OCT. 27 2015 (The Conway Bulletin) – The Kyrgyz Central Bank said after its monthly monetary policy meeting that it was keeping interest rates stable at 10% after pressure on the som currency eased in October. Last month, it raised rates by 2% to halt a slide in the value of the som. It lost 16% of its value in June-Sept.
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(News report from Issue No. 254, published on Oct. 30 2015)
OCT. 27 2015, BISHKEK (The Conway Bulletin) — US State Secretary, John Kerry, was due to fly to Kyrgyzstan on Oct. 31 for the start of his first tour of Central Asia, a stopover considered vital to repair relations with an ally that has drifted towards Russia over the past couple of years.
In Bishkek, Mr Kerry will hold bilateral discussions with senior Kyrgyz officials, including President Almazbek Atambayev, and open a new campus for the American University of Central Asia.
Top of Mr Kerry’s agenda will be the growing influence of Russia as well as a draft bill banning so-called gay propaganda and a law that bans local NGOs from foreign funding.
Marat Kazakpayev, a Bishkek analyst, said US investments and security would be discussed.
“They will discuss security in the region, including situation in Afghanistan and Syria, as well what to do to counter terrorism,” he said.
The US operated an airbase from the Manas airport outside Bishkek for 13 years until 2014 when it was wound down alongside military operations in Afghanistan.
For Mr Kerry and the US, this is an important trip to Central Asia.
It has ceded influence in the region to Russia and China. Russia has the historical, political and cultural links; China has the financial firepower.
In contrast, with the scaling down of military operations in Afghanistan, the US and the West have appeared to disengage with Central Asia. Mr Kerry’s main mission will be to re- assure the region’s leaders that the US is still interested in Central Asia.
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(News report from Issue No. 254, published on Oct. 30 2015)
OCT. 23 2015 (The Conway Bulletin) — The Kyrgyz government said it wants to sell a bankrupt paper mill for 300m soms ($4.3m), a fraction of its original value. The plant, built in the early 2000s through a Kyrgyz-Chinese joint venture, cost around 151m yuan, ($24m) to build. It operated for only two years, before being mothballed. Paper prices have collapsed over the past few years, forcing paper mills around the world out of business.
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(News report from Issue No. 254, published on Oct. 30 2015)
OCT. 22 2015 (The Conway Bulletin) – Kyrgyzstan’s exiled former President Kurmanbek Bakiyev published an autobiography of his time in office, a move that will irritate the Kyrgyz leadership. Mr Bakiyev presented his book in Belarus, where he fled after a revolution in 2010. Kyrgyzstan has tried unsuccessfully to extradite Mr Bakiyev to face various corruption charges.
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(News report from Issue No. 253, published on Oct. 23 2015)
OCT. 15 2015 (The Conway Bulletin) — The Eurasian Economic Commission published the latest statistics on trade turnover among EEU countries. It made for interesting, if also distressing, reading.
Trade among Russia, Kazakhstan, Belarus, Armenia and Kyrgyzstan was down by a quarter in Jan.-Aug. 2015, compared to the same period last year.
By volume, Russia was the country that suffered the largest fall, amounting to over $4b. In terms of percentage, however, all other countries except for Kyrgyzstan fared worse — Kyrgyzstan acceded as a full member only in August, so its numbers could be misleading.
Curiously, Armenia increased trade turnover with non-EEU countries such as Uzbekistan and Turkmenistan by over 40%.
In the two periods analysed by the Commission, oil prices were significantly different. And this can be clearly seen in Kazakhstan’s statistics, which show a sharp fall in exports to Italy, China and Russia, its main trade partners by volume. In particular, the value of Kazakhstan’s exports were reduced by the double whammy of lower oil prices and the decrease in the value of the tenge after the government abandoned its peg to the US dollar.
It is undeniable that the rouble crisis and the fall in oil prices have affected the Eurasian region. And the EEU has been unabel to contain the spill-over effects on its members.
OCT. 23 2015 (The Conway Bulletin) —
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(News report from Issue No. 253, published on Oct. 23 2015)
OCT. 22 2015 (The Conway Bulletin) – Kyrgyz police captured a group of criminals who escaped last week from a prison outside Bishkek. Five of the nine fugitives died, two in clashes with the police and three in custody. Families and human rights groups have asked for an investigation.
