Category Archives: Central Asia & South Caucasus News

House prices still fall in Kyrgyzstan

APRIL 28 2017 (The Conway Bulletin) — House prices in Kazakhstan are continuing to fall, an indication that the economy is still struggling to pull out of a deep slump linked to the collapse in oil prices since mid- 2014. The price tracking website homsters.kz said that only in Almaty were prices beginning to recover. The housing market fell sharply after a 50% cut in the value of the tenge in 2015.

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Copyright ©The Conway Bulletin — all rights reserved

(News report from Issue No. 327, published on May 5 2017)

Georgia raises minimum capital requirements for banks

TBILISI, MAY 5 2017 (The Conway Bulletin) — Georgia’s Central Bank will quadruple the minimum capital requirement that commercial banks have to hold to 50m lari ($20.5m), part of drive to reduce the number of small, weak banks in its financial system.

Acting on a recommendation from the IMF, the Georgian Central Bank said that commercial banks would need to hold capital of 30m lari by the end of the year, 40m lari by mid-2018 and 50m lari by the end of 2018. Currently the minimum capital requirement for a bank in Georgia is just $12.5m lari.

“It should be noted that in terms of minimum capital requirement Georgia has one of the lowest in the world, not in line with the financial sector’s development,” it said in a statement.

“The change was supported by the International Monetary Fund’s mission.”

Georgia and the rest of the Central Asia and South Caucasus region have been battling an economic downturn over the past three years that has eaten into the value of their currencies, undermined mortgage holders and companies holding large debt and bankrupted, or nearly bankrupted, a number of banks.

In Tajikistan only a government bail-out prevented a banking collapse; in Azerbaijan several small banks have been forced to close and the government has bought a majority stake in International Bank of Azerbaijan, the country’s biggest bank; in Kazakhstan the government has set up a bad loan fund for banks to dip into for support.

Georgia’s economy has survived the downturn in better shape than its neighbours – the lari proved more robust than the manat, which halved in value, but it still shook the banking sector. There are 17 banks operating in Georgia, the Central Bank said, roughly the same as 10 years ago. In 1995, there were 102 banks.

The two biggest, TBC and Bank of Georgia, are listed on the London Stock Exchange but many of the others are small, a legacy of the post- Soviet banking boom in the 1990s.

Last month the IMF approved a $285.3m loan on the understanding that Georgia would continue a series of economic reforms, including strengthening its banking sector.

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Copyright ©The Conway Bulletin — all rights reserved

(News report from Issue No. 327, published on May 5 2017)

Kazakhstan expects $180m from Kashagan

APRIL 28 2017 (The Conway Bulletin) — Kazakhstan’s sovereign wealth fund Samruk Kazyna and its state-run energy company Kazmunaigas will receive $180m from the Kashagan oil project in 2017, media reported, quoting Dauren Karabayev, a vice president at Kazmunaigas. The Kazakh economy has been flatlining since mid-2014 when oil prices collapsed. Kashagan, in the Caspian Sea, finally came onstream at the end of last year after a delay of three years.

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Copyright ©The Conway Bulletin — all rights reserved

(News report from Issue No. 327, published on May 5 2017)

Emergencies ministry is underpowered, says Kyrgyz minister

MAY 4 2017 (The Conway Bulletin) — Kyrgyzstan’s emergencies ministry is short-staffed and under-funded, deputy Kalys Ahmatov told parliament. The emergencies ministry is a legacy of the Soviet era and is deployed to deal with the aftermath of everything from earthquakes and avalanches to plane crashes. Specifically, Mr Ahmatov said that the ministry needed another 240 employees and 30% more equipment.

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(News report from Issue No. 327, published on May 5 2017)

KAZ Minerals CFO to take over as CEO

APRIL 28 2017 (The Conway Bulletin) — KAZ Minerals, the Kazakhstan- focused copper produced listed on the London Stock Exchange, said that its current CFO Andrew Southam would be promoted to CEO from Jan. 2018. He replaces Oleg Novachuk who has been CEO for 11 years and is set to become the KAZ Minerals chairman.

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(News report from Issue No. 327, published on May 5 2017)

Domestic violence law in Kyrgyzstan becomes strengthened

APRIL 28 2017 (The Conway Bulletin) — Kyrgyz President Almazbek Atambayev signed into law a bill that is designed to strengthen legislation against domestic violence. The new law obliges police to investigate all reports of domestic violence even if the complaint was not filed by the victim.

