Tag Archives: economy

Kazakhstan to set up monetary policy committee in Central Bank

ALMATY/JAN. 21 2021 (The Bulletin) — In an attempt to both modernise the Central Bank’s decision-making process and to inject some confidence into its currency, Kazakhstan set up a Monetary Policy Committee that will oversee interest rate setting decisions and inflation targets.

When it comes into operation later this year the committee will be the first focused on monetary policy in Central Asia and will, eventually, include independent economists.

“The establishment of the Monetary Policy Committee is in line with the best practices of inflation–oriented countries and will increase the efficiency and transparency of monetary policy decisions,” the Central Bank said in a statement.

Like other currencies in the Central Asia and South Caucasus regions, the impact of the coronavirus pandemic has buffeted Kazakhstan’s tenge, forcing it down to below 450/$1 in March last year from around 380/$1 in January. It is now trading at 420.4/$1.

Confidence in the tenge was already weak before the coronavirus pandemic as the Central Bank was blamed for its collapse in 2014 after a sharp fall in oil prices.

And it was perhaps with this in mind that Kazakh President Kassym-Jomart Tokayev ordered, in September last year, a Monetary Policy Committee to be set up. The order also came during a more general modernisation of the Kazakh Central Bank. It has dusted off plans to shift its headquarters to Nur Sultan from Almaty. The original plan was scrapped in 2015 after the economy went into recession.

On its new Monetary Policy Committee, analysts said that the Central Bank needs to move quickly to bring in independent economists. And the Central Bank agreed.

“In the medium term, the Committee will include independent members who specialise in macroeconomics and monetary policy and have extensive experience,” it said.

In its last interest rate setting decision, in December last year, the Kazakh Central Bank kept its core interest rate at 9%, saying that inflation was stable.

— ENDS

— This story was first published in issue 469 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2021

Remittance flows to Kazakhstan fall

Leave a Reply

JAN. 20 2021 (The Bulletin) — Remittance flows to Kazakhstan, an important indicator of the economic health of the entire Central Asia region, dropped by 18.5% in 2020, the ranking.kz economic website reported. It said that the flow of cash from Russia dropped by nearly 50%, highlighting the impact of the coronavirus pandemic on the Russian economy. Remittances are a vital source of income for people in Central Asia. After Russia, the second most important origin of remittances to Kazakhstan last year was South Korea.

— ENDS

— This story was first published in issue 469 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2021

Turkey ratifies free trade deal with Azerbaijan

Leave a Reply

BAKU/JAN. 19 2021 (The Bulletin) — — Turkey’s parliament ratified a free trade agreement with Azerbaijan, part of a plan to boost bilateral trade by five or six times over the next couple of years.

The free trade deal was originally signed by Azerbaijani President Ilham Aliyev and Turkish President Recep Tayyip Erdogan in February last year. Since then the coronavirus has slowed global trade but Azerbaijan’s victory, supported by Turkey, in a war against Armenia has accelerated increasingly close relations.

Turkish media reported that the free trade deal will allow quotas and customs to be lifted on certain goods. Turkey’s main exports to Azerbaijan are machinery, construction materials and mechanical appliances.

And media in Azerbaijan has reported that Azerbaijani President Ilham Aliyev said that he would prioritise handing contracts to rebuilding Nagorno-Karabakh to Turkish companies in what appears to be a clear statement of gratitude for Turkish support in Azerbaijan’s war with Armenia in 2020.

One of the first deals to be announced was a $50m investment by Turkey into a textile factory in Nagorno-Karabakh.

— ENDS

— This story was first published in issue 469 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2021

Fuel prices rising in Tajikistan

Leave a Reply

JAN. 18 2021 (The Bulletin) — Fuel prices are rising in Tajikistan, media reported by quoting local taxi drivers who said that there had been a 10% increase in the past week. Analysts said that the fuel price increase is linked to a drop in imports of fuel from Russia and Kazakhstan. Tajikistan does not have its own oil refinery and is reliant on imports.

— ENDS

— This story was first published in issue 469 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2021

Azerbaijan commissions new Central Bank HQ

Leave a Reply

JAN. 15 2021 (The Bulletin) — In a show of confidence in its Central Bank which was derided by ordinary Azerbaijanis six years ago for allowing the manat to devalue twice in 12 months, Azerbaijan’s government commissioned the construction of a new $265m and 37-storey headquarters for it. Building work, by Turkish construction company Tekfen, is expected to take three years.

— ENDS

— This story was first published in issue 469 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2021

Flour prices rise again in Tajikistan

Leave a Reply

JAN. 6 2021 (The Bulletin) — Flour prices in Tajikistan, which are managed by the state, have continued to rise, media reported. Reports said that a bag of flour rose in price by 4% in December. Inflation is rising across Central Asia. Media in Kyrgyzstan has reported that the price of meat had risen by a third in the second half of 2020.

— ENDS

— This story was first published in issue 467 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2021

Fuel prices rise in Azerbaijan

Leave a Reply

JAN. 4 2021 (The Bulletin) — State-mandated fuel prices rose in Azerbaijan to offset, state-owned energy company Socar said, the refining investments it has made to improve quality. Media reported that AI-92 petrol had risen by 11% and the cost of a litre of diesel had risen by a third. Fuel price rises have previously triggered disquiet in the region.

— ENDS

— This story was first published in issue 467 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2021

Georgia’s economy shrinks in 2020

Leave a Reply

DEC. 31 2020 (The Bulletin) — Georgia’s economy shrunk by 7.7% in 2020 because of the impact of the coronavirus pandemic, Geostat said, more than the 4% that economists had predicted earlier in the year (Dec. 31). Economists have now said that they expect these worse-than-predicted results to be played out across the region

— ENDS

— This story was first published in issue 467 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2021

Georgian economy shrinks by 6%

Leave a Reply

JULY 31 (The Bulletin) — Georgia’s economy was 5.8% smaller by the end of June compared to the same period in 2019 because of the impact of the coronavirus pandemic, official data showed. This is in line with previous estimates for a coronavirus-linked recession. In the first six months of 2019, Georgia’s economy had grown by 4.9%.

ENDS

— This story was published in issue 455 of the Central Asia & South Caucasus Bulletin, on July 31 2020.

— Copyright the Central Asia & South Caucasus Bulletin 2020

Azerbaijan cuts interest rates

Leave a Reply

JULY 30 (The Bulletin) — Azerbaijan’s Central Bank cut its core interest rate by a quarter of a percentage point to 6.75%, its lowest rate for more than four years, to try to stimulate lending and its economy. Like the rest of the region, analysts have said that the coronavirus pandemic may tip Azerbaijan’s economy into a recession, although it is protected by cash earned from oil and gas sales.

ENDS

— This story was published in issue 455 of the Central Asia & South Caucasus Bulletin, on July 31 2020.