APRIL 8 2015 (The Conway Bulletin) – A proposed $70b takeover of BG by Royal Dutch Shell will have implications for Kazakhstan’s energy sector. BG is a major shareholder in, and the operator of, the Karachaganak oil and gas project in north Kazakhstan. This will pass to Shell if the deal goes through.
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(News report from Issue No. 226, published on April 8 2015)
APRIL 8 2015 (The Conway Bulletin) – Uzbekistan’s government passed a law that will pave the way for a joint venture between Uzavtomprom and Germany’s MAN Group to build truck cabins. The factory should be operational by 2016. Uzbekistan has developed a substantial auto industry although a region-wide economic decline has hit demand.
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(News report from Issue No. 226, published on April 8 2015)
APRIL 3 2015 (The Conway Bulletin) – Alcohol prices in Georgia have increased by 10% over the past year, the national statistics agency said.
Alongside the rising price of food (3.7%) and healthcare (6%) the cost increase in Alcohol is a major driver of overall inflation. Annualised inflation for March measured 2.6%, up from 1.3% in April.
Analysts blame a fall in the value of the lari currency for this price rise but new taxes slapped on alcohol from March 1 have also driven up prices.
The government increased tax on beer by 50% and on hard liquor by 100%. It has said the tax will bring in an extra 100m lari ($45m) and harmonise Georgia’s tax laws with the EU.
And for now, it appears, thirsty consumers and bar owners in Tbilisi are shouldering the price rises.
Cory Greenberg, owner of Dive Bar in Tbilisi said distributors wanted more for a litre of beer but he has promised to keep prices steady.
“Not so much for charity, but because it is smart,” he said. “Let the others raise their prices and business will come to us.”
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(News report from Issue No. 226, published on April 8 2015)
APRIL 3 2015 (The Conway Bulletin) – Turkmenistan and Belarus plan to set up a joint venture for cotton products, news agencies reported quoting a senior Belarusian official after a meeting with Turkmen President Kurbanguly Berdymukhamedov in Ashgabat. Turkmenistan is looking for ways to diversify its economy from energy.
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(News report from Issue No. 226, published on April 8 2015)
APRIL 2 2015 (The Conway Bulletin) – Construction of the Turkmenbashi International Sea Port on the Caspian Sea has been ongoing since 2013 but the Turkmen authorities have only just officially appointed a controlling agent to check on progress of the project, according to press reports.
The Italian company Rina Services have now been made the official controllers of the project.
The Turkmenbashi International Sea Port is a crucial piece of infrastructure for Turkmenistan as it should open it up further to Europe.
Inaugurated in August 2013 by Turkmen President Kurbanguly Berdymukhamedov and Turkey’s Recep Erdogan, then PM and now president, the new Turkmenbashi port is being built by the Turkish company Gap Insaat for $1.5b.
Rina Services will be awarded $10m to act as the controller, a key third-party role to check the progress and the execution of the project.
The company, based out of the port city of Genoa, has certified Dragon Oil’s pipelines in Turkmenistan and is also active in Kazakhstan, where it audits and supervises Kashagan’s D-Island.
Michele Francioni, CEO at Rina Services, told the Italian financial newspaper Il Sole 24 Ore: “(Rina Services) has had a presence there [Turkmenistan] for some time with deeply rooted local organisations.”
According to the plan, construction should be completed by 2017 . The port should facilitate east-west trade.
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(News report from Issue No. 226, published on April 8 2015)
APRIL 5 2015 (The Conway Bulletin) – Kazakhstan will give car-makers 35b tenge ($188m) to help them survive the economic downturn, media reported quoting First Vice Minister for the Economy, Marat Kussainov. Kazakhstan’s car-makers have been hit hard by the sharp drop in the rouble because Russia was one of its biggest markets.
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(News report from Issue No. 226, published on April 8 2015)
MARCH 31 2015 (The Conway Bulletin) – The World Bank has approved a $52m loan to upgrade Armenia’s power distribution network, media reported. The authorities in Armenia blame the aging power network partly for the patchy electricity supplies across the country.
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(News report from Issue No. 225, published on April 12015)
MARCH 30 2015 (The Conway Bulletin) – Air Baltic, based in Riga, and Uzbekistan Airways have announced a planned codeshare on a route to New York, media reported. The deal matches Uzbekistan Airway’s aspirations to increase its various service.
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(News report from Issue No. 225, published on April 12015)
MARCH 30 2015 (The Conway Bulletin) – Elbit Cyclone, a subsidiary of Israel’s Elbit Systems, plans to build a factory in Georgia that will produce parts for passenger planes, media reported quoting Georgian economy minister Giorgi Kvirikashvili.
This is an important development for industry in Georgia as it represents a potential shift to a more hi-tech focus. Reports did not say what parts specifically the Georgian factory would produce for Elbit Cyclone, although all the factory output will be for export, but they did say the longer-term aim was to develop a hi-tech industrial sector.
The $85m cost of the project will be shared by the Georgian government and Elbit Cyclone. The factory will also employ 300 people.
And Elbit Systems already has a link with Georgia.
Prior to its 2008 war with Russia, Georgia bought several spy planes from the company. Elbit Systems is the largest publicly-traded military equipment manufacturer in Israel.
lbit Systems also makes technical equipment for the US military.
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(News report from Issue No. 225, published on April 12015)
MARCH 26 2015 (The Conway Bulletin) – A parliamentary inquiry in Armenia said the government subsidised gas for consumers between 2011 and 2013 ahead of a controversial buyout of the pipeline network by Russia’s Gazprom.
The US-funded Radio Free Europe/Radio Liberty (RFE/RL) said the government had previously denied it was subsidising gas imports from Russia.
The Armenian government was desperate both to retain support ahead of an election and to write off a $300m debt to Gazprom. To do this, it needed the public’s support to sell the pipeline distribution network.
The inquiry’s findings will pile more pressure on Armenia’s president Serzh Sargsyan whose administration has become increasing unpopular.
The RFE/RL report also said Gazprom cut the gas price when Armenia agreed to join the Kremlin-led Eurasian Economic Union (EEU), which also includes Belarus and Kazakhstan.
“The commission has found documentary evidence of unpublicized Russian-Armenian agreements that gradually raised the gas price from $180 to $270 per thousand cubic meters in 2011-2013,” RFE/RL reported.
“Gazprom cut the price to almost $190 per thousand after Armenia agreed to join the Russian-led Eurasian Economic Union in late 2013.”
This is yet more evidence that Russia pressured Armenia into joining the EEU.
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(News report from Issue No. 225, published on April 12015)