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Cablegate: Kazakhstan: Money and Power

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PP RUEHBI RUEHCI RUEHDBU RUEHFL RUEHKW RUEHLA RUEHLH RUEHNEH RUEHNP
RUEHPW RUEHROV RUEHSL
DE RUEHTA #0072/01 0250814
ZNY SSSSS ZZH
P 250814Z JAN 10
FM AMEMBASSY ASTANA
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RUEAWJA/DEPT OF JUSTICE WASHDC PRIORITY
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RHMFISS/DEPT OF ENERGY WASHINGTON DC PRIORITY
RHEFAAA/DIA WASHDC PRIORITY
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RUEHNO/USMISSION USNATO PRIORITY 2973
RUCNDT/USMISSION USUN NEW YORK PRIORITY 2683

S E C R E T SECTION 01 OF 03 ASTANA 000072

SIPDIS

STATE FOR SCA/CEN, EEB

E.O. 12958: DECL: 01/25/2030
TAGS: PGOV PINR EPET EINV KCOR RS CH KZ
SUBJECT: KAZAKHSTAN: MONEY AND POWER

REF: ASTANA 0061

Classified By: Ambassador Richard E. Hoagland: 1.4 (b), (d)

1. (S) SUMMARY: During a private dinner, KazMunaiGaz First
Vice President Maksat Idenov named, in his view, the four
most powerful gate-keepers around President Nursultan
Nazarbayev: Chief of Administration and General Services of
the President's Office Sarybai Kalmurzayev, the President's
Chief of Staff Aslan Musin, State Secretary-Foreign Minister
Kanat Saudabayev, and the tandem of Prime Minister Karim
Masimov and Nazarbayev's billionaire son-in-law Timur
Kulibayev. According to Idenov, in Kazakhstan, market
economy means capitalism, which means big money, which means
large bribes for the best connected. The following details
are a single snapshot of one version of current reality. The
significant point is that Nazarbayev is standing with Idenov,
not Kulibayev, to maintain international standards to develop
the massive Kashagan and Karachaganak hydrocarbon projects.
END SUMMARY.

2. (S) On January 21, KazMunaiGaz First Vice President
Maksat Idenov and the Ambassador had a one-on-one dinner in a
nearly empty restaurant (times are still hard!) at the
Radisson hotel in Astana. When the Ambassador arrived,
Idenov was barking into his cell phone, "Mark, Mark, stop the
excuses! Mark, listen to me! Mark, shut up right now and do
as I say! Bring the letter to my office at 10:00 pm, and we
will go together to take it to (Minister of Energy and
Mineral Resources, MEMR) Mynbayev at his house." On ending
the call, Idenov explained he was talking to British Gas (BG)
Country Director for Kazakhstan Mark Rawlings who had missed
the deadline to deliver a letter about arbitration on the
Karachaganak super-giant oil-field project (reftel). Still
clearly steamed, Idenov alleged, "He's still playing games
with Mercator's James Giffin," the notorious AmCit fixer
indicted for large-scale bribery on oil deals in the 1990s,
whose case drags on in the Southern District Court of New
York. "I tell him, 'Mark, stop being an idiot! Stop
tempting fate! Stop communicating with an indicted
criminal!'" Idenov asked, "Do you know how much he
(Rawlings) makes? $72,000 a month! A month!! Plus
benefits! Plus bonuses! Lives in Switzerland but supposedly
works in London. Comes here once a month to check in. Nice
life, huh?"

3. (S) Idenov calmed down and said, "Let's look at the
menus." Then he immediately started typing on his PDA and
turned the screen toward the Ambassador, saying, "Let's look
at the 'four courses.'" On the screen were four names:
Kalmurzayev, Musin, Saudabayev, and Masimov-Kulibayev."
Idenov said, "The Big Four around Number One." (NOTE:
Sarybai Kalmurzayev, currently the head of Administration and
General Services in the Presidential Administration, was,
among other jobs, a former head of the Financial Police and,
before that, in the 1990s, in charge of privatization. Aslan
Musin is the current Chief of Staff for Nazarbayev. Kanat
Saudabayev, a personal friend of Nazarbayev for nearly 40
years, is Minister of State and Foreign Minister. Karim
Masimov is Prime Minister, and Timur Kulibayev is currently
the favored presidential son-in-law, on the Forbes 500 list
of billionaires (as is his wife separately), and the ultimate
controller of 90% of the economy of Kazakhstan. END NOTE.)
In response to a question, Idenov said that Masimov has a
degree of freedom, but never acts without permission from
"the hyphen" (Kulibayev). Then Idenov stood up abruptly and
carried his PDA to a ledge about 20 feet from the table and
asked the Ambassador to turn off his cell phone.

