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Stock Market: Tethys, Centerra Gold

APRIL 6 2017 (The Conway Bulletin) — Shares in oil producer Tethys traded up at 1.73% on Monday despite full year results showing that its revenues from oil and gas sales had fallen by 47% to $11.7m.

It blamed the drop in revenue on the devaluation of the tenge in the second half of 2015 and a drop in oil output. Tethys sells most of its production on the domestic Kazakh market.

Despite the drop in revenues, Tethys said that its losses for 2016 were actually smaller than its losses in 2015, perhaps driving the price up 26% on the London Stock Exchange. Tethys if one of the region’s most illiquid stocks.

Most of the savings came in tight cost-cutting in administrative issues. It said that losses for 2016 were $46.9m compared to $74.6m in 2015. Tethys is pulling out of a project with China’s CNPC and France’s Total in Tajikistan because it couldn’t keep up with its call payments. It is also locked in a commercial dispute in Kazakhstan which has meant that the bank accounts of its subsidiary have been frozen.

Despite hitting a 6-month high of C$7.65, analysts have been lining up to give Centerra Gold’s stock a hefty ‘buy’ rating.

CIBC gave it a target rating of C$10 this year and CSFB went even further with a rating of C$10.25. The consensus target price is C$8.08.

The buy ratings appear to be based on strong gold prices which are enough to shrug off Centerra Gold’s spat with the Kyrgyz authorities. Kyrgyzstan wants a direct stake in the Kumtor gold mine, its largest industrial asset, which is wholly owned by Centerra Gold. Instead it currently holds a 32.7%% stake in Centerra Gold.

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(News report from Issue No. 323, published on April 6 2017)

Georgian Zoo to house Siberian tiger

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APRIL 2 2017 (The Conway Bulletin) — Tbilisi Zoo will house its first tiger since a flood in 2015 destroyed the site and killed dozens of animals including the zoo’s tigers, media reported. The Siberian tiger is being donated by Riga Zoo. Other zoos have also donated animals to Tbilisi’s zoo, including London Zoo. 19 people were also killed in the flood on June 13 2015.

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(News report from Issue No. 323, published on April 6 2017)

Georgian court jails Ex-MP for property Ponzi scam

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TBILISI, APRIL 3 2017 (The Conway Bulletin) — A court in Tbilisi sent the high-profile sisters Maia Rcheulishvili and Rusudan Kervalishvili to four years in prison for embezzlement linked to their construction company Center Point Group.

In a court case that gripped Georgia, the once glamorous sisters who had it all were told they had swindled 6,200 families out of $14m by promising them that they would build the homes of their dreams.

Instead many investors got nothing.

After the judgement, though, there was outrage from some families who said the sisters had gotten off lightly and that the real amount they had embezzled in an elaborate Ponzi scheme was far greater. In 2012, Transparency International, the anti- corruption lobby group, produced a report which said they had stolen $310m.

The judge said that the scam ran from 1999, when the Center Point Group was established, until it went bankrupt in 2008. Its assets were then moved to a company called Dexus in a deal in 2010 that observers have described as murky.

Center Point Group was notorious for collecting large advance payments from clients on promises to build luxury apartments. Hundreds said they never received their apartments.

For Ms Kervalishvili, prison represents a sharp fall from grace. She was once regarded as one of the richest and most successful businesswomen in the country. She had been an MP for former president Mikheil Saakashvili’s United National Movement party and Parliament’s deputy speaker in 2008-12.

M Rcheulishvili’s husband is Vakhtang Rcheulishvili who was the former head of the Georgian Socialist party and a deputy speaker of Parliament in the 1990s and 2000s.

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(News report from Issue No. 323, published on April 6 2017)

Armenian fruit firms sign deal with the UAE

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MARCH 29 2017 (The Conway Bulletin) — Two fruit and vegetable companies in Armenia have signed supply deals with six luxury hotels in the UAE, media reported. The Armenian companies, Tamara Fruit and Natural Organic Healthy Food Company, signed the deals earlier in March at a UAE-Armenia trade meeting in the Dubai. This sort of deal is important for Armenia which is looking to boost its exports.

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(News report from Issue No. 323, published on April 6 2017)

Rates kept steady, prices rise in Armenia

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APRIL 6 2017 (The Conway Bulletin) — Armenia’s Central Bank kept its key interest rate unchanged at 6% because inflation was rebounding (March 28). It said that for the 12 months to the end of March inflation measured minus 0.2% but that it was confident that this would rise to plus 4% by the end of the year. The impact of a recent economic slowdown on Armenia has been to push prices down. In an interview with Reuters, Central Bank chief Arthur Javadyan said that it would simply be too risky for the Central Bank to cut interest rates any further. In August 2015, Armenia’s key interest rate had measured 10.5%.

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(News report from Issue No. 323, published on April 6 2017)

Tajik government promotes traditional dresses

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APRIL 4 2017 (The Conway Bulletin) — The Tajik government has been campaigning for women in Tajikistan to wear traditional brightly-coloured flowing dresses in an effort to dampen the rise in popularity of Islamic headscarves and hijabs, the AFP news agency reported. Tajikistan’s government is increasingly worried about the popularity of extremist Islamic ideology and the drift of many young men towards joining the radical IS group in Syria and Iraq.

