SEPT. 11 2017 (The Conway Bulletin) — Foreign direct investments into Georgia, a vital part of its economy, fell by 5.5% in the first half of 2017, compared to the same period in 2016, data showed. FDI between January and June measured 751m, down from $794.4m. This was the lowest H1 result since 2014. Construction is the biggest driver of FDI and this fell by nearly a third from 2016 to $272m.
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— This story was first published in issue 343 of The Conway Bulletin on Sept. 15 2017
ALMATY/SEPT. 15 2017 (The Conway Bulletin) — — Kazakh officials want an improved offer from Shell and ENI to end a long-running dispute over a $1.6b profit sharing claim at the oil and gas Karachaganak project in the north of the country.
They told the Reuters news agency that the Shell-led consortium operating the plant, Kazakhstan’s biggest gas producer, had offered to build a gas processing plant in exchange for dropping the profit sharing claim.
Kazakh Energy Minister Kanat Bozumbayev declined to confirm this but did say that the offer fell short of his expectations.
“We have calculated the value of the offer to Kazakhstan and it does not meet our demands and we have already told that to consortium members,” he said told Reuters.
“We have asked the consortium to offer something in addition.”
Kazakhstan has said that it is owed an additional $1.6b from a profit sharing scheme. The tax authorities have also investigated Karachaganak and some Western commentators have said that they are simply looking to squeeze extra cash out of their partners.
The consortium operating Karachaganak has not commented.
Shell and Italy’s Eni are the field’s operators and largest shareholders with a 29.25% stake each. Chevron (18%), Lukoil (13.5%) and state-owned Kazmunaigas (10%) own the rest.
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— This story was first published in issue 343 of The Conway Bulletin on Sept. 15 2017
SEPT. 11 2017 (The Conway Bulletin) — The authorities in Azerbaijan released Mehman Aliyev, head of the Turan news agency which is described as the country’s only remaining independent media outlet, from pre-trial detention but said an investigation into alleged tax avoidance was ongoing. Mr Aliyev’s detention last month has enraged human rights groups and Western governments who have said the allegations are fabricated. Azerbaijan has been accused of cracking down on free media.
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— This story was first published in issue 343 of The Conway Bulletin on Sept. 15 2017
BISHKEK/SEPT. 12 2017 (The Conway Bulletin) — Kyrgyzstan and Toronto-listed Centerra Gold said they had agreed a deal to end their dispute over ownership of the Kumtor gold mine in the east of the country.
The news propelled Centerra Gold’s shares to a 4-1/2 year high on the Toronto stock exchange. It will also give Kyrgyzstan’s ruling Social Democratic party a boost ahead of next month’s presidential election.
Under the deal, Centerra Gold will retain its 100% ownership of Kumtor in exchange for a one-off $50m payment to a new environmental protection agency. It will also pay the agency $3m every year and make another one-off payment of $10m to a cancer centre. Centerra Gold will also pay $6m a year into Kumtor’s reclamation fund, up to a total of $69m.
The Kyrgyz state owns 26.6% of Centerra Gold.
After signing the deal, Kyrgyz PM Sapar Isakov said: “This will be the basis for restarting our relations based on mutual trust and joint efforts to further effectively implement the project in the interests of the people of Kyrgyzstan and all the shareholders of Centerra Gold.”
Kumtor is Centerra Gold’s most important asset and also the biggest industrial site in Kyrgyzstan. It produces 10% of Kyrgyzstan’s total GDP.
As well as suppressing Centerra Gold’s share price, the row has damaged Kyrgyzstan’s reputation as a place to do business.
Western analysts have accused Kyrgyz officials of trying to make life difficult for Centerra Gold by denying key workers permits, launching claims for environmental damage and chasing back tax payments.
Centerra Gold retaliated last year by taking the dispute to an international arbitration court.
This action will now be dropped.
