Tag Archives: business

Pakistani military chief visits Tajikistan

MARCH 5 2016 (The Conway Bulletin) – General Raheel Sharif, Pakistan’s military chief, made his first trip to Tajikistan, pledging his full support for defeating terrorism in the region. This is important as it shows the growing bonds between Central and South Asia. Tajikistan is part of the CASA-1000 plan to generate electricity in Kyrgyzstan and Tajikistan which is then exported to Pakistan, via Afghanistan.

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

Oil output to rise in Kazakhstan

MARCH 10 2016 (The Conway Bulletin) – Kazakhstan will raise its target annual oil production in 2016 by 5% to 77m tonnes if oil prices remain at around $40/barrel, media quoted energy minister Vladimir Shkolnik as saying. This is important because a rise in both production and price would give government revenues in Kazakhstan a much-needed lift.

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

AvtoVaz cuts exports to Kazakhstan

MARCH 10 2016 (The Conway Bulletin) – Russian carmaker AvtoVAZ has stopped exporting finished cars to Kazakhstan due to the introduction of new customs duties, Vedomosti reported quoting a source close to the company. The new taxes, introduced this year, increase the overall average price of an auto- mobile by $2,000. Instead, AvtoVAZ will expand its exports of car parts to its factories in Kazakhstan. This was confirmed to Kazakh media late on Thursday by an AvtoVAZ spokes- person.

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

Uzbekistan plans to invest $249m in its giant gas processing plant

MARCH 4 2016 (The Conway Bulletin) – The Uzbek government wants to invest around $294m to increase production and efficiencies in its gas sector, mainly to boost the Ustyurt chemical plant.

State-owned Uzbekneftegaz co- owns the Ustyurt chemical plant with South Korea’s Lotte Chemicals. The $4.1b project was opened in October and is considered key to Uzbekistan’s future economic plans.

The Uzbek government will directly invest around $236m in the Sharkiy Berdakh gas fields near the Aral Sea to complete the new booster compressor station it is building with Ukrainian firm Sumy. The state-run Fund for Reconstruction and Development will provide an additional $58m through a loan.

Uzbekistan is in the top 15 gas producing countries in the world and sees it as the bedrock of its future economic plans. It’s a gamble, though. Uzbekistan and its partners have committed to large energy projects, with fixed up-front costs, as energy prices continue to bounce along record lows.

If it all goes to plan, the project will be completed in November 2016 and output at the gas fields will be increased by 15% to around 2b cubic metres annually. Improved infrastructure will allow Sharkiy Berdakh to supply the Ustyurt plant, located around 100km away in the remote Karakalpakstan region of western Uzbekistan.

The Ustyurt chemical complex has a processing capacity of 4.5b cubic metres per year. It has been designed to turn Uzbekistan into a gas processing hub for Central Asia and also Russia.

Uzbekistan is also looking to invest in its largest chemical complex, Navoiazot. The government issued a $393m loan last week to extend its nitrogen and ammonia facilities.

The Uzbek government has put 49% of Navoiazot, in central Uzbekistan, up for sale to foreign investors in a recent drive to privatise state assets to raise funds to ward off a worsening economic slowdown.

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

S&P downgrades Kazakhstan’s Baiterek

FEB. 26 2016 (The Conway Bulletin) – Ratings agency Standard & Poor’s downgraded the credit ratings for Baiterek Holding from BBB-/A-3 to BB+/B. S&P said “the likelihood of extraordinary government support to the consolidated Baiterek group [is] almost certain”. It said its negative outlook mirrors that of the agency’s latest assessment of Kazakh sovereign credit. Baiterek’s subsidiaries include the Development Bank of Kazakhstan and the Investment Fund of Kazakhstan.

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(News report from Issue No. 270, published on March 4 2016)

Kazakh court fines Karachaganak

MARCH 2 2016 (The Conway Bulletin) – A Kazakh court fined the consortium operating the Karachaganak gas and condensate field in the north of the country 526b tenge ($1.5m) for environmental damage. The court said the KPO consortium emitted around 43.8 tonnes of pollutants into the atmosphere between April and July 2015. KPO consortium shareholders include BG Group, ENI, Chevron, Lukoil and state-owned Kazmunaigas.

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(News report from Issue No. 270, published on March 4 2016)

Moody’s downgrades Uzbek Khamkorbank

FEB. 26 2016 (The Conway Bulletin) – Rating agency Moody’s cut Khamkorbank’s long-term local currency deposit rating to B2 from B1. In February, the Uzbek Central Bank suspended the bank’s licence to trade foreign currencies for six months. The World Bank’s IFC and the Netherlands’ state-owned FMO own stakes in Khamkorbank.

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(News report from Issue No. 270, published on March 4 2016)

Kazakh telecoms launch 4G

MARCH 2 2016 (The Conway Bulletin) – Telecoms companies in Kazakhstan are rolling out 4G services after the government opened the market up to competition at the end of 2015. Tele2 Kazakhstan said it launched 4G services in several central and eastern districts in Kazakhstan, building on its merger with Altel in November. Before the market was liberalised, Altel had been the only licensee of 4G services. Kcell and Beeline also said they will launch pilot 4G coverage in major cities.

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(News report from Issue No. 270, published on March 4 2016)

Kyrgyzstan considers Muslim debt

FEB. 26 2016 (The Conway Bulletin) – Perhaps following Kazakhstan’s lead, Kyrgyz parliamentarians are going to discuss the potential to issue a so-called sukuk, media reported. A sukuk is a debt which adheres to Islamic laws and principles. One of the advantages is that a sukuk may attract a greater range of potential investors from the Middle East and South-East Asia. The Kyrgyz parliament still has to discuss new laws aimed at easing a route to issuing a sukuk.

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(News report from Issue No. 270, published on March 4 2016)