Author Archives: admin

VimpelCom to pay $600m fine for Uzbek bribes

JAN. 17 2016 (The Conway Bulletin) — Russian telecoms company Vimpel- Com said it would plead guilty to bribing Uzbek government officials for mobile phone licences and agree to pay a $600m settlement in the United States, bringing a row over corruption in Uzbekistan that has also involved Sweden’s TeliaSonera and Norway’s Telenor closer to an end.

Sources close to the company told the Russian business newspaper Vedomosti that the amount that VimpelCom is ready to pay is lower than the $900m it set aside in the last months of 2015 for possible penalties.

A prosecution team at the New York District Court has been target- ing VimpelCom and MTS, another Russian company, who allegedly paid around $500m in exchange for mobile licences, but other companies have been dragged into a row that centres on corruption in Uzbekistan

In November, Norwegian police arrested Jo Lunder, VimpelCom’s ex-CEO for alleged bribe paying. Earlier, Norwegian authorities had sacked the chairman of Telenor, a company that owns — and wants to sell — a 33% stake in VimpelCom.

A parallel investigation is looking into a similar corruption issues at TeliaSonera, a Swedish competitor to VimpelCom in Uzbekistan. TeliaSonera now wants to sell its Eurasian unit.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Lavrov to visit Turkmen capital

JAN. 21 2016 (The Conway Bulletin) – Russian foreign minister Sergei Lavrov has scheduled a visit Ashgabat to open a new embassy on Jan. 27/28, media reported, just as relations between the two countries appear to bottom out over a row about gas supplies. Earlier this year Russian gas monopoly confirmed that it would stop buying gas from Turkmenistan and instead buy from neighbouring Uzbekistan.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Tajik authorities tighten internet access

JAN. 15 2016 (The Conway Bulletin) – Tajik president Emomali Rakhmon signed a decree forcing all internet traffic into Tajikistan to pass through a single entry point controlled by state-run Tajiktelecom, media reported. The authorities in Tajikistan regularly turn off access to social media websites which they say are being used by Islamic radicals to infiltrate Tajik society.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Central Asia and South Caucasus welcome Iran

JAN. 16/17 2016, ALMATY/Kazakhstan (The Conway Bulletin) – Countries in the South Caucasus and Central Asia applauded the end of western sanctions against Iran, a move they hope will turn their southern neighbour into a strong trade and diplomatic partner.

But, as well as adding a hopefully vibrant economy on their southern fringe, the reemergence of Iran also presents a major potential downside.

Low commodity and oil prices have been a major contributor to an economic downturn that has shaken the region. Adding Iran’s large oil reserve to the market will further pressure prices which are already hovering around 12-year-lows of $28/barrel, down from $115/barrel in the summer of 2014.

Most countries in the region issued a statement applauding Iran’s return to the international fold.

The Kazakh foreign ministry said: “It is a critically important step in creating a safer world.”

It also said that Iran had signed its first post-sanctions international agreement with Kazakhstan’s Air Astana to open an Almaty-Tehran flight in 2016.

In the South Caucasus, Armenia and Georgia are trying to negotiate gas supply deals with Iran, and Azerbaijan may be able to persuade Tehran to fill part of its TANAP gas pipeline running via Turkey to Europe.

Elham Hassanzadeh, Research Fellow at the Oxford Institute for Energy Studies, said Iran could become an important trade and diplomatic partner for Central Asia and the South Caucasus.

“It will certainly be an easier partner to trade with [than previously],” she told The Conway Bulletin in an interview.

“The cost of doing business with Iran will be significantly lower than that of during the sanctions era while less economic and political restrictions on a given country in the region could be translated into less antagonism and conflict and more collaboration and constructive dialogue.”

She said, though, that energy would be at the forefront of relations. “A good number of Azeri and Turkmen companies are planning to invest in Iran’s oil and gas sector,” Ms Hassanzadeh said.

