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Georgian PM and CBank meet despite row

SEPT. 22 2015, TBILISI (The Conway Bulletin) — Pushing their personal differences aside, Georgia’s Central Bank chief Giorgi Kadagidze and the PM Irakli Garibashvili held a rare head-to-head meeting to discuss the increasingly poor state of the Georgian economy.

A collapse in global energy prices and a sharp fall in the performance of Russia have pressured regional economies this year but a breakdown in relations between the Central Bank and the PM’s office has also been a feature of the year in Georgia.

The Central Bank’s press office declined to confirm if this was the first time Mr Garibashvili, the PM, had visited Mr Kadagidze in 2015 but analysts said it was a rare occasion.

“It was significant, as they discussed the currency,” said Tamar Jugheli, research director at the Policy and Management Consulting Research Center. She said a management change in one of the main departments at the Central Bank had improved relations. Mr Garibashvili has criticised Mr Kadagidze over monetary policy. He also stripped the Central Bank of its power to oversee commercial banks.

Like many issues in Georgia, politics is at the heart. Mr Kadagidze was appointed by the previous government of former president Mikheil Saakashvili, irritating the current government.

Still with Georgia’s currency dropping to an all-time low and with inflation rising fast, Mr Kadagidze and Mr Garibashvili had to act. After the meeting the Bank bought $40m worth of lari and then, the following day, it increased interest rates.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)

Azerbaijan warns foreign media

SEPT. 21 2015 (The Conway Bulletin) – Ali Hasanov, an aide to Azerbaijani President Ilham Aliyev, warned foreign media outlets they needed to ensure their reporters carried the correct accreditation to work in Azerbaijan. If foreign journalists didn’t have the correct accreditation on them, Mr Hasanov said, police would arrest them. Azerbaijan has made it increasingly difficult for foreign media to operate freely.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)

Tajikistan boosts imports of LNG

SEPT. 21 2015 (The Conway Bulletin) – To meet growing demand, Tajikistan has increased the volume of liquefied natural gas (LNG) it imported to 220,000 tonnes in the first eight months of the year, an increase of 18% over the same period last year. Tajikistan imports LNG from Kazakhstan. Over the past year, the proportion of LNG-fuelled vehicles on the road in Tajikistan has increased to 60% from 40%.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)

Georgian soldier dies in Afghan

SEPT. 21 2015 (The Conway Bulletin) – A Georgian soldier, Private Vasil Kuljanishvili, was killed while on patrol outside Bagram airbase in Afghanistan, Georgia’s ministry of defence said. Kuljanishvili’s death means that 31 Georgian soldiers have died in Afghanistan supporting US operations against the Taliban. Georgia wants to join NATO.

ENDS

(News report from Issue No. 249, published on Sept. 25 2015)

Georgia expects power investment

OCT. 16 2015 (The Conway Bulletin) – Georgia expects investments in its energy sector of $8b over the next few years, media quoted a Reuters interview with Ilia Beroshvili, Georgia’s deputy energy minister. Mr Beroshvili said that most of the investment would be in gas processing plants and hydropower.

ENDS

(News report from Issue No. 253, published on Oct. 23 2015)

Currency: Kazakh tenge, Kyrgyz som

SEPT. 18 2015 (The Conway Bulletin) — Have the Kazakh tenge and the Kyrgyz som reached rock bottom yet? This week, the tenge in Kazakhstan suffered another strong fall (-4.4%). The cost of $1 even rose above the psychological rate of 300 tenge on Sept. 16, only to settle back down to around 270 by the end of the week.

The Kyrgyz som also hit a historical high of 70/$1 on Wednesday.

And this despite repeated interventions from both Central Banks, which bought hundreds of millions of dollars in the currency market to support the tenge and som.

At the end of last week, the announcement that Dariga Nazarbayeva, the eldest daughter of Kazakh president Nursultan Nazarbayev, had been appointed as deputy PM sparked a late round of trade in the dollar market, weakening the tenge. Was this the market saying that they were worried about her promotion? Some analysts said that President Nazarbayev may be grooming her to take over the top job.

