Tag Archives: aluminium

China eyes up $545m investment into Tajikistan’s Talco

Tajik aluminium smelter and Rusal near deal

FEB. 16/17 2017 (The Conway Bulletin) — Talco, the Tajik aluminium smelter owned through a series of offshore companies by the family of President Emomali Rakhmon, has struck a deal to end a long-running dispute with Russia’s Rusal, both Eurasianet and RFE/RL reported.

A court in 2014 ruled against Talco, in a ruling that focused on a breach of contract a decade earlier, meaning that it needed to pay Rusal up to $375m.

Now, Eurasianet and RFE/RL reported, Talco will pay Rusal the full amount it has been fined plus an extra sum for control of the Hyatt hotel and a business centre in Dushanbe, which Rusal had owned.

The deal appears to allow both sides to save face and also for Rusal to quit Tajikistan.

ENDS

(News report from Issue No. 317, published on Feb.17 2017)

Tajikistan’s TALCO told to cut production

SEPT. 27 2016 (The Conway Bulletin) – TALCO, Tajikistan’s aluminium smelter and the country’s biggest industrial asset, should cut output to survive because aluminium prices have fallen below production costs, the company auditors said.

Tajikistan’s government has repeatedly intervened to give TALCO incentives and preferential loans but has not been able to prevent thousands of job losses.

Now production cuts are likely.

“This year, a significant decrease in the level of world prices for aluminium has impacted TALCO’s earnings. The company auditors have suggested that the management orders a cut in production in order to keep financial losses at a minimum,” TALCO said in a statement.

TALCO produced over 73,000 tonnes of aluminium in the first half of 2016, a 13.5% increase compared to the same period last year. It exports to clients in Turkey, Taiwan, Iran, British Virgin Islands, Uzbekistan and Pakistan.

Low commodity prices, though, meant it sold aluminium at a price range of $1,400-$1,600/tonne. Production costs have reached $2,000/tonne. In April, it laid off around 600 workers to cut costs.

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(News report from Issue No. 298, published on Sept. 30 2016)

Tajikistan’s TALCO makes Glencore deal

APRIL 21 2016 (The Conway Bulletin) – TALCO, Tajikistan’s aluminium smelter, said it agreed to supply 200,000 tonnes of aluminium per year to Glencore, a Swiss-based commodities trader. This is an increase of almost 23% compared to the previous deal which expires later this year. TALCO also said it increased its aluminium production by 17% in the first quarter of 2016, compared to the same period last year.

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(News report from Issue No. 277, published on April 22 2016)

Norway parliament challenges Tajikistan’s TALCO to reveal its true owner

MARCH 6 2016 (The Conway Bulletin) – A parliamentary committee in Norway opened an investigation into alleged corruption by state-owned aluminium producer Norsk Hydro in Tajikistan, the second probe in the last six months into bribery against a Norwegian government-owned company working in Central Asia and the South Caucasus.

Specifically, the Norwegian parliament now wants to see Hydro’s contract with Tajikistan’s state-owned aluminium plant TALCO. It challenged the notoriously secretive TALCO, the biggest industrial asset in Tajikistan, to reveal who its true beneficial owners are. Many believe that, via a network of offshore companies, it is Tajik President Emomali Rakhmon and his family.

Media quoted Jette Christensen, MP and a member of the committee, as saying: “We and the minister must find out who are the hidden owners, therefore this is an order to both Hydro and the minister. We also believe that we must see the entire contract Hydro had with TALCO Management Ltd.”

TALCO Management Ltd., the shell company for TALCO, is registered in the British Virgin Islands and is seen by many observers as a safe haven for corrupt practices.

Norwegian newspaper Dagens Naeringsliv wrote an in-depth story about the Hydro-TALCO case in mid- February, an article that appears to have triggered parliament’s renewed interest deals between the two companies between 1993 and 2003.

Hydro have denied the allegations and sent a 17-page reply to parliament. “There are no indications of Hydro having acted in violation of applicable laws, internal rules or guidelines,” Dag Mejdell, Hydro’s chairman, said in the statement.

“The company has zero tolerance towards corruption.”

The Norwegian government owns a 34.3% stake in Norsk Hydro.

In November 2015, Norway’s minister of industry sacked Svein Aaser, chairman of Telenor, a telecoms company under investigation for corruption in Uzbekistan in 2007/8 linked to payments for 3G licences. The investigation is ongoing.

