Tag Archives: economy

Tajikistan’s TALCO lays off 607 workers

DUSHANBE, APRIL 18 2016, (The Conway Bulletin) — Central Asia’s largest aluminium smelter, TALCO, laid off 607 workers to cut costs, an indication of how a heavy fall in global commodity prices has hit industry in Tajikistan.

TALCO is Tajikistan’s largest factory, its biggest taxpayer and its biggest consumer of electricity. It dominates the Tajik economy so for it to lay off 607 workers cuts deep into the national conscience. TALCO now employs 8,200 workers.

According to a report by the Reuters news agency, foreign consultants had advised the company to cut around 2,000 workers from the workforce to maintain a healthy balance sheet.

The company, however, chose what it described as a “a gentle strategy to optimise costs”.

Aluminium prices, now at $1,530/tonne, are around 25% lower than in August 2014.

Besides having to cope with lower revenues, TALCO is also under the spotlight for unpaid electricity bills to the national distributor Barqi Tojik and is the focus of a parliamentary investigation in Norway over alleged corrupt practices.

The Norwegian investigation involves Norsk Hydro, a government- owned smelter that has done business with TALCO.

Norway’s MPs want to know who the beneficial owner of Talco Management, registered in the British Virgin Islands, is. Talco management controls TALCO in Tajikistan.

ENDS

(News report from Issue No. 277, published on April 22 2016)

EBRD praises Kazakh economy

APRIL 8 2016 (The Conway Bulletin) – The European Bank for Reconstruction and Development (EBRD) has defended Kazakhstan’s economic record over the past couple of years despite a sharp currency devaluation, rising inflation and thousands of job losses, media reported. Media quoted the EBRD’s chief in Kazakhstan, Janet Hackman, saying that Kazakhstan was not faced with an economic crisis because of steps it had taken recently to join the WTO and move to an inflation targeting monetary policy.

ENDS

(News report from Issue No. 276, published on April 15 2016)

Bad loans re-emerge in Kazakhstan

APRIL 11 2016 (The Conway Bulletin) – Kazakhstan’s Central Bank said non-performing loans had grown by 7.7% in tenge terms in the first two months of the year. Compared to last February, most banks saw their portfolio worsen, with the notable exception of the two largest lenders, Kazkommertsbank and Halyk Bank. As a proportion, overdue loans now represent 8.3% of total lending in Kazakhstan.

ENDS

(News report from Issue No. 276, published on April 15 2016)

Berdy says time to stop Turkmen government subsidies for utilities

APRIL 11 2016 (The Conway Bulletin) – At a government meeting, Turkmen President Kurbanguly Berdymukhamedov appeared to suggest the unimaginable. He said he wanted to scrap state subsidies for gas, electricity, water and salt.

And, unscoring the growing economic pressure in Turkmenistan, Mr Berdymukhamedov also sacked the ministers for economic development and foreign economic relations as well as the head of the tax administration.

Mr Berdymukahmedov has now sacked six top government officials this year.

With little accurate economic data coming out of Turkmenistan, the quick succession of sackings and the musing over cutting government subsidies suggest that the Turkmen economy, which is so heavily reliant on gas sales, is listing heavily.

Government subsidies of utilities is one of its cornerstone policies. They have been in place since 1993, although Mr Berdymukhamedov floated the idea of cutting the subsidies through the Council of Elders last year. The Council of Elders is a traditional Turkmen advisory body although it has been co-opted over the past two decades to test the opinions of the president with the public.

Now, though, according to press reports, Mr Berdymukhamedov has openly discussed cutting the subsidies for the first time.

“This is no longer justifiable from an economic point of view. It is hindering our transition to a market economy and imposing an additional burden on the budget,” he said.

There is no publicly available data which shows just how much the government spends each year on subsidises for gas, electricity, salt and water for the 5.5m people who live in Turkmenistan.

