DEC. 1 2015 (The Conway Bulletin) – Kyrgyzstan’s Central Bank decided to keep its interest rate unchanged at 10% for the third month running because of slowing inflation. It also said that its reserves had fallen by 12% this year as it tried to defend its currency.
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Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 259, published on Dec. 4 2015)
DEC. 2 2015 (The Conway Bulletin) – New York-based Human Rights Watch (HRW) accused the authorities in Kyrgyzstan of banning their Bishkek office director from entering the country and crushing free speech.
The accusation will hurt Kyrgyzstan’s international reputation as a place for Westerners to visit and for Western companies to do business. Direct foreign investment and tourism are important to Kyrgyzstan’s economy.
Mihra Rittmann, the HRW Kyrgyzstan director, said she had been refused entry at Manas airport. In June the Kyrgyz authorities had rescinded her work permit.
“Kyrgyzstan’s decision to ban me is highly disappointing on a personal as well as a professional level,” Ms Rittmann told the Bulletin from Berlin where HRW has its European headquarters.
“We are keen to clarify the grounds for the ban and to resolve the situation such that I can return to Bishkek and continue Human Rights Watch’s work in country.”
Kyrgyzstan has not commented.
According to Ms Rittmann, she saw a note at the airport which described her as a “persona non- grata”.
Over the past few years, Kyrgyzstan has shifted from a relatively pro-Western stance to a more pro-Russia outlook. As the US quit its air base outside Bishkek last year, Russia was increasing its involvement in Kyrgyzstan by boosting aid money, pulling the country into its Eurasian Economic Union trade bloc and strengthening its military commitments.
HRW in Kyrgyzstan, led by Ms Rittmann, has also been documenting what it has described as a decline in human rights and free speech, from attacks on ethnic Uzbeks and homosexuals to a new law, similar to a Russian law, that makes it harder for NGOs to accept funding from overseas.
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(News report from Issue No. 259, published on Dec. 4 2015)
DEC. 4 2015 (The Conway Bulletin) — Oil prices fell by 2.3% to $43/barrel of Brent crude this week.
Tethys Petroleum shares jumped 15% in one day on Dec. 2 to 4.88p, but fell later in the week to close at 4.50p on Friday, a 5.9% increase over the last week.
Roxi Petroleum shares fell sharply to 7p on Friday, down 10% from last week.
Gold prices rose by 2.7% this week to $1,086/ounce, which, together with positive industrial news, propped up the region’s principal gold miners.
Kyrgyzstan-focused miner Centerra Gold gained around 6% this week on the Toronto Stock Exchange, closing at 7.61 Canadian dollars on Friday.
After announcing a new financing deal for its gold deposit in Armenia, Toronto-listed gold miner Lydian International shares gained 30% in just two days. Lydian share price then fell back to 0.27 Canadian dollars on Friday.
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(News report from Issue No. 259, published on Dec. 4 2015)
NOV. 28 2015 (The Conway Bulletin) – A $60m Chinese-built oil refinery opened in Tokmok in the north of Kyrgyzstan, the second refinery that China has constructed in the country. Both the Chinese-refineries will rely on Russian crude oil to operate. Kyrgyzstan has been facing a shortage of refined petrol products.
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(News report from Issue No. 259, published on Dec. 4 2015)
DEC. 4 2015 (The Conway Bulletin) — The Kyrgyz som continued its slump against the dollar and now trades at above 75.5/$1. The Central Bank chairman Tolkunbek Abdygulov said the exchange rate had changed because of a speculative attack and promised to continue to intervene to prop up the currency. The regulator said that local bank FinanceCredit was found guilty of speculative trading of the som. In addition, the Central Bank fined several exchange points across the country for speculating on currency rates.
In Tajikistan, the somoni was stable at 6.7/$1, after a rough week. On Nov. 30, media reported that Dushanbe residents had to pay around 7.5somoni for $1. The Central Bank reacted by drafting a decree that shut down the remaining private exchange bureaus in the country. Earlier in April, it had forced the closure of over 800 out of a total of 1,500 exchange bureaus because it said they were taking advantage of the unstable currency markets.
On Dec. 1, the Central Bank also reported the arrest of six employees of exchange bureaus for currency speculation. As with the Kyrgyz incidents, the details of these so-called speculative attacks have been difficult to pin down.
But none of this is surprising in Central Asia’s currency markets.
We witnessed a similar trend in Kazakhstan in 2014, when a devaluation of the tenge was followed by speculative attacks on the currency and interventions to keep the tenge from plummeting. This was repeated this year again in Kazakhstan.
It is likely that both Tajikistan and Kyrgyzstan will follow this trend and crack down on private exchange bureaus to strengthen their control over exchange rates.
In much of the rest of the region, currencies did not move. The exception was Uzbekistan. The Uzbek sum reached a new record trading low, officially, at 2,755/$1. In the last year, it lost almost 15% of its value.