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(News report from Issue No. 253, published on Oct. 23 2015)
OCT. 19 2015 (The Conway Bulletin) — Canadian miner Centerra Gold said its operations at Kyrgyzstan’s Kumtor mine will produce up to 17% less gold in 2015 compared to 2014. The company forecasts production of 13.3 to 14.7 tonnes of gold this year. Last year, it produced 16.1 tonnes of gold. Kumtor is vital to Kyrgyzstan’s economy and news of a drop in output will hit the country’s economic forecasts. It accounts for around 10% of GDP.
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(News report from Issue No. 253, published on Oct. 23 2015)
OCT. 23 2015 (The Conway Bulletin) — Oil companies suffered from a fall in oil prices this week. The Brent index closed at $48/barrel on Friday, down 5% this week.
Nostrum Oil & Gas lost around 9% this week, recovering on Friday to end at 475p per share in London. Nostrum’s summer objective Tethys Petroleum continued its slump, reaching the lowest level in 2015 on Oct. 22, trading at 0.06 Canadian dollars per share in Toronto on Thursday, rebounding slightly to 0.07 Canadian dollars on Friday. Kazakhstan-focused Roxi Petroleum gained 2%, after it issued new shares earlier in October. Roxi closed at 9.63p on Friday.
Last week, the price of copper fell by 2% before recovering to $2.40 per lb. Britain-based miner KAZ Minerals was hit by the market crunch this week and recorded a 7% loss, closing at 127p in London on Friday.
The upside was represented by Centerra Gold, whose shares gained almost 9% despite slower gold production in Kyrgyzstan. The final price in Toronto was 8.28 Canadian dollars.
In the banking sector, Bank of Georgia rose by almost 7% this week to 214p. The stability of the lari currency kept the market optimistic.
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(News report from Issue No. 253, published on Oct. 23 2015)
OCT. 20 2015, BISHKEK (The Conway Bulletin) — Kyrgyzstan’s real estate market has slowed, media reported quoting a land registry report, more evidence that the overall Kyrgyz economy is stalling.
Analysts from the department of land registry said that the number of house sales this year had dropped by around 42% and the market for apartments was down by 34%.
The official position was the housing market had cooled off because prices were simply too high but a construction company in Bishkek said that the real reason activity in the housing market had fallen was the drop in the value of the Kyrgyz som against the US dollar.
“Sanctions on Russian economy definitely affect the purchasing power of our citizens because the US dollar is the currency for real estate transactions,” a construction company manager who wanted to remain anonymous told the Bulletin.
Roughly in line with other currencies in the region, the som has lost around 33% of its value over the past 12 months and is now trading at around 69/$1.
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(News report from Issue No. 253, published on Oct. 23 2015)
OCT. 16 2015 (The Conway Bulletin) – Former Armenian PM Tigran Sargsyan will take over as chairman of the Eurasian Economic Commission on Feb. 1, an appointment that highlights Russian President Vladimir Putin’s influence over the group.
The Russia-led Eurasian Economic Union (EEU) announced Mr Sargsyan’s appointment after a meeting in Astana. Mr Sargsyan succeeds Russian Viktor Khristenko.
According to media, Belarus President Alexander Lukashenko said of Mr Sargsyan’s appointment: “His candidacy is supported by the Russian President as they worked together some time ago.”
The Eurasian Economic Commission runs the EEU — which also includes Kazakhstan and Kyrgyzstan as its members — on a day-to-day basis, and Mr Sargsyan’s appointment should, at first sight, give Armenia more influence over the trade bloc.
The reality is different, though. The EEU is a Russian project and Mr Lukashenko’s words show just how influential Mr Putin is over the group. Without his support, Mr Sargsyan could not have been appointed as chairman.
Since April 2014, Mr Sargsyan has been the Armenian ambassador to the United States. He had been PM between 2008-14 but quit abruptly after his government’s reforms to the state pension programme proved unpopular.
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Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 253, published on Oct. 23 2015)