The som is struggling because the Russian economy isn’t recovering and the upcoming parliamentary elections in Kyrgyzstan are upset- ting the market.

In Georgia, the lari lost 2.4%, probably linked to general Emerging Markets weakness.

The Fed hasn’t ruled out the possibility of increasing rates by the end of the year. Such a decision would divert US dollars back to the US economy, away from Emerging Markets. The faltering economies in Central Asia and the South Caucasus need to prepare themselves for the worst.

Tightly-managed currencies in Azerbaijan, Tajikistan, Turkmenistan and Uzbekistan remained vir- tually unchanged this week. To maintain the exchange rates constant, central bankers in these countries had to heavily intervene in the currency markets.

ENDS

(News report from Issue No. 248, published on Sept. 18 2015)

Stock market: Centerra Gold, KAZ Minerals

SEPT. 11-18 2015 (The Conway Bulletin) — Canadian mining company Centerra Gold saw its stock price on the Toronto Stock Exchange jump over 16% to 7.34 Canadian dollars, after having slumped in the past three weeks, due to the signing of a new exploration licence in British Columbia. Centerra’s main asset, the Kumtor gold mine, is located in Kyrgyzstan. London listed KAZ Minerals, was down 6% to 152 pence due to low copper prices. Kazakhstan-focused Roxi Petroleum gained 4.4% this week, to 8.75 pence.

Kcell, one of Kazakhstan’s largest telecoms, lost 2% on Sept. 17 after its mother company TeliaSonera said it would leave Eurasian markets.

London-listed Bank of Georgia surged 3.9% this week to 1,907 pence. The GDR stock of Georgia’s TBC Bank lost 6.5% this week in London, down to $9.25 per share, though it had fallen to $9.11 on Sept. 14.

ENDS

(News report from Issue No. 248, published on Sept. 18 2015)

Azerbaijan’s SOCAR revenues to drop

SEPT. 14 2015 (The Conway Bulletin) – Azerbaijan’s state oil and gas company SOCAR said it would transfer less cash to the national budget this year because a fall in oil prices had dented its revenues. This is a blow to Azerbaijan which is heavily reliant on revenues from oil and gas for its income.

ENDS

(News report from Issue No. 248, published on Sept. 18 2015)

BP suspends Azerbaijan’s oil platform

SEPT. 17 2015 (The Conway Bulletin) — BP said it will suspend operations at the Chirag oil platform, in Azerbaijan’s sector of the Caspian Sea because of planned maintainence work. BP didn’t specify when Chirag would resume operations. Chirag, together with Azeri and Guneshli, is one of the most important oil fields in Azerbaijan.

ENDS

(News report from Issue No. 248, published on Sept. 18 2015)

Comment: To monitor or not, that is the question

SEPT. 18 2015 (The Conway Bulletin) -Has Europe’s democracy watchdog, the OSCE, shot itself in the foot by deciding not to monitor Azerbaijan’s up and coming parliamentary election?

Certainly it must have been irritating that the Azerbaijani authorities had told the OSCE that it can have barely half the number of monitors it had asked for on the ground. But that feels like scant justification for pulling out altogether.

Instead, this feels personal.

The Azerbaijani authorities have been in menacing mood, pressuring anybody in their way and this has included the OSCE. Earlier this year, the OSCE closed its office in Baku under pressure from the Azerbaijani authorities.

Now it feels that the OSCE has been able to exact some sort of payback by crying foul over monitor numbers, pulling its observation team from Azerbaijan’s Nov. 1 election altogether and drawing yet more international condemnation on Azerbaijani president Ilham Aliyev.

But this is, surely, an opportunity missed.

Would it not have made more sense to monitor the election as best as possible with limited resources. That way the West can improve its understand of what is going on in Azerbaijan and maintain closer contact with ordinary Azerbaijanis.

There will be other Western vote monitoring teams at the election but without the size and experience of the OSCE team, the West is severely limited and this is a crying shame.

By James Kilner, Editor, The Conway Bulletin

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(News report from Issue No. 248, published on Sept. 18 2015)