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— This story was first published in issue 343 of The Conway Bulletin on Sept. 15 2017
SEPT. 7 2017 (The Conway Bulletin) — The Russia-led Collective Security Treaty Organisation (CSTO), a post-Soviet grouping of most militaries in Central Asia, the South Caucasus, Belarus and Russia, decreed at its meeting in June that the Islamic Renaissance Party of Tajikistan (IRPT) was a terrorist organisation, media reported. Tajik officials have arrested or forced into exile all the main members of the IRPT since 2015 after President Emomali Rakhmon accused the group of a coup attempt. Until then, the IRPT, whose top members have sought sanctuary in Europe, had been the official opposition group.
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— This story was first published in issue 343 of The Conway Bulletin on Sept. 15 2017
SEPT. 7 2017 (The Conway Bulletin) — Kazakh officials are in talks with OPEC to try and arrange a separate output deal that would allow it more flexibility to ramp up output from its Kashagan field, media quoted officials as saying. OPEC has been looking to restrain global oil production to increase prices, a plan that Kazakhstan, which is not an OPEC member, has gone along with. It, though, has said that it needs to extract oil from its giant Kashagan field, which started operations last year, to repay shareholders.
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— This story was first published in issue 343 of The Conway Bulletin on Sept. 15 2017
SEPT. 13 2017 (The Conway Bulletin) — In Tashkent, 50 chefs cooked up a traditional plov that weighed 7.3 tonnes, setting a new world record for the biggest plov ever cooked. The previous record was 4 tonnes.
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— This story was first published in issue 343 of The Conway Bulletin on Sept. 15 2017
DUSHANBE, SEPT. 7 2017 (The Conway Bulletin) — Investors snapped up Tajikistan’s first sovereign bond issue, surprising Central Asia analysts who said the auction came with huge risk.
The $500m Eurobond issue came with a coupon of 7.125%, which analysts said was around 200 basis points more than the price paid by other frontier economies for debt. It is set to mature in 2027.
Tajikistan, considered the poorest of the Central Asian countries with an economy reliant on remittances, has said it wants to raise the cash to pay for construction of the giant Rogun Dam.
Lutz Roehmeyer, director at Landesbank Berlin Investment, invested in some of the debt.
“They don’t want to splash out the money on any nonsense, they want to build a dam and produce electricity which would be a massive boost for the local economy,” he was quoted by Reuters as saying. The Rogun dam is part of a wider project to supply electricity generated by hydroelectric power to Afghanistan and Pakistan.
Tajikistan has a reputation for corruption and analysts warned that investing in Tajikistan was a gamble. Last year, the government bailed out its commercial banks.
Max Lambertson of the EIU said yields on investment grade debt around the world were currently so poor that investors were looking at far riskier options to find profit.
“Investors typically show little interest in Tajikistan, which has a poor record with foreign investors and multilaterals,” he said.
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— This story was first published in issue 343 of The Conway Bulletin on Sept. 15 2017
SEPT. 6 2017 (The Conway Bulletin) — Kyrgyzstan and Uzbekistan officially reopened the Dostuk (Friendship) border crossing point that has been closed since ethnic fighting in Osh, Kyrgyzstan, in 2010. The Dostuk checkpoint is one of the most important in the Ferghana Valley and its reopening is considered a major indicator of improved relations between Kyrgyzstan and Uzbekistan.
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— This story was first published in issue 343 of The Conway Bulletin on Sept. 15 2017
SEPT. 10 2017 (The Conway Bulletin) — Defying his former ally-turned-foe Ukrainian Pres. Petro Poroshenko, former Georgian Pres. Mikheil Saakashvili forced his away into Ukraine two months after his Ukrainian citizenship was revoked.
Mr Saakashvili has called politicians in Ukraine corrupt. After crossing the border from Poland into Ukraine, he headed by Lviv in west Ukraine.
Since quitting as Georgia’s president in 2013, Mr Saakashvili has promoted himself as the scourge of official corruption. Mr Poroshenko made him governor of Odessa region in 2015 but Saakashvili quit in 2016. Georgia wants Mr Saakashvili extradited to face various criminal charges.
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— This story was first published in issue 343 of The Conway Bulletin on Sept. 15 2017