APRIL 25 2014 (The Conway Bulletin) — Property prices in Almaty have risen by 25% over the past year as the economy rebounds and the city attracts migrants looking for work, media reported. Kazakhstan’s economy is still relatively fragile and the large property price increase has triggered concerns of a bubble.
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(News report from Issue No. 182, published on April 30 2014)
APRIL 29 2014 (The Conway Bulletin) — In a surprising, and perhaps risky, move, Turkmenistan’s President Kurbanguly Berdymukhamedov ordered the authorities to scrap a monthly handout of petrol to car owners.
Mr Berdymukhamedov had introduced the subsidy in 2008 to ease a massive increase in the price of fuel. Mr Berdymukhamedov’s eccentric predecessor Saparmurat Niyazov had set the price of petrol at an unrealistic 2 cents per litre. Mr Berdymukhamedov wanted to raise the price to 22 cents.
Reuters quoted Turkmenistan’s state media as saying that the abolition of the fuel allowance was needed to “help sustain the growth of the national economy, achieve the efficient use of oil products and ensure their orderly converting to cash on the domestic market”.
In other words, Mr Berdymukhamedov decided that it was time to wean the population off the free fuel allowance.
Turkmenistan can, after all, afford the petrol giveaway. It has grown rich from energy exports. These exports are mainly gas. It produces roughly 10m tonnes of crude oil a year, most of which it refines into oil products locally.
Salaries are low in Turkmenistan. The sudden cut in fuel subsidies may impact people and increase resentment.
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(News report from Issue No. 182, published on April 30 2014)
APRIL 28 2014 (The Conway Bulletin) — Tajikistan’s somoni currency fell against the dollar, media reported, continuing its general depreciation. Like other currencies across the region, the somoni has been under pressure because of a decline in the value of the Russian rouble. Kazakhstan devalued its tenge by 20% in February.
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(News report from Issue No. 182, published on April 30 2014)
APRIL 23 2014 (The Conway Bulletin) — Kazakhstan will boost exports of grain to Iran and China as it looks to reduce its reliance on Ukrainian and Russian ports, Reuters reported quoting the Kazakh grain trading company. The switch is a possible reaction to the turmoil in Ukraine and sanctions on Russia.
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(News report from Issue No. 182, published on April 30 2014)
APRIL 10 2014 (The Conway Bulletin) — Armenia signed a deal with Russia that will ease Armenian migrant workers’ permits in Russian cities, media reported. The deal is another sign of the economic benefits that Armenia is in line to receive after agreeing to join the Russia-led Customs Union. Remittances from Russia are an important part of Armenia’s economy.
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(News report from Issue No. 180, published on April 16 2014)
APRIL 10 2014 (The Conway Bulletin) — Data from Kyrgyzstan’s state statistics committee showed that the country’s GDP grew by 5% in the 12 months to the end of March, media reported. GDP growth in Kyrgyzstan is fragile and over the past few years has depended on the level of output at the Kumtor gold mine and also the level of public discontent.
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(News report from Issue No. 180, published on April 16 2014)
APRIL 15 2014 (The Conway Bulletin) — For Kyrgyzstan membership of the Customs Union, comprising Belarus, Kazakhstan and Russia, is looking ever less appetising.
Negotiations between Bishkek and the Customs Union countries at the beginning of the month failed to finalise the roadmap for the country’s accession and Kyrgyz officials have now stopped talking about entry in 2015.
At a minimum the Union’s highly protective tariffs would curtail Kyrgyzstan’s trade in re-exports with fellow WTO member China, worth up to 15% of its GDP.
Kyrgyz officials had been hoping to offset this with concessions on Chinese imports and a vague CU-financed stabilisation fund to promote domestic industries but with western sanctions on the horizon, Moscow no longer looks a model guarantor of Kyrgyzstan’s economic security.
Depending on the damage the Ukraine crisis reaps on the Russian economy, Bishkek may also fear for a series of keystone infrastructure projects the Kremlin had committed to investing in such as the Hydroelectric Power facility Kambar-Ata 2 and the civilian airport, Manas.
Long-term, migrant remittances, worth around a fifth of GDP according to the World Bank could also take a hit. The government’s one-time target of entry in 2015 now looks overly optimistic.
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(News report from Issue No. 180, published on April 16 2014)
APRIL 2 2014 (The Conway Bulletin) — Uzbekistan officially joined the Russia-led CIS free trade zone, a rare collegiate move by the generally unilateral Uzbek leadership.
Russian President Vladimir Putin officially signed Uzbekistan in as a member of the group, a few weeks after Russia’s parliament had approved the plan.
The timing, for Uzbekistan, is slightly unfortunate. Uzbek president Islam Karimov agreed the move towards Russia in December last year when close ties were considered vital.
The United States was withdrawing from Central Asia, its main interest had been as a launch pad for missions to Afghanistan, and Uzbekistan no doubt wanted to balance China’s growing influence against Russia.
Uzbekistan pulls in most of its remittance cash from Russia, a vital plank of its economy.
Now, though, after its annexation of Crimea from Ukraine, Russia is seen as a global pariah and increasingly heavy sanctions are set to appear.
Still, as a simple free trade agreement, rather than a global statement of geo-political intent, it is still a useful move for Uzbekistan.
It allows for the free movement of goods in the free trade zone, abolishes duties and taxes and introduces anti-dumping regulations.
The other signatures are Russia, Belarus, Kazakhstan, Armenia, Ukraine, Kyrgyzstan, Moldova and Tajikistan. They signed up to the agreement in 2011.
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(News report from Issue No. 179, published on April 9 2014)
APRIL 2 2014 (The Conway Bulletin) — Consumer prices in Armenia were 4.6% higher in March compared to the same period in 2013, media quoted the state’s statistics centre as saying. Food prices rose by 2.6%, tobacco and alcohol by 7.3% and non-food items by 3%.
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Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 179, published on April 9 2014)
APRIL 2 2014 (The Conway Bulletin) — Stubbornly high unemployment is a major problem for Armenia’s economy, media quoted the Asian Development Bank (ADB) as saying in an annual reported. Unemployment last year in Armenia measured 16.8%, the ADB said. It said GDP growth in 2013 slowed to 3.5% from 7.2% in 2012.
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(News report from Issue No. 179, published on April 9 2014)