Tag Archives: business

Kyrgyz MPs want to impose gold export tax

JUNE 16 2015 (The Conway Bulletin) – MPs in Kyrgyzstan’s parliament have called for the introduction of a new tax on gold exports, media reported, pitting themselves, once again, against the country’s largest foreign investor.

The Kumtor gold east of the country is Kyrgyzstan’s single biggest industrial asset and parliamentarians said that its exports needed to be targeted to raise extra revenue for the national budget.

Centerra Gold, listed on the Toronto Stock Exchange, owns Kumtor. The Kyrgyz government is a minority owner in Centerra. It has been fighting to increase its stake in the company and to gain more control over Kumtor itself. Earlier this year, a Kyrgyz PM resigned after failing to win concessions.

Mirlan Bakirov, an MP for the opposition Onuguu (Progress) party, proposed a 20% gold export tax to be instated at the beginning of 2016, while Alla Izmalkova of the Social Democratic Party argued for a similar tariff to start in 2018.

Official data showed that in 2014, Kyrgyzstan exported 85,000 tonnes of gold, an increase of around 36% from mine in the 2013.

But the issue of taxing gold exports has been passing around the Kyrgyz parliament for years without ever being resolved.

Earlier in June, Kozhobek Ryspayev, member of the Committee on Fuel and Energy, said an export tax would harm the mining industry. Valentin Bogdetsky, member of the Board of the Kyrgyz Mining Association similarly stated: “The imposition of an export duty on gold is not a solution to the problems between the industry and the government.”

ENDS

(News report from Issue No. 236, published on June 18 2015)

Georgian Poti Port to increase in size

JUNE 5 2015 (The Conway Bulletin) – APM Terminals plans to increase the size and depth of its port at Poti, on Georgia’s Black Sea coast, media quoted its deputy managing director Joseph Crowley as saying at a conference. Mr Crowley said APM wanted to add two more deep-water berths to the port, boosting its capacity.

ENDS

(News report from Issue No. 235, published on June 11 2015)

Turkmenistan boosts transport

JUNE 10 2015 (The Conway Bulletin) – Turkmenistan increased the amount of cargo and people it transported around the country, the government said. It’s not possible to independently verify the numbers but Turkmenistan has made several high profile announcements over the past months about boosting its transport sector.

ENDS

(News report from Issue No. 235, published on June 11 2015)

Uzbek car-maker offers discount to boost sales

JUNE 5 2015 (The Conway Bulletin) – The Uzbek-US joint car-maker General Motors Uzbekistan said it would discount two of its models by 15% until the end of 2015, an admission of sorts that its needs to boost sales to counter a falling market linked to economic turmoil in Russia.

Customers, though, can only claim the 15% discount on Lacetti and Cobalt cars by paying in US dollars with international debit and credit cards.

The car plant in the eastern town of Andijan is critical for jobs in the surrounding region and also an important barometer of Uzbek industry.

Most of its sales are made in Russia and also in neighbouring Kazakhstan but the fall in oil prices has hit the region and badly dented demand for cars.

In March, the plant sold 1,757 cars compared to 4,604 cars in the same month a year earlier, the Association of European Businesses, an industry lobby group, said.

As well as driving up car sales (pun intended), the government may also be looking to bolster US dollar flows in its economy.

Information leaking out of Uzbekistan on the state of the economy is light but it does appear to show that the slowdown in the Russian economy is having a major impact on Uzbekistan. Remittances are hugely important in Uzbekistan. They rely on a strong Russian economy. Economists have estimated that these will fall by 40% this year. Global gas prices, another important foreign currency earner for Uzbekistan, are also low.

By imposing a dollar payment scheme on car buyers, the Uzbek government may be trying to get hard currency flowing through the system once again as well as boosting sales at its flagship industrial asset.

