SEPT. 8 2015 (The Conway Bulletin) – Police arrested the governor of the Kostanai region in north Kazakhstan, Akhmetbek Akhmetzhanov, for corruption. Kazakh officials have arrested a handful of senior regional officials over the past year or so for corruption.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 8 2015 (The Conway Bulletin) – Aisultan Nazarbayev, grandson of Kazakh president Nursultan Nazarbayev, has said he wants to be head of Kazakhstan’s football association. Mr Nazarbayev is already head of the club that owns FC Astana which has qualified for the UEFA Champions League.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 9 2015 (The Conway Bulletin) — Perhaps the most important feature of news and data from the region’s money markets this week was details about the various Central Banks’ gold and currency reserves.
Kazakhstan’s Central Bank said it had increased its reserves in August to $29.1b. Kazakhstan has amassed reserves over the past 3 months after spending around $400m in April to contain the effects of the regional financial crisis.
In Kyrgyzstan, the Central Bank’s reserves hit $2b, according to the Central Bank, back up to the levels of August 2014.
In Baku it was another story. The Central Bank has been spending ferociously since it devalued its manat currency by a third in February. According to the state-linked Trend news agency, the Azerbaijani Central Bank spent 14% of its foreign currency reserves in August. In the last year, Azerbaijan has spent half its foreign currency reserves trying to defend the manat.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 11 2015 (The Conway Bulletin) — The biggest movers on the stock markets were copper producer KAZ Minerals which finished the week up 8%, Roxi Petroleum settled down 12% and Centerra Gold fell by 6.6%.
KAZ Minerals’ share price has fluctuated wildly, hit by China’s economic health and commodity prices. It is now trading at 162 pence, up from around 150 pence at the start of the week. It is sensitive to the value of the tenge which weakened by 10% this week and gave KAZ Minerals a lift.
Roxi Petroleum’s main oil assets are in Kazakhstan.
Its shares fell after it said it was having to downgrade the value of its assets by 28% in line with the fall in the tenge last month.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 9 2015 (The Conway Bulletin) – If oil prices continue to fall, Kazakhstan may cut production back to 73m tonnes a year, media quoted deputy energy minister Uzakbai Karabalin as saying. Kazakhstan is projected to produce around 80m tonnes of oil this year. Oil is the main driver of the Kazakh economy.
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(News report from Issue No. 247, published on Sept. 11 2015)
ALMATY, SEPT. 4 2015 (The Conway Bulletin) — Japanese car-maker Honda has decided to quit the Kazakh and the Russian markets until economic conditions improve, media reported.
Honda’s final shipment of cars to Kazakhstan was at the start of 2015 and to Russia in Dec. 2014.
The fall in value of currencies and the collapse in the car market had forced Honda to leave.
Weak local currencies have pushed up prices of imported cars.
A Honda spokesperson denied that the company was quitting the former Soviet Union altogether.
“We think the market has potential in the future so we’re not pulling out,” she told the FT. “We can respond flexibly since we don’t have a plant in Russia.”
Honda car sales in Kazakhstan fell by around 50% in 2015. In Russia, they shrank by 78%.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 6 2015 (The Conway Bulletin) – A court in Almaty ordered the Communist Party of Kazakhstan, until a few years ago one of the only genuine opposition parties in the country, to disband permanently. Media reported that the Kazakh ministry of justice said the party had misrepre- sented its activities. In 2011, a few months before a parliamentary election in 2012, a court suspended the Communist Party.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 4 2015 (The Conway Bulletin) — London-listed Roxi Petroleum said it had downgraded the value of its assets in Kazakhstan by 28% after last month’s devaluation of the tenge. Roxi’s main activities are focused in the Mangistau region, west Kazakhstan. Since the announcement, Roxi’s share price has fallen by 12%.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 4 2015, ALMATY (The Conway Bulletin) — The Kazakh government scrapped petrol price controls, another major admission that the market rather than the state is better placed to direct its economy.
Government officials blamed the volatility in foreign exchange markets for scrapping price controls on petrol which immediately jumped in price by around 40%.
Pressured by low oil prices, rising inflation and the depressed value of the Russian rouble, the Kazakh Central Bank released the tenge from its US dollar peg last month. It fell 23% in one day and is now trading at an all-time low of around 262/$1 which made petrol excessively cheap.
Deputy PM Bakhytzhan Sagintayev was handed the task of explaining the new policy to journalists.
“Having studied all possible options and discussed the issue with market players, we decided there should be a flexible pricing model given the ongoing volatility at the FX market,” he said. “The Government has decided to stop regulating prices for AI-92 and AI-93 petrol.”
In Almaty, Kazakhstan largest city, the effect was immediate. Queues snaked out of petrol stations as drivers rushed to fill their tanks.
Guldariya Iskakova, an accountant, summed up the feeling of people in Almaty about the petrol price rises. “It is awful. We are now seriously thinking to use public bus,” she said. “Our expenses have increased several times. The prices for petrol increased by 20 tenge in just one day.”
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(News report from Issue No. 247, published on Sept. 11 2015)
ALMATY/Kazakhstan, AUG. 26 2015 (The Conway Bulletin) — FC Astana, the quasi Kazakh government football project, may have qualified for the UEFA Champions League for the first time but not everybody was celebrating.
Football fans in Almaty, Kazakhstan’s former capital, noted FC Astana’s success in beating Apoel Nicosia 2-1 over two legs in a qualifying round for Europe’s top football competition, but only grudgingly.
Azimat, 27, was taking a lunch-break from his job selling French wine at a shop in central Almaty. It was one of those graceful late summer days in Almaty. Snow-capped mountains in the background glinted bright in the sun; tree-lined streets provided a natural, fresh canopy for pedestrians. The day had a laid-back — louche, even — feel about it.
“This is definitely Kazakhstan’s glory,” Azimat said of FC Astana’s unexpected victory. “But, they are celebrating in Astana and not down here.” He smiled, proudly. “We are Almaty.”
People in Almaty are used to Astana’s status as the loud, brash newcomer usurping their beloved city. Kazakh president Nursultan Nazarbayev has treated Astana as his pet project, building grandiose government ministries and replicas of some of Europe’s most famous monuments such as the Arc de Triomphe. He made it his capital in 1997, wary of Almaty’s reputation for dissent. Since then he has poured billions into constructing the city of his dreams and shifted business and government agencies north to Astana. The Central Bank will be the last major government agency to move to Astana from Almaty when it shifts its office at the end of 2016.
Much like the city, FC Astana is a new football team. It was established in 2009, wears the national colours and is sponsored by Kazakhstan’s sovereign wealth fund. It has been created to succeed.
Almaty’s team Kairat was the football powerhouse in Kazakhstan but has been firmly superseded by FC Astana and its stars. A few hours after Azimat espoused on FC Astana’s success, Kairat was playing France’s Bordeaux in a qualifying match for Europe’s second tier UEFA Europa League. It won the match but still lost the two-leg tie. Once again, Almaty residents will have to look on as Astana carries the Kazakh flag, searching for more glory.
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(News report from Issue No. 246, published on Sept. 4 2015)