JAN. 17 2016 (The Conway Bulletin) – Russia’s VimpelCom said that it was prepared to pay a $600m for bribes it paid in Uzbekistan to gain access to mobile phone licences. The row is part of a wider corruption investigation centred around bribes paid by international telecoms companies to gain access to Uzbekistan.
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(News report from Issue No. 264, published on Jan. 22 2016)
JAN. 14 2016 (The Conway Bulletin) — Swedish telecoms company TeliaSonera effectively slashed the value of its assets in Uzbekistan by 5.3b Swedish kronor ($622m) to speed up a fire sale of its unit which it considers toxic after it was heavily implicated in a major corruption scandal.
Since last September, TeliaSonera has sought to sell off its businesses in Central Asia and the South Caucasus so that it can concentrate on its core mobile and data services in Europe.
TeliaSonera is under investigation in the Netherlands, Sweden and the US over its acquisition of mobile licenses in Uzbekistan in 2007. Prosecutors say the deal involved paying large bribes to the Uzbek president’s eldest daughter, Gulnara Karimova. Rival Norwegian telecoms company Telenor has also been accused of bribing Uzbek officials.
The cut in value of Teliasonera’s Uzbek assets, which will be booked on its Q4 2015 operations, is part of a 7.2b Swedish kronor ($845m) cut in the company’s global assets.
“We are well on track shaping the new TeliaSonera and the process to reduce our presence in Eurasia continues,” Teliasonera CEO, Johan Dennelind, said in a statement.
“As a consequence of this progress and current status in the overall divestment process, Region Eurasia will be reported as discontinued operations. When doing this we are obliged to change valuation method for these operations. This has resulted in an impairment charge relating to our operations in Uzbekistan.”
In its forthcoming 2015 annual report, due later this month, TeliaSonera will block out results from the Eurasia region and tag it “held for sale”.
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(News report from Issue No. 263, published on Jan. 15 2016)
JAN. 13 2016 (The Conway Bulletin) -Swedish telecoms company Teliasonera said that it would write $622m off the value of its Uzbek unit that it wants to sell. A corruption scandal has enveloped the Uzbek unit of Teliasonera and it has said that it wants to sell its entire Eurasian operations.
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(News report from Issue No. 263, published on Jan. 15 2016)
DEC. 11 2015 (The Conway Bulletin) – A court in Bishkek sentenced Dilger Zhaparov, head of the state-owned gold miner Kyrgyzaltyn, to three years in jail because of an unauthorised payment he made to Centerra Gold. Centerra Gold has denied any wrongdoing.
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(News report from Issue No. 261, published on Dec. 20 2015)
DEC. 11 2015 (The Conway Bulletin) – A court in Karaganda sentenced former Kazakh PM Serik Akhmetov to 10 years in prison on corruption charges, completing the downfall of a former high-flying member of Kaza- khstan’s inner clique of elite.
Akhmetov was sentenced alongside other 20 senior officials, among them the former governor of the Karaganda region, Baurzhan Abishev, and former mayor of the
city, Meiram Smagulov.
They were all charged with abuse of office and embezzlement.
The trial effectively disbands the former group of Karaganda elite and acts as a warning for other local elites in Kazakhstan.
Akhmetov, 57, had served as PM from September 2012 to April 2014, when he was removed and replaced by his predecessor Karim Massimov.
He was then appointed defence minister, but was sacked in October 2014, just one month before prosecutors filed corruption charges against him.
Now, in his latest ignominy, he will going to jail for taking a $2.4m bribe.
Days before his sentence, Akhmetov publicly admitted his errors and asked President Nursultan
Nazarbayev for forgiveness.
“I sincerely apologise to Nursultan Abishevich for not repaying his trust and causing him distress,” said Akhmetov. The court displayed little clemency towards Akhmetov, instead pre- ferring to hand him a heavy sentence and use him as an example to others.
