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Kyrgyzstan: Could Kumtor Shakedown Backfire on Bishkek?

Are foreign mining firms ready to give up the gold in the mountains of Kyrgyzstan? (Photo: David Trilling)

In another grim sign for foreign investors in Kyrgyzstan, a parliamentary probe into operations at the Kumtor gold mine has some experts worried that officials are angling to nationalize one of the Central Asian country’s most valuable assets.

Kumtor is responsible for generating at least 7 percent of Kyrgyzstan’s GDP and accounts for more than one-third of the country’s exports. Operations at the mine date back to the early 1990s, when Cameco Corp., a Canadian mining outfit, launched a joint venture with the Kyrgyz government. Under the initial agreement, Bishkek held close to 60 percent of shares in Kumtor’s production. A restructuring in 2004 created Centerra Gold, which also operates a mine in Mongolia, leaving the Kyrgyz government a 15.6 percent stake. Since then, Kyrgyz officials have taken action to steadily increase the state’s share in Kumtor.

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Alisher Khamidov is a freelance writer specializing in Central Asian affairs.

Kyrgyzstan: Could Kumtor Shakedown Backfire on Bishkek?

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