House of Commons - Foreign Affairs

Select Committee on Foreign Affairs Sixth Report

DELIVERING THE GOVERNMENT'S OBJECTIVES

145. The key British objectives in the South Caucasus and Central Asia cannot be delivered without an effective British presence in the region, and without the engagement of Ministers and senior officials from London. At present the United Kingdom has small missions in six of the eight countries (there is no mission in the Kyrgyz Republic or in Tajikistan). These missions were established some time after the states became independent in 1991, the first being opened in Azerbaijan and Kazakhstan in 1992, with Uzbekistan following in 1993, and Armenia, Georgia and Turkmenistan in 1995. Staffing levels have been low, ranging from five United Kingdom-based staff in Uzbekistan to three in Armenia, Georgia and Turkmenistan. The slow beginning of British representation reflected what Ms Quin described as the "uncertainty as to how durable [the new countries] might be and what kind of evolution they were going to take."[330]

146. A theme in evidence received from business people was that the United Kingdom was poorly represented in the region compared to our European partners. Mr Chapman of BG told us that "the weight and extent of the support of the missions has probably not increased in step with that increased investment."[331] He went on to say that "we would argue for some specialist energy presence [in the Embassy to Kazakhstan],"[332] and that "additional strength in the mission from the lobbying perspective would be helpful."[333] The British Consultants Bureau[334] described posts as "under-resourced", and Mr Peters of the Bureau told us that one Embassy had lacked the resources to support properly a trade mission looking at infrastructure business following from oil and gas developments.[335] We also heard from one Ambassador during our visit to the region that pro-active commercial work had been difficult in the past because of staff shortages. Others were more sanguine about the current level of representation. Mr Barr of BP Amoco told us that "when we require help it is there; there is good liaison and rapport and good communication. From time to time it clearly stretches the resources of these posts, but they tend to manage."[336] He added, however, that "some specific energy expertise might be a very good idea."[337]

147. The FCO told us that "a key priority of FCO Ministers has been to enhance our very small diplomatic presence in the region."[338] The British Consultants Bureau[339] described the enhancement as a "very welcome, albeit rather late, move." In numerical terms, the total enhancement amounts to 13 more staff. This will bring the total of United Kingdom based staff in the region from 22 to 35.[340] Not all these new staff will be FCO staff. For example, a military attaché will join the staff of the Embassy in Tbilisi and a Department of Trade and Industry official will be based in Kazakhstan.[341] To a large extent, new staff will meet commercial needs. For example, Ms Pringle told us that "..in Almaty we are putting in a Second Secretary Commercial to focus on the energy prospects there....in Baku...we will be putting in an expert on oil and gas...."[342] We were told in Armenia that the cost to public funds of having a new official in Yerevan was in the order of £60,000 per annum. If this is typical, the cost of the enhancement will be under £750,000.

148. After enhancement, the United Kingdom's representation will still trail well behind that of either France or Germany, as Table 8 demonstrates.

TABLE 8

Home-based diplomatic representation

Country	Germany	France	United Kingdompre-enhancement	United Kingdompost-enhancement
ARMENIA	7	8	3	4
AZERBAIJAN	6	10	4	10
GEORGIA	17	14	3	5
KAZAKHSTAN	29	17	4	6
KYRGYZ REPUBLIC	11	0	0	0
TAJIKISTAN	6	0	0	0
TURKMENISTAN	6	4	3	5
UZBEKISTAN	26	17	5	5
TOTAL	108	70	22	35

Source: FCO, Evidence pp. 92 and 213-5.

Other European Union countries are also represented in the area. For example, Greece has three diplomats (and a military attaché) based in Armenia, and seven in Georgia. The predominant Western presence is, of course, the USA which has almost 300 US-based staff in the region, with, for example, over 40 in Armenia and over 50 in Georgia.[343] Russia is also heavily represented in each country.

149. Ms Quin emphasised that there is no correlation between diplomatic numbers and commercial success although "posts can be very effective in helping companies."[344] She went on to tell us that "our trade with Kazakhstan has increased a lot even though in terms of the personnel on the ground we have much fewer than the French, for example, although our trading performance has been bigger."[345] As a member of British Invisibles put it: "some countries such as the USA put far more people into a Post than the UK is able to do but it is what the people do that brings the success."[346] This can mean that commercial success does not rely on diplomatic effort at all: the Netherlands has very little diplomatic representation in the region (one newly opened embassy in Kazakhstan, with other countries covered from Moscow or Ankara) but has had an impressive commercial record, with exports in 1997 amounting to almost half those of the United Kingdom. Regardless of support provided by governments, in the end, as Sir Derek Thomas put it to us, it is the business people themselves who have "actually to go out and get the business."[347]

150. In our recent report on FCO Resources,[348] we drew attention to the comparative strength of the French and German diplomatic services world-wide. We also pointed out that there are caveats which need to be attached to any simplistic read-across between the bald figures for different countries. For example, France does not use locally engaged staff and frequently employs gendarmes at its Embassies. In the case of Germany, there are particular reasons for its heavy representation: ties which existed between East Germany and the Soviet Republics have been built upon, and there is a substantial German population, with citizenship rights in Germany, in Kazakhstan and the Kyrgyz Republic. Influence does not mirror the number of diplomats, nor does the commercial success of a country. Nevertheless, the contrast between the strength of the diplomatic presence of the United Kingdom, France and Germany in South Caucasus and Central Asia is striking.

