Tag Archives: IFI

Editorial: Uzbekistan’s railway

FEB. 26 2016 (The Conway Bulletin) – At 19.2km, the Kamchik Pass railway tunnel may be the longest in Central Asia and might also be a great engineering achievement, but it is also a sign of Uzbekistan’s further isolation from world politics and markets.

Uzbekistan said it completed a World Bank and China-backed railway bypass in the Ferghana Valley that will allow its trains to run to the east of the country without having to transit through Tajikistan.

The World Bank support is important because it shows international endorsement for a mega project that Uzbekistan was eager to achieve despite the economic downturn rolling through Central Asia.

Chinese money and workers were key to the success of the project, as China has growing interest in building infrastructure in Central Asia to support its ambitious project to connect with Europe via rail and road.

Tajikistan is the main loser in this game. It will no longer receive the in- kind payment of $25m worth of gas shipments from Uzbekistan in exchange for the railway transit. And it also lost an important diplomatic chip in its endless row with Tashkent.

ENDS

(Editorial from Issue No. 269, published on Feb. 26 2016)

EBRD finances Kazakh road

FEB. 18 2016 (The Conway Bulletin) – The European Bank for Reconstruction and Development (EBRD) said it is giving Kazavtozhol a $103m loan to widen an 80km stretch of road in southern Kazakhstan on the main south-north highway. The EBRD has been an important driver of infrastructure projects in former Soviet Central Asia since the collapse of the USSR in 1991.

ENDS

(News report from Issue No. 268, published on Feb. 19 2016)

IMF draws funding plan for Tajik Rogun

FEB. 4 2016 (The Conway Bulletin) – IMF representatives met with Tajik government officials in Dushanbe to draw up funding plans for the $2b Rogun hydropower plant. The IMF has said that the World Bank-backed Rogun project, strengthening its banking sector and diversifying the economy are priorities for Tajikistan. Down- stream Uzbekistan has lobbied hard against the Rogun dam.

ENDS

(News report from Issue No. 266, published on Feb. 5 2016)

EBRD funds power plant in Kazakhstan

JAN. 31 2016 (The Conway Bulletin) — The EBRD sent a $5.9m loan to Sagat Energy for the completion of a combined gas and heat electric power plant in Atyrau, western Kazakhstan. The plant will have a capacity of 11 MW.

ENDS

(News report from Issue No. 266, published on Feb. 5 2016)

IMF flies to Azerbaijan for talks on $4b loan

JAN. 27 2016, BAKU (The Conway Bulletin) — An IMF delegation flew to Baku for meetings with Azerbaijan’s government over a potential loan to buffer it against a financial storm that now threatens to seriously damage its economy.

The FT newspaper reported that the the loan could hit $4b, although an IMF statement later dodged giving specific numbers.

“An IMF team will be in Baku during Jan. 28 – Feb. 4 for a fact- finding staff visit at the authorities’ request. The team will discuss areas for technical assistance and assess possible financing needs,” it said in a statement.

Azerbaijan’s finance minister, Samir Sharifov, though, played down reports of a loan.

He instead said that Azerbaijan was going to raise $2b by selling debt for the Southern Caucasus Gas Corridor Company, which manages various pipelines, and pipeline projects, running from the Caspian Sea to Europe.

“There is no urgent need for a loan, but we can raise loans to support the economy amid low oil prices,” Mr Sharifov told journalists in Baku of talks with the IMF.

If Azerbaijan did take an IMF loan it would be the first emergency loan given to a sovereign state during this current financial downturn. Taking an IMF loan would also dent Azerbaijan’s pride. Fuelled by high oil prices its economy has boomed over the past 15 years. The government has invested heavily in promoting its reputation as a bridge between the East and West, building grandiose towers and sponsoring major sports events.

But the government has failed to shift Azerbaijan from a petro-econ- omy to a more dynamic economy with several income streams. Instead, Azerbaijan still receives around 95% of its export revenue from oil sales.

And with oil prices at around 12- year-lows this has begun to hurt.

The government has slashed spending, inflation is soaring and jobs are melting away. The manat currency has dropped a third in value in the past month and frustrated ordinary people are beginning to speak out and protest against the government.

A Conway Bulletin correspondent in Baku said people in the streets were increasingly referring to the current economic downturn as a “crisis”.

ENDS

(News report from Issue No. 265, published on Jan. 29 2016)

Armenia’s bank wants IPO

JAN. 22 2016 (The Conway Bulletin) – Armenia’s biggest bank Ameriabank said that it would seek an IPO in London within the next couple of years after the European Bank for Reconstruction and Development (EBRD) bought a stake in it. If Ameriabank did list in London it would be the first Armenian company to list on a Western stock market.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Armenia’s Ameriabank aims for London IPO within 2 or 3 years

JAN. 21 2016 (The Conway Bulletin) — Ameriabank, Armenia’s largest bank, said it wants to list its shares on the London stock exchange, after it received an investment of around $100m from international lenders, including the EBRD and the World Bank’s IFC.

If Ameriabank does list on LSE, it would be the first Armenian bank, or company even, to be publicly traded on a Western stock exchange. In the South Caucasus it would be the second publicly traded bank after Bank of Georgia.

Ameriabank’s chairman Andrew Mkrtchyan said the bank plans an IPO in the next two or three years.

“Our aspiration is an IPO (initial public offering) and to try to triple our balance sheet in the next three years,” Mr Mkrtchyan told Reuters.

The EBRD said it paid $30m for an equity stake of around 20% in Ameriabank and has pledged an additional $10m for the bank’s asset growth.

“This is the largest single-ticket equity deal the EBRD has signed in the region to date,” the EBRD said in a statement.

By becoming a shareholder, the EBRD has committed to growing the bank in Armenia.

“As a shareholder the EBRD will support Ameriabank’s development, with a special emphasis on corporate governance,” Mark Davis, head of the EBRD Yerevan office, said.

The World Bank’s IFC also provided Ameriabank with a $50m loan to increase its lending capacity.

For Armenia, the investments by the EBRD and the IFC are a vote of confidence in its banking sector and are especially important at a time when currencies and economies in the region are depreciating or falling back on earlier growth spurts.

For foreign investors, an Ameriabank IPO would give them a chance to buy into an Armenian corporation for the first time.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Georgia announces first wind farm tender

JAN. 5 2016 (The Conway Bulletin) – Georgia announced a tender to build its first wind farm in conjunction with the European Bank for Reconstruction and Development (EBRD). The project is estimated to cost $35m, with the EBRD giving a $25m loan. The wind farm will consist of 10 turbines and produce two megawatts of power. States in Central Asia and the South Caucasus are investing in wind power to help meet power demand.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Kazakhstan’s parliament agrees $1b loan

DEC. 23 2015 (The Conway Bulletin) – Kazakhstan’s parliament ratified a deal to take a $1b loan from the Asian Development Bank to plug a gap in the government’s finances. The deal was agreed in November. The sharp fall in oil prices has hit Kazakhstan’s economy hard shrinking growth rates and government revenues.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

ADB funds Azerbaijani infrastructure

DEC. 14 2015 (The Conway Bulletin) – The Asian Development Bank (ADB) said it would allocate a loan of up to $2.24b to co-finance transport and energy projects in Azerbaijan in 2016- 2017. Out of this loan, the ADB said it would allocate $500m to developing the electricity network and $40m for renewable energy.

ENDS

(News report from Issue No. 261, published on Dec. 20 2015)