Category Archives: Central Asia & South Caucasus News

Georgia joins EU’s Energy Community

TBILISI, OCT. 14 2016 (The Conway Bulletin) — Georgian energy minister Ilia Eloshvili signed a deal for Georgia to join Europe’s Energy Community, meaning that it will now impose various EU rules and regulations over its electricity and gas networks.

For Georgia, joining the Energy Community is another step towards integrating its economy, and in this case energy network, more closely with the EU.

Earlier this year it entered into an Association Agreement with the EU which will make it easier to sell goods in Europe and this month EU members states said that Georgia should receive visa-free access to the Schengen zone.

At the signing ceremony in Sarajevo, the capital of Bosnia Herzegovina, Mr Eloshvili was clear about Georgia’s overall intentions.

“By receiving the status of the contracting party, we plan to embark on the implementation of new round of reforms for approximating Georgia’s energy sector with the European Union energy market rules,” media quoted him as saying.

Georgia had said in February that it wanted to join the Energy Community. Along with EU member states, Albania, Bosnia and Herzegovina, Kosovo, Macedonia, Moldova, Montenegro, Serbia and Ukraine are members of the Energy Community.

Georgia is expected to become a member next year after its parliament ratifies the deal and Dominique Ristori, director general for Energy at the European Commission said it would give the project momentum.

“With yet another new country joining the Energy Community family, this framework for the creation of a pan-European energy system is once again showing that it is relevant and successful,” he said.

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(News report from Issue No. 301, published on Oct. 21 2016)

Cotton exports rise in Uzbekistan

OCT. 15 2016 (The Conway Bulletin) — At its annual cotton fair, Uzbekistan reportedly signed deals to export finished cotton worth $1.3m, up from $800m in 2015, Radio Free Europe/Radio Liberty reported. Cotton is one of Uzbekistan’s most important exports. Many Western brands refuse to use Uzbek cotton in their garments because of its association with child labour.

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(News report from Issue No. 301, published on Oct. 21 2016)

Kazakh President returns back to work

OCT. 14 2016 (The Conway Bulletin) — Kazakh president returned to work after three days off because he had apparently caught a cold, his press office said. Part of Mr Nazarbayev’s image is his fitness and virility and it is rare for him to admit to taking any time off work. The cold apparently caused Mr Nazarbayev to skip a meeting of the FSU-focused CSTO group in Yerevan.

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(News report from Issue No. 301, published on Oct. 21 2016)

Gerogia TBC Bank completes buyout of rival

TBILISI, OCT. 18 2016 (The Conway Bulletin) — Georgia’s TBC Bank completed the takeover of Bank Republic, making it the biggest bank in the country in terms of loans.

At the same time, the Georgian Central Bank suspended the licence of Progress Bank, linked to former energy minister Kakha Kaladze and billionaire Bidzina Ivanishvili, suggesting that a deal for TBC Bank to buy it was about to go through.

TBC had bought most of Bank Republic last month from Societe Generale for 315m lari ($136m) but still had to buy the final 6.4% from the European Bank for Reconstruction and Development.

Vakhtang Butskhrikidze, TBC Bank CEO, enthused about the future. “We believe the acquisition of Bank Republic is a critical step in delivering on TBC Bank’s strategy and represents a major step forward

in TBC Bank’s ambition to build the leading banking group in Georgia and the broader Caucasus region,” he was quoted by media as saying.

Importantly, the deals shift TBC Bank from having a 5.3% share of the deposits market to a 34.5% share.

Georgia’s banking sector is generally considered the most advanced in the South Caucasus. Bank of Georgia, TBC’s rival, is listed on the London Stock Exchange.