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Copyright ©The Conway Bulletin — all rights reserved

(News report from Issue No. 327, published on May 5 2017)

EBRD says may still lend to Azerbaijan despite EITI row

MAY 4 2017 (The Conway Bulletin) — The European Bank for Reconstruction and Development (EBRD) may still lend Azerbaijan $500m for a gas pipeline linking the Caspian Sea to Europe despite Baku quitting the EITI, a global transparency watchdog.

The comments by EBRD chairman Suma Chakrabarti go against an EBRD statement last year which said Azerbaijan would have to pass the EITI’s transparency criteria to receiving funding. The EITI suspended Azerbaijan’s membership in March for failing to improve NGO laws, triggering Azerbaijani officials to walk out of the organisation.

Now, in an interview with Bloomberg, Mr Chakrabarti appeared to suggest that mission creep may be blurring the Oslo-based EITI’s remit.

“What’s happened on the EITI is very, very unfortunate,” Bloomberg quoted Mr Chakrabarti as saying. He then said that people were “worried about some of the criteria that are now being used in EITI”.

Azerbaijani officials complained that the EITI, an acronym for Extractive Industry Transparency Initiative, had drifted from its remit of improving accountability in mining and oil and gas sectors and was now acting as a watchdog on more general democracy issues.

In his Bloomberg interview, Mr Chakrabarti said that the EBRD is “progressing” its finance plans for the Southern Gas Corridor and will give a final decision by the end of 2017.

“The question really is whether the Azeris are adopting the principles, not just by saying they are but by showing transparency in what they do,” he said.

“That’s a judgment we’ll make.”

The $40b Southern Gas Corridor is a network of pipelines that should pump Azerbaijani gas from the Caspian Sea to Europe, reducing its reliance on Russia. It has political backing from the EU and business backing from BP and other multinational but corruption and human rights activists are critical of Azerbaijan and have said that Western companies and governments should not be dealing with it.

At the EITI, the head of its secretariat, Jonas Moberg, told The Conway Bulletin that Mr Chakrabarti’s interview hadn’t undermined its core mission of increasing accountability within the extractive sectors.

“Civil society needs to be able to hold their governments to account if the EITI is going to have a meaningful impact on how the oil sector is governed in a country,” he said.

Kazakhstan, Armenian, Kyrgyzstan and Tajikistan are also members of the EITI. The EITI criticised Tajikistan and Kyrgyzstan this year for making inadequate progress against its criteria.

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Copyright ©The Conway Bulletin — all rights reserved

(News report from Issue No. 327, published on May 5 2017)

Air China to fly to Kazakh capital

APRIL 27 2017 (The Conway Bulletin) — Air China said that it will start operating a direct flight between Beijing and Astana from June 1, highlighting the growth in the number of airlines flying directly to Kazakhstan. The route will help strengthen links between China and Kazakhstan. Air Astana already flies an Astana – Beijing service. Astana Airport is opening new passenger terminal too next month which will be able to process more passengers.

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Copyright ©The Conway Bulletin — all rights reserved

(News report from Issue No. 327, published on May 5 2017)

 

Uzbek president orders to rename airport after Karimov

MAY 4 2017 (The Conway Bulletin) — Uzbek president issued a decree renaming Tashkent International Airport after former president Islam Karimov. Karimov died in September 2016 having ruled Uzbekistan since the 1991 breakup of the Soviet Union. He has been genuinely mourned in Uzbekistan but to outsiders he is remembered more for having a poor human rights record and his cantankerous, isolationist foreign policy.

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Copyright ©The Conway Bulletin — all rights reserved

(News report from Issue No. 327, published on May 5 2017)

Tajik police arrests anti-corruption officials

APRIL 27 2017 (The Conway Bulletin) — Police in Tajikistan have arrested 17 officials at the state anti-corruption unit for abuse of power and document forgery, local media reported. The unit used to be headed by Rustam Emomali, son of Tajik president Emomali Rakhmon. He became the mayor of Dushanbe earlier this year. One of the officials arrested was deputy director Davlatbek Khairzoda.

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Copyright ©The Conway Bulletin — all rights reserved

(News report from Issue No. 327, published on May 5 2017)