Category Archives: Uncategorised

Kyrgyz Prosecutor imposes ban on Centerra manager’s travel

JUNE 6 2016 (The Conway Bulletin) — Canadian miner Centerra Gold said Kyrgyzstan’s Prosecutor has imposed a temporary ban on travel for some unnamed managers at the Centerra-controlled Kumtor Gold Company. The Kyrgyz government has not commented. Last week Centerra said that it had started arbitration proceedings against the Kyrgyz government in Stockholm for hindering its business in various ways.

ENDS

(News report from Issue No. 284, published on June 10 2016)

Tajik-Chinese JV produces first gold at mine in Tajikistan

DUSHANBE, JUNE 6 2016 (The Conway Bulletin) — A Chinese-owned mine has produced its first gold in Tajikistan, highlighting the growing influence and importance of China in the Tajik precious metals sector.

Another Chinese gold mining company, though, was accused of trying to dodge paying an environmental fine, a reminder of the complexity of business in the region.

Tajikistan’s government said Pokrud LLC, a Chinese-Tajik JV involving the China National Metallurgical and Mining Company mine, had held a licence to develop a mine 20km east of Dushanbe since 2003. Only far more recently, though, has work started on exploiting it.

Official news outlets quoted the visiting President Emomali Rakhmon as saying that investments to date in the mine totalled $256m. The Pokrud mine will produce around 1.3 tonnes of gold per year, giving the gold sector in Tajikistan a decent boost. It currently produces around 4 tonnes of gold per year.

At the other end of the spectrum, Chinese miner Zijin Mining, which operates the Zarafshan mine in the north of the country, was at the centre of a corruption probe this week.

Tajikistan’s anti-corruption agency, headed by Mr Rakhmon’s son, Rustam Emomali, said the company had finally paid off a 13.4m somoni ($1.7m) penalty for environmental damage owed since last year. He said that two of Zijin Mining’s managers had tried to dodge the payment by allegedly forging official documents. The two managers are now under investigation.

Zijin Mining bought a 75% stake in Zarafshan from Britain’s Common- wealth and British Minerals in 2007. Zarafshan is Tajikistan’s biggest gold mine.

The majority of the largest gold mining projects in Tajikistan are part- owned by Chinese companies. Tajikistan is looking to gold production, with Chinese help, and electricity exports to boost its GDP.

ENDS

(News report from Issue No. 284, published on June 10 2016)

China to invest in Georgian healthcare

JUNE 3 2016 (The Conway Bulletin) — The Chinese government said it will inject a $9m investment into the Georgian healthcare system, which will improve medical infrastructure in two peripheral regions. China’s vice-PM Zhang Gaoli said the investment is part of the country’s Silk Road strategy. In 2014, the Chinese government invested $4m in a similar programme.

ENDS

(News report from Issue No. 284, published on June 10 2016)

Expobank buys Kazakh RBS

JUNE 8 2016 (The Conway Bulletin) — Russian lender Expobank, owned by Igor Kim, agreed to buy the Kazakhstan-based subsidiary of Britain’s Royal Bank of Scotland. Earlier this year, Mr Kim bought RBS’s Russian subsidiary. Orifzhan Shadiyev, owner of Capital Bank Kazakhstan, had, in March 2015, expressed an interest in buying RBS Kazakhstan although the deal later fell through.

ENDS

(News report from Issue No. 284, published on June 10 2016)

Turkmen dissidents fly out

JUNE 4 2016 (The Conway Bulletin) — Under pressure from international human rights groups, the Turkmen government lifted a 13 year travel ban on the family of an exiled dissident. Human rights Watch said the daughter of ex-MP Pirkuli Tanrykuliev, Ayjemal Rejepova, was able to fly out of Turkmenistan. The Norway-based Mr Tanrykuliev had been a vocal government critic.