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(News report from Issue No. 301, published on Oct. 21 2016)

Kazakhstan renames Gulen-led schools

OCT. 18 2016 (The Conway Bulletin) — Kazakhstan is renaming a series of schools linked to the Gulenist Movement, blamed by Turkish president being behind a coup attempt earlier in the year, media reported. The movement is headed by the exiled cleric Fethullah Gulen. He has denied any link to the July coup attempt. Gulen schools in Kazakhstan and Kyrgyzstan are considered some of the best and both the Kazakh and Kyrgyz governments have been resistant to closing them despite pressure fromTurkey.

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(News report from Issue No. 301, published on Oct. 21 2016)

Kazakhs turn to credit cards

ALMATY, OCT. 18 2016 (The Conway Bulletin) — Kazakhs are spending more money on credit cards than ever before, new data showed, as they try to work out ways of pulling through a prolonged economic downturn.

Data from the rankings.kz website showed that the amount of credit cards in circulation in Kazakhstan had increased by 250% this year, a jump that suggests a large rise, too, in consumer debt.

Kuralai Abenova, a student in Almaty, was using her credit card to buy kit to renovate her apartment.

“It is very convenient rather than saving money. I can take a large sum of money and then pay little bits of it off regularly,” she said.

A crash in oil prices and a recession in Russia have hit Kazakhstan hard. The tenge currency has lost around 50% of its value since 2014 and inflation is rising.

Analysts have previously warned, though, that Kazakhs’ over-reliance on credit was a weakness that could undermine the economy. During the Global Economic Crisis of 2008/9, Kazakh banks were left with piles of bad debt. The risk is that similar amounts of bad debt are being accrued now.

And this loose attitude towards consumer debt is being replicated in high street shops which are encouraging shoppers to spend through cheap loans.

Saida Zhunusova, a financial consultant at the electronics store Technodom, said she had seen a large increase in the number of people using credit cards or asking directly for credit to pay for products.

“Many people cannot pay for the goods with cash and it is more convenient for them to pay only a part of the cost. Compared to 2014-2015 our sales have doubled because of loans,” she said.

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(News report from Issue No. 301, published on Oct. 21 2016)

Kazakh court fines Ural Oil and Gas

OCT. 20 2016 (The Conway Bulletin) – A court in Kazakhstan slapped a 2.1b tenge ($6.23m) fine on Ural Oil and Gas, a small energy company, for environmental damage. According to the prosecutor, the company had illegally disposed of its drilling waste at its operations in the Fedorovsky Bloc in Western Kazakhstan. State-owned Kazmunaigas (50%) and Hungary’s MOL (27.5%) are the two largest shareholders in Ural.

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(News report from Issue No. 301, published on Oct. 21 2016)

Kyrgyz MPs push back referendum

OCT. 19 2016 (The Conway Bulletin) — MPs in Kyrgyzstan voted to push back a referendum on changing the country’s constitution to Dec. 11 from an earlier date of Dec. 4. One of the reasons give for pushing back the referendum was to find the original document. This was supposed to have been kept in the President’s office but could not be found. The referendum focuses on strengthening the power of the PM.

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(News report from Issue No. 301, published on Oct. 21 2016)

Kazakh women’s rights leaders ambivalent on Dariga as future president

ALMATY, OCT. 21 2016 (The Conway Bulletin) — Dariga Nazarbayeva, daughter of Kazakh president Nursultan Nazarbayev, may have been promoted to the Senate in a reshuffle last month, and is now being touted as a presidential successor, but many women appear ambivalent on supporting her candidacy.

The issue of who will succeed president Nursultan Nazarbayev, 76, as next president dominates Kazakh politics but Ms Nazarbayeva, 53, is a divisive figure and she fails to generate mass support among what should be her natural support base — women — as interviews with women’s rights advocates suggested.

Dina Smailova, who heads a group fighting domestic and sexual violence called ‘Don’t be silent’, said that while Ms Nazarbayeva had been supportive of their work, she may not be the right person to lead the country.

“I can view her candidacy as a woman who is educated, a modern woman but why not consider another candidate?” she said.

