SEPT. 12 2016 (The Conway Bulletin) – The Vatican released a schedule for Pope Francis’ second trip to the South Caucasus. The Pope will spend two days in Georgia, Sept. 30 and Oct. 1, and the following day in Azerbaijan. In June, Pope Francis had visited Armenia.
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(News report from Issue No. 296, published on Sept. 16 2016)
SEPT. 15 2016 (The Conway Bulletin) – SOCAR, Azerbaijan’s state-owned oil company, said it expects oil prices to stabilise at $40/barrel in 2017. Oil prices are crucial for Azerbaijan’s economy as it earns most of its income from oil exports. Earlier this year, after Brent prices fell below $30/barrel, Azerbaijan’s parliament formed its 2016 budget with a $25/barrel forecast.
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(News report from Issue No. 296, published on Sept. 16 2016)
SEPT. 8 2016 (The Conway Bulletin) — Foreign direct investment (FDI) in Georgia in the first half of 2016 grew by 10% compared to the same period last year. In Q2, FDI declined by 3.8% to $445m. Azerbaijan, Britain and the Czech Republic were the three largest investors in Georgia in Q2. FDI in the transport and communications sector made up more than a third of the total inflow.
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(News report from Issue No. 295, published on Sept. 9 2016)
SEPT. 6 2016 (The Conway Bulletin) — A court in Azerbaijani sentence two men to 13 and 14-1/2 years in prison for fighting for the extremist IS group in Syria. Governments in the S.Caucasus have been clamping down on IS recruitment.
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(News report from Issue No. 295, published on Sept. 9 2016)
SEPT. 9 2016 (The Conway Bulletin) — Azerbaijan’s Central Bank raised its key interest rate to 15% from 9.5%, its highest level since 2008, to try to boost confidence in the ailing currency.
The manat has been falling in value for weeks, hitting an all-time low of 1.67/$1 on Friday, setting off fears of another currency crisis. Last year, the Central Bank devalued its currency twice, undermining confidence and wiping out people’s manat-based savings. A series of protests across the country against the worsening economic conditions, almost unprecedented in Azerbaijan, unnerved the Azerbaijani leadership.
The currency had been gaining in value this year until the end of May when it began to slip again. The manat has now lost 11% of its value since May 30.
The day before, the Azerbaijani Central Bank had sold $100m to try to prop up its currency.
Last week, Bloomberg News reported that local banks and exchange bureaus had suspended sales of foreign currencies due to the high demand.
Ratings agency Moody’s said the government should change regulations on capital controls brought in earlier this year.
“The restrictions on foreign-currency sales have led to the emergence of a parallel exchange market, which in our view speaks to the challenges the central bank faces to stem dollar demand and elevates risks of an accelerated depreciation in the official exchange rate,” Moody’s analysts said in a report.
Low oil prices have hit Azerbaijan’s economy hard over the past two years. Azerbaijan ‘s economy is particularly dependent on oil revenues as it generates around 3/4 of its income.
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(News report from Issue No. 295, published on Sept. 9 2016)
SEPT. 7 2016 (The Conway Bulletin) — British oil company BP said it expects flat oil output in Azerbaijan in 2017. BP also expects oil prices to hover around $40- 50/barrel for the next two years. In the first six months of 2016, production at Azeri-Chirag-Guneshli (ACG), Azerbaijan’s biggest oil producing field, production rose to 16m tonnes, 2% higher than in the same period in 2015.
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(News report from Issue No. 295, published on Sept. 9 2016)
SEPT. 2 2016 (The Conway Bulletin) — Banks in Azerbaijan’s capital have stopped selling foreign currency as demand soared after the Azerbaijani manat started to depreciate, triggering memories of the currency’s double devaluation last year.
The news will be disappointing to Central Banks across the Central Asia and South Caucasus region who had hoped to have moved away from the currency crises of 2014 and 2015.
According to sources in Baku, the manat traded at 1.68/$1, 5% lower than last month. They said that many Azerbaijanis now fear that another crisis is around the corner and have tried to hoard foreign currency. Bloomberg reported that 15 banks in Baku and the city’s international airport had stopped selling US dollars, a sign that demand had surpassed availability.
Azerbaijan’s economy is particularly vulnerable to the vagaries of oil prices, which have collapsed since 2014, and it is set to shrink this year for the first time since the mid-1990s.
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(News report from Issue No. 294, published on Sept. 2 2016)
SEPT. 2 2016 (The Conway Bulletin) — Azerbaijan’s state-owned oil company SOCAR shipped 729,000 tonnes of oil through Russia’s pipeline network in Jan.-Aug. 2016, a 22% fall compared to the same period last year. The fall is mostly due to a halt in shipments via the Baku-Novorossyisk pipeline in the Jan.-Feb. 2016, while the countries were negotiating a new deal. Monthly shipments are now back at the same levels as last year.
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(News report from Issue No. 294, published on Sept. 2 2016)
SEPT. 1 2016 (The Conway Bulletin) — Georgian PM Giorgi Kvirikashvili paid an official visit to Azerbaijan to discuss partnership in joint infrastructure projects with President Ilham Aliyev. Mr Kvirikashvili was accompanied by energy minister Kakha Kaladze and deputy foreign minister Gigi Gigiadze. The parties discussed the latest developments in the construction of the Baku-Tbilisi-Kars railway and the Southern Gas Corridor pipeline network.
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(News report from Issue No. 294, published on Sept. 2 2016)
AUG. 19 2016 (The Conway Bulletin) — Azerbaijan has started prosecuting people working in public offices allegedly linked to the exiled Turkish cleric Fethullah Gulen who Turkish president Recep Tayyip Erdogan has accused of orchestrating a coup attempt against him in July, media reported. Azerbaijan is Turkey’s strongest ally in the region.
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(News report from Issue No. 293, published on Aug. 29 2016)