EXTENDING REPRESENTATION

151. There is no permanent British diplomatic presence in the Kyrgyz Republic. The British Ambassador to Kazakhstan, who is based in Almaty, is accredited to the Kyrgyz Republic. We understand that he visits about once in every six weeks. This is feasible because of the relative proximity of Almaty to Bishkek. The arrangement appears to work reasonably satisfactorily, as our visit demonstrated. Ms Quin told us that, in terms of ministerial access during her own visit to the area, "the access in the Kyrgyz Republic was even more impressive than it was in Kazakhstan."[349] Nevertheless, the permanent British presence in Bishkek is limited to an inadequate office for one locally engaged member of staff of the Know How Fund. The Kyrgyz Government would like to see the United Kingdom represented, and Ms Quin acknowledged that the present situation was "not satisfactory."[350] She said that the question of opening a post would be considered in the next spending round—and noted that if the British Embassy to Kazakhstan moved to the more distant new capital of Astana, the case for an Embassy in Bishkek "becomes very strong indeed."[351]

152. There are very good reasons for the United Kingdom to be represented in the Kyrgyz Republic. As it is, the present arrangements put an unnecessary strain on the post in Almaty, which has to service two countries and three locations from one office with few staff. Of the representatives of the countries of the region in London, only the Kyrgyz Ambassador has no opposite number in Bishkek. There are some commercial reasons for opening an Embassy. Mr Peters of the British Consultants Bureau told us that "it is a great pity that we have no permanent representation in Bishkek."[352] On the other hand, Sir Derek Thomas told us that in the Kyrgyz Republic: "it is [more] possible to bring a transaction to a successful conclusion over an acceptably short period of time than it is in some of the other countries. I am not saying that we do not need help in Kyrgyzstan but the culture makes it easier to do business."[353] Perhaps more importantly than assisting business, the opening of an embassy in Bishkek would send a valuable message to a government which is believed to be serious in its promotion of democratic reform and development. Bishkek is also developing as a regional centre for multilateral diplomacy, and the United Kingdom may suffer from not having a public profile or an information-gathering presence. We recommend that the United Kingdom open an Embassy to the Kyrgyz Republic in Bishkek.

153. The case for representation in Tajikistan is rather different. The security situation is poor, with an ongoing civil war and the murder in 1998 of four members of the UN Mission monitoring the poorly-observed ceasefire.[354] There is some British trade with British gold-mining concerns active, and an average of £1 million per year has been given indirectly in aid. Tajikistan is also an important transit country for drugs from Afghanistan, and a base from which Afghanistan can be observed. It is also the principal route into non-Taliban controlled Afghanistan. Ms Quin told us that the Government "want to be active in efforts to try to find a way forward" in Tajikistan's internal difficulties, and that it "would be keen to have a presence there if the situation changed." She said, however, that there were no plans to open an embassy in Dushanbe, but that the situation was kept under review, with regular accounts from the Ambassador in Tashkent, who is also accredited to Tajikistan.[355] We appreciate that opening an Embassy in a difficult environment like Dushanbe would be costly, and that the returns in commercial terms are likely to be negligible. The returns in political and security terms are also questionable, though the United Kingdom shares the common Western interest in helping the peace process and preventing Tajikistan from descending into the anarchy from which Afghanistan has suffered. There is a German Embassy in Tajikistan, and it may be possible to work in co-operation with Germany, even to the extent of basing a British diplomat in the German Embassy. Tajikistan is the only one of the eight countries which has no representation in London. It should be made plain to the Tajik Government that if they decide to open an Embassy in London, they would be welcome. We recommend as a first step that the FCO approach the German government about the possibility of creating a permanent British diplomatic presence in the German Embassy in Dushanbe.

154. There is one country where we are not convinced of the value of extending British representation. This is Turkmenistan. Although British energy companies are active in Turkmenistan, they appear to be able to cope without major assistance from the Embassy. There are few legitimate opportunities for SMEs. The present Turkmen Government is also apparently impervious to the serious human rights concerns which are raised with it. It would be a major step to recommend withdrawal altogether from a country where the United Kingdom is at present represented, and this would cause administrative difficulties for British companies operating there (for example, in the issuing of visas to Turkmen employees needing to visit the United Kingdom). However, we believe that for the present there is no need further to enhance representation in Turkmenistan.