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(News report from Issue No. 323, published on April 6 2017)

Georgians celebrate visa-free access to the EU’s Schengen Zone

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TBILISI, MARCH 6 2017 (The Conway Bulletin) — Georgians held street parties and hung the Council of Europe’s blue and gold starred flag from their windows as they celebrated being allowed to travel to the European Union’s Schengen Zone without a visa.

Georgian PM Giorgi Kvirikashvili, together with students, journalists and state officials, was one of the first to use the new visa-free regime, taking an early morning flight from Tbilisi to Athens for an academic conference on the future of Europe, before flying on to Brussels.

He hailed the start of a new, increasingly close relationship between Georgia and the EU.

“This is an enormous achievement and a great opportunity for Georgian citizens to better acquaint with the European Union, to better learn the values that the European Union stands on,” he was quoted as saying.

Georgia harbours ambitions to join the EU at some point and, although there is no appetite among EU member states to bring Georgia into the Union, relations are growing increasingly close. Last year Georgia and the EU signed an enhanced Association Agreement that allows Georgian companies to export to the EU.

Under the new rules, Georgians are allowed to travel to the EU’s 26- country Schengen Zone without a visa for 90 days. Georgians citizens will still have to carry documents confirming the purpose of their visit to the EU, including a return air ticket, insurance, a bank statement and accommodation bookings.

Still, most people in Tbilisi were excited by the prospect of visa-free travel to the EU. Miranda, travelled to Vienna on March 29. She said that border controls could not have been easier.

“I travelled the very day next after visa liberalisation was put into force,” she said.

“It was as easy as one can imagine. I met other Georgians at the airport who were travelling without visa. They all made it safely as well.”

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(News report from Issue No. 323, published on April 6 2017)

Turkmen president sacks his energy minister

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APRIL 5 2017 (The Conway Bulletin) — Turkmen president Kurbanguly Berdymukhamedov sacked the experienced Yashigeldy Kakayev as deputy PM responsible for overseeing the oil and gas sector, perhaps the most important position in his administration, for “shortcomings”, state media reported.

In his place, Mr Berdymukhamedov promoted Maksat Babayev, who was appointed to head Turkmengaz in January.

Mr Berdymukhamedov is all- powerful and although he spoon- feeds ordinary Turkmen with data that suggests the economy is running smoothly, anecdotal evidence suggests otherwise.

He also appears to need to protect himself from any culpability for Turkmenistan’s economic problems, linked to a sharp fall in the price of gas – its main revenue earner. This means he has to shift blame onto his ministers and senior officials who he appoints and fires with increasingly regularity.

Mr Kakayev had been appointed energy minister under very similar circumstances in 2015 when his predecessor was also sacked for “shortcomings”.

In the cabinet reshuffle, Mr Berdymukhamedov also fired deputy PM in charge of agriculture, Redjep Bazarov.

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(News report from Issue No. 323, published on April 6 2017)

Russia slaps ban on Tajik flights

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APRIL 2 2017 (The Conway Bulletin) — The Russian air authorities have once again banned Tajikistan’s privately-owned Somon Air from flying to Russia, an apparent resumption of the row between the two countries earlier this year which cut the number of air-links. Air-links between Russia and Tajikistan are especially important for Tajikistan’s migrant work force which relies on jobs in Russia.

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(News report from Issue No. 323, published on April 6 2017)

Uzbek president enjoys upbeat meeting with Putin

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APRIL 5 2017 (The Conway Bulletin) — On his first trip to Moscow as Uzbekistan’s president, Shavkat Mirziyoyev signed investment pledges worth $12b and trade deals worth $3.8b with Russian president Vladimir Putin.

The main thrust of the deals was in gas. Mr Mirziyoyev said that Russia had agreed to increase the amount of gas it buys from Uzbekistan, a vital revenue earner for the Uzbek economy.

“The case in point is significant expansion of deliveries of natural gas to Russia on the basis of the five-year contract to be concluded for the first time,” the TASS news agency quoted Mr Mirziyoyev as saying.

The deals bode well for Mr Mirziyoyev who cuts a very different figure on the international scene than his predecessor, Islam Karimov, who died in September after ruling for 25 years. Where Karimov was cagey, aloof and unilateral, Mr Mirziyoyev has shown that he is able to charm regional heads of states and get bilateral deals signed.

Mr Putin, who always had a difficult working relationship with Mr Karimov, appeared happy to see Uzbek-Russian relations blossom.

“We are witnessing our trade and economic ties intensifying, and we have always paid special attention to it,” he was quoted as saying. “It should be noted that in general we keep the trade turnover at a high level. In some positions it grows in a remarkable manner.”

The meeting in Moscow, though, came just two days after an alleged suicide bomber from Central Asia killed at least 14 people on a metro in St Petersburg. Security, cracking down on terrorist recruitment drives in Central Asia and stopping the spread north of the Taliban from Afghanistan, was also high on the agenda.

ENDS

(News report from Issue No. 323, published on April 6 2017)