Tag Archives: Azerbaijan

Azerbaijan wants to change name of F1 race

OCT. 4 2016 (The Conway Bulletin) – The management of Azerbaijan’s Formula One city circuit said they want to change the name of Baku’s grand prix race. Formula One held its first race in Azerbaijan in June, under the European Grand Prix moniker which has previously been assigned to races not fixed to specific geographic area. Azerbaijan, which sees sport as a way of promoting its brand, wants to rename the race as the Azerbaijani Grand Prix, in the style of most of the other races.

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(News report from Issue No. 299, published on Oct. 7 2016)

Azerbaijan to initiate ties with the EU

SEPT. 30 2016 (The Conway Bulletin) – Azerbaijan’s parliament voted to initiate a rapprochement with the EU, after relations were downgraded last year after the EU criticised Azerbaijan’s human rights record. The resolution follows an official visit by delegates from the EU parliament to Baku earlier in September. Azerbaijan quit the Euronest Parliamentary Assembly in Sept. 2015, after a row with the EU and the OSCE over restrictions on parliamentary election observers.

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(News report from Issue No. 299, published on Oct. 7 2016)

Azerbaijan signs missile deal with Russia

OCT. 1 2016 (The Conway Bulletin) – Azerbaijan and Russia agreed to jointly produce tactical air-to-air and surface-to-air missiles, according to the AzeriDefense magazine. Representatives of KTRV, Russia’s Tactical Missiles Corporation, and Sharg, owned by Azerbaijan’s ministry of defence, signed the deal in Baku. Azerbaijan has been spending heavily on its weapon system in the last few years.

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(News report from Issue No. 299, published on Oct. 7 2016)

Comment: Regional economies begin to steady, writes Sorbello

OCT. 7 2016 (The Conway Bulletin) — Central Banks across Central Asia and the South Caucasus seem to have switched off their crisis mode, as inflation slows, oil prices pick up and remittances begin to regenerate.

Excited about the imminent re-start of the Kashagan offshore oil project, Kazakhstan is looking stronger, after months of uncertainty regarding its currency and its budget stability.

An important sign of the country’s recovering health was the rate cut by Kazakhstan’s Central Bank this week, which said that with inflation back into the 6 – 8% band that it was targeting and that monetary policy could be eased.

This decision has been in the Central Banker’s thinking over the past few weeks. That much is clear. Daniyar Akishev has been showing, for the first time, a more confident and determined tone.

And countries less impacted by oil prices, from Armenia to Kyrgyzstan, have also tried to boost their rather slow economic activity by lowering or keeping low interest rates in the past weeks.

All currencies from the region have been hit by a stronger US dollar over the past two years, and their depreciation led inevitably to a sharp increase in consumer prices.

Some — such as Azerbaijan, Kazakhstan, Kyrgyzstan and Georgia — needed strong monetary interventions. Others, such as Tajikistan, Armenia and Uzbekistan stabilised at a comparatively faster pace.

Last month, Russia’s Central Bank said migrant worker remittances to Kyrgyzstan had increased by 21%, reflecting a higher migration rate. On the other hand remittances to Tajikistan and Uzbekistan fell because of a drop in the number of migrants. Perhaps this is the Eurasian Economic Union effect?

Kyrgyzstan and Tajikistan are among the top remittance-dependent countries in the world.

As the ship seems steadier, however, countries across the region will have to cope with more domestic problems, chiefly in the banking sector and other private sectors hit hard by the economic downturn.

As shown this week with the bankruptcy of Bank Standard, Azerbaijan’s financial sector doesn’t seem to have fully recovered from the crisis. And in western Kazakhstan, where oil is the job creator, a month-long strike just ended with the workers obtaining higher salaries and the company winning state tenders. There is still work to do.

By Paolo Sorbello, Deputy editor, The Conway Bulletin

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(News report from Issue No. 299, published on Oct. 7 2016)

Azerbaijan to invest in Bulgarian gas storage

SEPT. 30 2016 (The Conway Bulletin) – Azerbaijan’s state-owned energy company SOCAR could soon enter the Bulgarian gas storage market, a potential bridgehead for its plans to construct a pipeline that will pump gas from the Caspian Sea to European consumers.

