Tag Archives: economy

Kyrgyzstan’s investment climate takes another turn for the worse

OCT. 16 2011 (The Conway Bulletin) – By Oct. 13 2011 Talas Copper Gold, a Kyrgyz gold mining company, had had enough.

After raiders on horseback had firebombed its camp in a remote part of northern Kyrgyzstan and local officials linked to its project had received death threats, the company decided to postpone further gold exploration. It had simply become too dangerous.

Talas Copper Gold, may only be a relatively small operation but the impact is significant and will echo around investors looking at Kyrgyzstan. The attacks bear the hallmarks of organised crime.

A joint venture between a British company Orsu Metals (40%) and South Africa’s Gold Fields (60%), Talas Copper Gold is the sort of operation Kyrgyzstan needs to lift its economy.

Foreign investors may be essential for Kyrgyzstan but their choice of investment sectors is limited. After water, gold is one of the most abundant natural resource. Kumtor, a gold miner owned by Canada’s Centerra Gold, contributes around 7% of Kyrgyzstan’s national income.

But two revolutions since 2005, ethnic violence last summer that killed roughly 400 people and a change of constitution, make Kyrgyzstan a risky place for foreign investors. Raids and death threats organised by local crime gangs looking for extra revenue often make it just too difficult to operate.

Perhaps most disturbing is that Talas Copper Gold’s experience is not unique. There have been several other cases of raiders on horseback attacking foreign gold prospectors this year.

ENDS

(News report from Issue No. 61, published on Oct. 18 2011)

Wages increase by 15% in Kazakhstan

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OCT. 17 2011 (The Conway Bulletin) – Wages rose roughly 15% in Kazakhstan during the 12 months to August, local media quoted Kazakhstan’s statistics agency as saying, an indication that inflation is rising fast in Central Asia’s largest economy. The government has said it expects the Kazakh economy to grow by around 7% a year in 2011 and 2012.

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(News report from Issue No. 61, published on Oct. 18 2011)

Auditors say Turkmenistan holds even more gas

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OCT. 11 2011 (The Conway Bulletin) – Auditors confirmed that Turkmenistan holds the world’s second largest gas field, cementing its place as a global energy supplier. The South Yolotan field holds between 13 trillion and 21 trillion cubic metres of gas, second only to Iran’s South Pars.

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(News report from Issue No. 60, published on Oct. 11 2011)

Georgia-Russia WTO talks fail, again

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OCT. 8 2011 (The Conway Bulletin) – Once again, talks between Georgia and Russia in Switzerland over Russian membership of the WTO failed. Reuters reported that Georgia’s main grievance was Russia’s refusal to give information on trade in and out of the rebel states of South Ossetia and Abkhazia. No date has been set for more talks.

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(News report from Issue No. 60, published on Oct. 11 2011)

Putin’s Eurasian Union shapes up

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OCT. 4 2011 (The Conway Bulletin) – So it’s finally official. The Kremlin sees the Russia-Belarus-Kazakhstan Customs Union as a tool for further integration.

In an article for the newspaper Izvestiya on Oct. 4, Russian PM Vladimir Putin wrote of his vision for a Eurasian Union based around Moscow’s leadership emerging from the customs union. The timing of this article underlined its importance. This was Mr Putin’s first major policy statement since Sept. 24, 2011 when he said he would return as Russian president.

For Central Asia, but not yet for the South Caucasus, the customs union is already important. Kazakhstan is an enthusiastic member, Kyrgyzstan has officially applied to join and Tajikistan is thinking about it.

Russia uses the customs union as a bulwark against the growing influence of China and the West in Central Asia, a region it considers to be its natural sphere of influence.

Although Uzbekistan and Turkmenistan may be able to afford to resist, for Kyrgyzstan and Tajikistan it has become politically and economically important to join the customs union.

Kazakhstan’s President Nursultan Nazarbayev can also claim to have been the first to float the idea of a Eurasian Union. He mentioned the concept during a speech at a Moscow university in 1994.

Now, 17 years later, this Eurasian Union is gaining momentum.

ENDS

(News report from Issue No. 59, published on Oct. 4 2011)

Georgia wants Russia to sign a non-aggression pact

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OCT. 3 2011 (The Conway Bulletin) – Ahead of another round of talks between Georgia and Russia over Russian hopes to join the WTO, media quoted Georgian deputy foreign minister David Dzhaglania as saying that Moscow should sign a non-aggression pact. Already a member of the WTO, Georgia effectively holds a veto over Russian entry.

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(News report from Issue No. 59, published on Oct. 4 2011)

Kyrgyzstan applies to join the Customs Union

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SEPT. 23 2011 (The Conway Bulletin) – Kyrgyzstan has applied to join the Russia-Belarus-Kazakhstan customs union, Bloomberg quoted Russian first deputy PM Igor Shuvalov as saying. Kyrgyzstan has hinted throughout the year it wants to join the union which some analysts say is a Russian ploy to pull in its former Soviet neighbours.

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(News report from Issue No. 58, published on Sept. 27 2011)

Kazakhstan inches closer to WTO membership

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SEPT. 22 2011 (The Conway Bulletin) – Kazakhstan signed a bilateral trade agreement with the US, media reported, taking it a step closer to WTO membership. The key aspect of the deal allows easier access to the Kazakh market for US service providers, especially in the energy industry. Kazakhstan first applied for WTO membership in 1996.

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(News report from Issue No. 58, published on Sept. 27 2011)

US engagement in Central Asia marks the return of the Silk Road

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SEPT. 27 2011 (The Conway Bulletin) – The Silk Road is back in vogue, at least at the UN’s General Assembly last week.

On the sidelines of the meeting, US Secretary of State Hillary Clinton and foreign ministers from Europe, India, Pakistan, Afghanistan and Central Asia were busy plotting a revival of the ancient trading route.

Media reports said the US sees the Silk Road as a way of boosting economic activity in Afghanistan from 2014 when NATO forces pull out of the country.

But if the Silk Road, which has always been a concept rather than a single physical route, is going to return to its glory days it requires a stable, prosperous and open Central Asia through which trade can flow.

Kazakhstan, with its anticipated economic growth of around 7% a year and increasingly open markets, is perhaps the only Central Asian state which fits that description. Uzbekistan and Turkmenistan are relatively closed and instability plagues Kyrgyzstan and Tajikistan.

Of course, a modern day trading system already straddles Central Asia. Lorries carry goods from China to Russia and on to Europe and pipelines pump oil from the Caspian to Western markets. It may not be the Silk Road with Afghanistan at its core that the US envisages, but it is a start.

ENDS

(News report from Issue No. 058, published on Sept. 27 2011)

Armenia-Iran trade increases fast

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SEPT. 19 2011 (The Conway Bulletin) – Trade between Armenia and Iran has increased by 40% recently, Iran’s ambassador in Yerevan said according to local media. Iran has been looking to increase military and economic relations. Iran mainly exports gas to Armenia and imports power from Armenia.

ENDS

(News report from Issue No. 57, published on Sept. 19 2011)