Tag Archives: Georgia

Athletes from C.Asia and S.Caucasus win medals at Rio Olympics

AUG. 29 2016 (The Conway Bulletin) — At the Olympics in Rio, Uzbekistan won four gold medals, including three in boxing. Kazakhstan once again pulled in a decent haul, winning three golds, including a first ever swimming win, five silvers and nine bronzes. Tajikistan also won its first gold medal since independence from the Soviet Union in 1991. Dilshod Nazarov won gold in the hammer, becoming an instant national hero in Tajikistan. In the South Caucasus, Azerbaijan won a gold medal in taekwondo, Georgia won golds in wrestling and weightlifting and Armenia won a wrestling gold, its first for 20 years.

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(News report from Issue No. 293, published on Aug. 29 2016)

Georgian president blocks gay rights referendum

AUG. 9 2016 (The Conway Bulletin) — Georgian President Giorgi Margvelashvili blocked a petition calling for a referendum that sought to enshrine an outright ban on gay marriages in Georgia’s Constitution. Supporters of the petition had argued for a referendum on the issue to be held at the same time as a parliamentary election in October.

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(News report from Issue No. 292, published on Aug. 12 2016)

Yandex taxi to expand in Georgia and Kazakhstan

JULY 27 2016 (The Conway Bulletin) — Internet taxi service Yandex Taxi said it plans to enter the Georgian market and expand its presence across Kazakhstan from its base in Almaty. Yandex Taxi entered the Armenian market in July, triggering complaints of price dumping from the traditional taxi association in Yerevan. In June, mobile-based Uber started operations in Astana.

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(News report from Issue No. 291, published on Aug. 1 2016)

Georgia sign gas deal with Iran

JULY 26 2016 (The Conway Bulletin) — Iran signed an agreement with Georgia to export gas via Armenia, Iranian official media reported. In February, Georgia had said that gas supplies from Iran would only be considered in the long term, as Azerbaijan was able to export enough gas to meet Georgia’s growing demands. With Azerbaijan’s production declining and Iran’s export to Armenia due to increase, Georgia could now find another supplier in Iran.

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(News report from Issue No. 291, published on Aug. 1 2016)

Briefing: Gulenist links in Central Asia & S.Caucasus

AUG 1 2016 (The Conway Bulletin) — >>So, we know that the Gulen movement was big in Turkey but in Central Asia? Really? How deep is it and what does it do?

>> The movement, created by cleric Fethullah Gulen, is a social and religious group that has said it wants to integrate moderate Islam into the secular Turkish state and to replicate the model in other Muslim countries. The movement counts millions of followers. As it puts great emphasis on education and upward social mobility, the movement established a network of schools around the world, including in Central Asia and the South Caucasus.

>>OK, but who is Gulen? Wasn’t he an ally of Erdogan?

>> Turkish President Recep Tayyip Erdogan found in Gulen a strong ally when he came to power in 2003, a bulwark against a possible military backlash, something that had dogged Turkish leaders for half a century. Gulen and Erdogan, though, fell out in 2013, when a corruption scandal targeting members of Mr Erdogan’s ruling AKP party emerged. Mr Erdogan and others in his party alleged that the Gulenist members of the judiciary had orchestrated the scandal. Since then the government has cracked down on Gulenists in Turkey. Mr Gulen has lived in the United States since 1999 in a self-imposed exile. Now, after a failed coup in Turkey last month blamed on Gulen, Turkey has said it could ask the US government for the extradition of Gulen. Since the coup, Turkish police have detained over 60,000 state employees and dozens of journalists and businessmen allegedly linked to the Gulen movement.

>>Quiete a full-on assault. Will Turkey now force a crackdown on Gulen- linked institutions in Central Asia and South Caucasus?

