Kyrgyzstan, The World’s Newest Bastion of Democracy?

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Kyrgyzstan Elects New President Chosen By Local Populace

Last month, Kyrgyzstan held presidential elections with a pool of 11 candidates. Here is how the election went down:

  • Former prime-minister Sooronbay Jeenbekov and the SDPK party won with just under 55% of the vote on a platform of continued stability.
  • His main opponent, Omurbek Babanov, one of the richest men in Kyrgyzstan, soon conceded defeat and urged the country to unite behind its new leader.
  • The previous president did not run as he had already served a six year term and was not eligible for re-election.

Central Asia and Fair Elections Are.. Uncommon

None of these events may seem out of place in Western developed countries, but the normalcy of the entire process was a complete outlier in Central Asia where dictatorship, corruption, and rigged elections are commonplace. Take a look at the elections in the rest of the former Soviet Union ‘stans:

  • Kazakhstan: held presidential elections in 2015 where the incumbent won almost 98% of the vote and has been in power since 1990
  • Tajikistan: held parliamentary elections in 2015, where the People’s Democratic Party won 65% of the vote. This party has maintained power since the country’s founding in late 1991, and the president has been in power since 1992.
  • Turkmenistan: held presidental elections in 2017, where the incumbent president won with 97% of the vote. The incumbent assumed power in 2006 when the previous president passed away.
  • Uzbekistan: held presidential elections in 2016 due to the death of the incumbent president. The interim president won with almost 89% of the vote.

The bleak track record in the rest of the region really serves to show how radical this election in Kyrgyzstan was.

A New Normal For Kyrgyzstan?

Even for Kyrgyzstan, this election is not business as usual. In 2005 the president was overthrown in the “Tulip Revolution”. Just five years later in 2010, another president fled the country after an attempted coup. In its 25 years as a sovereign nation, this may be the most optimistic the world has ever been on future political stability in Kyrgyzstan.

There is a lot of progress to be made. Despite this election, Kyrgyzstan still has a reputation for corruption: it came in 136 out of 176 countries on the Corruption Perceptions Index in 2016. Even this election had claims of vote buying and other shenanigans, although the fact that the result isn’t being contested is positive for the country.

Time To Get Bullish On Kyrgyzstan?

While we do not think that the presence of democracy will lead to instant riches and economic growth (see China, or city states like Singapore and Hong Kong), it is still a very positive development for the country. That is because with a wealth of natural resources, we have seen many frontier market countries suffer from looting on a national scale as dictators enrich themselves at the expense of the country. Kyrgyzstan is now hopefully on a path towards reduced croneyism and corruption, which will inevitably filter back to the rest of the country’s population.

Kyrgyzstan currently has a relatively average GDP growth rate of just under 4%. Its stock market has barely budged over the past year. Commodities, of which Kyrgyzstan has an abundance in gold, minerals, and natural gas, have not performed as strongly as they have in the past.

But with a new political mandate, there is a lot of low-hanging fruit that the government can go for in terms of reforms and positive relationships with foreign countries. Kyrgyzstan, as one of the countries on the ancient Silk Road, is also a prime beneficiary of China’s New Silk Road, Belt and Road Initiative. There is a lot of upside in this country, and if the political environment can remain stable and corruption can be tackled, we are very bullish on the future of Kyrgyzstan.

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