VZCZCXRO7196
RR RUEHAST RUEHBI RUEHCI RUEHLH RUEHLN RUEHNEH RUEHPW RUEHVK RUEHYG
DE RUEHEK #1209/01 3381006
ZNR UUUUU ZZH
R 031006Z DEC 08
FM AMEMBASSY BISHKEK
TO RUEHC/SECSTATE WASHDC 1571
INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUCNCIS/CIS COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 2773
RHEFDIA/DIA WASHDC
RUEKJCS/OSD WASHDC
RUEAIIA/CIA WASHDC
RHEHNSC/NSC WASHDC
RUEKJCS/SECDEF WASHDC
RUEKJCS/JOINT STAFF WASHDC
RUEHGV/USMISSION GENEVA 1136
RUEHVEN/USMISSION USOSCE 3164
RUCNDT/USMISSION USUN NEW YORK 2550
RUEHNO/USMISSION USNATO BRUSSELS BE
RUEHBS/USEU BRUSSELS
RUEHLMC/MILLENNIUM CHALLENGE CORP
RUMICEA/USCENTCOM INTEL CEN MACDILL AFB FL

UNCLAS SECTION 01 OF 02 BISHKEK 001209 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR SCA/CEN (GORKOWSKI) 
 
E.O. 12958: N/A 
TAGS: ETRD ECON PREL SOCI KG
SUBJECT: ANALYZING CHINESE TRADERS IN KYRGYZ MARKETS 
 
BISHKEK 00001209  001.2 OF 002 
 
 
¶1. (SBU) Summary:  A university survey of traders at two 
Chinese-dominated markets identified a "lack of market 
competition" as a main reason for Chinese "migration" to the 
Kyrgyz Republic.  Despite large increases in visa and work 
permit costs, Chinese entrepreneurs continue to trade in 
bazaars from which Chinese-made goods are dispersed to other 
Central Asian countries.  While dismissing estimates that 
30,000 Chinese reside in Bishkek, the Kyrgyz official charged 
with migration issues confirmed that 4,500 of 10,000 
available work permits have been issued to Chinese nationals. 
 The official added that the return of Kyrgyz labor migrants 
from Russia and Kazakhstan will likely force a cut in 
available work permits.  Among Kyrgyz public officials and 
private citizens there is a uniform concern about Chinese 
influence in the Kyrgyz Republic.  End summary. 
 
A Tale of Two Markets 
--------------------- 
 
¶2.  (SBU) Student researchers under an American University of 
Central Asia faculty-supervised project presented findings 
November 21 of their investigation into Chinese migration 
patterns among traders at two Kyrgyz markets.  The research 
team, which included one ethnic Kyrgyz student from China, 
surveyed about 50 traders at the large outdoor Dordoi market 
in Bishkek's northern outskirts and the enclosed Taatan 
market located in eastern Bishkek.  (Note:  There is a large 
shuttle trade of Chinese goods from the Dordoi market and the 
Kara-Suu market near the southern Kyrgyz city of Osh to 
neighboring countries.  End note.)  According to the 
researchers, ownership of the Taatan market is split between 
Chinese and Kyrgyz entrepreneurs even though 70% of the 
traders working there are Chinese.  Embassy understands that 
Ak Jol parliamentarian Askar Salymbekov still controls a 
majority stake in the Dordoi market, which hosts an estimated 
1,000 Chinese workers who toil amongst thousands of shipping 
containers full of Chinese goods. 
 
Preliminary Conclusions 
----------------------- 
 
¶3.  (SBU) The researchers concluded that a "lack of market 
competition," combined with Chinese and Kyrgyz membership in 
the World Trade Organization and the Shanghai Cooperation 
Organization, drew entrepreneurial Chinese migrants to the 
Kyrgyz Republic.  Traders identified visas, work permits and 
corruption as significant barriers to entry.  Chinese traders 
at Taatan said the cost of Kyrgyz visas had jumped from $300 
to $1300.  Their Dordoi counterparts claimed visas cost 
$700-$800.  Chinese traders reported that work permits have 
increased in price from $50 to $1300 since 2004.  (Note: 
Embassy consular personnel report that Kyrgyz visa costs 
range from $200 to $600.  End note.)  The Dordoi traders also 
cited ethnic competition for a series of fires that destroyed 
Chinese-owned stalls at the market. 
 
¶4.  (SBU) While acknowledging the absence of any baseline 
data for their study, the researchers questioned how an 
estimated 30,000 Chinese can be in Bishkek legally when the 
Kyrgyz Republic caps the number of work permits for 
foreigners at 10,000.  (Note:  There are no reliable data on 
the number of Chinese in the Kyrgyz Republic.  However, 
official adherence to the 10,000 work permit maximum is 
questionable.  End note.) 
 
Government Official Weighs In 
----------------------------- 
 
¶5.  (SBU) Aigul Ryskulova, Chair of the Kyrgyz State 
Committee for Migration and Employment Issues, attended the 
presentation and provided more insights into the issue. 
While dismissing the "myth" of massive Chinese migration into 
the country, Ryskulova said that most Chinese in the Kyrgyz 
 
BISHKEK 00001209  002.2 OF 002 
 
 
Republic are entrepreneurs who only remain until they can 
sell the contents of their shipping containers.  She praised 
the economic and trade benefits of the Chinese presence, but 
noted that there are moves in parliament to implement 
positive discrimination for local Kyrgyz traders vis-a-vis 
foreign (Chinese) traders.  Both Ryskulova and the 
researchers discussed Chinese traders marrying Kyrgyz 
nationals -- a trend which would ease conditions on the 
Chinese partner to conduct business in the Kyrgyz Republic. 
 
¶6.  (SBU) While confirming rate increases for work permits 
and the revenues these permits generate for the government, 
Ryskulova claimed that the 10,000 foreign work permit quota 
would need to be cut to enable Kyrgyz laborers returning from 
Russia and Kazakhstan, where the job market has been 
deteriorating, to find work in the Kyrgyz Republic.  She 
disputed the 30,000 estimate for Chinese in Bishkek, but 
verified that 4,500 work permits have been issued to Chinese 
nationals. 
 
Comment 
------- 
 
¶7.  (SBU) Kyrgyz officials and citizens routinely express 
concerns about the impact of their large eastern neighbor, 
China.  With disputes about China having sparked previous 
discord within the Kyrgyz Republic, most notably over border 
demarcation concessions, Kyrgyz authorities remain sensitive 
to Chinese influence in the country.  The construction of a 
large, multi-story Chinese embassy (within eyesight of the 
U.S. embassy) is a reminder of China's interest in its 
western neighbor, which the Chinese view as a source for 
minerals and hydroelectric power. 
LITZENBERGER