OCT. 27 2016 (The Conway Bulletin) — Three Kazakh women weightlifters were stripped of their 2012 Olympic gold medals after new tests showed that they had used banned drugs. The three Kazakh weightlifters were Zulfiya Chinshanlo, Maiya Maneza and Svetlana Podobedova. The international weightlifting authorities are now considering banning Kazakhstan from all competitions.
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(News report from Issue No. 302, published on Oct. 28 2016)
OCT. 28 2016 (The Conway Bulletin) — Amsterdam-based Nostrum Oil & Gas continues to navigate through the troubled waters of low oil prices. Its stock has rallied heavily in recent weeks.
The positive trend in the London stock market could be tied to the promises of a better 2017, when the company aims to complete an expansion and boost production.
CEO Kai-Uwe Kessel is confident production will more than double in just two years. “Our main focus continues to be the completion of GTU3, which is on track to be delivered on budget in 2017, and which will more than double our production capacity,” Mr Kessel said in a statement.
In the first part of 2016, however, average daily production fell to around 36,000 barrels. Now the company says that it expects to boost output to 40,000 barrels/day by year end. Sustained low oil prices, together with production and sales hiccups, have hit revenues, down 35% in the first nine months of 2016 to $240m, compared to the same period last year.
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(News report from Issue No. 302, published on Oct. 28 2016)
OCT. 26 2016 (The Conway Bulletin) — German logistics giant DHL set up an office in Baku, part of its drive to build a transport hub in the South Caucasus. In May, state- owned Azerbaijan Railways and DHL signed an agreement to establish a logistics hub in Azerbaijan to transport goods from China to Turkey, Russia and Europe. In Azerbaijan, DHL will initially employ Turkish management.
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(News report from Issue No. 302, published on Oct. 28 2016)
OCT. 24 2016 (The Conway Bulletin) — On the first day of her murder trial, Gyulchekhra Bobokulova, an Uzbek nanny, pleaded guilty to beheading a 4-year-old girl in Moscow in February. Bobokulova was filmed standing outside a Moscow metro station waving the severed head and calling herself a terrorist. She had been hired by a Moscow- based family to care for the girl she murdered. The incident has shocked people in Russia and triggered calls by nationalists to increase control over migrant workers from Central Asia.
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(News report from Issue No. 302, published on Oct. 28 2016)
OCT. 26 2016 (The Conway Bulletin) — Kazakh president Nursultan Nazarbayev visited Saudi Arabia where he signed deals with King Salman bin Abdulaziz Al Saud, including a deal to boost nuclear cooperation. Kazakhstan is one of the biggest producers of uranium in the world and has been trying to build up a market to sell to.
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(News report from Issue No. 302, published on Oct. 28 2016)
OCT. 17 2016 (The Conway Bulletin) — Azerbaijan’s GDP shrank by 3.9% in the first nine months of the year compared to the same period in 2015, highlighting the heavy impact that a fall in the price of oil has had on the economy. The fall is roughly in line with analysts’ prediction. They had said that Azerbaijan is particularly exposed to the collapse in oil prices because it has not diversified its economy.
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(News report from Issue No. 301, published on Oct. 21 2016)
ALMATY, OCT. 18 2016 (The Conway Bulletin) — Kazakhs bought just under 31,000 cars in the first nine months of the year, a drop of 59% compared to the same period last year.
The car market is a key indicator of Kazakhstan’s economic health and its collapse since an oil price crash in mid-2014 has mirrored the Kazakh economy. In Q1 2014, by comparison, Kazakhs bought 35,000 new cars, easily outstripping total sales for the first nine months of this year.
Analysts have said that consumers are not buying cars because of a 50% cut in the value of the tenge and higher inflation which have made them vastly more expensive.
Putting a positive spin on the news, Oleg Alfyorov, president of Kazavtoprom, the car industry union, said that he thought the market had bottomed-out and that sales would start to rise again soon.
“Kazakhstan’s car market has been in a state of recession since the second half of 2014. But this year, sales have reached a market plateau, from which retailers can start moving upwards,” he said.
Mr Alfyorov also pointed out the increased share of locally produced cars in total sales, which grew to 24%, almost double the share in 2014.
“Quarterly Kazakhs bought about 10,000 new cars. This figure has been stable since the beginning of the year.
At the same time, an increasing number of buyers preferred locally- assembled cars,” he said.
Still, this is a long way from where the industry was a few years ago when foreign car makers were eager to get a foothold in Kazakhstan’s growing manufacturing sector to launch into what they thought would be a lucrative Central Asian market.
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(News report from Issue No. 301, published on Oct. 21 2016)
OCT. 17 2016 (The Conway Bulletin) – A man blew himself up outside the headquarters of the TV station in the breakaway Georgian region of Abkhazia. Reports were unclear on whether the bomb was a suicide or the man was targeting the TV station itself. Abkhazia and South Ossetia broke away in 2008 after a brief war between Georgia and Russia. Russia recognises their independence.
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(News report from Issue No. 301, published on Oct. 21 2016)
OCT. 15 2016 (The Conway Bulletin) – Neil McKain, regional director of the EBRD, said that the Bank is ready to put $100m into the ailing Tojiksodirotbank (TSB), which has been under temporary administration since May. Rumours about the EBRD buying a stake in TSB have lingered for months. Should the investment be confirmed, it would be lower than the $165m previously rumoured. TSB is Tajikistan’s second-largest lender.
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(News report from Issue No. 301, published on Oct. 21 2016)
OCT. 17 2016 (The Conway Bulletin) – ArcelorMittal, the world’s largest steelmaker, has shown signs of trouble in its operations in Kazakhstan due to the fall in commodity prices.
In early 2014, it laid off around 1,000 workers. The subsequent devaluation of the tenge currency seemed to have fixed its cost problems but as the US dollar strengthened against all commodities, effectively pushing prices down, the company felt the bite of lower revenues.
In 2015, it cut worker salaries by 25% only to later face a court order that deemed the move illegal. Later in 2015, when the tenge sank after the Central Bank ditched the peg to the US dollar in August, ArcelorMittal Temirtau’s former boss Vijay Mahadevan said that the tenge value needed to be even lower for the company to effectively cut costs.
But exchange rate fixes are only one-off solutions that cannot ensure long-term stability.
Earlier this year, the company predicted a 13% drop in net income and cancelled a promised pay raise to its employees, lowering their benefits instead. And in September, the government lodged a veiled accusation against ArcelorMittal Temirtau for allegedly slowing production to keep revenues low and avoid a higher tax bill. The company said this week it had resumed full production, to avoid further problems.
But the headaches are still there, despite the potential growth of the Iranian market, vital for ArcelorMittal, after most sanctions were lifted this year.
Besides the thousands that it currently employs, the plant in Temirtau holds symbolic value, as President Nursultan Nazarbayev worked there in his youth.
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(News report from Issue No. 301, published on Oct. 21 2016)