>> In short, this bureau and the analysts we contacted all agree that Turkey will not go as far as to sever relations with countries that don’t respond to the request to shut down Gulen-linked schools. Apart from Azerbaijan, all other countries are loosely linked with Turkey. Plus, as shown in our story on page 3, these schools are a relative island of quality and reliability in the South Caucasus and Central Asia’s messy educational system. Both Kyrgyzstan and Kazakhstan have shrugged off Turkey’s requests to shut down Gulen- linked schools. Georgia appears also to have pretty much ignored Turkey’s request. Only Azerbaijan, Turkey’s super-tight ally, has gone along with Turkey’s request and closed down a TV station that had planned to run an interview with Gulen and brought under government control a university linked to the Gulen movement.

>>OK, but what about the businesses linked to Gulen?

>> The closest business link between Gulenists and the South Caucasus seems to have been uprooted immediately, with the sacking of Sadettin Korkut, chief of Petkim, a petrochemical complex in Izmir, owned by Azerbaijan’s state-owned SOCAR (See the front page of the Business News). It appears that SOCAR was also keeping a list of Gulen-linked people among its ranks. Together with Korkut, who was later arrested, around 200 other employees of SOCAR-linked companies were sacked. This, however, appears to be a one-off act of loyalty from Azerbaijan’s government to Ankara.

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(News report from Issue No. 291, published on Aug. 1 2016)

Georgia’s Central Bank to cut interest rate

JULY 27 2016 (The Conway Bulletin) — Georgia’s Central Bank said on Wednesday it cut its key interest rate by a quarter of a percentage point to 6.75%. The decision is in line with the Bank’s policy of containing inflation while reducing the rate to within a 5% – 6% corridor in the short term. Since April, the Bank has cut interest rates three times from the previous level of 8%.

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(News report from Issue No. 291, published on Aug. 1 2016)

Georgia looks to boost wine sales to China

TBILISI, JULY 27 2016 (The Conway Bulletin) — Georgia’s wine marketing chiefs are looking to reduce their export over-dependence on Russia and boost sales to China.

Having cemented its status and influence in Central Asia over the past decade, China has pushed harder for a stronger foothold in the South Caucasus. In the last few years it has opened up cultural centres, sent senior officials on trade and diplomatic visits and given out soft loans.

Now China also appears to be sponsoring an education and advertising drive to encourage consumers to buy products from the region, including that most iconic of Georgian products — wine.

In an interview with The Conway Bulletin, Irakli Cholobargia, the head of marketing at the Georgian National Wine Agency, said that China had built shops dedicated to selling Georgian wine.

“Wine consumption in China is growing and Georgian wine is an extremely attractive product on Chinese market because of its ancient origins and old traditions,” he said.

“There are businessmen who started to open big wine houses wholly dedicated to Georgian wines. This is a completely different approach to the wine business. Nowhere else is there this kind of approach.”

And the figures back up this trend. China has now become Georgia’s third biggest export market after a 148% increase in sales during the first half of the year.

Georgia is likely to sign a free trade agreement with China later this year, again boosting trade between the two countries.

All this, Mr Cholobargia said, was helping his strategy of reducing the Georgian wine industry’s reliance on Russia. Russia stopped a number of products being imported from Georgia in 2006, including wine, when relations between the two countries fell apart, leading to a brief war in 2008. In 2013, the trade embargo was relaxed.

“The Russian market is not a stable market. Before the embargo in 2006, 80% of our export went to Russia,” Mr Cholobargia. “When it opened up in 2013, we had 65% of total export to Russia. Now it is about 50%. Our goal is to keep shrinking this, and maybe get to the 30%.”

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(News report from Issue No. 291, published on Aug. 1 2016)

Imports fell in Georgia

JULY 19 2016 (The Conway Bulletin) — Georgia’s Statistics Committee said that trade turnover had shrunk by 11% in H1 2016, compared to the same period last year, dragged down by dwindling imports. Overall, the fall in both exports and imports resulted in a smaller trade deficit of $2.3b. Turkey, Russia and China are Georgia’s main trading partners.