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(News report from Issue No. 271, published on March 11 2016)

ArcelorMittal cancels second pay rise for Kazakh workers

ALMATY, FEB. 1 2016 (The Conway Bulletin) — ArcelorMittal’s steel factory in Kazakhstan scrapped plans to raise workers’ salaries in June because of worries about continued weak market conditions for its products.

In January, ArcelorMittal increased salaries for its 14,000 workers at its steel plant in Temirtau, central Kazakhstan, by 6.8% and had promised another pay rise of 6.8% six months later, but in a letter to employees Vijay Mahadevan, the factory’s CEO, said that this was not now going to happen.

“Unfortunately, we have not fulfilled our plans for 2015, and therefore will not be able to pay the remainder of the wage increase this year,” he said.

“I know that this news will disappoint you, but no-one would benefit from a salary increase which will only put additional pressure on our company.”

A 50% drop in the value of the tenge and rise in inflation has hit workers’ real wages in Kazakhstan and forced many employers to raise salaries.

ArcelorMittal Temirtau is one of the biggest employers in Kazakhstan. It has had, though, tempestuous relations with its workers over salaries in the past few years and had to make thousands of staff redundant. The factory has added symbolic importance as President Nursultan Nazarbayev worked there before moving into politics.

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(News report from Issue No. 266, published on Feb. 5 2016)

Tajikistan reports on transparency in mining sector

OCT. 30 2015 (The Conway Bulletin) – The Extractive Industries Transparency Initiative (EITI), an intergovernmental organisation set up to improve transparency in mining and oil sectors, published its first report on Tajikistan which the authors said shone some light on the murky Tajik extractive sector.

Anti-corruption lobby groups have previously criticised the Tajik government for siphoning off cash from its metals sector and while the report was considered a step forward for transparency in Tajikistan, there were still many blank spots.

And the authors of the report made this clear.

“Three of the 14 companies in the EITI Report are partially state owned. Considerable details related to these companies are missing from the report due to the currently weak government systems for recording all company payments,” they wrote in the EITI report.

Tajikistan had been supposed to present its first report to the EITI in February, a deadline it missed.

A presentation on the report will be made in Dushanbe on Nov. 25.

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(News report from Issue No. 255, published on Nov. 6 2015)

Top TALCO manager sacked

FEB. 13 2015 (The Conway Bulletin) — Tajikistan’s president Emomali Rakhmon sacked the managing-director at TALCO, the company that runs its aluminium smelter, media reported. No official reason was given for sacking Sadriddin Sharipov from TALCO which generates around 70% of Tajikistan’s foreign earnings.

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(News report from Issue No. 219, published on Feb. 18 2015)

Tajik state-firms’ debt deepens

JULY 29 2014 (The Conway Bulletin) – Tajikistan’s national energy company Barqi Tojik has blamed another massive state-run concern, the aluminium smelter TALCO, for part of its growing $300m debt.

Over a third of Barqi Tojik’s debts are owed to a pair of hydroelectric power facilities, which TALCO officially co-owns with Russia and Iran. Other debts are unpaid taxes to the state, salary arrears, and unpaid loans.

In an interview with Asia-Plus, a Barqi Tojik official said TALCO owed the company $50 million in unpaid energy bills. TALCO, which as reported is itself suffering from a major slump in demand for its products, has denied the allegations.

Barqi Tojik and TALCO are two of Tajikistan’s most significant state-owned companies and both appear to be in trouble.

Barqi Tojik’s debts have grown as public sector clients like TALCO (which alone consumes at least a sixth of national energy production) and other major industrial facilities renege on payments. TALCO reportedly haemorrhaged $40m last year and laid off a fifth of its workforce. The company has suffered from low prices for aluminium and alleged corruption within the political elite. Tajikistan’s economy looks increasing fragile.

ENDS

(News report from Issue No. 193, published on July 30 2014)

Terrorists threaten Tajik smelter TALCO

APRIL 9 2014 (The Conway Bulletin) — Security forces in Tajikistan said they had prevented a terrorist attack on TALCO, the aluminium smelter that forms the backbone of Tajikistan’s economy, media reported. According to a Tajik government spokesman, criminals had planned to detonate bombs at the plant.

(News report from Issue No. 180, published on April 16 2014)