APRIL 2 2013 (The Conway Bulletin) — Kazakhstan’s Central Bank kept interest rates at a record low of 5.5% due to continued sluggish inflation data. It last cut interest rates in August 2012. The Kazakh economy grew by 5% last year, disappointing policy-makers who want higher growth.
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(News report from Issue No. 130, published on April 5 2013)
MARCH 19 2013 (The Conway Bulletin) – The governor of Kazakhstan’s Central Bank, Grigori Marchenko, called for the government to grant it full independence, media reported.
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(News report from Issue No. 128, published on March 22 2013)
MARCH 12 2013 (The Conway Bulletin) – Although probably not wholly unexpected, the IMF’s assessment of Azerbaijan’s economy was still relatively blunt.
Instead of increasing public spending the Azeri authorities need to reduce government expenditure while improving its efficiency, as well as enhancing the business climate in general, media quoted Raja Almarzoqi, head of the IMF’s mission to Azerbaijan, as saying.
Like other energy-rich former Soviet states — Kazakhstan, Uzbekistan and Turkmenistan for example — Azerbaijan’s economy is heavily tilted towards cash earned from gas and oil.
Most of Azerbaijan’s energy-fuelled growth has occurred over the last decade. Now the government wants to boost other sectors of the economy and has promised various cash injections.
But the IMF said this strategy comes with risks.
According to Bloomberg news agency, Mr Almarzoqi cut straight to the point. “The 2013 budget is expansionary and creates overheating risks,” he said.
He backed up this statement with figures. Public spending and a significant increase in the non-energy economy will nearly double Azerbaijan’s GDP growth to 4.5% in 2013. Inflation, though, will also increase to 7% from 1.1% last year.
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(News report from Issue No. 127, published on March 15 2013)
MARCH 12 2013 (The Conway Bulletin) – An increase in foreign direct investment will help Georgia’s economy maintain a 6% growth rate in 2013, media quoted finance minister Nodar Khaduri as saying. Mr Khaduri predicted that foreign investment in Georgia will double to $2b this year. Georgia’s economy officially grew by 6.1% in 2012.
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(News report from Issue No. 127, published on March 15 2013)
MARCH 2 2013 (The Conway Bulletin) – After a 12 year joining process Tajikistan officially became a member of the World Trade Organisation (WTO). The WTO approved Tajikistan’s membership at the end of last year. Kyrgyzstan is the only other Central Asian WTO member although Kazakhstan will likely join by the end of the year.
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(News report from Issue No. 126, published on March 8 2013)
FEB. 8 2013 (The Conway Bulletin) – On Feb. 1, Uzbekistan banned buying foreign currencies with cash. Officially, the ban was imposed to stamp out Uzbekistan’s burgeoning black market. Unofficially it appears to be another form of control over ordinary people.
A black market for US dollars in Uzbekistan has been vibrant for years because of heavy currency controls imposed by the government. These controls made it far cheaper to buy US dollars under the counter at the back of a carpet shop than it did in a bank.
But reports from Tashkent already suggest that strategy of banning currency transactions in cash to quash the black market, if this was the real aim, may have backfired. Despite the crackdown US dollars are still being traded. According to Eurasianet, the effect of the currency restrictions was to limit supply of US dollars and push prices up by roughly 40%.
The restrictions on US dollars may also effect wider sales. US dollars are often used in Uzbekistan to buy cars or houses as using sum, the local currency, in a large cash purchase is practically impossible because of the piles of notes needed.
Uzbek officials will point out that if you have a bank account you can, electronically, still buy US dollars. The worth of this, in a cash based economy, is, though, highly questionable.
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(News report from Issue No. 123, published on Feb. 8 2013)
FEB. 4 2013 (The Conway Bulletin) – Azerbaijan launched its first communications satellite, media reported. The satellite, launched from French Guiana, potentially allows Azerbaijani to diversify away from its energy industry and branch out into communications and broadcasting for the South Caucasus, Central Asia and North Africa.
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(News report from Issue No. 123, published on Feb. 8 2013)
JAN. 30 2013 (The Conway Bulletin) – Uzbekistan’s Central Bank has banned the cash exchange of foreign currencies, mainly US dollars, from Feb. 1, Radio Free Europe/Radio Liberty reported. The Central Bank said it needed to ban the exchange of dollars to clamp down on Uzbekistan’s burgeoning black market. Dollars can still be bought electronically.
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(News report from Issue No. 122, published on Feb. 1 2013)
FEB. 4 2013 (The Conway Bulletin) – A shopping centre, a food production plant and a chain of car repair garages will be the first state-owned enterprises sold on March 9 during Turkmenistan’s privatisation process, media quoted officials as saying. More items are due to be privatised although it is unclear if this will include oil and gas assets.
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(News report from Issue No. 123, published on Feb. 8 2013)
JAN. 19 2013 (The Conway Bulletin) – It may, at times, feel slow, but Turkmen president Kurbanguly Berdymukhamedov is opening up Turkmenistan. Media reported that he has instructed one of his ministers to study entry into the World Trade Organisation (WTO) for Turkmenistan, which has a reputation for being one of the most closed and repressive countries in the world.
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(News report from Issue No. 121, published on Jan. 25 2013)