Last February, Kyrgyzstan ordered the U.S. to leave the Manas air base it has been using (to support operations in Afghanistan) for the last seven years. Now, after the U.S. matched the Russian offer, Kyrgyzstan has decided that the United States can stay after all.
The original expulsion order came about after Russia made a financial offer that Kyrgyzstan could not refuse. Russia has never been happy with U.S. aircraft operating in a Kyrgyz (former Soviet, actually) airbase. But Kyrgyzstan successfully played the old Cold War aid game, where some third country that both the U.S. and Russia wanted something from, would basically hold an auction to determine which superpower would get their way. Russia is no longer a superpower, but it does remember how to conduct itself in one of these auctions.
Russia's winning offer consisted of forgiving $180 million in debt, giving an interest free loan of $150 million (these usually don't get paid back) and a real loan worth $2 billion. Three years ago Kyrgyzstan tried to get the U.S. to increase payments for use of the 2,500 acre Manas air base, from $5 million, to $50 million a year. Local politicians had already developed a feeding frenzy around the rich Americans. The U.S. offered more money ($17.4 million), but not nearly as much as the Russians eventually offered
The revised and upgraded U.S. offer consists of annual payments of $60 million for basing rights, plus $66 million for infrastructure improvements to Manas (replacing a lot of elderly Soviet era stuff with new Western gear, something the U.S. wanted to do anyway.) Then there's $20 million for development projects (a bribe) and $10 million for fighting terrorism (another bribe.) No doubt some of the $60 million annual payment will disappear into secret bank accounts somewhere outside Kyrgyzstan. At this point, the Russians will have to keep most, if not all, of their offers on the table. The Russians never explicitly said that all their largess was offered in order to get the U.S. tossed out of Manas.
Russian efforts to get the U.S. out of Kyrgyzstan were interrupted four years ago when the then leader of Kyrgyzstan, pro-Russian president Askar Akayev, was driven out of power by mass demonstrations protesting government attempts to rig recent parliamentary elections. The opposition had seized the commercial airport outside the capital, where it was believed that a Russian airliner was waiting there to take Akayev and his family into exile. Akayev later showed up in neighboring Kazakhstan. The new leader of Kyrgyzstan, Kurmanbek Bakiyev, took a while to get to, and forced the Russians to pay a high price to get a few dozen U.S. and NATO aircraft out of Manas airbase. What the U.S. uses Manas for most is as a stopover for military transports. The new deal does not allow the U.S. to fly any weapons into Afghanistan via Kyrgyzstan, but that's not a problem.
Russia considers the Central Asian nations, that used to be provinces of the Soviet Union, as more than just neighbors. But these five countries are all run, as dictatorships, by former Soviet bureaucrats. This arrangement is not popular with most Central Asians, and Kyrgyzstan had the most vocal population protesting the lack of democracy. Russia, learning from the beating it took in Ukraine, where it backed a dictator in the face of a popular democratic uprising, did not speak up for the dictator Akayev, and promptly tried to get cozy with a new government in Kyrgyzstan. The opposition that overthrew Akayev did not contain a lot of Islamic radicals (who believe the country should be run as an Islamic state). The Kyrgyz democrats see Islamic radicalism as a hostile force, and were willing to continue cooperation between Russia and Kyrgyzstan against Islamic terrorists. However, many Russians believe that the United States is behind the ouster of Akayev, via pro-democratic NGOs and American business investments in Kyrgyzstan.
Earlier this year, however, Kyrgyzstan sold out to the Russians, and then double crossed them, because they desperately needed the money. Kyrgyzstan is a poor country, and the current global recession is making things worse. Meanwhile, Russia is still eager to have American and NATO cargo get shipped via Russia to Afghanistan. This is a money maker for Russia, which gets prime rates for moving these cargo containers. However, the U.S. was pretty confident it could convince Kyrgyzstan and Russia to let America continue to use Manas to some extent. And that's exactly what happened.