Women’s rights and domestic abuse moved into the mainstream in Kazakhstan this year after a well- known female TV presenter was badly beaten up by her husband at a petrol station outside Almaty.

According to the UN, 500 women are killed each year in Kazakhstan by their partners.

Aida Alzhanova, chair of Adam Damu charity and a former UN expert for women’s equality said Ms Nazarbayeva had not done enough to promote women’s rights.

“I didn’t know Dariga was promoting women’s rights,” she said. “Here gender inequality in politics and business is gradually moving into the domestic sphere.”

She did say, though, that she would consider supporting Ms Nazarbayeva.

“If she wins in a fair election and if she has a clear gender policy that fits with international norms and standards, then I will vote for her,” she said.

The third women’s rights leader interviewed by The Conway Bulletin said that she would support Dariga Nazarbayeva if she wanted to become president.

“I want to believe that if a woman becomes president there will be pos- itive changes in the country,” said Marianna Gurina, president of the Ulagatty Zhanuya charity, which pro- motes family values and women’s rights.

“Yes, I support her candidacy because I think she, as a woman understands women.”

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(News report from Issue No. 301, published on Oct. 21 2016)

A presidential election in Turkmenistan

OCT. 17 2016 (The Conway Bulletin) – >> So, an election in Turkmenistan then. Will it be close?

>> No, not at all. The incumbent president, Kurbanguly Berdymukhamedov, will clean up and win probably with more than 95% of the vote. He won 97% of the vote at the last presidential election in 2012.

>> Right. He must be a popular chap, then.

>> Again, unlikely, but it is very hard to tell. Since he was officially elected president in January 2007, Berdymukhamedov has carefully built up a personality cult to rival any other around the world. Last year he unveiled a statue of himself sitting on a horse with a flowing cloak. It was all very Roman. Berdymukhamedov pretty much makes all the key decisions in Turkmenistan. He runs the the economic, foreign and domestic policies. He’s not a big delegator. The problem is that it is very difficult to know how genuinely popular, or unpopular, he is at the moment as free media doesn’t exist in Turkmenistan. What we do know is that although Berdymukhamedov can take credit for opening up the economy and for developing its gas export routes, Turkmenistan is suffering, just like its neighbours, from a sharp regional economic downturn linked a drop in energy prices and a recession in Russia.

>> What do you mean?

>> Again, information that is 100% reliable is hard to come by but we do know that government salaries have been paid late and that people are blocked from transferring cash into foreign currencies. There have also been a handful of small protests in the past couple of years in Ashgabat which are vitally important in judging the mood. These have focused on domestic issues, such as satellite dishes on buildings and the destruction of suburban housing to clear ground for a new Olympic village. They are not directly political but they are good indicators that not all is as steady as the Turkmen government, and Berdymukhamedov in particular, would like. Protests are extremely rare in Turkmenistan so any indicator that people are prepared to stand up to the authorities must be taken seriously.

>> Does this make the election is risky for Berdymukhamedov?

>> Turkmenistan is a tightly controlled police state so this is unlikely. He also had to hold a presidential election next year. Until he changed the constitution last month, presidential terms in Turkmenistan were set at five years. The previous election was in 2012. He’s now changed the length of a presidential term to seven years so once next February’s election is out of the way, he won’t have to deal with another until 2024. This election will be something for the Turkmen authorities to carefully manage but beyond that it shouldn’t trigger any major problems.

>> Got it. And how will the international community deal with it?

>> This is a tricky one. The Russians and the Chinese mainly want a reliable partner and stability. They have this in Berdymukhmaedov and won’t want the the boat to be rocked, so to speak. The West, and Europe in particular, have a different agenda. They want Turkmenistan’s gas but are also interested in human rights. It’s unlikely that they will send vote monitors and they will complain about the lack of free speech but, by and large, there is very little that they can really do.

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(News report from Issue No. 301, published on Oct. 21 2016)