FEB. 7 (The Conway Bulletin) — China’s Huaxin Cement said it will construct a new cement factory in Uzbekistan’s Jizzakh region. The plant will cost $150m to build and have a capacity of 1.2m tonnes per year. The new plant is expected to start operations in December. Several companies have built cement factories in Central Asia over the past few years.
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>This story was first published in issue 399 of The Conway Bulletin on Feb. 8 2019
Copyright The Conway Bulletin 2019
ALMATY/Feb. 7 (The Conway Bulletin) — — An obscure brokerage ultimately controlled by the Kazakh government bought a 99.5% stake in Tsesnabank, part of a deal that saved Kazakhstan’s second-biggest bank from bankruptcy.
The actual amount that Almaty-based First Heartland Securities paid for Tsesnabank has not been disclosed but it follows directly on from a 604b tenge ($1.6b) bailout agreed by the government this month. Tsesnabank had already been bailed out in September last year when the government’s bad debt fund bought $1.8b of debt linked to the agricultural sector.
First Heartland Securities is controlled by state-owned Nazarbayev University. This gives the government, and President Nursultan Nazarbayev and his family, total dominance over the Kazakh banking sector. His son-in-law, Timur Kulibayev, and daughter, Dinara Nazarbayeva, own Kazakhstan’s largest bank — Halyk Bank.
In a statement, First Heartland Securities said that under the terms of the deal it will inject 70b tenge ($185.8m) into Tsesnabank. Erke Nurkenov, First Heartland Securities’ chairman, said that Tsesnabank’s operations would not be impacted by the change in ownership.
“First Heartland Securities will continue to develop Tsesnabank and strengthen its position in the SME segment and work with individuals, primarily focusing on improving the quality and availability of service,” he said in a statement.
Pres. Nazarbayev’s ally Adilbek Zhaksybekov had owned Tsesnabank. He had been head of the Presidential Administration before resigning in September with a promise to sort out his ailing bank. He was replaced as Tsesnabank’s chairman by Shigeo Katsu, president of Nazarbayev University, and Bekzhan Pirmatov, formerly deputy CEO at First Heartland Bank, was appointed the Tsesnabank CEO.
Tsesnabank had been heavily exposed to the agriculture sector. Since a 2015 devaluation of the tenge, its debtors have struggled and the proportion of bad debt in its portfolio expanded rapidly.
Although analysts had warned of Tsesnabank’s collapse for months, it will still shake investor confidence.
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>This story was first published in issue 399 of The Conway Bulletin on Feb. 8 2019
Copyright The Conway Bulletin 2019
FEB. 4 (The Conway Bulletin) — Uzbekistan is testing investor sentiment towards the possible issue of either a 5-year or 10-year sovereign debt issue, Bloomberg News reported. It said that Citigroup, JP Morgan Chase and Gazprombank had been hired for what would be Uzbekistan’s first bond issue. Last year, Uzbekistan was given its first sovereign debt rating.
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>This story was first published in issue 399 of The Conway Bulletin on Feb. 8 2019
Copyright The Conway Bulletin 2019
FEB. 5 (The Conway Bulletin) — Azerbaijan signed a deal with Liberty Media, the owners of the Formula 1 franchise, to hold an F1 Grand Prix in Baku for the next five years. The Baku F1 race has become an important part of Azerbaijan’s national branding since it first hosted it, as the European Grand Prix, in 2016. >>See Comment on page 2
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>This story was first published in issue 399 of The Conway Bulletin on Feb. 8 2019
Copyright The Conway Bulletin 2019
FEB. 4 (The Conway Bulletin) — The Afghan company building part of the CASA-1000 power-line that will link Kyrgyzstan and Tajikistan with Pakistan said the project will be delayed for eight months because of a delay in deals to build substations in Pakistan and Tajikistan. CASA-1000 is being funded primarily by the World Bank and it is considered a vital project for the economies of Tajikistan and Kyrgyzstan. It was meant to be finished at the end of 2018.
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>This story was first published in issue 399 of The Conway Bulletin on Feb. 8 2019
Copyright The Conway Bulletin 2019
FEB. 5 (The Conway Bulletin) — The Swiss government, which has been mediating between Russia and Georgia since the end of a brief war in 2008, said that “conditions to implement the customs deal signed by Georgia and Russia are in place”. The two neighbours have been working on a deal that will mean trade between them passes through three corridors — via the disputed regions of Abkhazia and South Ossetia and the undisputed Zemo Larsi-Kazbegi border.
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>This story was first published in issue 399 of The Conway Bulletin on Feb. 8 2019
Copyright The Conway Bulletin 2019
FEB. 6 (The Conway Bulletin) — OPIC, the US-government’s Overseas Private Investment Corporation, will invest $50m into the $120m construction of a new port terminal at Poti on Georgia’s Black Sea coast, media reported. At a press conference, Georgian PM Mamuka Bakhtadze said the new port was vital to Georgia in maintaining its key position as an entry point for goods transiting between Europe and Asia. OPIC’s mission is to help US businesses expand overseas and also to push US foreign policy objectives.
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>This story was first published in issue 399 of The Conway Bulletin on Feb. 8 2019
Copyright The Conway Bulletin 2019
JAN. 26 (The Conway Bulletin) — Turkmenistan started work on construction of a $2.3 four-lane motorway that will run across the sandy Kara Kum desert and connect Ashgabat with Uzbekistan.
Serdar Berdymukhamedov, the son of President Kurbanguly Berdymukhamedov and widely regarded as his heir, launched the construction, highlighting its prominence. The project is seen as a continuation of Turkmenistan’s government policy to try to kickstart its economy through a combination of spending cuts on services and prestige infrastructure projects which aim to generate thousands of jobs and additional revenue.
Turkmen officials have said that the road, the biggest ever built in Turkmenistan, will also build up its position as a prominent stage-post for trade routes running across Central Asia.
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>This story was first published in issue 398 of The Conway Bulletin on Jan. 31 2019
Copyright The Conway Bulletin 2019
JAN. 28/30 (The Conway Bulletin) — Kazakhstan and Uzbekistan’s Central Banks kept their interest rates steady because of low inflation. Falling prices have been a feature of the economies of the region since they recovered from an economic downturn in 2014-17. Kazakhstan’s interest rate is currently 9.25% and Uzbekistan’s lies at 16%.
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>This story was first published in issue 398 of The Conway Bulletin on Jan. 31 2019
Copyright The Conway Bulletin 2019
JAN. 22 (The Conway Bulletin) — Uzbek President Shavkat Mirziyoyev signed a decree that should lead to the privatisation of the country’s main gold producer the Navoi Mining and Metallurgical Company (NMMC). The decree said that NMMC should be privatised by December 2019. NMMC and Almalyk Mining and Metallurgical Company (AMMC) produce an estimated 80% of Uzbekistan’s gold.
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>This story was first published in issue 398 of The Conway Bulletin on Jan. 31 2019
Copyright The Conway Bulletin 2019