FACILITATING REPRESENTATION

155. Mini posts, such as those in the South Caucasus and Central Asia, encounter particular difficulties. The first of these is the demands put upon them. As Ms Pringle put it, "By their very presence in the region, people expect to be able to turn up and get visas and commercial guidance; we expect to get political analysis in London. That is a very tall order."[356] A sudden demand—for example, for a large number of visas for a cultural exchange—puts a great strain on resources. There is little that can be done about demands of that type. However, the FCO can be more sensitive to the demands which it places upon small posts itself. Among matters which we discovered as causing concern were the wide range of statistical returns required by London, the pressure of resource-based accounting and the volumes of paper passing through the Embassies which were often of little or no use or relevance to the Post concerned. While the versatility expected of quite junior staff may be an attractive feature of the work at a small post (for example, in the Ambassador's absence on leave, a Deputy Head of Mission of a very junior grade may have to take responsibility for the running of the Mission), there is also a danger that hard-pressed staff will not be able to cope.

156. We were told that the FCO had conducted a review of the demands it made on small posts.[357] However, after enhancement, only the post at Yerevan will count (in FCO terms) as small, and will therefore alone benefit from the lightening of the administrative burden placed upon small posts. Paradoxically, the administrative burdens on the other posts will increase post-enhancement. The FCO acknowledged that staff were at present overworked. Even after enhancement, all the posts will remain small even if they will not formally count as such. We accept, as Ms Pringle put it, that "there is a certain minimum these posts have to fulfil to satisfy the centre they are doing the job for which we are giving them resources."[358] We fully appreciate that FCO management in London must satisfy itself with the financial and other propriety of its posts abroad—the recent cases of fraud in the Embassy in Jordan demonstrate that. However, we welcome Ms Quin's willingness to look again at the management demands made upon the posts in the area,[359] and we recommend that the FCO should ensure that the demands placed upon posts of the size of those in the region are regularly reviewed, and that they are no more than are absolutely necessary.

157. Demands are also placed upon staff in mini posts in personal terms. This calls for very careful thought by personnel officers and other management in London. Sometimes in the past this careful thought has not been manifest. For example, the decision that a third secretary should be based part-time in Yerevan and part-time in Tbilisi might have seemed a sensible use of resources in London, but proved unworkable on the ground where the needs of neither Embassy was satisfied and the individual concerned was put under unacceptable strain. Other stresses can come if just one member of staff is not able to pull his or her weight—the operation of a post with four or five United Kingdom-based staff is greatly hampered by illness or other indisposition of any staff member or by any lack of good personal chemistry between the small teams involved. The British Consultants Bureau pointed to a problem they had encountered as a consequence of one under-performing staff member.[360] Finally there is a problem of isolation in small posts, with few facilities and a limited support network, as well as a dearth of information materials from the United Kingdom. Part of the solution to this problem lies in better use of IT. We discuss this issue further in our Report into FCO Resources,[361] and we note that better IT access to posts would also bring benefits for British business, as the CBI argued.[362]

158. Our general impression on our visits to each Embassy and our discussions with virtually all the United Kingdom based staff in the region is that the Embassies cope extremely well with the pressure put upon them. Ms Quin spoke of "dynamism",[363] and we agree with this assessment. We were particularly struck by the high regard in which Embassies were held by government representatives, British business people and local NGOs and human rights organisations. From all of these, we heard many unsolicited tributes—and this was reflected, in the case of business especially, in the written evidence we received.[364] However, even after the enhancement programme has been fully implemented, the Embassies in the region will be tightly stretched. Reflecting the opinions of major investors in the region, the CBI called for the Caspian Enhancement Programme to be kept under review.[365] We agree. While we welcome the creation of new posts in the Embassies in the South Caucasus and Central Asia, we recommend that the FCO continue to monitor closely staffing levels in the region and the demands made upon staff.

