Author Archives: Editor

Trans-Anatolian Natural Gas Pipeline opens

BAKU/Nov. 30 (The Bulletin) –Azerbaijani President Ilham Aliyev and Turkish President Recep Tayyip Erdogan officially marked the completion of the Trans-Anatolian Natural Gas Pipeline (TANAP) which will pump gas from the South Caucasus across Turkey to Europe.

TANAP is the longest section of the 3,500km-long $38b Southern Gas Corridor. The first section connecting the BP-operated Shah Deniz II gas field in the Caspian Sea to Erdine, in eastern Turkey has already been open and next year the final section, the Trans-Adriatic Pipeline, running across Greece and the Balkans to Italy, will open.

In a speech in Ipsala, on the Turkey-Greece border, Mr Aliyev said that the project, which will give Azerbaijan’s economy a major boost through gas sales, was more than just a gas transit pipeline.

“This project leads to cooperation, stability, long-term mutual understanding, and it would be wrong to consider these projects simply as energy projects,” he said according to a statement on his website.

Construction of the pipeline, one of the world’s longest energy pipeline was started four years ago and has had the financial backing of European countries, the EU and various financial institutions such as the EBRD.

European countries want an alternative energy source to Russia, which has been their primary provider of gas.

When the Southern Gas Corridor does open next year it will pump an estimated 10b cubic metres of gas to Europe, enough power for up to 10m households.
TANAP’s shareholders are Azeri state energy company Socar with a 51% stake, Turkish pipeline operator BOTAS with a 30% stake, BP with 12% and Socar Turkey with 7%.
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— This story was first published in issue 431 of the weekly Bulletin on Dec. 9 2019

Copyright owned by the Central Asia & South Caucasus Bulletin

Kyrgyzstan eases visa regulations with Iran

DEC. 4 (The Bulletin) — Highlighting improved bilateral relations, Kyrgyzstan and Iran eased visa regulations between the two countries and also resumed direct flights. Iran has been keen to develop relations with Central Asian countries. For the Kyrgyz government, improving links with Iran is an opportunity to try to entice Iranians looking to holiday in a cooler climate to travel to Kyrgyzstan.
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— This story was first published in issue 431 of the weekly Bulletin on Dec. 9 2019

Copyright owned by the Central Asia & South Caucasus Bulletin

Comment: The CSTO has always lacked relevance

Other than spreading Russian influence, the CSTO is a military alliance lacking a clear mission. Opportunities to impose itself and carve out an identity have been missed, writes James Kilner.

NOV. 29 (The Bulletin) — For a military organisation that can pull together regular summits which include Russian President Vladimir Putin, the CSTO is oddly anaemic. On Nov. 28, the heads of states of the six members of the CSTO met in Bishkek for a summit that was only vaguely relevant.

This is a military organisation led by Russia which has dodged intervention on its doorstep and inside its borders. It currently doesn’t even have a permanent Secretary-General to lead it.

The CSTO, or to give it its full name the Collective Security Treaty Organisation, emerged from the ashes of the Soviet Union as something of a Warsaw Pact light, very light. It was supposed to impose a military pact over the rump of the Soviet Union that wasn’t looking West and to NATO. But its origins and ambitions have always been confused.

A CIS military grouping was formed after the Tashkent Pact of 1992, with Russia, Armenia, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, Azerbaijan, Belarus, and Georgia as members. When it came to be renewed in 1999, though, Georgia, Azerbaijan and Uzbekistan declined. This meant that when the CSTO was finally created in 2002 there were also only six members and it was dominated by Russia.

Recent inaction by the CSTO has also undermined its cause. The CSTO stood by in 2010 when fighting between ethnic Kyrgyz and ethnic Uzbeks in Osh, southern Kyrgyzstan, killed several hundred people and forced thousands of ethnic Uzbek to flee. Often too, as in Ukraine and Georgia, Russia is a belligerent, or backs a belligerent, in a conflict, forcing CSTO peacekeeping missions off the table.

Even when there is cooperation within the CSTO, it is couched as bilateral. Armenia has sent 100 deminers and doctors to support Russian rebuilding in Syria but other countries declined and the deal is considered to be between Russia and Armenia directly.

Of course, it doesn’t help that since the start of this year, the CSTO has been without a Secretary-General. Yuri Khachaturov, the Armenian former CSTO Secretary-General, is currently standing trial for “subverting the constitution” in Yerevan in 2008 when police killed at least 14 protesters. Members of the CSTO haven’t been able to agree on a replacement.

