aluminum plant they will build. Tajikistan has an extensive aluminum processing industry but depends on importing the ore. Despite being a mineral rich country, it is on the verge of economic collapse simply because the president is more interested in consolidating power than stimulating the economy.
So yes, Tajikistan’s location is strategically important to both the U.S. and Russia, but not only are they facing economic collapse, they are also on the verge of a civil war.
Back to that referendum again. In addition to making the president Emperor-for-Life, it also lowered the minimum age for a presidential candidate from 35 to 30. Why you may ask? Well the president has a 29-year-old son. The ultimate in nepotism.
Peter Kohli is CEO of DMS Funds.