LOCALLY ENGAGED STAFF

159. As well as meeting United Kingdom-based staff, the Committee met a number of high quality locally engaged staff. Ms Pringle referred to "excellent" graduate recruits,[366] and GEC wrote of "highly enthusiastic and extremely knowledgeable" locally engaged commercial staff.[367] These staff are crucial to the delivery of service by the Embassies, and, because of the nature of British staffing policies, they form a more important component of the British Embassies' resources than they do of our competitors. The Caspian enhancement programme will result in the employment of 16 extra locally-engaged staff.[368] There is a concern that the most able of the locally engaged staff may be poached by local commercial employers. This was mentioned in memoranda from BP Amoco and British Consultants Bureau.[369] Indeed, we were made aware of some evidence that it has occurred already.[370] Ms Quin told us that efforts were made to build up commitment among local staff by "being a good employer", and Ms Pringle suggested that the volatility of the local employment market might encourage loyalty.[371] The East European Trade Council[372] suggested that Heads of Mission should have the flexibility to offer higher salaries to retain good locally engaged staff. We have already recommended that the FCO continue to review the implications of the balance between UK based and locally engaged staff at overseas posts.[373] Central Asia and the South Caucasus would be an interesting case study.

STAFF EXPERTISE

160. One advantage of locally engaged staff is that they can have expertise in areas which United Kingdom based staff do not. We have addressed in our report on FCO Resources[374] the question of specialisation in the FCO. Central Asia and the South Caucasus do illuminate a dilemma which the FCO faces: how much effort should it put into developing expertise in its United Kingdom-based staff when that expertise is likely to be of use for only a brief time in their careers? How much effort, for example, should be put into teaching the languages of the region? Will a knowledge of Russian be adequate—as several diplomats in the area told us—or is a knowledge of local languages desirable, as Monument Oil and Gas argued?[375] This is a question which will need to be re-examined as the use of local languages develops: we understand that in Georgia, for example, Russian is now little used in official circles.

161. There was also a concern among business witnesses that staff should be expert in the areas of particular relevance to them. We have already referred to oil and gas companies' wish to have energy expertise in the Embassies[376]. The Independent Power Corporation believed that there were "simply not enough diplomats with the necessary linguistic and business skills to be effective and competitive in promoting British trade".[377] We were also informed by British Invisibles, which conducted a survey of its members operating in the region, that while "overall the BI members polled were satisfied and in most cases more than satisfied with the service delivered by FCO Posts in the region," members "still feel that, generally speaking, officials in the DTI [Department of Trade and Industry] and the FCO do not have as good an understanding of, and interest in, the financial sector and its needs as they do of the 'visible' sector."[378] This suggests a need for a greater financial and commercial awareness among all FCO staff. In this context, we hope that the FCO will consider the CBI's suggestion of making use of six-month secondments from the private sector to Embassies in the region.[379] It might also be possible to offer a retired experienced businessman or woman a senior representational role under the auspices of British Trade International. More particularly, there may be a case for developing a cadre of staff within the FCO who have expertise in the CIS, as there are groups which specialise in the Arab world or the Far East.

EMBASSY BUILDINGS

162. Embassy buildings are an important public demonstration of the commitment of the United Kingdom to countries abroad. An appropriate building, appropriately sited, can create a favourable impression, and vice versa. Embassies are also the environment in which the FCO's staff have to work. In Armenia, the Embassy is located in a private house in a residential street not far from the main government area of Yerevan. Space is adequate, but the lease is close to expiry. A handsome, but decrepit building has been acquired near to the US Embassy and Presidential Palace and opposite the Parliament. Funds now need to be earmarked for refurbishment. This new Embassy will be an appropriate base for British diplomacy. In Azerbaijan, there is a widespread recognition that facilities are inadequate—and as the Anglo Azeri Society wrote, "the importance of an appropriate Embassy building should not be underestimated."[380] The Embassy and Residence are both located in a modern hotel complex. Recent increases in staff and workload mean that the office accommodation is under pressure and alternative office premises are being sought. In Georgia, the British Embassy has adequate space and is well appointed. However, it is located at the rear of a hotel some way from the centre of Tbilisi. This is an inconvenient location, and contrasts with the much more obvious presence of the German Embassy in the city centre. In Kazakhstan, the British Embassy is co-located in Almaty with the French and German missions. This brings cost advantages since the Post pays only 12.6 per cent of total rent and utility costs, with the Germans providing management facilities. The British occupy just half of one floor in the building housing the three Embassies.[381] Ms Quin told us that a question mark hangs over the Almaty presence because of the move of the capital to Astana.[382] Like other Western countries, the United Kingdom has not moved to Astana because of the concentration of commercial and economic business in Almaty. Indeed, we understand that the Ambassador has found it necessary to visit Astana only one every couple of months. In Turkmenistan, the Embassy occupy a self-contained suite of offices in a complex attached to a modern hotel. The French and German embassies are in the same building. The accommodation is of a sufficient standard and size to meet foreseeable requirements. There are plans to build a new Residence in an area designated for the diplomatic community by autumn 2000. In Uzbekistan, the Embassy and the Residence are co-housed in excellent accommodation converted for the purpose. The Committee recommends that the FCO review its Embassy buildings in the region and satisfy itself that each is an appropriate base both for its staff and for the United Kingdom's public diplomacy.