Kazakhstan: Corruption probe hits Expo-2017

Caspian

Published on 2015 June 23, Tuesday Back to articles

Kazakhstan will spend US$2.3 billion on EXPO-2017 in 2015-2017

Talgat Ermegiyaev, the former CEO of Astana Expo-2017 – a state-owned joint-stock company created by presidential decree in January 2013 to prepare and conduct the World Expo event in 2017 – was placed under house arrest on 12 June. The previous day he had been dismissed by President Nursultan Nazarbaev and replaced by Astana’s mayor Adilbek Dzhaksybekov.

Ermegiyaev is suspected of embezzlement and corruption, although the scale of his alleged wrongdoings has yet to be ascertained. His father, Amangeldy Ermegiyaev, is widely known as the owner of the Almaty Kurylys construction firm, whose Sert subsidiary was previously involved in a major scandal in Almaty. In late 2012, dozens of people marched on the Ermegiyaev family residence in one of Almaty’s upscale districts to claim compensation for their unfinished apartments. This did not help, however, most likely because of Amangeldy Ermegiyaev’s good political connections. In the early 2000s he had even co-headed the ruling Otan party – which became NurOtan after its merger with Dariga Nazarbaeva’s Asar – alongside Nazarbaev himself.

Talgat Ermegiyaev served as managing director and vice-president of Kazakh Railways from 2002–06 and for the next two years was first vice-president of his father’s sprawling construction business. In February 2008 he was appointed deputy minister of tourism and sports and subsequently became minister until early 2012. When the ministry was reorganised into the Agency of Sports and Physical Education, he retained his post until the establishment of Astana Expo-2017. In 2011, Ermegiyaev chaired the board of directors of the organising committee of the 7th Asian Games, which took place in Astana and Almaty in January–February 2011.

Bad finances prompt corruption audits

The organisation of the World Expo in Astana is considered an absolute national priority and has a total budget of over US$2.3 billion for 2015–17. Recent cuts in government spending have most probably drawn the Anticorruption Agency’s attention to the management of such considerable funds. Earlier this month another Astana Expo-2017 official, Kazhymurat Ussenov, was placed under house arrest on suspicions of embezzlement of US$1.2 million. A shell company owned by Ussenov’s accomplice, Southfork Ltd, had apparently received inflated profits between May and October 2014 for low-cost fencing works on several construction sites.

Ermegiyaev is one more addition to the list of former high-ranking government officials who have either been caught red-handed or have the face the music for past misdemeanours. One is former prime minister (2012–14) Serik Akhmetov who served as defence minister from April–November 2014 before being arrested for corruption and abuse of power. His house arrest has been extended a number of times, most recently until mid-July – hardly a good moment to begin court hearings on the eve of the annual summer recess.

Akhmetov was, unlike Ermegiyaev, a prominent member of the powerful Karaganda clan, so his trial will take a different form. Akhmetov’s acquittal or sentencing to a lengthy prison term will depend on President Nursultan Nazarbaev’s clemency or, if the rival clans still convince him to show no mercy, his resolve to remove the unlucky former head of government from the political landscape.

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