Canadian government covers up interference in Kyrgyzstan mining dispute
Sadyr Zhaparov (Japarov), Kyrgyzstan's prime minister and a presidential candidate, attends an election rally in Tokmok, Kyrgyzstan, December 30, 2020 [Vladimir Pirogov/Reuters]
Written by: Morrigan Johnson
ATIPs obtained by The Canada Files show the Canadian Government attempted to cover up its relationship with a Canadian mining company which operated in Kyrgyzstan until its mine was nationalized by the Kyrgyz government.
In May 2021, the Kyrgyzstan government pushed for a parliamentary resolution to introduce a three month state management at the Kumtor Gold Mine, formerly run by Canadian mining corporation Centerra Gold. This was triggered by political unrest and the corporation’s corruption which made international headlines the year prior. The former Soviet state nationalized the mine, being the country’s largest industrial asset in July 2021.
The Kyrgyz people have overwhelmingly chosen to stand up to foreign exploitation. Canada’s government and Centerra Gold have responded with disdain.
Corruption
In May 2021, Kyrgyzstan took Centerra Gold to court over gross corruption and environmental violations in an effort to nationalize and seize the Canadian mine, and put the natural resources and environment into the hands of the people. Immediately the Canadian government released a statement, with minister of foreign affairs Marc Garneau expressing disappointment saying “This will likely have far-reaching consequences on foreign direct investment in Kyrgyzstan”.
The Kyrgyzstan government pushed for a settlement outside of the court to seize ownership of Centerra Gold’s Kumtor Gold Mine through arbitration. In December 2021, the company saw a criminal suit by the government over matters of cyber security, abuse of workers, and environmental violations. This year, the dispute reached a conclusion with a settlement, meanwhile Centerra Gold continues denying that they have done anything wrong.
Centerra Gold had incurred a $3.2 billion fine in damages to the environment by placing mining waste on nearby glaciers. However in settling, the court has canceled the fine. A foreign advisor had abused the company’s position and workers, acting as a middleman, risking roughly one thousand jobs, while those company insiders in government have been accused of financial crimes. The company locked computer access during the court dispute, raising questions whether workers would be paid during the turmoil. The CEO of Centerra Gold Scott Perry was replaced unexpectedly, and also resigned as we see in a statement released by the company in September 2022.
Centerra Gold owns major projects in Canada, Turkey, South Africa, and is settling its venture in Kyrgyzstan. Although the seizure of the project and the embroilment was costly and unproductive for the company, as it applied for bankruptcy in a United States court, and had requested a bailout, the company is still expected to survive the financial losses without incurring debt.
(Source: BBC 2013)
The Kumtor Gold has been a site of major political outrage in the country, with mass protests over the project in 2013, and again in 2020 leading to calls for impeachment, release of jailed political opponents, and forcing a change in government. The former Prime Minister Kubatbek Barono resigned over the uprising.
In losing Kumtor Gold Mine, Centerra Gold had lost -$828 million in discontinued operations the last year, similarly the company’s stocks have dropped by -62 per cent in the last two years. Centerra generated $1.3 billion in revenue in 2019, down to $900 million in 2021, and $935 million in the last twelve months.
Sanctions on Russia along with the pressure of the Russo-Ukraine war has impacted the international economic situation. For a developing eurasian country and the rising political tensions between its closest neighbours, Russia and China respectively, the situation is not only economic. Kyrgyzstan is draped in the struggle of the working class to vest sovereignty in navigating a way forward. Corporate and foreign influence is risking socio-economic and national ties with both of its most important neighbours. In particular, nearly all of the country’s fuel comes from Russia, and 31 per cent of the 2020 GDP was Russian remittance. The country also shares a tremendous socio-economic relationship with China. Kyrgyzstan has a very high inflation rate of 15.6 per cent in August and shows one of the worst economic trends in the Eurasian region.
A Canadian corporation’s extraction of the country's natural resources are at odds with development, sovereignty, emerging contradictions of political actors, and the stark economic reality.
From the viewable emails, we can see that Global Affairs Canada agents pitched emergency food relief to Centerra Gold. The Canadian state is seeking to assist the company in protecting its reputation.
We can see meddling in Kazakhstan under the funding category of a legal initiative, hiring and training legal teams, to assist in an ‘information campaign’ targeting refugees from Xinjiang Province, China. The geopolitical goal is to undermine regional relations with a false new cold war narrative which has little to do with promoting civil society.
‘Identified projects in KZ’ “in combination with other initiatives, offer a balanced approach to advancing CDLI priorities in these countries…” and the names of those countries are not visible to us. Which countries are these CFLI initiatives being funded in, and what for? What in Kyrgyzstan, through the Kumtor Gold Mine, was being funded by the Canadian government?
There is a precedent of nefarious money funding coordinated operations to achieve an imperialist state’s goals in the target country. Grants to establish legal teams can be very powerful in legitimizing, discrediting, or intimidating other institutions. The diplomatic departments of imperialist countries have branded their diplomacy with civil society and democracy, but if the goal is determinedly to plunder, meddle, and dominate the country then it would be a neocolonial imperialist project.
Self Determination of Kyrgyzstan
President Japarov won 79 per cent of the vote, taking power in November 2020, having run on a platform promising to crack down on foreign corporations exploiting the country's limited natural resources and putting the economy back into the hands of the people. An overwhelmingly popular position for the Kyrgyz people.
Wilczewska reports in Al Jazeera, “30 years into its operation, Kumtor has for many come to symbolize some of the developing world’s greatest ills: corruption, environmental degradation and neocolonial greed.” 26 per cent of the Canadian mine was owned by the state prior to seizure which was frozen until the settlement, but the people voted for Japarov on the idea of putting natural resources fully into the hands of the people.
On the April 4, 2022, president Japarov released a statement with some key remarks:
“It is no exaggeration to say that today is a true turning point in the history of our country. Today our people have taken responsibility for their fate into their own hands.”
“Our national assets are now exactly what they should be – in our own hands. This proves that we are on the path of sustainable development and growth.”
“Up until now, we have only received symbolic annual dividends from Kumtor Mine. To be precise, over 20 years we have received a total of only about US$85 million. In contrast, in just seven months last year we made a profit of US$323 million from the mine. This year, we hope to earn US$500 million dollars.”
Canada’s role in the world continues to subvert developing economies with corporate corruption, while sowing political chaos with state interference. Minister of foreign affairs Marc Garneau’s weighing in on the matter demonstrates Canada's abject disregard for global responsibility.
The Krygryz people have rejected the Canadian subversion of the region’s sovereignty, economy, and environment. The redaction and covering up of Canada's state-corporate collusion abroad is hard to miss. What are civil society grants weaving in the age of Western imperialism?
Note: ATIPs and ATIP response letters were originally obtained by TCF Editor-in-Chief, Aidan Jonah.
Editor’s note: The Canada Files has spent nearly three years doing critical investigative reporting on Canada's imperialist foreign policy. We’ve established a clear track record of exposing the truth Canada's political establishment hides from you. Currently we are at $678 CAD per month in support. There's so much more we can do, but only with your financial support.
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Morrigan Johnson is an anti-imperialist writer based in Calgary, Alberta.
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