FEB. 20 2015 (The Conway Bulletin) — Kazakhstan and the US have signed an agreement that will smooth law enforcement issues between the two countries, the US State Department said. In particular the deal, which the US State Department described as an “important step forward”, will help the transfer of evidence between the two countries.
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(News report from Issue No. 220, published on Feb. 25 2015)
FEB. 18 2015 (The Conway Bulletin) — Kazakh president Nursultan Nazarbayev ordered work on the Almaty Metro system to stop because of a shortage of funds, media reported. The first phase of Almaty’s metro was unveiled in 2011 but high costs and low passenger numbers have combined with a drop in government funds to delay a planned extension.
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(News report from Issue No. 220, published on Feb. 25 2015)
FEB. 24 2015 (The Conway Bulletin) — Kyrgyzstan’s Central Bank left its key interest rate unchanged at 11% despite inflationary pressure from a devaluing currency and falling remittances from workers based in Russia. In February, Kyrgyzstan’s inflation was measured at 10.9%.
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(News report from Issue No. 220, published on Feb. 25 2015)
FEB. 18 2015 (The Conway Bulletin) — Russia’s military will equip its Kant airbase in Kyrgyzstan with up-to-date fighter-jets, media quoted Colonel Jaroslav Roschupkin, a Russian army spokesman, as saying. Russia has, generally, been looking to beef up its military deployments in Central Asia, especially at the Kant airbase.
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(News report from Issue No. 220, published on Feb. 25 2015)
FEB. 24 2015 (The Conway Bulletin) — Armenia has agreed to allow Iraq Airways to fly a direct flight from Baghdad to Yerevan and also to grant Iraqis visa-free access, Iraqi media reported. If confirmed by Armenia the move will open it up to tourism and business from Iraq. Neighbouring Georgia already hosts thousands of Iraqi businessmen and tourists.
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(News report from Issue No. 220, published on Feb. 25 2015)
FEB. 25 2015 (The Conway Bulletin) — Two major inter-governmental financial organisations — the Asian Development Bank and the International Finance Corporation (IFC) — have issued lari-denominated bonds for the first time.
The IFC, which is part of the World Bank, issued a 30m lari ($13.2m) bond with an initial yield of 6.924% and the Asian Development Bank issued a 100m lari ($44.2m) bond with a floating yield.
The idea behind the issues is to help boost the Georgian capital markets and to support small businesses.
In a statement, Pierre Van Peteghem, treasury of the Asian Development Bank said: “This bond — the largest by a foreign issuer — will provide a key market benchmark and could encourage more borrowers, both domestic and foreign, to tap the Georgian bond market.”
The ADB explained that profit from the bonds would be given to TBC Bank to lend out to small and medium sized enterprises.
And they need all the help they can get at the moment.
Like its neighbours in the South Caucasus, Georgia is struggling to deal with the fallout from the economic turbulence in Russia. Its lari currency is losing value, making lari-denominated bonds a risky investment.
Still, the drive by the IFC and the ADB to sell lari denominated bonds is a boost for the ailing currency. It also shows confidence in its future. It remains to be seen if the market also holds the same confidence in the lari currency.
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(News report from Issue No. 220, published on Feb. 25 2015)
MARCH 19 2015 (The Conway Bulletin) – Forced to look for alternative markets because of sanctions on Russia and war in Ukraine, Uzbekistan has become a major target for Lithuania’s dairy exports.
In December, dairy exports from Lithuania to Uzbekistan recorded a 19-fold increase compared to the same month in 2013, according to Russia’s Soyuzmoloko, a milk industry group.
Uzbekistan now represents over 12% of the Lithuanian dairy export market, becoming a key target for Lithuanian cheese and butter. Only Poland and Italy now import more dairy products from Lithuania.
Soyuzmoloko said there may be an alternative motive for sending products to Uzbekistan.
“Dairy products exported from Lithuania to Uzbekistan are then sent from Uzbekistan to Russia directly or via Kazakhstan, which is part of the Customs Union,” the Soyuzmoloko said in a note on its website.
The reference to the Customs Union is to an old Kremlin-led economic group. It is now called the Eurasian Economic Union.
While relations between Uzbekistan and the EU have been strained over the past few years because of rows over human rights abuses, Uzbekistan–Lithuania bilateral relations have been improving.
Last year, Lithuania’s foreign minister travelled to Tashkent for direct talks with his Uzbek counterpart.
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(News report from Issue No. 224, published on March 25 2015)
FEB. 18 2015 (The Conway Bulletin) — Tajikistan’s cotton exports, an important foreign currency earner, grew by 7% in January compared to a year earlier, local media reported. The increase bucks a trend of falling cotton exports from Tajikistan over the past few years. Extra revenue from the exports though are tempered by a global drop in cotton prices.
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(News report from Issue No. 220, published on Feb. 25 2015
FEB. 22 2015 (The Conway Bulletin) — The opposition Islamic Renaissance Party of Tajikistan accused the government of cracking down on its activities in the build-up to a parliamentary election on March 1. The party’s chairman, Muhiddin Kabiri, told the AFP news agency that the party was facing “total pressure”.
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(News report from Issue No. 220, published on Feb. 25 2015)
FEB. 21 2015 (The Conway Bulletin) — Azerbaijan’s Central Bank slashed the value of its manat currency by a third overnight, a sudden move that took businesses and ordinary Azerbaijanis by surprise.
Previously Azerbaijani officials had said that they would release the manat from its dollar peg, suggesting only a gradual devaluation to adjust to a sharp decline in the Russian rouble.
They have now justified the sudden devaluation by saying that they had little choice but to act in the face of a collapse in oil prices and economic turbulence in Russia.
“This decision was made in order to support diversification of Azerbaijan’s economy, strengthen its international compatibility and export potential as well as to provide balance of payments sustainability,” the Central Bank said in a statement.
On the streets of Azerbaijan’s towns, though, the devaluation was less generously viewed.
Veli, 29, a small business owner in Guba, a northern city, told a Bulletin correspondent that he was in shock.
“I believed the government. I kept my savings in the manat,” he said. “I lost third of my savings. It’s painful. It’s theft by the government.”
He said that he had no choice but to increase the price of the electronic goods he was selling in his shop — fuelling rising inflation.
Sahiba, a mother of two young children living in the city of Gazakh on the western border with Georgia echoed these sentiments. Her husband is a government official but has had his pay cut already this year.
“We’ve got a mortgage,” she said. “I don’t know what we’ll do.”
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(News report from Issue No. 220, published on Feb. 25 2015)