Tag Archives: business

Georgia bets on Bitcoins

SEPT. 25 2015 (The Conway Bulletin) — BitFury, a company linked closely to Bitcoin, will build the first Technology Park in Georgia and has pledged to invest $100m in the project (Sept. 24). The Park is being built in Gldani a district of Tbilisi. BitFury provides technological infrastructure for Blockchain, the virtual wallet for the Bitcoin payment network. It already operates a data centre in Gori, 70km west of Tbilisi.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)

Ukraine Air argues with Turkmenistan

SEPT. 22 2015 (The Conway Bulletin) – Ukraine International Airlines postponed the resumption of flights to Ashgabat due to an ongoing row between the two countries’ aviation authorities. Flights were suspended in August and were due to resume on Sept. 21. Ukraine is also locked in a row with the aviation authorities in Uzbekistan.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)

VimpelCom in Uzbekistan appoints new CEO

SEPT. 23 2015 (The Conway Bulletin) — Unitel, a telecoms company based in Uzbekistan, appointed Dmitry Shukov, formerly head of Sistema Shyam Teleservices, the Indian branch of MTS, as its CEO. Unitel, which is owned by Amsterdam-based Vimpelcom, operates under the Beeline brand and has around 10m customers in Uzbekistan. VimpelCom’s owners are Russian magnate Mikheil Friedman and Norway’s Telenor.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)

Business comment: Kazakhstan & The Oil Markets

SEPT. 23 2015 (The Conway Bulletin) — Low oil prices hit Kazakhstan again, as it revised downwards oil production numbers.

Iran’s re-emergence into the global markets will keep prices low according to a spokesperson from the Ministry of Energy in Astana and this means the Kazakhstan will lower production.

“Oil output is expected to reach 79.5m tonnes in 2015,” the spokesperson told Reuters. This is

1m tonnes less than earlier predicted and almost 2% less than in 2014. And it could get worse, as the government has not ruled out a further reduction in production, should prices continue to fall.

This has an adverse effect on Kazakhstan’s economy.

First, foreign investors reduce their financial positions because their assets lose value, either because of low oil prices or due to the devaluation of the local currency. Foreign investors have already started to leave Kazakhstan,

as TeliaSonera, Samsung, Honda, have shown in the past fortnight.

Second, the country’s financial position weakens further. It has to spend foreign reserves to protect its currency from falling further.

Third, the domestic oil sector marks some projects, which have been labelled uneconomic, as on- hold until oil prices rise. This, in turn, means lower revenues.

When it comes to oil, Kazakhstan is a price-taker. Its fate will depend on how it manages to survive what could be a long period of cheap oil.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)

Kyrgyzstan to establish energy holding

SEPT. 22 2015 (The Conway Bulletin) – Kyrgyzstan will establish a national energy holding next year, Kubanychbek Turdubayev, Kyrgyz minister of energy, said in a statement. The government has said that it hopes that a single energy holding would improve efficiency.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)

Azerbaijan’s oil fund buys Tokyo shopping centre

SEPT. 23 2015 (The Conway Bulletin) – Sofaz, the Azerbaijani oil wealth fund, bought property in Japan worth $435m, its first foray into the east Asian property markets.

In a statement, it said that it had teamed up with Mitsubishi UFJ Trust and Banking Corporation to buy the landmark retail property Kirarito Ginza for 52.3b yen.

Shahmar Movsumov, the fund’s executive director, said he was excited by the purchase. “We are delighted to have made our first foray into the Japanese real estate market. Our investment rationale for this asset is based on its capital preservation capacity,” he said.

In the past few years, Sofaz has been developing its property portfolio with purchases in London, Paris, Sydney and Kuala Lumpur. Last month it said that it would reduce payments to the national budget as its earnings had fallen because of the collapse in oil prices.

In July the fund, which holds around $37b earmarked for infrastructure projects, bought $500m of Chinese government bonds, part of planned diversification of its assets.

