MARCH 24 2014 (The Conway Bulletin) — UzMobile, the new mobile operator in Uzbekistan run by Uzbektelecom, will be exempt from paying licence fees for five years, local media reported quoting the government. The Uzbek government is keen to set up its own mobile company after foreign companies working in the sector ran into various regulatory problems.
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(News report from Issue No. 177, published on March 26 2014)
MARCH 24 2014 (The Conway Bulletin) — The Uzbek government aims to stop cash leaving the country by forcing local companies to get written permission from the Central Bank before opening foreign bank accounts, media reported. Foreign companies have long complained that repatriating profits is a major problem for businesses in Uzbekistan.
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(News report from Issue No. 177, published on March 26 2014)
MARCH 18 2014 (The Conway Bulletin) — Uzbek foreign minister Abdulaziz Kamilov flew to Brussels to attend a meeting with his EU counterparts. The trip was relatively controversial because of Uzbekistan’s poor human rights record. Uzbek President Islam Karimov cancelled a trip to Prague earlier this year because none of the minister would meet him.
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(News report from Issue No. 176, published on March 19 2014)
MARCH 12 2014 (The Conway Bulletin) — Russian energy company Lukoil invested $660m in gas projects in Uzbekistan last year, media reported quoting a company press release. This is a 38% increase in Lukoil’s investment in 2012 and underlines just how important Russian investment is for Uzbekistan.
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(News report from Issue No. 176, published on March 19 2014)
MARCH 18 2014 (The Conway Bulletin) — Uzbekistan’s parliament voted to tinker with the country’s constitution and pass some of the president’s powers to the PM. President Islam Karimov first suggested the changes in December last year. It may be that he has been forced to reduce his powers by his increasingly powerful rivals in the security services.
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(News report from Issue No. 176, published on March 19 2014)
MARCH 12 2014 (The Conway Bulletin) — Swiss investigators said they had started investigating Gulnara Karimova, the eldest daughter of Uzbek president Islam Karimov, for money laundering. They had previously been investigating four people linked to Ms Karimova. Ms Karimova is reportedly currently under house arrest in Tashkent.
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(News report from Issue No. 176, published on March 19 2014)
MARCH 17 2014 (The Conway Bulletin) — Uzbekistan is fast becoming a pariah state for businesses.
The US authorities opened corruption investigations into business conducted by Russia’s Vimpelom and Swedish-Finnish TeliaSonera in Uzbekistan, shortly after Swiss authorities announced they were looking into money laundering allegations against Gulnara Karimova, eldest daughter of Uzbek president Isam Karimov.
It’s not a pretty picture. Vimpelcom and TeliaSonera also have registered offices in the Netherlands, where the authorities have also launched investigations.
The trigger for these problems was a $330m deal that TeliaSonera struck with Gibraltar-registered Takilant to buy a 3G licence in 2007. Takilant was officially owned by Gayane Avakyan, an associate of Ms Karimova.
A Swedish investigation has been looking into whether this payment was actually a bribe to the Karimov family. Mr Karimov and his family have run Uzbekistan as their personal fiefdom since independence from the Soviet Union in 1991. They may also have had personal stakes in Uzbekistan’s big businesses.
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(News report from Issue No. 176, published on March 19 2014)
MARCH 8 2014 (The Conway Bulletin) — Food prices in Uzbekistan may have risen by as much as 30-70% over the last few weeks, an anecdotal survey by the Uzmetronom.uz website said. While Uzmetronom.uz’s figures may be out, there is little doubt that rising energy prices and falling business activity is pushing up inflation in Uzbekistan.
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(News report from Issue No. 175, published on March 12 2014)
MARCH 10 2014 (The Conway Bulletin) — Uzbek President Islam Karimov has passed a decree which stated that he had to give permission for the top 25 ranked officials in the government to go on overseas trips, media reported. The decree is not designed to save money, Radio Free Europe/Radio Liberty reported, but to safeguard state secrets.
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(News report from Issue No. 175, published on March 12 2014)
MARCH 6 2014 (The Conway Bulletin) — Beeline Uzbekistan, Vimpelcom’s subsidiary, saw its revenue grow by 11% in 2013 to $175m, it said during its annual results presentation.
The company also boosted its customer numbers by 3% in 2013 to 10.5m partly because MTS’s subsidiary, Uzdunrobita, had been chased out of Uzbekistan in 2012. This is a smaller jump than you may have imagined but most of the switch over of customers from Uzdunrobita to Beeline happened in Q4 2012.
Most importantly from the presentation was the statistic that data usage rose significantly in Uzbekistan last year.
Beeline reported a 61% jump in mobile data revenue. This is mainly internet surfing on mobile phones. What this means is that the Uzbek mobile consumer is becoming increasingly sophisticated.
Beeline is one of two mobile providers in Uzbekistan. Ucell, owned by Swedish-Finnish mobile operator TeliaSonera, has a similar number of customers.
Both Beeline and Ucell will have watched the MTS saga apprehensively. For now, though, Uzbekistan is a good market.
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(News report from Issue No. 175, published on March 12 2014)