--Wednesday, 02 December 98-- $1 = 12,500 to 16,000 manat
Emerging Financial Problems: How Real Are They?
One afternoon a coworker came into the office and asked if our phone worked.
He said that his phone had been turned off because most of the phones
in the Ministry had been turned off because of nonpayment. Think about
Above, Turkmenbashy's recently
completed "Tower of Power." Please do not confuse with
the space shuttle.
How is one to interpret this and the other straws in the wind? The government
is secretive about things and determined to control the flow of information.
For instance, I asked to see a list of projects that have been suspended
because of the financial problems. I was politely refused. I am periodically
informed that the relevant decision maker hasn't said, "No,"
just that he is a busy man and hasn't gotten to it yet. Yeah, right.
There are rumors galore, passed by word of mouth, and all unverifiable:
the KGB has been strengthened, the police have gone into the Russian Market
and ordered vendors to reduce their prices, etc., etc. But there are very
few hard facts.
The one fact that does stand out is the fall in the value of the manat
and the corresponding rise in the black market for dollars. There are
currency dealers everywhere and the rate the manat is falling is accelerating.
Currently it is selling at less than 50% of the value when I arrived.
This will force a rise in the price of imported goods but this has not
clearly shown up yet.
The price of bread is still stable at 1,000 manats but self sufficiency
in grain is a governmental goal so the change in the informal exchange
rate may not affect this.
In such an environment one is tempted to grasp at straws and interpret
them as major indicators. Cancelled meetings, hurriedly called assemblies,
the depressed state of officials as they walk the halls wondering what
to do, what to cut, when they know that nothing would be considered that
would really address the problem.
Above, the gold plated statue
of Turkmenbashy summons his people to the Neutrality Arch.
We try to piece things together but the pieces are widely scattered on
this puzzled and puzzling landscape and nothing can be completely relied
upon. I heard that the President called in the leaders of the statistics
agency and told them he didn't like the numbers they were publishing.
Does that mean they will doctor the numbers more? Or they will publish
less? All of the above? Or was my information just misinformation?
Drivers complain of gasoline shortages. People whisper about trouble.
Many worry quietly. One day I was told by one person in the morning that
there was a rumor that the manat would be devalued by 50%. That afternoon
another person told me that her friends were saying that the manat was
about to appreciate in value. Go figure.
The money changers are particular about damaged bills here. The reject
bills that have small tears in them and won't take bills that have a date
before 1990. Did you know that bills have a date on them?
We heard this week that the government ceased providing convertibility
to ordinary citizens (we assume businesses can still convert manat to
dollars at the official rate). We conjectured that the impact would be
an increased scarcity of dollars which will drive up the value of the
Someone told me that the President announced he is writing a book (Turkmenbashy's
Red Book?) that will tell his successors how to manage the economy, the
World Bank, the International Monetary Fund, and everything else. He was
even seen on TV berating a group of Duma members who were visiting from
Russia, telling them that the IMF and the World Bank and ruined Russia
but he was doing it right in Turkmenistan.
All the official statements of his opinions say that he thinks the current
system works fabulously. It was reported in the local newspaper that "results
of the economic reforms in Turkmenistan prove the truth of the way chosen."
More poetic than factual.
I was helping a local with his resume. When he came over to pick it up
he complemented my pullover and said it went with my jeans. He told me
that since he had first met me I was different. My ears pricked up as
my vanity surged into full gear. He went on to say, "You are always
using words that he didn't know." Oh, well, that certainly let the
hot air out of the balloon.
--Thursday, 03 December 98-- $1 = 12,000 manat
They unveiled the pinnacle of the Peace Arch today. It is topped with
a gold leaf monument of the Turkmenbashy. He stands in front of a pole
with a flag fluttering in the breeze. The paper says it is twelve meter
tall and weighs 36 tons (one ton = 1,000 kilograms). I believe every centimeter
and kilo of the estimate. It is huge. The guesstimate for the cost is
A person we respect said that someone he knows has not been paid since
June or July; a woman working with this person (in the same salary boat)
who has two kids at home has to send them to two different school sessions
since she has only one pair of shoes for them. Quote: "Some people
have forgotten the taste of meat."
We learned this week that wage arrears are defined as wages that are more
than 30 days past due. If you owe people this months wages, it is not
counted. A convenient definition.
The weather continues bleak. Starting on Friday last, it has been gray
and cold. Starting on Sunday, it was rainy as well. Not heavy rain, but
light rain for periods during the day and heavier at night. There is always
a gray, blank sky, featureless, drab, boring and depressing. So this is
winter in Turkmenistan.