APRIL 1 2014 (The Conway Bulletin) — The Uzbek authorities have increased the price of utilities by roughly 10%, media reported. For most of last year, reports from Uzbekistan have documented price rises and inflationary pressures. These have been frustrating parts of Uzbekistan’s population.
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(News report from Issue No. 178, published on April 2 2014)
MARCH 24 2014 (The Conway Bulletin) — The price of fuel in Kyrgyzstan has increased by as much as 6.7% since the beginning of the year, media reported. An official from an industry lobby group blamed increased import prices from Russia for the rise. Fuel price rises, especially sharp ones, can generate discontent.
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(News report from Issue No. 177, published on March 26 2014)
MARCH 14 2014 (The Conway Bulletin) — A rare admission from a Kazakh insider that the country’s energy policies may not be working hints at future fuel price increases, analysts have said.
Sauat Mynbayev, chairman of state-owned KazMunaiGas, said sending Kazakh oil to China to be processed into fuel and then re-importing it to make up for a shortfall in domestic refining capacity has become too expensive.
“The transit operations regarding the refining of Kazakhstan’s oil in China has become unprofitable,” media quoted him as saying.
Analysts immediately unpicked his statement. What this meant, they said, was that fuel prices would rise shortly.
And that, as the government knows, will be deeply unpopular.
Oil-rich Kazakhstan has a chronic lack of refining capacity. The three refineries at Shymkent, Pavlodar and Atyrau are often under repair. New refineries are only scheduled to come on-stream in five or six years time.
To make up for the shortfall, Kazakhstan is importing refined fuel from China and Russia. It is also sending unrefined fuel into China for processing and then shipping it back over the border.
Added to this complex arrangement is Kazakhstan’s 20% currency devaluation in February which makes imports even more expensive.
Mr Mynbayev has just been made head of Kazakhstan’s Greco-Roman wrestling federation, a position that underlines his insider credentials.
For an insider to admit a policy problem is almost unheard of in Kazakhstan. As analysts have now warned, expect fuel price increases.
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(News report from Issue No. 176, published on March 19 2014)
MARCH 8 2014 (The Conway Bulletin) — Food prices in Uzbekistan may have risen by as much as 30-70% over the last few weeks, an anecdotal survey by the Uzmetronom.uz website said. While Uzmetronom.uz’s figures may be out, there is little doubt that rising energy prices and falling business activity is pushing up inflation in Uzbekistan.
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(News report from Issue No. 175, published on March 12 2014)
FEB. 15 2014 (The Conway Bulletin) — In the week since the Kazakh Central Bank decided to de-value the tenge by 20%, prices in shops have risen, stoking fears of inflation. A Conway Bulletin correspondent in Almaty interviewed shoppers and stores owners for their feelings on the devaluation.
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(News report from Issue No. 172, published on Feb. 19 2014)
JAN. 31 2014 (The Conway Bulletin) — In its 54-page quarterly inflation report, Kazakhstan’s Central Bank said that between July and September 2013 prices rose by only 0.6% — the slowest rate for a decade. Kazakhstan has previously said that it is focusing on battling slowing inflation.
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(News report from Issue No. 170, published on Feb. 5 2014)
JAN. 31 2014 (The Conway Bulletin) — In its 2014 assessment of Azerbaijan’s economy, the Standard & Poor’s rating agency maintained Azerbaijan’s stable status with GDP growth of around 5%.
Although the World Bank and the Azerbaijani government have already given their predictions for next year, the S&P assessment is important to pick over.
Its forecast was generally in line with others, including the Azerbaijani government and the World Bank.
Where it did differ was on inflation and on potential risks to this growth prediction.
Azerbaijani media reported that S&P said inflation would increase by 4.7% this year compared to 2.4% last year. It also said inflation would rise to 6% in 2015 and over 8% in 2016.
Azerbaijan’s economy is recovering from the shock of the global financial crisis and the government has been looking for an increase in inflation.
It doesn’t, though, want this much inflation.
S&P said there were also other risks to Azerbaijan’s upward economic trajectory. One of these was the high consumer lending rate.
Azerbaijan’s Central Bank has already tried to tackle this by giving increasingly stringent guidelines to its banks on lending to consumers.
S&P also made another positive, and important, observation.
It said that the proportion of savings kept in dollars was dropping as people have increased confidence in Azerbaijan’s own currency. The proportion of savings held in dollars now was around 40%. Compare this to Kazakhstan’s 70%.
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(News report from Issue No. 170, published on Feb. 5 2014)
JAN. 10 2014 (The Conway Bulletin) — The Uzbek government increased the price of petrol by 20% because of continued shortages. Uzbeks are already labouring under a series of price rises, from food to general utilities. The jump in petrol prices could cause resentment to grow.
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(News report from Issue No. 167, published on Jan. 15 2014)
JAN. 14 2014 (The Conway Bulletin) — The Uzbek government has quietly increased the price of fuel by 20%, media reported. The new prices came into effect from Jan. 10.
The main cause of the petrol shortages in Uzbekistan are problems at the country’s largest oil refinery in Ferghana.
It’s still unclear what impact this price rise will have on Uzbek society. Tension is already rising because of price increases for basic utilities and food. Last year in Samarkand a group of women held a rare anti-government protest. Still, in Uzbekistan’s tightly controlled society there has so far been few signs of dissent.
And Uzbeks have already been adapting to steadily rising fuel prices.
The main problem for drivers is a deficit of oil in Uzbekistan. This means that state-owned UzGazOil has had to import and refine oil at more or less commercial rates, pushing up the price of petrol.
Reports from Uzbekistan have said that many drivers have already modified their vehicles to run on gas, which is cheaper, rather than petrol. This can be a dangerous practice as these gas fired wagons are prone to exploding.
The Uzbek authorities announced the petrol price rise quietly and official media didn’t cover the event.
But there was more bad news for drivers. From April, the government is introducing a 3% so-called road maintenance tax on new cars.
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(News report from Issue No. 167, published on Jan. 15 2014)
JAN. 1 2014 (The Conway Bulletin) — Uzbekistan’s Central Bank cut its key interest rate to 10% from 12% to try and combat falling inflation, media reported. Uzbekistan’s interest rate had been 12% since January 2011. Analysts expect official inflation in Uzbekistan to fall in 2014 to around 6% from 7% in 2013.
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(News report from Issue No. 166, published on Jan. 8 2014)