Tag Archives: business

Arbitration is damaging our reputation, says Kazakhstan’s Dariga Nazarbayeva

JUNE 16 2021 (The Bulletin) — Dariga Nazarbayeva, daughter of former Kazakh President Nursultan Nazarbayev and an MP, said that Kazakhstan had to avoid getting dragged into international arbitration proceedings as they were damaging the country’s reputation as a place to do business. She specifically mentioned the long-running arbitration between Kazakhstan and Moldovan Anatoli Stati over an oil field which he says was illegally expropriated.

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— This story was published in issue 48 of the Central Asia & South Caucasus Bulletin, on June 16 2021

— Copyright the Central Asia & South Caucasus Bulletin 2021

Interview: Gold-plated resiliance in a tough year

>> Artem Volynets, the CEO of AIM-listed Chaarat Gold, had to deal wtih war and a coup in 2020, on top of the global pandemic.

JUNE 16 2021 (The Bulletin) — A global pandemic meant a tough 2020 for most people but for Artem Volynets, the CEO of AIM-listed gold miner Chaarat Gold, it was just one issue that he had to deal with. He also had to navigate a war and a coup.

“Yes, it was a complicated time,” he told The Bulletin over lunch in central London, flashing a pearl-white, relaxed, smile. 

“But in many ways it made us stronger as a company.”

Chaarat Gold is the owner of the Kapan gold mine in southeast Armenia and two gold concessions in Kyrgyzstan, Tulkubash and Kyzyltash. In 2020, Armenia lost a war to Azerbaijan for the disputed region of Nagorno-Karabakh and in Kyrgyzstan, a coup in October overthrew the government.

Volynets said that a third of his 1,000-person workforce at the Soviet-era Kapan gold mine was called up for active duty.

“Even so, if anything our reputation in the region was strengthened by the war,” he said. “We were the ones paying the taxes, keeping production going and jobs open.”

Chaarat Gold bought the Kapan mine from Russia’s Polymetal in 2019 for $55m, a deal that Volynets said had proved to be good value. 

He dodged discussing criticism of Armenian PM Nikol Pashinyan for allegedly dragging his feet over clearing protesters who have blocked access to another foreign-owned gold mine at Amulsar, but he was keen to discuss the expropriation in Kyrgyzstan of the Kumtor gold mine, the biggest in the country, from its Toronto-based owners, Centerra Gold.

Western investors in Bishkek have now described Kyrgyzstan as an “investment pariah” but Volynets was more circumspect.

“It’s very much an isolated incident that has to do with one particular foreign investor and one particular project,” he said. “We have been assured that we have no problems.”

Still, the noise around the expropriation of Kumtor has made life more difficult for Volynets and Chaarat Gold. Last month it said that raising finance for its Tulkubash project had slowed and that its first gold production was now delayed by a year to the second half of 2023.

In 2018, Chaarat Gold had offered to buy Kumtor, but Centerra Gold had turned down the offer.

“We’re not interested in it any more but we are still looking around at other FSU projects,” Volynets said.

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— This story was published in issue 48 of the Central Asia & South Caucasus Bulletin, on June 16 2021

— Copyright the Central Asia & South Caucasus Bulletin 2021

Uzbekistan works on reform of electricity market

JUNE 16 2021 (The Bulletin) — Private companies will be able to sell electricity by the hour in Uzbekistan from 2025, the Uzbek government said in a decree, the latest move to alleviate a shortage of power production in the country. The reforms are planned in three stages and should give consumers more choice. Pres. Shavkat Mirziyoyev has promised various liberal reforms since he came to power in 2016.

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— This story was published in issue 48 of the Central Asia & South Caucasus Bulletin, on June 16 2021

— Copyright the Central Asia & South Caucasus Bulletin 2021

Tokayev talks up Kaspi.kz

JUNE 14 2021 (The Bulletin) — Highlighting the importance of London-listed Kaspi.kz as a champion of Kazakh business in the West, Kazakhstan’s President Kassym-Jomart Tokayev said that it was a role model for the future of the country’s fintech sector.. Kaspi’s banking app has been a success in pulling in millions of users in Kazakhstan. On the London Stock Exchange its share price has doubled since it listed in October.

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— This story was published in issue 48 of the Central Asia & South Caucasus Bulletin, on June 16 2021

— Copyright the Central Asia & South Caucasus Bulletin 2021

Transcaucasian trekking trail opens in Armenia

YEREVAN/JUNE 14 2021 (The Bulletin) — The 832km Armenia section of the Transcaucasian Trail (TCT) officially opened, a hiking route that its founders hope will boost tourism and interest in the Armenian countryside.

The route runs north to south and, according to its founders, rewards hikers with beautiful views over Armenia’s rugged landscape which is dotted with monasteries.

“This marks the first country section in the international TCT. The Armenia trail will connect to Georgia, eventually taking hikers all the way to the Greater Caucasus,” Meagan Neal, one of the founders wrote in a blog post. “The Armenia route is part ancient trails, part newly built trails, part Soviet jeep tracks, and part open terrain.”

