Tag Archives: business

Georgia to use Bitcoin tech for new land registry

TBILISI, APRIL 27 2016, (The Conway Bulletin) — The Georgian government and BitFury, a US company with a base in Tbilisi that develops technology used by the Bitcoin virtual currency, will jointly develop a land registry system which they hope will set new global standards.

The new model for the National Agency of Public Registry will reduce bureaucratic practices and costs for citizens, according to officials.

“By building a blockchain-based property registry, Georgia can show the world that we are a modern, transparent and corruption-free country that can lead the world in changing the way land titling is done,” Georgian media quoted Papuna Ugrekhelidze, the agency’s chairman, as saying.

Blockchain technology is a data- base system that Bitcoin has pioneered. It is considered the most efficient system to log data.

The Agency of Public Registry said the cost of a land registry transactions will drop to virtually zero.

Last September, BitFury said it would invest $100m in a new Technology Park in the Gldani district of Tbilisi. BitFury already operates a data centre in Gori, 70km west of Tbilisi.

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(News report from Issue No. 278, published on April 29 2016)

Kazakhstan’s KMG EP revenues drop

APRIL 28 2016 (The Conway Bulletin) – Kazakhstan’s state-owned energy company KMG EP said its revenues for Q1 2016 were nearly 50% lower in US dollar terms than in Q1 2015, highlighting the impact of the depreciation of the tenge on Kazakh businesses. KMG EP data is a good indicator of the overall health of Kazakhstan’s state owned energy company Kazmunaigas, a main driver of the Kazakh economy.

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(News report from Issue No. 278, published on April 29 2016)

Banking activity drops in Georgia

APRIL 25 2016 (The Conway Bulletin) – Data from Georgia’s Central Bank showed savings held in Georgian banks dropped by 2.4% between February and March. At the end of March, Georgia’s commercial banks held 24.7b lari, a drop of 800m lari. This is the lowest savings level since November last year. The Central Bank is concerned that inflation has slowed. Like the rest of the region, Georgia has been vulnerable to a fall in its lari currency.

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(News report from Issue No. 278, published on April 29 2016)

Business comment: BTC fails to live up to hype

APRIL 29 2016 (The Conway Bulletin) – In the early 2000s, the Baku-Tbilisi- Ceyhan (BTC) oil pipeline was hailed as a key component of the New Silk Road, designed by the West for the West. The dream might now be over.

Western oil producers wanted a pipeline that would pump Caspian oil to world markets without having to pass through Russia.

Everyone in Washington DC was excited. “Happiness is multiple pipelines” was the slogan that could be heard espoused by US diplomats and oil companies. It was even seen on bumper stickers around the US capital.

The 1b barrels/day dream pipeline was inaugurated in 2005 and relied on Azerbaijan’s largest oil fields as well as on Kazakh and Turkmen trans-Caspian shipments.

The decade-long excitement, however, seems to have hit a wall as Kazakh oil shipments have now faded away.

Experts don’t believe shipments will resume anytime soon. Tengizchevroil appears to have let its contract with BTC lapse. Kazakhstan’s Aktau port management has said it doesn’t foresee oil shipments from Tengiz resuming.

At a time of low oil prices and rising extraction prices, cutting expenditure on shipments of oil across the Caspian Sea was the obvious move for Kazakh producers.

Tengiz, and Kashagan whenever it comes online, will use the expanded Caspian Pipeline Consortium for future exports.

This choice will isolate Azerbaijan at a time when it is under the spotlight to become Europe’s new gas provider. The take-home from this story is that corporate interest, in the long run, overrides diplomatic objectives.

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(News report from Issue No. 278, published on April 29 2016)

Stock market: Nostrum Oil & Gas

APRIL 29 2016 (The Conway Bulletin) – Nostrum Oil & Gas shares jumped 6% on Wednesday to 295.25p after the company announced quarterly results, its highest price for over three months.

Investors were happy with the company’s performance although Nostrum said a scheduled maintenance and low oil prices had hindered its performance in Q1 2016.