ENDS

(News report from Issue No. 284, published on June 10 2016)

UN criticises Kazakh labour law

JUNE 8 2016 (The Conway Bulletin) — The UN’s International Labour Organisation said that Kazakhstan has made little progress in implementing international standards in its labour legislation. In particular, the committee urged the government to amend the 2014 law on trade unions and the 2015 law on the chamber of entrepreneurs, which restrict workers’ freedom and independence.

ENDS

(News report from Issue No. 284, published on June 10 2016)

Armenian and Azerbaijani Presidents to meet again

JUNE 9 2016 (The Conway Bulletin) — The presidents of Armenia, Azerbaijan and Russia will meet in St. Petersburg later in June for a tripartite negotiation on the Nagorno-Karabakh conflict, a source in the Russian foreign ministry told local media. Azerbaijan’s Ilham Aliyev and Armenia’s Serzh Sargsyan met in Vienna in May and agreed to maintain the ceasefire over the disputed Nagorno-Karabakh region where clashes erupted at the beginning of April.

ENDS

(News report from Issue No. 284, published on June 10 2016)

Georgian football team beats Spain

JUNE 8 2016 (The Conway Bulletin) — Just days ahead of the 2016 UEFA European Championship, the Georgian football team beat reigning champions Spain 1-0 in a friendly match in Getafe, near Madrid. In its 26-year history, the Georgian football team has never qualified for the top European tournament. The victory against Spain is the country’s highest achievement in football.

ENDS

(News report from Issue No. 284, published on June 10 2016)

Editorial: Attacks in Aktobe

JUNE 10 2016 (The Conway Bulletin) – Kazakh officials have been quick to blame Islamic militants for a series of attacks in Aktobe, northwest Kazakhstan, that killed at least 25 people.

This, if proved, would be alarming as it would confirm links in west Kazakhstan with Islamic militants in both the North Caucasus and Syria/Iraq. The Islamic militant explanation, though, would also help President Nursultan Nazarbayev’s narrative. He made it clear that if the Kazakh population didn’t support him they would be faced with a dystopian future.

And this version of events, of course, could be accurate, time will tell. But no group has taken responsibility and there is an alternative explanation.

Some analysts have said that the attacks were organised by disgruntled members of the Kazakh elite. Mr Nazarbayev, 75, is looking weak. He hasn’t organised a clear succession and is presiding over a worsening economy. By destabilising the country, a rival would be piling on the pressure.

This is the alternative explanation for the Aktobe attacks that the gov- ernment doesn’t want discussed.

ENDS

(Editorial from Issue No. 284, published on June 10 2016)

Business comment: Banking mergers

JUNE 10 2016 (The Conway Bulletin) — A wave of mergers, acquisitions and privatisations has hit Central Asia and the South Caucasus.

At The Bulletin, we’ve extensively covered the Kazkommertsbank buyout over the past two years. But elsewhere, from Azerbaijan to Uzbekistan, the banking sector is in a restructuring phase.

A renovation of the financial sector had become crucial after an extended economic downturn hit the money markets, from currency exchange rates to loan sustainability. What’s more, low oil prices, besides depressing budget capacity and economic growth, have hindered investment and project financing.

From small local lenders to country-wide behemoths, banks across Central Asia and the South Caucasus have equally suffered, albeit for different reasons.

And since the beginning of 2016, small quakes have shaken the sector.

In Azerbaijan, immediately after the sharp depreciation of the manat, middle and small-sized banks were unable to maintain the newly set capital ratio requirements, triggering failures and mergers.

This week a rather obscure deal involving an Uzbek bank and a German plastics manufacturer marked the beginning of the new privatisation era in Uzbekistan.

And of course, across the border in Tajikistan, we are now three weeks into the care-taking administration of the country’s second-largest bank.

This is both a stress test and an opportunity. 25-year-old countries cannot afford to have a banking crisis every decade. Dependent as they are on commodity prices and regional trade, they need to seize this occasion to build more reliable and stable foundations for their finance sector.

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(News report from Issue No. 284, published on June 10 2016)