Kirarito Ginza is a modern retail building built on Tokyo’s Chou Avenue, one of the most prestigious streets in the country.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)

Stock market: KAZ Minerals, Nostrum Oil & Gas

SEPT. 18-24 2015 (The Conway Bulletin) — KAZ Minerals shares, now trading at 101 pence, lost over 30% in one week, a fall sharper than the one it suffered last January, when it dropped by more than 25% in one day. Questions on China’s demand

for copper worried investors. Credit Suisse and BNP Paribas downgraded KAZ Minerals and reviewed downwards its target price. Goldman Sachs said there could be a potential upside on Friday and next week.

Nostrum Oil & Gas dropped a further 4% to 481 pence (Sept. 25), although an agreement with Tethys Petroleum seems closer after a company statement said the latest Nostrum offer priced each Tethys share at 0.147 Canadian dollars (Sept. 23).

Azerbaijan-based miner Anglo- Asian Mining gained 13% to 5.38 pence this week, after it published a promising H1 2015 report.

Kazakhstan-focused Roxi Petroleum continued its oil price linked slump, dropping by 4.3% to 8.5 pence this week in London.

In the GDR markets, Kazmunaigas E&P lost almost 20% this week, trading at $6.47 onFriday, almost certainly linked to Kazakhstan’s weak prospects in terms of oil production. Kcell fell by 13.4% finishing the week at $5.35 after TeliaSonera announced last week it would leave its Eurasian markets. TeliaSonera owns 62% of Kcell.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)

Kazakh Central Bank wants loans in tenge

SEPT. 23 2015, ALMATY (The Conway Bulletin) — The Kazakh Central Bank presented a bill to parliament that will force people to take loans in tenge, a tactic it says is necessary to wean the economy off its addiction to US dollars.

Shaken by a 40% drop in the value of the tenge over the past 18 months, the Central Bank wants to ensure that commercial banks do not accrue a large amount of bad loans in US dollars as they did during the 2008/9 Global Financial crisis.

“This is an effort to protect customer’s rights and to decrease the rate of non-performing loans for second-tier banks,” Kuat Kozhakhmetov, deputy chairman of the Central Bank, said when he presented the bill to the parliament.

If the bill becomes law, people who have not earned their salary in a foreign currency for the 6 months before asking for a loan will will only be able to apply for a tenge loan.

According to a recent IMF study, almost 60% of the total loans issued by financial institutions in Kazakhstan are denominated in a foreign currency. The Central Bank also said that 14% of mortgages are currently denominated in foreign currencies.

People in Kazakhstan have used foreign currency loans to buy goods indexed to the US dollar or the Russian rouble, such as houses or cars. Salaries are often paid in tenge but are indexed to the US dollar.

A fall it the value of oil and a slump in the Russian economy has pressured the tenge and other regional currencies. Loans taken out in US dollars have become much more expensive to service.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)

Visa signs Tajik deal

SEPT. 21 2015 (The Conway Bulletin) — US-based Visa International and Tajikistan’s Central Bank signed an agreement to resolve a long-standing problem with payments and mutual settlements in the country. Media quoted Jamshed Nurmakhmadzoda, the Tajik Central Bank chairman, as saying: “Prior to this, Visa card holders could incur financial losses during the transactions.” The move is poised to increase the population’s confidence in cashless payment methods.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)

Auchan starts supplying food to Tajik capital store

DUSHANBE, SEPT. 17 2015 (The Conway Bulletin) — French retail group Auchan said it will supply its new hypermarket in Tajikistan with Russian-produced goods from November after a successful test-run.

The Russian branch of Auchan had earlier signed an agreement with Schiever Group to open a 5,000 square metres store in Dushanbe.

From a warehouse in Novosibirsk, Russia will supply around 80% of the products for sale in Tajikistan’s new store, the company said.

The project, conceived in 2014, was co-financed through the European Bank for Reconstruction and Development (EBRD), which allocated $5m for the construction of Tajikistan’s first hypermarket. Through the deal, EBRD has become a stakeholder in Schiever Tajikistan.

Tajikistan is the third post-Soviet country, after Russia and Ukraine, to host an Auchan hypermarket. It also plans one in Armenia. Reliant on workers’ remittances, Tajikistan needs more foreign investment.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)