“It has been a steady start to the first quarter with production broadly in line with expectations taking into account the first part of the annual maintenance,” Kai-Uwe Kessel, Nostrum’s CEO said.

Investors also appreciated Nostrum’s position that cost-cutting remained a top priority.

“We continue to focus on reducing our operating costs internally and I am pleased with the progress we are making,” Mr Kessel said.

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(News report from Issue No. 278, published on April 29 2016)

Kashagan to resume production, says Kazakh energy minister

APRIL 22 2016 (The Conway Bulletin) – Kazakhstan’s energy minister Kanat Bozumbayev said he expects production at the Kashagan offshore field to resume by the end of 2016. Mr Buzumbayev’s statement sounded like a rebuttal to an earlier comment by CNPC, which said it saw Kashagan production resuming in mid-2017.

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(News report from Issue No. 278, published on April 29 2016)

Kazakhstan’s Kazinvest shareholders sell shares

APRIL 26 2016 (The Conway Bulletin) – Kazakhstan’s minister of economy Yerbolat Dossayev and businessmen Yuri Pak and Berik Kaniyev sold their shares in Kazinvestbank, a mid-ranking bank in Kazakhstan, for an undisclosed amount. Gaukhar Kapparova, who received 11.3% of the bank’s shares after her husband died last year, is the only shareholder left from the previous structure.

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(News report from Issue No. 278, published on April 29 2016)

Georgia cuts interest rate for the first time in 3 years

TBILISI, APRIL 27 2016 (The Conway Bulletin) — Georgia’s Central Bank cut its key interest rate for the first time in three years, performing a policy U-turn designed to boost its flagging economy.

It cut its key refinancing rate by 50 basis points to 7.5%, having steadily raised it from 4% throughout 2015. It said this was the first step towards a rate of around 5 or 6%.

“The Monetary Policy Committee considers it necessary to start phasing out the tight monetary policy, which means the gradual reduction of the refinancing rate down to the neutral level in the medium-term,” the Central Bank said in a statement.

“The rate of further monetary policy softening will depend on the revised inflation forecasts.”

In March, annualised inflation fell to 4.1% from 5.6% in February.

The Central Bank also dropped the lari-denominated minimum capital requirements for its commercial banks from 10% to 7% and increased the US dollar-denominated requirements.

It did this to try to push more lari into circulation and to take the US dollar off the market.

Alongside the less-than-rosy economic news, the Central Bank said that there had been signs of improved economic activity, especially in construction, but that high interest rates and other issues were a brake on potential growth.

“Another factor keeping the economic growth low is the negative impact of the economic situation in Georgia’s trade partners, reflected in the decrease of remittances and weakening of external demand,” it said.

Russia and Greece have traditionally been Georgia’s main source of remittances. Russia is currently in a recession linked to low global oil prices and Western imposed sanctions. Greece’s economy remains in recovery-mode after the impact of the 2008/9 Global Financial Crisis.

Like inflation, GDP growth has also been sluggish. The Statistics Committee said GDP grew by 2.3% in Q1, one percentage point slower than the expectations. The Central Bank expects 3% GDP growth in 2016.

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(News report from Issue No. 278, published on April 29 2016)

Kazakhstan announces high speed train

APRIL 27 2016 (The Conway Bulletin) – The Kazakh railway authority announced the launch of a new high-speed connection between Astana and Kostanai, which will be operated by Tulpar-Talgo trains. Tulpar-Talgo is a joint venture between a subsidiary of state-owned Kazakhstan Temir Zholy and Spain’s Talgo.

ENDS

(News report from Issue No. 278, published on April 29 2016)

Kazakhstan’s Kazmunaigas denies KMG EP’s buyout

APRIL 21 2016 (The Conway Bulletin) – Kazakhstan’s state-owned oil and gas company Kazmunaigas denied it had plans to issue new debt to raise cash to finance the buyout of minority shareholders in KMG EP, its subsidiary whose GDRs are listed in London. Ardak Kassymbek, one of Kazmunaigas’ managing directors, had earlier told Reuters that the company could borrow about $1b for the buyout.

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(News report from Issue No. 278, published on April 29 2016)