4. (S) Idenov said he wanted to explain why he has been less
visible for at least the last half year. Starting last
spring, all the "Big Four" (on the menu) began blocking him
from seeing President Nazarbayev. In October, KMG President

ASTANA 00000072 002 OF 003


Kairgeldy Kabyldin told Idenov, "Kulibayev doesn't want to
work with you any more." Idenov said he replied, "Fine,"
immediately returned to his office, wrote his letter of
resignation, and packed up his personal files and photos of
his family." He said Mynbayev immediately called and asked,
"My dear friend, what are you doing?!" Idenov said he was
fed up and was going to the Middle East to work -- "I want
out of here!" PM Masimov called and said, "Nazarbayev wants
to know how you're doing. He'd really like to see you when
you have time." Idenov, who said he'd been trying to see the
President for months but had been blocked by the "Big Four,"
went to see the President and told him, "Kabyldin says
Kulibayev doesn't want to work with me any more." Idenov
said the President told him to calm down: "It's probably
just evil gossip. I'll have Karim (Masimov) talk to Timur
(Kulibayev). Then Idenov went to Masimov and told him, "OK,
I'll stay, but how do I deal with this?" Masimov said he'd
talk to both Kabyldin and Kulibayev.

5. (S) Soon, intermediaries arranged an Idenov-Kulibayev
meeting. Idenov said they both pretended to ignore the core
problem -- Kulibayev's, he alleged, avarice for large bribes.
Idenov averred he told Kulibayev, "Please watch your image
and reputation. You have a real opportunity to improve your
own image and the image of the nation." Idenov said
Kulibayev was "like a Buddha with a Paris manicure," and both
understood life would continue. Idenov said he believes he
has, so far, the president's protection. "But the games
continue," he said. Idenov alleged that both BG and Italy's
ENI are corrupt -- and Kulibayev is salivating to profit from
them -- but, so far, Idenov stands in the way. "So long as
Nazarbayev says he wants Kashagan and Karachaganak developed
according to international standards, that's what I'll do."

6. (SBU) (NOTE: Fugitive former CEO of BTA bank, Mukhtar
Ablyazov, accused of embezzling over $1 billion, recently
leaked "documentary evidence" to the international media that
China's state companies have bribed Kulibayev over $100
million in recent months for oil deals. END NOTE.)

7. (S) The Ambassador asked if the corruption and infighting
are worse now than before. Idenov paused, thought, and then
replied, "No, not really. It's business as usual." Idenov
brushed off a question if the current maneuverings are part
of a succession struggle. "Of course not. It's too early
for that. As it's always been, it's about big money.
Capitalism -- you call it market economy -- means huge money.
Listen, almost everyone at the top is confused. They're
confused by their Soviet mentality. They're confused by the
corrupt excesses of capitalism. 'If Goldman Sachs executives
can make $50 million a year and then run America's economy in
Washington, what's so different about what we do?' they ask."

OTHER TIDBITS

8. (S) MODEST WEALTH. Idenov alleged that MEMR's Mynbayev
is among the richest in Kazakhstan but "flies under the
radar" because he is a relatively modest and very
hard-working technocrat. His great wealth derives, in part,
from his former ownership of KazKommerzBank -- "But he never
flaunts it."

9. (S) VULTURES. Idenov alleged that GazProm and China
National Petroleum Company "continue to circle like
vultures," hoping that the Kashagan and Karachaganak
consortia will implode, and then they can pick up the pieces.
"Won't happen on my watch!" Idenov vowed.

10. (C) HOW TO ORDER LAMB. Idenov insisted the Ambassador
order a bottle of wine for their dinner but then never
touched his first glass. Instead, he gulped three cans of
Coca-Cola while inhaling his food. When both he and the
Ambassador ordered lamb chops, Idenov advised, "Well done,

ASTANA 00000072 003 OF 003


never rare -- this is Astana, not London!"

11. (S) COMMENT: Idenov is effusive, even theatrical, by
nature. When he trusts, he spills his heart. Of course,
there's no doubt he also spins his own narrative, as we all
do. And so, this dinner is simply a snapshot -- but, we
would judge, a relatively accurate glimpse of one version of
current reality. The significant point is that Nazarbayev is
standing with Idenov, not Kulibayev, to maintain
international standards to develop the massive Kashagan and
Karachaganak hydrocarbon projects. END COMMENT.
HOAGLAND

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