ENDS

(News report from Issue No. 276, published on April 15 2016)

Kazakh econ health worsens

APRIL 11 2016 (The Conway Bulletin) – Kazakhstan’s Central Bank said the country’s economic health worsened, as the debt/GDP ratio grew from 72.4% in 2014 to 83% last year. The debt/GDP ratio is the key figure to watch as it is recognised as a key indicator of economic health. Like the rest of the region, Kazakhstan has been trying to fend off an economic downturn.

ENDS

(News report from Issue No. 276, published on April 15 2016)

Azerbaijan’s SOCAR transfers

APRIL 11 2016 (The Conway Bulletin) – Azerbaijani state energy company SOCAR transferred 109m manat ($72m) to the government’s budget in March, a drop of around 4% from the same month in 2015, media reported. The drop high- lights the continued pressure that SOCAR and the rest of the Azerbaijani economy is under from the low global oil prices. In US dollar terms, the drop is even more severe. Last year, the manat lost half its value.

ENDS

(News report from Issue No. 276, published on April 15 2016)

Kazakh oil production to drop

APRIL 13 2016 (The Conway Bulletin) – OPEC, a club of oil exporting countries, and the US Energy Information Administration (EIA) said Kazakhstan’s oil output will decline this year. OPEC said Kazakh production will slow by 3.2% to 1.55m barrels/day. The EIA, which uses different parameters in its calculations, said it would fall 1.2% to 1.71m barrels/day.

ENDS

(News report from Issue No. 276, published on April 15 2016)

Kyrgyz GDP declines

APRIL 11 2016 (The Conway Bulletin) – Kyrgyzstan’s GDP stood at 79b som ($1.15b) in the first quarter of the year, a decrease of 4.9% compared to the same period last year, the national statistics committee said. Officials blamed industrial output and precious metals production for the decline. Without accounting for the Kumtor gold mine, the country would have seen its GDP increase by 1%.

ENDS

(News report from Issue No. 276, published on April 15 2016)

Tajik and Kyrgyz migration start to rise

APRIL 8 2016, DUSHANBE (The Conway Bulletin) — Migration from Kyrgyzstan and Tajikistan to Russian cities rose in April, signalling an improvement in Russia’s economy and also, potentially, giving all-important remittance flows back to Central Asia a boost.

Kyrgyzstan and Tajikistan marked an increase of 0.2% and 1.8% in the number of migrants in Russia compared to the same time last year, according to official statistics from the Russian Federal Migration Service. It recorded its data on April 6.

The rise may be small but it is important as it breaks a downward trend over the past 18 months. Also, official figures only report on a portion of the total migrant population as a large part of it is illegal. When official statistics go up, analysts believe the overall number of migrants grows even faster.

Together with Uzbekistan, which recorded the same number of people living in Russia this year as 2015, people from Kyrgyzstan and Tajikistan represent the most important migrant populations from Central Asia. The home countries of these migrant workers depend heavily on remittances from their migrant workers.

Migrant numbers to Russia had slowed significantly in the past two years due to tougher migration policies and a sharp depreciation in the rouble at the end of 2014, linked to a fall in oil prices and a recession. The drop in the value of the rouble also depressed the value of remittances that migrants were sending home.

This year, though, the rouble has gained around 17% against the US dollar since the low point of 81/$1 in mid-January and the economic situation in Russia appears to have improved enough to attract migrants once again.

ENDS

(News report from Issue No. 276, published on April 15 2016)

Kazakh President signs Iran deal

APRIL 10 2016 (The Conway Bulletin) – Kazakh President Nursultan Nazarbayev flew to Tehran to meet with President Hassan Rouhani sign deals worth around $1b, giving Kazakhstan-Iran economic ties a major boost. Kazakhstan has been forthright at trying to boost economic ties with Iran since sanctions were relaxed earlier this year.

ENDS

(News report from Issue No. 276, published on April 15 2016)