The Georgia section is, according to the TCT website, coming along, while work on the Azerbaijan section has barely started. Tourism makes up a far smaller part of Armenia’s economy compared to Georgia. 

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— This story was published in issue 48 of the Central Asia & South Caucasus Bulletin, on June 16 2021

— Copyright the Central Asia & South Caucasus Bulletin 2021

Swede charged with paying massive bribe to Azerbaijani railway exec

JUNE 13 2021 (The Bulletin) — Prosecutors in Sweden charged Thomas Bimer, a former executive at engineering firm Bombardier, of corruption linked to a $350m signalling project that the company won in Azerbaijan in 2013. According to press reports, Mr Bimer was part of a scheme to pay a $100m bribe to a mid-ranking official at Azerbaijani Railways for the contract. Mr Bimer and Bombardier deny any wrongdoing.

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— This story was published in issue 48 of the Central Asia & South Caucasus Bulletin, on June 16 2021

— Copyright the Central Asia & South Caucasus Bulletin 2021

Uzbekneftegaz to launch gas-to-liquid plant this year

JUNE 11 2021 (The Bulletin) — Uzbekneftegaz said that it would launch its first gas-to-liquids plant in Q4 2021. Opening the plant in the south of the country will reduce Uzbekistan’s reliance on imports of diesel and jet fuel. Uzbekneftegaz has been building the $3.6b plant since 2019. It was supposed to start operations in 2020 but the coronavirus pandemic and strikes over pay and conditions have delayed the construction.

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— This story was published in issue 48 of the Central Asia & South Caucasus Bulletin, on June 16 2021

— Copyright the Central Asia & South Caucasus Bulletin 2021

Georgian flour mill workers call off strike

JUNE 10 2021 (The Bulletin) — Workers at the Gulistani flour-milling plant in western Georgia have ended their 38-day strike after agreeing terms with management, said Georgia’s Trade Union of Agriculture and Industry. The trade union didn’t give any details of the terms and conditions reached. Georgia has been hit by a wave of industrial disputes this year.

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— This story was published in issue 48 of the Central Asia & South Caucasus Bulletin, on June 16 2021

— Copyright the Central Asia & South Caucasus Bulletin 2021

Armenia to drop cognac branding on brandy exports

YEREVAN/JUNE 10 2021 (The Bulletin) —  Armenia’s government agreed to stop marketing its premium brandy products to Europe as cognac from 2032, part of a trade deal that it signed with the EU four years ago.

The announcement that Armenia would finally drop using the cognac brand came 10 days after PM Nikol Pashinyan had been in Paris meeting with French President Emmanuel Macron to lockdown France’s support for Armenia over its ongoing border rows with Azerbaijan. 

France, a key ally of Armenia, has been pushing for the cognac title to be used only by brandy produced in its Cognac region. In return for dropping the term cognac, the EU promised to spend 3m euro helping Armenia build up a new brand for its brandy exports to Europe.

The TASS news agency quoted Armenia’s deputy PM Mger Grigoryan as saying that a new brand for Armenian brandy had not yet been decided upon.

“I am not ready to disclose such details so far because major market players have no consensus so far,” He said.

Armenia had appeared to drag its feet over imposing a ban on the cognac branding after signing an Enhanced Partnership Agreement with the EU in 2017 that improves trade relations and enforces European standards. 

EU law protects regional names on European food and drink products, although Armenia will still be able to market its brandy as cognac in Cyrillic on bottles sold to Russia, its main export market. The EU struck a similar deal with Moldova in 2014 when it agreed to drop using the cognac term too. Premium Moldovan brandy is now called Divin.

Brandy is an important part of Armenia’s branding and it is famed across the former Soviet Union. Its most famous producer is the Yerevan Brandy Company which markets its products under the Ararat brand and is owned by France’s Pernod Ricard.

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— This story was published in issue 48 of the Central Asia & South Caucasus Bulletin, on June 16 2021

— Copyright the Central Asia & South Caucasus Bulletin 2021

Georgian PM says he wants new terms on controversial dam

TBILISI/JUNE 9 2021 (The Bulletin) — After months of protests, Georgian PM Irakli Garibashvili said that he wanted to renegotiate the terms that Turkish construction company Enka and Norway’s Clean Energy Group were given to build and run the Namakhavani Hydropower Plant in the Rioni Valley in the west of the country. 

Protesters have said that the project, slated to be Georgia’s biggest hydropower plant, damages the countryside and is too lenient towards the foreign investors. The government has said that the Namakhavani Hydropower Plant is vital for its future energy generation projects as it will boost energy production by 15% and must go ahead.

Protesters have blocked access to the site for the past seven months and staged rallies in both Kutaisi and Tbilisi which have attracted thousands of people. Police have made several arrests at some of the protests in the Rioni Valley after clashes with demonstrators.

Enka Renewables, in which Enka owns a 90% stake and Clean Energy Groups owns a 10% stake, signed an $800m deal to build and run the Namakhavani hydropower plant with Georgia in April 2019. 

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— This story was published in issue 48 of the Central Asia & South Caucasus Bulletin, on June 16 2021

— Copyright the Central Asia & South Caucasus Bulletin 2021