ENDS

(News report from Issue No. 235, published on June 11 2015)

EBRD boosts spending in Kazakhstan

JUNE 5 2015 (The Conway Bulletin) – The European Bank for Reconstruction and Development (EBRD) said lending to projects in Kazakhstan would hit a record $1b this year as the country diversifies away from oil, gas and other extractive minerals.

ENDS

(News report from Issue No. 235, published on June 11 2015)

Lukoil knocks price in Kazakhstan

JUNE 5 2015 (The Conway Bulletin) – Russia’s Lukoil will knock 10% off the price of assets in Kazakhstan it plans to sell to China’s Sinopec to ease the deal through, media reported quoting industry sources. The discount shows how oil and gas assets in Kazakhstan have lost value since oil prices fell sharply.

ENDS

(News report from Issue No. 235, published on June 11 2015)

Refinery investment needs Azerbaijani oil company

JUNE 8 2015 (The Conway Bulletin) – SOCAR, Azerbaijan’s state oil and gas company, said it wanted to invest $1.2b upgrading its oil refinery in Baku. Officials in Azerbaijan have been saying for several months that they want to increase their capacity for producing high-grade oil-products.

ENDS

(News report from Issue No. 235, published on June 11 2015)

IMF enters Georgian banking row

JUNE 5 2015 (The Conway Bulletin) – The IMF jumped into an increasingly vicious row over supervisory oversight of commercial banks in Georgia by criticising the government’s plans to strip the Central Bank of the responsibility.

In a rare intervention into domestic politics, the IMF released a statement
which said it was worried about the implications that a change of supervisory powers would bring.

“The IMF is concerned that recent proposals to amend the central bank law would put NBG (National Bank of Georgia) independence at risk,” the statement said.

The government’s plan, which some suspect has been motivated by a desire to punish the Central Bank still headed by senior officials appointed by the previous administration of Mikheil Saakashvili, has been controversial from the start. A group of businesses warned that the policy change would not only pose a threat to the banking system, but also to the business and investment climate. This sentiment was supported by President Giorgi Margvelashvili, who said he would veto the bill if it was adopted by parliament.

The government has said that it wants to transfer responsibility for the oversight of commercial banks to an independent body to improve and strengthen this oversight. It has fallen out with Central Bank chief Giorgi Kadagidze over his handling of the economic storm which has battered the region.

IMF made its statement the day after former PM and Georgia’s most powerful man, Bidzina Ivanishvili, backed the proposed changes.

Mr Ivanishvili set up the governing Georgian Dream coalition and is considered the country’s chief power broker. He has clashed with both Mr Margvelashvili and Mr Kadagidze.

It its statement, the IMF also reiterated its public support for Mr Kadagidze, pitting itself firmly against Mr Ivanishvili and Mr Margvelashvili.

ENDS

(News report from Issue No. 235, published on June 11 2015)

Kazakhstan’s oil field to start pumping

JUNE 10 2015 (The Conway Bulletin) – Kashagan, Kazakhstan’s trouble- some Caspian Sea oil field, will start pumping oil by mid-2016 and hit an output of 370,000 barrels per day by the end of 2017, media reported quoting an interview with Stephane de Mahieu, managing- director of the consortium developing the field.

ENDS

(News report from Issue No. 235, published on June 11 2015)

FDI in Georgia halves in first 3 months of 2015

JUNE 9 2015 (The Conway Bulletin) – Foreign direct investment (FDI), so important to Georgia’s economy, halved in the first three months of this year compared to the last quarter of 2014, GeoStat, the Georgian statistics agency, said.

GeoStat measured total FDI in Georgia at $175m, down from $349m in Q4 2014. Georgia’s attractiveness as a foreign investment destination was rebounding after the global economic crisis of 2008/9 and a war against Russia in 2008, so the data will disappoint.

Apart from the second quarter of 2014, this was the weakest FDI data for Georgia since 2009. The biggest drop was in construction and manufacturing, reflecting the recession which has hit the region, triggered by a struggling Russian economy.

ENDS

(News report from Issue No. 235, published on June 11 2015)