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(News report from Issue No. 264, published on Jan. 22 2016)

Nordavia flies to Armenia

JAN. 15 2016 (The Conway Bulletin) — Russian airline company Nordavia said it will open a regular flight from St. Petersburg to Yerevan. Nordavia previously only operated regular domestic flights in western Russia. According to the press statement, Nordavia will fly between St. Petersburg and Armenia’s capital three times a week.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Remittances fall to Georgia

JAN. 15 2016 (The Conway Bulletin) – Total remittances to Georgia fell by 25% in 2015 to $1.08b, mainly because of a sharp slowdown in the Russian economy, the Central Bank said. Remittances from Russia fell by 39% to $433m and from Greece (Georgia’s second largest remittance originator) by 42.5% to $118m. A slowdown in Russia’s economy has rippled out across the former Soviet Union.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Armenia’s bank wants IPO

JAN. 22 2016 (The Conway Bulletin) – Armenia’s biggest bank Ameriabank said that it would seek an IPO in London within the next couple of years after the European Bank for Reconstruction and Development (EBRD) bought a stake in it. If Ameriabank did list in London it would be the first Armenian company to list on a Western stock market.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Editorial: Kyrgyzstan’s hydropower troubles

JAN. 22 2016 (The Conway Bulletin) – For Kyrgyzstan, hydropower represents a genuine export opportunity. With the World Bank-sponsored CASA-1000 project, is is developing a market alongside Tajikistan for its power in Pakistan and Afghanistan.

The problem is that it needs huge capital investment to upgrade and expand upon its mainly Soviet-era hydropower plant network. And the pulling out of Russia from the Kambar-Ata-1 plant represents a real step backwards.

This was the $2b project that would have underscored Kyrgystan’s power exports. Now it needs to find an alternative investor.

Of course, China is always there, ready to help out with infrastructure projects in Central Asia, but its economy has been jittery and it may not fancy taking on such a big project. India has been looking to expand its influence into Central Asia but it has focused on oil and gas projects. That leaves Western financial institutions and, in particular, the World Bank. It has pledged to fund half of the $1.2b CASA-1000 costs. It may now have to help Kyrgyzstan out with Kambar-Ata-1.

ENDS

(Editorial from Issue No. 264, published on Jan. 22 2016)

Kazakhstan orders to pay $25m for ditching building plans

ALMATY, JAN. 18 2016 (The Conway Bulletin) — An arbitration court in Stockholm ordered a Kazakh state- owned company to pay €22.7m ($24.8m) to Estonian construction company Windoor for reneging on a building deal in Astana.

The case is important as more and more infrastructure projects in Kazakhstan grind to a halt with the deepening economic slump.

In the Stockholm case, Windoor, which specialises in glass-aluminium structures, filed a lawsuit against state-owned Diplomat Stroi Servis for €18m ($19.7) after it failed to pay for work it had carried out on a conference centre.

In 2012, Windoor and Baltiiski Dom, a Kazakh construction company, agreed a deal to build a 40,000 square metres diplomatic conference centre behind the Kazakh ministry of foreign affairs.

In an interview via email with The Conway Bulletin, Mailis Lintlom, the Windoor chairman, said: “By early 2014, it became clear that the construction of the project was behind schedule and that Windoor would not be able to start the [installation] work of the facade at the agreed time.” In February 2015, in line with the worsening economy in Kazakhstan, Windoor was told that the project had been “frozen”, triggering Windoor’s arbitration action.

At the end of December 2015, the Stockholm court said Diplomat Stroi Servis, owned by the Economic Department of Kazakhstan’s ministry of foreign affairs, will have to pay a €4.7m premium on Windoor’s court claim.

A Kazakh court will have to enforce the payment and Windoor is still waiting for a judicial confirmation of the award.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Yerevan Jur to improve water supplies in Armenia

JAN. 21 2016 (The Conway Bulletin) — Yerevan Jur, a French company managing the water network in Armenia’s capital, said it has launched a new $21.6m programme to improve water supplies. Veolia, a French utilities company listed in New York and Paris, established Yerevan Jur in 2006. International lenders, including the European Bank for Reconstruction and Development, will finance the water network project.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)