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(News report from Issue No. 259, published on Dec. 4 2015)
NOV. 30 2015 (The Conway Bulletin) – The authorities in Tajikistan sent two Kyrgyz men to Kyrgyzstan for allegedly trying to recruit people to join the radical IS group in Syria and Iraq, media reported. Central Asian governments are worried about an increase in IS recruiting in the region.
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(News report from Issue No. 259, published on Dec. 4 2015)
NOV. 24 2015 (The Conway Bulletin) – The Kyrgyz Central Bank is spending so much cash trying to defend its som currency that it is considering selling off its stock of diamonds.
Tolkunbek Abdygulov, the Central Bank chief, said that the bank had already sold large amounts of gold and that silver and diamonds were next.
“We started selling gold this year, next year are going to add silver bullion to this and have discussed the options of even selling diamonds,” he said according to media reports. Mr Abdygulov didn’t say whether Kyrgyzstan held substantial diamond reserves or not.
The Kyrgyz Central Bank has intervened 22 times this year in the currency market. This week it spent another $7m defending the som which at one point fell nearly 5% to an all-time low of around 79/$1. After the Central Bank intervention it rose back to around 74/$1.
The Central Bank’s reserves have fallen from $2.2b at the start of the year to about $1.7b now.
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(News report from Issue No. 258, published on Nov. 27 2015)
NOV. 20 2015 (The Conway Bulletin) – The warden in charge of the jail from which nine prisoners escaped last month has been found hanged in his cell, Radio Free Europe/Radio Liberty reported. Imankul Teltaev had been in pre-trial detention waiting for this trial on charges linked to the mass escape.
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(News report from Issue No. 258, published on Nov. 27 2015)
DEC. 3 2015 (The Conway Bulletin) – Russia is piling pressure on its partners in the Eurasian Economic Union (EEU) to join it in blocking Turkish trade across the region, a move that could fracture regional alliances.
After a Turkish fighter-jet shot down a Russian fighter-jet over Syria last month, Russian President Vladimir Putin promised revenge. This included a ban on Turkish exports to Russia.
To tighten the ban, Mr Putin needs his allies in the EEU — Armenia, Belarus, Kyrgyzstan and Kazakhstan — to stop Turkish goods transiting through their territories into Russia. But it’s a clarion call which is likely to prove divisive for Central Asia and the South Caucasus where Turkey has strong cultural, trade and diplomatic links.
Of the EEU members, Belarus is a natural ally of Russia and will support Moscow. As will Armenia, which has strained relations with Turkey.
For Kazakhstan and Kyrgyzstan the issue is more complicated. They have good relations with both Turkey and Russia and will likely try to appease both sides as Kazakh foreign minister Yerlan Idrissov has said.
“Emotions are running high, but my president, knowing Mr Putin very well personally and knowing his great potential to be constructive and knowing personally (Turkish) President Erdogan, believes and hopes they will think strategically in this very difficult situation,” he told Reuters in an interview.
Outside the EEU, Turkey is likely to find more supporters. Turkmenistan sees Turkey as a natural ally and has been building up a rapport with Ankara while its relations with Moscow have worsened. It wants to pump gas to Europe and this means crossingTurkey.
With its 2008 war with Russia still fresh in the memories, Georgia naturally leans towards Turkey.
Azerbaijan, though, is Turkey’s biggest ally in the region. The countries are close culturally, politically and economically. Their militaries also often train together.
Although relations with Russia have improved over the past couple of years, it didn’t take long for Azerbaijan to rally to Turkey’s cause.
Azerbaijan cut by 20% cargo tariffs for Turkish trucks travelling from Baku across the Caspian to Kazakhstan and Turkmenistan, a move that will irritate the Kremlin and exacerbate regional tension.
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Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 259, published on Dec. 4 2015)
NOV. 27 2015 (The Conway Bulletin) — The only currency that moved substantially this week was the Kyrgyz som, which lost 2.3%, closing at 74/$1 on Friday.
The Kyrgyz Central Bank intervened heavily this week to prop up its currency, which looked like it was losing traction and could have spiralled downwards. During the day on Nov. 26, the exchange rate had surged to 77-79 som/dollar, which prompted the Central Bank to sell $7m in the currency market and enabled the currency to recover somewhat and move back to 74/$1.
Tolkunbek Abdygulov, the Central Bank chief, said this week the exchange rate was influenced by speculators.
All other currencies were stable.
In the South Caucasus, the Georgian lari maintained its level of 2.40/$1 and the Armenian dram was also stable at 480.8/$1.
In Central Asia, the Kazakh tenge floated at around 307/$1 throughout
the week. The Tajik somoni continued its gentle depreciation, and now trades at 6.7/$1.
The dollaruz.com website which monitored the Black Market rate for the Uzbek sum, appears to have closed.
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Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 258, published on Nov. 27 2015)