Bulgarian officials said that SOCAR has expressed interest in participating in the expansion of the Chiren storage facility. The government plans a €200m investment to double its capacity to 1b cubic metres. The underground gas storage facility at Chiren links up with Bulgaria’s network, making it a potentially valuable asset for SOCAR, which agreed to send 1b cubic metres of gas to Bulgaria by 2020. Azerbaijan wants to pump gas to

Europe via the so-called Southern Gas Corridor, a network of pipelines from Azerbaijan through Turkey, Greece and Albania to Italy.

Bulgaria hopes to receive Azerba- ijani gas through the construction of the Interconnector Greece-Bulgaria which will feed off the TANAP pipe- line that will form the backbone of the Southern Gas Corridor stretching from Azerbaijan to Italy.

Azerbaijan views Europe as an important next client for its gas.

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(News report from Issue No. 299, published on Oct. 7 2016)

Azerbaijan’s Parliament passes TANAP

SEPT. 30 2016 (The Conway Bulletin) – Azerbaijan’s parliament approved a deal to build the TANAP pipeline across Turkey, a long-overdue step in the development of the project to pump gas from the Caspian Sea to Europe. An initial agreement on TANAP, a $10b gas pipeline, was signed in May 2014.

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(News report from Issue No. 299, published on Oct. 7 2016)

EBRD threatens pipeline funds if Azerbaijan fails to improve transparency

SEPT. 27 2016 (The Conway Bulletin) – The EBRD said it may withhold funds for a pipeline linking gas fields in the Caspian Sea to consumers in Europe until Azerbaijan agreed to provide more transparency into its state linked energy companies.

Taking a tough stance, the EBRD, a London-based intra-governmental bank set up during the collapse of the Soviet Union to fund business and infrastructure projects, said unless Azerbaijan complied with the Extrac- tive Industry Transparency Initiative (EITI), it would withhold $1.5b ear- marked for the TANAP pipeline.

The EBRD’s stance casts fresh doubts over the Azerbaijani leadership’s commitment to transparency into its business dealings.

Riccardo Puliti, the EBRD’s managing director for energy, said that EITI, considered a global benchmark for transparency in the extractive sectors, would consider whether Azerbaijan had made progress at its next meeting in Kazakhstan in October.

“In the case of TANAP, it is important that this progress takes place. If there is no progress it will be quite difficult to justify a large amount of financing,” he told Turkish media.

Last year, the EITI downgraded Azerbaijan from ‘compliant’ to ‘candidate’ country and criticised it for a lack of transparency.

TANAP will link Azerbaijan’s pipe- line network to Greece via Turkey, forming part of the Southern Gas Corridor. SOCAR, Azerbaijan’s state- owned energy company, owns a 58% stake in TANAP, Turkey’s Botas (30%) and BP (12%) own the rest. TANAP will link with TAP which will pump the gas to Italy.

Azerbaijan has yet to react to the EBRD’s statement.

Aliya Tskhay, a researcher focus- ing on Azerbaijan at the University of St Andrews said that the EBRD may have been trying to encourage Azerbaijan to engage more closely with the EITI.

“The EBRD request seems to be an encouragement for Azerbaijan’s government to still be part of the EITI, despite a status downgrade last year,” she said.

TANAP will cost $10b to build, while TAP has a price tag of around $5b.

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

Azerbaijan’s SOCAR postbones DESFA deal

SEPT. 27 2016 (The Conway Bulletin) – SOCAR, Azerbaijan’s state-owned energy company, postponed by one month the deadline for its purchase of a 66% stake in Greek gas distributor DESFA. The purchase guarantee, by which SOCAR would have to buy 49% of DESFA if it finds a partner to buy a 17% stake, was due to expire at the end of September. The EU froze the €400m ($446m) deal, signed in 2013, due to regulations on market competition.

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

ADB forecasts Azerbaijan’s GDP

SEPT. 27 2016 (The Conway Bulletin) – The Asian Development Bank (ADB) said that Azerbaijan’s economy will contract by 2.5% this year. Earlier this year, the ADB had forecast a 1% contraction. The Bank said Azerbaijan’s GDP will resume growth in 2017, when it will increase by 1%.

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

Azerbaijans SOFAZ reduces government funds

SEPT. 29 2016 (The Conway Bulletin) – SOFAZ, Azerbaijan’s sovereign oil fund, said it would reduce by 20% its transfers to the state budget, in an effort to balance the country’s economy. In 2017, SOFAZ plans to give the government 6.1b manat ($3.8b). This year, SOFAZ forecast a total of 7.5b manat ($4.6b). As of July 1, SOFAZ holds $35.1b in assets and reserves.

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