OCT. 28 2010 (The Conway Bulletin) —  Underdeveloped banking systems, a high rate of non-performing loans and inflexible exchange rates are potential brakes on economic recovery in Central Asia and the south Caucasus, the IMF said.

With their reliance on neighbouring Russia and global commodity prices, the global financial downturn in 2009 was tough for the economies of Central Asia and the south Caucasus. This year, with Russia and commodity prices recovering and the impact of domestic fiscal stimulus taking hold, the IMF predicts steady economic growth throughout the regions, other than for Kyrgyzstan.

Remittances from workers in Russia, so important for the poorer Central Asian and Caucasus countries, grew by 26% in the first half of 2010 compared to the same period in 2009.

The IMF said that inflation was generally under control at around 8%, although in Uzbekistan it was nearer 11%. For the IMF, the regions’ banking sectors are a concern. In Kazakhstan, the IMF pointed out, non-performing loans total nearly 26% of all loans.

IMF’s GDP % growth figures (2010 and 2011 are predictions):

Armenia +13.7 (2007); +6.9 (2008); -14.2 (2009); +4.0 (2010); +4.6 (2011)

Azerbaijan +25.0 (2007); +10.8 (2008); +9.3 (2009); +4.3 (2010); +1.8 (2011)

Georgia +12.3 (2007); +2.3 (2008); -3.9 (2009); +5.5 (2010); +4.0 (2011)

Kazakhstan +8.9 (2007); +3.2 (2008); +1.2 (2009); +5.4 (2010); +5.1 (2011)

Kyrgyzstan +8.5 (2007); +8.4 (2008); +2.3 (2009); -3.5 (2010); +7.1 (2011)

Tajikistan +7.8 (2007); +7.9 (2008); +3.4 (2009); +5.5 (2010); +5.0 (2011)

Turkmenistan +11.6 (2007); +10.5 (2008); +6.1 (2009); +9.4 (2010); +11.5 (2011)

Uzbekistan +9.5 (2007); +9.0 (2008); +8.1 (2009); +8.0 (2010); +7.0 (2011)

ENDS

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(News report from Issue No. 13, published on Nov. 1 2010)