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(News report from Issue No. 261, published on Dec. 20 2015)
DEC. 5 2015 (The Conway Bulletin) — Police in Azerbaijan arrested Jahangir Hajiyev, the former head of the International Bank of Azerbaijan (IBA) who was once feted as a future Central Bank chief, on charges of fraud and abuse of office.
His arrest follows the sacking of his brother-in-law, Eldar Mahmudov, in October as the national security minister and the sacking of Ali Abbasov as communications minister in November.
Mr Hajiyev, 54, had resigned from his position of chairman at IBA in March, officially because of poor health. He had been chairman of IBA for 14 years. State-controlled IBA is the largest bank in Azerbaijan and controls 60% of all loans in the country.
IBA also published its half-year results for 2015 on Dec. 5, highlighting a loss of 216m manat ($206m), due to the economic slowdown in the country, significantly worsened the bank’s loan portfolio.
Mr Hajiyev had been considered something of a high-flying financial executive and was tipped by many to succeed Elman Rustamov as head of the Azerbaijani Central Bank.
Instead, it appears as if Mr Hajiyev has become embroiled in a power- struggle within the notoriously secretive, and corrupt, Azerbaijani elite.
Azerbaijani media have started publishing stories which said Mr Mahmudov, the former security minister, had been covering for Mr Hajiyev who was pilfering cash.
Corruption in Azerbaijan is rife. In July, the Berlin-based lobby group Transparency International said: “Corruption in Azerbaijan is widely perceived to be endemic and deeply institutionalised – permeating all spheres of public life, with entrenched political patronage networks and widespread conflicts of interest closely connected to the political elite.”
With formal charges being filed, Mr Hajiyev will remain in jail for the next four months, pending trial.
In July, IBA appointed Elmar Mammadov as its new chairman. He had previously been head of Azer- Turk Bank.
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(News report from Issue No. 260, published on Dec. 11 2015)
NOV. 25 2015 (The Conway Bulletin) — Russian telecoms company VimpelCom could be close to a $775m settlement with a US court that accused it of paying bribes to access mobile licences in Uzbekistan, Bloomberg reported. Earlier in November, the company set aside $900m for settlement costs. VimpelCom representatives declined to comment.
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(News report from Issue No. 258, published on Nov. 27 2015)
NOV. 18 2015 (The Conway Bulletin) – Possibly aimed at either cracking down on corruption or giving the under-pressure somoni currency a boost, Tajikistan’s parliament discussed a bill that would ban Tajik official from holding bank accounts or property overseas. Corruption is a major issue in Tajikistan.
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(News report from Issue No. 257, published on Nov. 20 2015)
NOV. 11 2015 (The Conway Bulletin) – Norwegian telecoms company Telenor said it had suspended four executives, including COO Richard Olva Aa, while an investigation into alleged bribe paying by VimpelCom in Uzbekistan continues. Telenor owns 33% of VimpelCom.
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(News report from Issue No. 256, published on Nov. 13 2015)
NOV. 6 2015 (The Conway Bulletin) – Uzbekistan’s government said it wanted foreign investors to buy stakes in state-owned enterprises, part of a privatisation plan it said was designed to bring expertise into some of its biggest companies.
Deputy PM Rustam Azimov made the statement at an investment forum in Tashkent.
“[The plan is] to attract strategic investors who are able to bring new technology and equipment (and) organise the production of modern and competitive products,” Reuters quoted Mr Azimov as saying.
He cherry-picked three companies, seemingly as a teaser to pique foreign investor interest. These were cement maker Kizilkumcement, chemical producer Ferganaazot and electronics plant Foton.
For foreign investors, though, Uzbekistan has always been a complicated to do business in. It holds a high level of natural resources, mainly gold, gas and cotton, but is riddled through with corruption and intrigue. Western companies have previously had their assets taken by the Uzbek state too.
It remains to be seen if Uzbekistan is serious about opening up to foreign investors — and also whether these investors are Western, Korean, Chinese, Russia or from elsewhere.
The Uzbek government does need to raise funds though to deal with the current economic malaise.
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(News report from Issue No. 256, published on Nov. 13 2015)