Tag Archives: Kazakhstan

China could beat India for Kashagan

APRIL 16 2013 (The Conway Bulletin) — China has shown interest in buying shares in the Kashagan oil project in the Caspian Sea, Kazakhstan’s oil and gas minister, Sauat Mynbayev, told reporters, comments that will cause concern in Delhi.

Potentially favouring China over India for a 8.4% stake in Kashagan (that the US oil company ConocoPhillips is selling) would cement Kazakhstan’s relations with its powerful neighbour and confirm Chinese dominance over the Kazakh energy sector.

China owns roughly a third of Kazakhstan’s energy reserves and is building a series of pipelines to ensure Kazakh oil and gas continues to flow east.

For India, losing out on a slice of the Kashagan project, the biggest oil field discovery in 40 years, would be a blow to its stated strategy of expanding its energy reserves abroad. India has been relatively slow to invest in the Caspian region’s energy projects and is trying to play catch-up.

ONGC, the state-owned Indian energy company, thought that it had secured a $5b deal to buy the stake from ConocoPhillips last year.

Kazakhstan, though, has the final say on who owns stakes in Kashagan and its intervention in a deal that India thought, and hoped, was done could be ONGC’s undoing.

Kazakhstan has until the end of May to decide who to award the stake to, or keep it for itself. Mr Mynbayev said simply that the best offer would win.

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(News report from Issue No. 132, published on April 22 2013)

Kazakh Trio to buy back ENRC

APRIL 19 2013 (The Conway Bulletin) — The largest stake-holders in Kazakh miner ENRC, Alexander Machkevitch, Alijan Ibragimov and Patokh Chodiev, said they were considering teaming up with Kazakhstan’s government to buy back the company. ENRC is listed in London and is the subject of a corporate governance review.

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(News report from Issue No. 132, published on April 22 2013)

Steel output falls in Kazakhstan

APRIL 17 2013 (The Conway Bulletin) — Production of steel, one of Kazakhstan’s most important exports, continued to fall, official statistics showed. In Q1 of 2013, Kazakhstan produced 22% less steel than in the same period in 2012. Analysts blamed the fall on a drop in global demand and sanctions imposed on Iran.

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(News report from Issue No. 132, published on April 22 2013)

Kazakhstan lifts moratorium on subsoil licences

APRIL 18 2013 (The Conway Bulletin) — The Kazakh government announced that it had lifted a moratorium on granting more licences to subsoil developers, underscoring the sector’s importance for Kazakhstan’s future development.

Minerals and energy have been the backbone of Kazakhstan’s economic boom since independence from the Soviet Union in 1991 and that is not likely to change.

Global demand for metals may have dropped but lifting the ban, which was introduced in 2008 to allow a smooth introduction of new tax codes, will still spur foreign investor interest in Kazakhstan. The country simply holds too much untapped mineral wealth to be ignored.

And the Kazakh minister for new technologies and industry, Asset Issekeshev, immediately invited foreign companies to apply for licences at a tender in May.

Most of the $170b foreign investment in Kazakhstan since 1991 has been in the energy sector although senior government officials told Reuters the emphasis now would be on metals and non-hydrocarbon minerals.

To further encourage this, the government suggested that miners may be exempt from VAT.

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(News report from Issue No. 132, published on April 22 2013)

Kcell gains subscribers in Kazakhstan

APRIL 19 2013 (The Conway Bulletin) — Kazakh mobile operator Kcell, controlled by Sweden’s TeliaSonera, said it had added 310,000 subscribers in Q1 2013, suggesting that Kazakhstan’s economy is still buoyant. At the end of March, Kcell said it had 13.8m subscribers and was the biggest mobile phone network in Kazakhstan.

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(News report from Issue No. 132, published on April 22 2013)

Kazakhstan to begin a development programme

APRIL 8 2013 (The Conway Bulletin) — Slowly, but steadily, it appears that Kazakhstan genuinely wants to take on a greater leadership role on development issues across the wider region.

Deputy PM Alexei Volkov said that the Kazakh authorities want to turn Almaty into a regional development centre, local media reported.

At the fulcrum of this centre, Mr Volkov said, would be Kaz Aid which would mix development and humanitarian work.

Mr Volkov also said that giving Almaty a similar status to Geneva, Vienna or Bangkok in the aid world would help generate larger, more influential humanitarian and development projects across a region stretching from Afghanistan to the South Caucasus.

Kazakhstan’s foreign partners will be pleased to hear this talk. They have long pressed for Kazakhstan to become more involved in regional affairs.

The need for a more interventionist Kazakhstan has become more acute with NATO planning to exit Afghanistan by 2014.

And there is the geo-political dimension. At the same time the West is reducing its influence in Central Asia and Afghanistan, China is increasing its own reach.

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(News report from Issue No. 131, published on April 12 2013)

Suicides among the Kazakh military

APRIL 6 2013 (The Conway Bulletin) — Two Kazakh soldiers committed suicide on consecutive days, local media reported, highlighting a continued problem with bullying in the military. In Astana on April 4, one soldier hanged himself. The following day, in Karaganda, another soldier shot himself. Bullying is common in armies across the ex-Soviet Union.

(News report from Issue No. 131, published on April 12 2013)

Bribe-taker arrested in Kazakhstan

APRIL 11 2013 (The Conway Bulletin) — Police in Kazakhstan arrested a human resources manager in Shymkent, in the south of the country, for demanding a $50,000 bribe for a job, local media reported. The case throws a rare spotlight over official corruption in Kazakhstan where lucrative jobs are often bought.

(News report from Issue No. 131, published on April 12 2013)

Nazarbayev calls to reduce wealth gap

APRIL 10 2013 (The Conway Bulletin) — Perhaps wary of potential civil strife, Kazakh president Nursultan Nazarbayev called on his government to try to spread Kazakhstan’s increasing wealth more evenly.

Signs of inequalities in Kazakhstan are not hard to find. In Almaty, the latest Western SUV competes for road space with battered and rusting second-hand cars. Street vendors sell shashlik, barbequed meat on skewers, for a few tenge across the street from restaurants charging hundreds of dollars for dishes cooked by a French chef.

And these inequalities are potentially dangerous, as a demonstration in the western town of Zhanaozen on Dec. 14 2011 that ended with the death of at least 14 protesters showed. The Kazakh government blamed inequality and a lack of job opportunities for the demonstration.

Now Mr Nazarbayev has said that more can be done. Specifically, he said that roughly 8% of families in Kazakhstan lived off $100 per person per month. According to the World Bank, which measures inequality using the Gini coefficient, Kazakhstan has a sizeable inequality gap. That gap, though, is slowly reducing.

The Gini coefficient measures inequality using a score of zero to 100, zero being perfectly equal. The latest data on the World Bank’s website showed that Kazakhstan scored 29 in 2009, down from 33.9 in 2003. This compares favourably with its neighbours and is lower than many European countries.

Still, as Mr Nazarbayev knows, perception is ever important.

(News report from Issue No. 131, published on April 12 2013)

Iran nuclear talks held in Kazakhstan

APRIL 7 2013 (The Conway Bulletin) — A second round of negotiations in Almaty between Iran and a US-led group ended without a resolution to the long-running dispute over the Iranian nuclear programme. Participants, though, praised Kazakhstan for the smooth running of the discussions.

(News report from Issue No. 131, published on April 12 2013)