MARCH 6 2015 (The Bulletin) – Azerbaijan’s state energy company SOCAR plans to issue a Eurobond by the end of March, the company’s CEO Rovnag Abdullayev said. Mr Abdullayev said SOCAR was launching the Eurobond because of the slide in oil prices over the past six months or so which have hit the company’s profits.
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(News report from Issue No. 222, published on March 11 2015)
MARCH 6 2015 (The Bulletin) – At a Senate hearing in Astana, chairman of the ministry of finance’s revenue committee, Daulet Yergozhin, said the country was going to impose new measures against off-shoring cash.
This is important — if new legislation actually appears — as the issue of Kazakhstan’s wealthy getting their cash out of the country while poorer sections of the population suffer during an economic downturn could turn political.
A study published last month by Alexander Cooley and Jason Sharman, two academics, analysed the channels through which the Kazakh elite amassed “spectacular fortunes” in Western financial centres.
Mr Yergozhin wasn’t responding to these accusations. Instead he said Kazakhstan was working with Switzerland and Liechtenstein to reduce the flow of capital out of the country.
“Already this year, we are planning to put barriers against the movement of capital [to offshore locations] and we will start seeing the results of this policy early next year,” media quoted him as saying.
Kazakhstan has been looking was to bring capital back into the country. Last year it introduced an amnesty for people which repatriated cash. It has said that this amnesty has so far attracted $1b back into Kazakhstan.
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(News report from Issue No. 222, published on March 11 2015)
FEB. 26 2015 (The Conway Bulletin) – KAZ Minerals, the London-listed Kazakh copper miner, recorded a net loss of £2.4b last year, mainly due to a $2.1b write-off from discontinued operations. KAZ Minerals, formerly called Kazakhmys, has close links with the Kazakh elite.
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(News report from Issue No. 221, published on March 4 2015)
FEB. 25 2015 (The Conway Bulletin) – Georgia’s Central Bank wants commercial banks to present plans to restructure US dollar loans to help them cope with the drop in the value of the lari. An estimated 60% of banks’ loans are held in foreign currencies making them more expensive to service.
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(News report from Issue No. 221, published on March 4 2015)
MARCH 2 2015 (The Conway Bulletin) – Underscoring China’s influence over Tajikistan’s economy, a Chinese company has agreed to build a $200m lead producing plant, media reported quoting a senior Tajik government official. China has increased its influence over Tajikistan over the past few years.
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(News report from Issue No. 221, published on March 4 2015)
FEB. 25/MARCH 2 2015 (The Conway Bulletin) – Ratings agencies warned that the 30% devaluation of the Azerbaijani manat last month would hurt the capitalisation of the country’s banks. Fitch said that most of debt held by Azerbaijani banks was in foreign currencies, making it more expensive for them to service.
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(News report from Issue No. 221, published on March 4 2015)
MARCH 3 2015 (The Conway Bulletin) – Baku-based freight carrier Silk Road West has ordered three Boeing 747-8 cargo planes for a reported $1.1b, Boeing said in a statement. The deal is a major one for Boeing and shows Silk Road West’s confidence.
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(News report from Issue No. 221, published on March 4 2015)
MARCH 1 2015 (The Conway Bulletin) – Georgia increased the amount of tax imposed on alcoholic drinks by 50% to 60 tetri. The government said the rise is needed to align its tax base with EU regulations. Opponents said this is not the case and that it is just trying to raise extra revenues.
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(News report from Issue No. 221, published on March 4 2015)
MARCH 3 2015 (The Conway Bulletin) – Kazakhstan’s foreign minister Erlan Idrissov flew to Brussels for a meeting with the EU where both sides committed to deepening their partnerships. The EU’s backing is important for Kazakhstan because of the growing stigma in the West over former Soviet countries’ ties to Russia.
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(News report from Issue No. 221, published on March 4 2015)
MARCH 4 2015 (The Conway Bulletin) – The European Union has identified Central Asia and the South Caucasus as a future source of energy that will, importantly, reduce its reliance on Russia.
In an interview with the FT, Maros Sefcovic, the European Commission’s vice-president for energy affairs, said that the region could become a major supplier of gas to the EU.
In particular, the EU is looking to Azerbaijan and Turkmenistan. It has diligently invested time and money building up relations and pipeline infrastructure over the past few years in the region.
Now, as relations with Russia sour over the Kremlin’s support for separatists in Ukraine, the EU is speeding up its search for alternative sources of energy.
And in Central Asia and the South Caucasus it will find a willing partner. The fallout over the drop in Russia’s economy and the collapse in energy prices have been severe and governments are looking for alternative markets. Europe may be bureaucratic but it is stable and reliable.
Turkmenistan’s government was quick to respond positively to the EU’s smoke signals.
It’s a different scenario in countries which don’t produce energy.
Armenia is reliant on Russia’s Gazprom for its energy. It has had to ask for a gas price discount, pulling it more and more under the influence of the Kremlin.
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Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 221, published on March 4 2015)