Tag Archives: Kazakhstan

COMMENT: Governments will be judged on how they deal with the coronavirus

MARCH 26 (The Bulletin) — With the global impact and disruption of Covid-19 becoming apparent, it is time to see what the governments of Central Asia and the South Caucasus are made of. Their responses now will forge their reputations. They will be judged.

And, so far, reactions have been wildly different.

Turkmenistan and Tajikistan appear to be pretending that the Covid-19 pandemic is not happening. Neither country has reported cases and in Tajikistan people are being encouraged to continue with their lives as normal. Last weekend thousands of people gathered to celebrate the Persian New Year and President Emomali Rakhmon has barely broken with his official engagements. In Ashgabat, President Kurbanguly Berdymukhamedov has talked up herbal remedies to the pandemic.

Berdymukhamedov and Rakhmon may be the Central Asian versions of Nero. While Rome burnt for a week in 64AD, Emperor Nero fiddled, or at least that is the popular perception.

Elsewhere the reaction of governments to the Covid-19 pandemic has been more mainstream. Kazakhstan, Uzbekistan, Georgia and Armenia have all ordered lockdowns over their main cities and announced economic packages that will support business. Kyrgyzstan has applied to the IMF to help dampen its own Covid-19 epidemic which appears linked to people in the more religious and conservative south of the country returning home from the Hajj in Saudi Arabia.

In Azerbaijan, the approach has veered away from the orthodoxy, as it often does. Instead of offering the government grants and loans favoured by other countries to keep business running and to buy extra supplies and resources for its health service, Azerbaijani President Ilham Aliyev set up a special fund that would accept donations from companies, government agencies and the wealthy.

Never one to miss an opportunity to self-promote, top billing on the website currently goes to Aliyev and his wife, Mehriban, who is also the vice-president, for donating their salaries for 2020 to the fund. The website doesn’t say how large these donations were.

Covid-19 will shrink growth rates and possibly even economies across the region. The people of Central Asia and the South Caucasus are used to big, interventionist and, some would say, authoritarian government. Now these leaders have the opportunity to show their people that this power can be used to good effect in a national emergency.

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— This story was first published in issue 440 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2020

Kazakhstan reports 109 cases of the coronavirus

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MARCH 26 (The Bulletin) — Kazakhstan has reported 109 cases of the coronavirus, mainly concentrated in Nur-Sultan and Almaty. One person, a 64yo woman has died. Earlier, the government had placed both cities under a lockdown, hoping to contain the disease but within a week it was clear that this policy was not going to work as officials in the regions started reporting cases.

Two coronavirus cases have been reported in Karaganda, two in Shymkent and a single case each in Aktobe, Almaty region, Zhambyl region and North Kazakhstan. Officials said that the disease has been imported by people returning to Kazakhstan from Europe and Russia.

Both former president Nursultan Nazarbayev and his successor, Pres. Kassym Jomart Tokayev have given TV broadcasts calling for calm.

So far only Nur-Sultan, Almaty and Shymkent have been placed under a lockdown which forces people to remain in their houses.

The authorities have also said that they will extend various visas to foreigners in Kazakhstan. Like the rest of the region, Kazakhstan has closed its borders and its schools.

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— This story was first published in issue 440 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2020

Coronavirus spreads through Central Asia and South Caucasus

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YEREVAN/March 26 (The Bulletin) — The Covid-19 virus started to take a grip of the Central Asia and South Caucasus region with only Tajikistan and Turkmenistan not reporting any outbreaks.

Worst hit, by some margin, has been Armenia with 290 cases reported by March 26. Officials said that the source of the outbreak was a sewing factory in Yerevan and people arriving from Iran, which has had one of the worst outbreaks in the world.

From sounding blase about the impact of the coronavirus only two weeks ago, Armenian PM Nikol Pashinyan has now ordered a lockdown along the same lines as European countries, which is hitting businesses.

“Let’s look at the upcoming week as a unique opportunity to read, self-reflect and plan the future of the Armenian nation,” he said.

Neighbouring Georgia and Azerbaijan have also reported cases of the coronavirus, 77 cases and 80 cases each, but have taken different approaches to dealing with it. The Georgian government has imposed a lockdown in Tbilisi but in Azerbaijan the rules are more relaxed.

In Central Asia, Kazakhstan, Uzbekistan and Kyrgyzstan have imposed lockdowns over their largest cities to try to contain the spread of the coronavirus, although Turkmen and Tajik officials have insisted, much to the amazement of many analysts, that they haven’t had any cases.

On March 21, Tajik towns hosted the traditional celebrations to mark the Persian new year Nowruz festival and Turkmen leader Kurbanguly Berdymukhamedov has talked up the medicinal benefits of various herbs against the coronavirus.

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— This story was first published in issue 440 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2020

New law in Kazakhstan will restrict protest rights, says HRW

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MARCH 26 (The Bulletin) — Kazakhstan’s parliament passed the first vote of a new law that human rights activists said would restrict people’s rights to protest (March 26). “The bill still gives the authorities power to approve or reject requests to hold events depending on their form,” Human Rights Watch said in a statement. “Government officials can propose alternative locations, times, and dates. If the organisers do not consent to the change, the event will be cancelled.” HRW also said, though, that parliament had voted against increased restrictions against journalists covering public meetings and protests.

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— This story was first published in issue 441 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2020

MARKETS: Coronavirus crashes currencies

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MARCH 26 (The Bulletin) — Currencies across the region crashed to their lowest levels as the full extent of the threat of the coronavirus to the world’s economic system became apparent, the US dollar strengthened and governments in Central Asia and the South Caucasus began to fret whether they would be able to deal with a major health crisis.