The CSTO holds value to Russia for helping it to spread political influence and to sell its military products, but as a militarily operational group it is largely irrelevant.

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— This story was first published in issue 430 of the weekly Bulletin.

Astana beats Man U 2-1

NOV. 28 (The Bulletin) — Stunning the football world, Astana FC beat Manchester United 2-1 in their UEFA Europa League match in Nur-Sultan, recording arguably their top ever win. The match was a dead tie as Manchester United has already qualified for the next round but the roar from the crowd of around 30,000 when Astana won from 1-0 down showed how much the win meant to fans.
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— This story was first published in issue 430 of the weekly Bulletin.

CSTO leaders meet in Bishkek for summit

NOV. 28 (The Bulletin) — Leaders of member states of the Collective Security Treaty Organisation (CSTO) signed 15 documents focused on enhancing cooperation at their annual summit in Bishkek, media reported quoting the Kyrgyz Presidential Administration. The CSTO was set up shortly after the break-up of the Soviet Union in 1991. It has been accused of being weak and failing to intervene in regional conflicts, most notably in fighting between ethnic Kyrgyz and Uzbeks in Osh in 2010.
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— This story was first published in issue 430 of the weekly Bulletin.

Major Kazakh grain exporter fails to pay bond coupon

NOV. 27 (The Bulletin) — Kazexportastyk, one of Kazakhstan’s biggest grain exporters, said that it had started talks with the Kazakh government after it failed to pay a bond coupon payment to investors under a debt restructuring deal. Russia’s Sberbank indirectly bought a stake in Kazexportastyk when it loaned the company $78m last year as part of a restructuring deal. Kazexportastyk missing a coupon payment may deter investors from other Kazakh companies.
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— This story was first published in issue 430 of the weekly Bulletin.

Azerbaijan and Armenia complete journalist exchange

NOV. 27 (The Bulletin) — Three Armenian journalists and three Azerbaijani journalists visited each other’s capitals in an exchange overseen by the Minsk Group of the Organisation for Security and Cooperation in Europe (OSCE) that its organisers hope will break down antagonism and foster goodwill. Eurasianet reported that the plan was hatched after the foreign ministers of Azerbaijan and Armenia met in Moscow in April. Armenia and Azerbaijan are still officially at war over the disputed region of Nagorno-Karabakh.
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— This story was first published in issue 430 of the weekly Bulletin.

Markets: Currencies steady after downward pressure

NOV. 27 (The Bulletin) — After a couple of months of sustained downward pressure that pushed currencies to some of their lowest levels, markets have slowed and steadied. Most currencies failed to shift significantly over the past week, with the exception of the Kazakh tenge which strengthened by 0.7%. It has pulled back from near an all-time low of 389/$1 and is now valued at 386.4/$1.

On the Central Bank news front, the Trend news agency has been reporting that the Uzbek Central Bank is considering lowering interest rates next year to give borrowing and spending a lift. It is held back by rising inflation, though, with analysts estimating that the real inflation rate if around 14 – 16%.

In Bishkek, the Central Bank said that it was going to keep its key interest rate steady because inflation had finally started to pick up. It said that inflation measured 2.5% in mid-November and would rise to 3.5% by the end of the year. It has an inflation target of 5-7%.

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— This story was first published in issue 430 of the weekly Bulletin.

Russia’s Tatneft will partner Uzbekneftegas

NOV. 27 (The Bulletin) — Russian oil producer Tatneft will partner Uzbekneftegas, the Uzbek state oil and gas company, to produce oil from three fields in the east of the country. The fields, Andijan, Palvantash and West Palvantash, all hold what are called “hard-to-recover” reserves.
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— This story was first published in issue 430 of the weekly Bulletin.

Aliyev delivers anti-Europe speech

NOV. 27 (The Bulletin) — In a speech at a university in Baku, Azerbaijani president Ilham Aliyev said that he wasn’t seeking closer integration with Europe because it didn’t respect Islamic values, Bloomberg News reported. Relations between Azerbaijan and Europe have been strained for the past few years with European politicians accusing Azerbaijan of cracking down on civil liberties and promoting corruption. Next year Azerbaijan is dues to supply central Europe with gas from its Caspian Sea fields.
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— This story was first published in issue 430 of the weekly Bulletin.