OCT. 13 2015 (The Conway Bulletin) – Azerbaijan is considering following Kazakhstan and allowing its manat currency to float free, the head of the Central Bank Elman Rustamov said to media, effectively warning of a another devaluation. Azerbaijan devalued its currency by 33% in February but has still had to spend billions defending its value since then.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 253, published on Oct.16 2015)
OCT. 15 2015 (The Conway Bulletin) – A bill under review by Kazakhstan’s parliament threatens the independence of NGOs in the country, the UN said. The bill is being likened to a law in Russia which cut NGOs’ ability to receive funding from overseas. If the law is passed, the Kazakh government will control funding to all civil society groups.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 253, published on Oct.16 2015)
OCT. 6 2015 (The Conway Bulletin) — KazTransGas, Kazakhstan’s state owned gas distributor, warned Georgia it might take their dispute over its subsidiary to international arbitration if Georgia failed to restart negotiations. KazTransGas is looking for compensation for the $130m it spent on its subsidiary KazTransGas-Tbilisi in 2006-09 before the Georgian government took control of the company.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 251, published on Oct. 9 2015)
OCT. 7 2015 (The Conway Bulletin) – Human Rights activists in Kazakhstan have asked President Nursultan Nazarbayev to veto a bill being reviewed by the Senate which will make it harder for domestic NGOs to receive funding from overseas. Campaigners said the bill is a form of state control over NGOs.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 251, published on Oct. 9 2015)
OCT. 9 2015 (The Conway Bulletin) — The biggest mover in the stock markets for Central Asia and the South Caucasus was London-listed KAZ Minerals, which gained a staggering 65% since the beginning of October at 145p on Friday. Its performance was in line with most commodity producers which were hit by the Glencore slump last week.
Kazakhstan-focused Nostrum Oil & Gas was stable this week at around 524 pence, after rebounding from a sharp drop last week. Its failed takeover offer for Tethys Petroleum affected its performance in the market.
Polyus Gold continued its roller- coaster to end the week at 198 pence. Polyus has shown a volatility of +/- 3% over the past three weeks.
In local markets, KEGOC, Kazakhstan’s state-owned electricity company became one of the strongest players in KASE, gaining over 25% in the past three weeks. However, because its stocks are denominated in tenge, the value of its assets has not fared as well as it seems. Speculative moves behind the multi-million dollar transactions of the past weeks have turned KEGOC into an appealing investment in a market marred with worsening assets.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 251, published on Oct. 9 2015)
OCT. 7 2015, TBILISI (The Conway Bulletin) — The Hague based International Criminal Court (ICC) said that it wanted to start investigating alleged war crimes committed during a 2008 conflict between Georgia and Russia.
One of the ICC’s prosecutors, Fatou Bensouda, has lodged a potential case with the court and is waiting for authorisation on whether to launch an official investigation. If a full investigation is initiated and charges brought against either Russian or Georgian officials, the case will likely worsen relations between the two neighbours.
“On the basis of the information available, Prosecutor Bensouda has concluded that there is a reasonable basis to believe that crimes within the jurisdiction of the Court have been committed in Georgia in the context of the armed conflict of August 2008,” the ICC said in a statement.
“She will shortly submit a request to the Pre-Trial Chamber for authorisation to open an investigation into this Situation.”
During the five day war in August 2008 that focused on the Georgian rebel region of South Ossetia, human rights groups alleged that both sides fired cluster bombs.
They also said that forces linked to Russia had burned houses belonging to Georgian farmers.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 251, published on Oct. 9 2015)
OCT. 7 2015 (The Conway Bulletin) — Scotland-based Wood Group won a service contract to supply an automated system for crude storage facilities at the Tengiz oil field in Western Kazakhstan. It said the automated system would increase storage capacity. Bechtel, a US-based engineering company, signed the multimillion dollar deal with Wood Group.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 251, published on Oct. 9 2015)
OCT. 7 2015, ALMATY (The Conway Bulletin) — A Kazakh government bail-out for hundreds of thousands of savers who hold tenge denominated deposits hit by a currency devaluation in August could cost the state around $420m, according to the Bulletin’s calculations.
The bail-out adds to the lengthening bill that the Kazakh state is having to foot to weather a worsening economic storm that has hit the Central Asia and South Caucasus region.
It has spent billions of dollars propping up its currency and also said that it will give handouts and tax breaks to key industries heavily effected by the economic downturn such as car-makers and smaller oil producers.
And in an effort to shore up support immediately after the devaluation on Aug. 20, President Nursultan Nazarbayev said savers would be compensated for losses incurred when the Central Bank ditched the tenge’s peg to the US dollar and allowed it to drop heavily.
Now, at a press conference in Almaty, Alexander Trentyev, director of the consumer protection department at the Central Bank, for the first time hinted at the bill that the government was facing.
“The compensation will cover the period August 18 2015 to September 30 2016. Over 1.7m accounts totalling around 250b tenge are eligible for the government aid,” media quoted him as saying.
The tenge is currently trading at around 275/$1, a drop of around 46% from its value of 188/$1 just before the devaluation on Aug. 20. This means that the 250b tenge in bank deposits will convert to 365b tenge and cost the government $420m in compensation. Of course, though, as analysts have said, the tenge could well drop further in value before Sept. 30.
But there is a flip-side for savers. Their accounts will be frozen for 13 months until Sept. 30 2016.
This measure appears to have been adopted to prevent customers from rushing to withdraw their savings and turning them into US dollars after they received compensation.
It will also keep a high level of tenge in the currency markets, a policy the Central Bank has said that it favours.
What the authorities are desperate to avoid during this period of economic turbulence is civil unrest. The bail-out of savers appears designed to ward this off.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 251, published on Oct. 9 2015)
OCT. 3 2015 (The Conway Bulletin) – The IMF said that rising inflation in Azerbaijan was a growing risk and the Central Bank said that its currency reserves had fallen to their lowest level for nearly four years, more data that points to a worsening outlook for the Azerbaijani economy.
In its World Economic Outlook, the IMF said that inflation would measure 5% this year in Azerbaijan, a reflection of the pressure prices have been under since February when the Central Bank devalued its manat currency by 33%.
And so are the Central Bank’s declining currency reserves.
These have fallen to just over $7b at the end of September from $7.3b in August, its lowest level since November 2011 when it was recovering from the 2008/9 Global Financial Crisis.
It’s been a steep, fast fall. At the end of 2014, Azerbaijan’s currency reserves were nearly double at $13.7b.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 251, published on Oct. 9 2015)
OCT. 7 2015 (The Conway Bulletin) – Armenia’s Metsamor nuclear power plant will shut down in two stages in 2017-2018 as part of a planned modernisation of the plant, the Armenian government said. The ministry of energy had planned one 6- month long closure in 2017, but pressure on electricity prices have forced the government to split the period into two phases.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 251, published on Oct. 9 2015)