The Kazakh tenge was trading down 13% at 447.8/$1, off a low of 456/$1. It follows the price of oil and the Russian rouble closely and with both bouncing around at lows, the tenge was always going to get dragged down. It has never been this low and before the oil price collapse of 2014 was valued at around 188/$1.

The Georgian lari fell by more than 15% to 3.3387/$1, also an all-time low. The currency has been weak for more than a year but policymakers had thought it was beginning to strengthen before the impact of the coronavirus turned it onto a downward trajectory.

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— This story was first published in issue 440 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2020

Coronavirus smashes in the region’s currencies

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TBILISI/March 26 (The Bulletin) — Currencies plunged across Central Asia and the South Caucasus because of the combined impact of the Covid-19 virus, a collapse in oil prices and a surge in the value of the US dollar.

Central Banks raced to pump money into their systems and sell off foreign currency assets to prop up the value of their currencies as the impact of the pandemic on business and economies across the globe became apparent.

In the past couple of weeks the region’s two most-traded currencies, the Kazakh tenge and the Georgian lari, have lost around 20% of their value.

Airlines have stopped flying into the region, land borders have closed and projects and foreign direct investment that had been pledged have been put on hold.

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— This story was first published in issue 440 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2020

SamsungPay starts operations in Kazakhstan

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MARCH 17 (The Bulletin) — Samsung Pay, the contactless smartphone payment system, is now available in Kazakhstan, Korean electronics-maker Samsung said in a statement. It said that Kazakhstan was added to its list of countries able to use the payment system on March 5 after six weeks of testing. It is now available in 26 countries around the world.

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— This story was first published in issue 440 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2020

COMMENT: Kazakh government on defensive after activist dies

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>> Concessions are likely from the Kazakh government as it works hard to contain the fallout from the death in police custody of an opposition activist, writes James Kilner.

MARCH 3 2020 (The Bulletin) — As The Bulletin was going to press, a court in the northeastern Kazakh city of Semey ordered the release of Mukhtar Dzhakishev, perhaps the country’s most high-profile political prisoner.

Dzhakishev has been in prison since 2009, sent down because of various financial crimes. He had been a high flyer within the Kazakh elite, at the time of his arrest he was head of the nuclear agency Kazatomptom, although the government of Nursultan Nazarbayev always doubted his loyalty.

Many people, including foreign governments, suspected that the real reason that Dzhakishev had been imprisoned was because he was close to Mukhtar Ablyazov, the billionaire owner of BTA Bank who fled to Moscow and then London in 2009 and set himself up as an opposition leader.

The theory goes that Nazarbayev couldn’t get to Ablyazov, and still hasn’t, but he could take out some of his key Kazakhstan-based associates, including Dzhakishev.

So why release Dzhakishev now? Afterall, Ablyazov is still acting as an opposition leader from his base in Paris and only last year a court rejected Dzhakishev’s appeal for his early release on health grounds.

The answer could well lie with the death in police custody of opposition activist Dulat Agadil. In life, Agadil had not been a particularly serious threat to the government but in death, he had become a powerful force for the government’s opponents to rally around. He died in police custody on Feb. 25 in murky circumstances. The government was quick to rush out a statement saying that Agadil had died of an underlying heart condition and not from police mistreatment. Not many ordinary people believe the government and the opposition had been quick to start organising demonstrations. The one on Saturday was snuffed out by the security forces but more were promised.

Perhaps the release of Dzhakishev was a carrot that Kazakh President Kassym-Jomart Tokayev believed was needed to pacify opposition momentum. It has allowed him to show himself as a moderate and even-handed president.

It may also only be the beginning of the concessions that the Kazakh government is prepared to give out to contain the fallout from the death of Agadil. Whether it works or not, The Bulletin will be there to report and analyse in full.

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— This story was first published in issue 438 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2020

Smugglers triggered ethnic violence, says Tokayev

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MARCH 1 2020 (The Bulletin) — Kazakh President Kassym-Jomart-Tokayev said that ethnic fighting in a series of villages in south Kazakhstan that killed at least 11 people, mainly ethnic Dungans, was caused by a dispute between rival smuggling gangs. In the aftermath of the violence, the authorities downplayed any threat to their idea of Kazakhstan as a place for dozens of different ethnic groups to live in harmony together.
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— This story was first published in issue 438 of the Central Asia & South Caucasus Bulletin

— Copyright the Central Asia & South Caucasus Bulletin 2020

Kazakhstan puts four banks into government protection scheme

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ALMATY/Feb. 28 2020 (The Bulletin) — Four Kazakh banks have entered a government scheme that protects them from bankruptcy after a Central Bank asset review test, the Kazakh Central Bank said in a statement.

The move comes at the end of the government’s review of assets held by 14 second-tier banks. This will concern analysts who have said that Kazakhstan’s banking sector is still too weak and that the banks’ asset-to-loan proportion is still too low.

The banks — Bank CenterCredit, ATF Bank, Eurasian Bank and Nurbank — are now protected from bankruptcy but will have to pay a premium for the insurance.

Although the banks have been taken into a government protection scheme, the Oleg Smolyakov, deputy chairman of the Kazakh Central Bank, said they were all adequately capitalised as they passed a minimum threshold of a capital adequacy ratio of 7.5%.

“We are confident that, based on the implementation of recommendations and measures, a further increase in the financial stability of the banking sector as a whole will be achieved,” he was quoted by the media as saying.

In December, sources had described the four banks as needing a bailout to survive after the asset review showed up holes in their balance sheets. Media reported that the asset protection scheme for the four banks would last five years and be worth $308m.

In the 2008/9 Global Economic Crisis, the government had to buy up three private banks. They were hit again after the 2014 collapse of oil prices.

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— This story was first published in issue 438 of the Central Asia & South Caucasus Bulletin