MAY 26 2016 (The Conway Bulletin) — Kazakhstan’s Parliament ratified an agreement to receive a $1b loan from the World Bank’s International Bank for Reconstruction and Development, a cash injection that the government will use to pay for expenses in 2016. Kazakhstan’s finance ministry and the IBRD had agreed on the loan on May 11.
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(News report from Issue No. 282, published on May 27 2016)
MAY 11 2016 (The Conway Bulletin) – Kazakhstan’s ministry of finance said it has agreed to take a $1b loan from the World Bank’s International Bank for Reconstruction and Development to plug a budget deficit that has opened up since an economic downturn hit the region. Finance minister Bakhyt Sultanov, said the loan will have a 20-year maturity and will be used to pay for government expenses in 2016.
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(News report from Issue No. 280, published on May 13 2016)
MAY 10 2016 (The Conway Bulletin) – In a statement to the UN, Kazakhstan announced plans to generate 50% of its electricity from alternative energy sources by 2050. This is an ambitious target. In 2014, renewable sources accounted for just 0.5% of production. The Kazakh government often lays out grandiose plans for its economic development. Green energy is the dominant theme of EXPO 2017, a major exhibition scheduled for next year in Astana.
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(News report from Issue No. 280, published on May 13 2016)
APRIL 15 2016 (The Conway Bulletin) – Azerbaijan is phasing out a programme that funded overseas study for undergraduates in order to save money during an increasing vicious economic downturn.
Mikhail Jabbarov, Azerbaijan’s minister of education, said funding for bachelor level programmes has dried up.
“The ministry is developing a new format of the program, which envisages education at foreign higher educational institutions only for PhD and Master’s Degrees,” Mr Jabbarov told media.
The government’s stated objective is to attract more foreign professors to Azerbaijan to allow undergraduates to receive high-level tuition without having to study abroad.
What the government cannot openly say is that the programme has become unsustainable because of a sharp drop in oil prices that has dragged down its economy.
The ministry of education’s overseas undergraduate programme is one of two channels that Azerbaijani youth can use to access scholarships to study abroad.
SOFAZ, the country’s oil fund, had also established an eight-year programme in 2007 to fund education abroad. But that programme is now being wound up and is unlikely to be extended.
In the first quarter of 2016, SOFAZ said it spent 5m manat ($3.3m) paying fees for Azerbaijanis studying abroad.
Analysts have said that if both programmes were cut, Azerbaijan would, effectively, be isolating itself from the West.
The government has already cut several domestic social projects, including updating broadband internet across the country and investments in care homes, roads and railways, to cut costs.
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(News report from Issue No. 277, published on April 22 2016)
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.
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(News report from Issue No. 276, published on April 15 2016)
NOV. 18 2015 (The Conway Bulletin) – Official media in Uzbekistan reported that President Islam Karimov has signed a resolution to begin a $16.6 investment programme running in 2016 and 2017. The main focus of the programme is to upgrade and modernise the country’s technology and energy sectors. Projects include part of a gas pipeline to China and the construction of both a petro-chemical plant and a thermal power station.
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(News report from Issue No. 257, published on Nov. 20 2015)
NOV. 10 2015 (The Conway Bulletin) – In what it described as a push to promote competition, the Kazakh government said it will cut subsidies for bread, petrol, and animal husbandry. In particular, the government will cut subsidies for wheat producers from 2,500 tenge/tonne ($8) to zero. The government may be looking to save money.
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(News report from Issue No. 256, published on Nov. 13 2015)
OCT. 27 2015 (The Conway Bulletin) – Samruk-Kazyna, Kazakhstan’s sovereign wealth fund, signed a five-year loan agreement for up to $1.5b to help fund its purchase of a 8.4% stake in the Kashagan oil field. Kazmunaigas, Kazakhstan’s state-owned energy company, agreed earlier this year to sell half its 16.81% stake in Kashagan to Samruk–Kazyna. The manoeuvre is considered a mechanism to help Kazmunaigas raise funds during this period of depressed oil prices.
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(News report from Issue No. 254, published on Oct. 30 2015)
OCT. 29 2015 (The Conway Bulletin) – Armenia’s government and Tahir Group, which bought the country’s electricity networks last month, said that they will subsidise electricity prices until the end of July 2016. Earlier this year thousands of Armenians protested against proposed electricity price rises.
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(News report from Issue No. 254, published on Oct. 30 2015)
JULY 9 2015 (The Conway Bulletin) – Tajikistan needs to invest about $2b into its infrastructure if it wants to provide clean drinking water for its entire population, Alimurod Islomzoda, head of the Tajik state public utilities company, said.
This is a rare public omission in Tajikistan but Mr Islomzoda didn’t stop there. He also said that updating the system would take 80 years.
“To date, only some 57 percent of the country’s population has access to safe drinking water,” the Asia-Plus news agency quoted Mr Islomzoda as saying. “About $2b is needed and the full rehabilitation of the water supply systems will take 80-85 years.”
Tajikistan is one of the poorest countries in the world and with vital remittances from Russia dropping by around 40% this year because of a downturn in the Russian economy, the outlook is looking worse.
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(News report from Issue No. 239, published on July 9 2015)