Clare Nuttall in Astana -

Kyrgyzstan's ruling coalition collapsed on August 22 after two of its four members finally pulled out after months of plotting the downfall of Prime Minister Omurbek Babanov. It leaves the government without a majority in parliament, and investors with an indefinite period of uncertainty.

Coalition party Ata-Meken announced it is quitting the Birimdik coalition on August 22, a day after the Ar-Namys party pulled out. This leaves only MPs from Babanov's Respublika party and the Social Democratic Party of Kyrgyzstan (SDPK) still backing the government, which is not enough for a majority in the 120 seat parliament. Kanat Isaev - leader of the Respublika parliamentary faction and credited as "coalition leader" - announced on August 22 that since the government no longer has a majority in the parliament, it must resign immediately.

Kyrgyzstan's President's Office confirmed on August 23 that documents on the collapse of the coalition have been submitted to President Almazbek Atambaev. The president now has three days to mandate one of the five parties represented in parliament to form a new coalition.

Babanov is reluctant to let go of power, but without Ata-Meken and Ar-Namys he would be unable to form a new coalition unless he keeps the SDPK on board and manages to persuade Ata-Zhurt, the only opposition party in the parliament, to join the government. That, however, is unlikely. Respublika - SDPK - Ata-Zhurt was the formation of the first, makeshift, parliamentary coalition after the April 2010 revolution, under Kyrgyzstan's former Prime Minister and current President Atambaev. However, the socialist SDPK and nationalist Ata-Zhurt remain ideologically opposed, and most SDPK MPs have already indicated that they also want Babanov out.

Ata-Meken, which has turned against Babanov in recent weeks, called for him to leave immediately instead of serving as acting prime minister while a new coalition is formed. "We, members of the Ata-Meken faction, have to declare our disagreement in principle with the policies of Babanov as the head of the government. We are also convinced that Babanov should not remain the acting prime minister of the republic and should waive his temporary powers immediately," the party said in a statement cited by 24.kg.

Long term shakes

The coalition government, which was formed in December 2011, has looked shaky for several months. MPs made an attempt to force a vote of no confidence just before parliament broke up for the summer recess in June, but failed to collect enough signatures on a single petition.

The trigger for the final collapse is a corruption scandal that broke in August. MPs allege a racehorse, which they say is worth up to $1.5m, was given to Babanov as a bribe by Serka, a Turkish company carrying out construction work at Bishkek's Manas International Airport. Babanov, who is one of Kyrgyzstan's richest businessmen, says he bought the horse himself and it is worth no more than $20,000.

However, there are deeper issues dividing the coalition, in particular the management of Kyrgyzstan's economy. Technical difficulties at the Kumtor gold mine, which accounts for around 12% of GDP, in the first half of 2012 have brought down growth forecasts. Economic expansion for the year is now set to reach no more than 1%, down from an original target of 5.5%. This has dashed hopes of bringing Kyrgyzstan's budget deficit, which soared in 2010, down to a more manageable level.

Other issues include Babanov's personnel policy. Speaking on August 21, Ar-Namys leader Felix Kulov said the decision to quit the coalition was based on Babanov's decision to fire officials appointed on the recommendation of his coalition partners, in particular the head of the State Registration Service, Emil Aliev.

Kyrgyzstan, which has seen two revolutions in the last seven years, now enters a refreshed phase of political turmoil, as MPs start discussions about a new coalition and awaiting Babanov's resignation. It took around six weeks of negotiations to agree on the two previous coalition governments formed since the April 2010 revolution, and with no less than three of the five parties represented in parliament needed to form a majority, a similarly lengthy round of talks is expected now.