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(News report from Issue No. 290, published on July 22 2016)

Briefing: Region’s economies sputter into life

JULY 22 2016 (The Conway Bulletin) — >>Malaise, downturn recession. What exactly going on in Central Asia and the South Caucasus?

>>All countries in the region are either growing slower than last year or, in some cases, their economies are even shrinking. The crisis is regional, although each country has shown its own specific problems.

>>This is the region-wide problem. I can see but what caused it?

>>The US dollar strengthened so much in 2014 that it triggered a sharp drop in oil and commodity prices. This pulled dollars away from Emerging Markets, like our own patch. As commodity prices sank, Russia fell into a crisis that quickly turned into a recession. The depreciation of the rouble cut the value of salaries earned by migrant workers, triggering a slowdown in remittances to Central Asia and the South Caucasus.

>>Okay, but oil prices picked up again since the 13- year low point in January. Isn’t that good for energy exporters in Central Asia and the South Caucasus?

>>Higher oil prices have helped state-owned oil companies to relax their emergency mode, but they’re still too low to justify the region’s most expensive projects. Think of the Kashagan oil project in Kazakhstan’s sector of the Caspian Sea, or the upgrade of Azeri Chirag-Guneshli oil project in Azerbaijan. Plus there are negative signs for transparency over the re-organisation of government companies and structures in the energy sector in Kazakhstan and Turkmenistan.

>>And what about the other commodities, such as gold and aluminium?

>>Gold is a big component of Kyrgyzstan’s GDP as it depends on the performance of the Kumtor gold mine in the east of the country. This year, operational problems and corporate battles have slowed production, which has significantly hit Kyrgyzstan’s growth figures. It now could slip into a recession. Tajikistan, on the other hand posted a promising 6.6% GDP growth in the first half of 2016 and state-owned smelter TALCO increased aluminium production. But these numbers should be read with caution. TALCO also said that it is currently operating at a loss, as its production costs are 25% higher than market prices.

>>Right, so is it all bad?

>>Not necessarily. Dollarisation, as Georgia’s Central Banker said this week, is still a problem across the region and the currencies continue to be weak. But despite some devaluations and depreciations, most of them have kept steady in 2016, which is a sign that governments want to keep their economies stable and will spend their reserves to prop them up.

>>And for companies looking to do business in the region, how bad is it?

>>If in 2015 we saw scores of international companies running away from projects in Central Asia and the South Caucasus, this year we’ve seen promising developments, such as the final investment decision for the expansion of the Tengiz oil- field in Kazakhstan and the signing of the contract for the construction of the Rogun dam in Tajikistan, both multibillion-dollar commitments. French hypermarket Auchan has also opened up its long-awaited store in Dushanbe. Perhaps confidence is returning or at least a sense of “let’s just get on with it”.

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(News report from Issue No. 290, published on July 22 2016)

Georgia Central Bank chief says he may let lari value fall

TBILISI, JULY 21 2016 (The Conway Bulletin) — Koba Gvenetadze, the new chief of the Georgian Central Bank, hinted that he wants the lari currency to slide further to keep pace with Georgia’s neighbours who have all seen their currencies fall heavily over the past two years.

Mr Gvenetadze said that the lari had strengthened too much against the US dollar earlier this year and as soon as the Central Bank relaxed its interventions in the currency market in mid-June, it slid to 2.34/$1, down from a high of 2.13/$1.

“Part of the population thinks that a steady foreign exchange is a synonym of stability, but that’s wrong,” Mr Gvenetadze told the newspaper Rezonansi in an interview designed to lay out his monetary policy. Mr Gvenetadze took over as the Central Bank chief in March.

He said that if people continue to use US dollar-equivalent measures to calculate their wealth or the value of their property, the lari will continue to suffer.

“Sometimes unpopular decisions can be made, but we need to see what happens in the future,” Mr Gvenetadze said.

After losing 27% of its value in 2015, the lari had strengthened significantly against the dollar, gaining 13% by June. Since then, though, it has fallen back to January levels.

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(News report from Issue No. 290, published on July 22 2016)