Category Archives: Central Asia & South Caucasus News

US Senator McCain flies into Georgia to warn Trump not to go soft on dealing with Putin

TBILISI, JAN. 1 2016 (The Conway Bulletin) — Landing in Tbilisi on the last leg of a tour of the Baltic States, Ukraine and Georgia, US Republican Senator John McCain said that the US needed to stand up to Russia and its president, Vladimir Putin.

Mr McCain, who was accompanied by Republican Senator Lindsey Graham, warned incoming US president Donald Trump not to be soft on Mr Putin.

“I believe we must continue to improve our relations and understand that Vladimir Putin, unless we stand up to him, will continue his aggression,” he told media on a trip to boundary with the break away region of South Ossetia. “We must stand up to Vladimir Putin.”

Mr McCain is known for his tough hawkish stance on Russia and, over the years, has been a major supporter of the westward trajectory taken by Georgia and other FSU countries.

And for Georgia, his support is important, especially with Mr Trump making increasingly benign overtones to Mr Putin. In a twitter message last month he praised Mr Putin, calling him “very smart”, for not reacting to the expulsion from the US of 35 Russian diplomats for trying to influence the US presidential election through a series of hacks.

Since 2003, when Mikheil Saakashvili took power during a peaceful revolution, Georgia has pursued a doggedly pro-Western agenda. It has joined in US-led military missions in Iraq and Afghanistan and applied for both NATO and EU membership.

These steps have irritated the Kremlin, which still aims to control its near-abroad, and triggered a war in 2008. Relations have improved since the Georgian Dream coalition won power in 2012 although they are still decidedly strained.

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(News report from Issue No. 311, published on Jan. 6 2017)

Armenia’s CB cuts interest rates

DEC. 27 2016 (The Conway Bulletin) — Armenia’s Central Bank cut the country’s key interest rate by 25 basis points to 6.25%, continuing to slash the cost of borrowing. Armenia’s interest rate measured 8.75% at the beginning of 2016 but was steadily cut to stimulate prices rises and economic growth.

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(News report from Issue No. 311, published on Jan. 6 2017)

Trump cancels Tower project in Georgia

TBILISI, JAN.4 2016 (The Conway Bulletin) — The Trump Organisation, the company running the businesses of President-elect Donald Trump, pulled out of a $250m deal to build a 47-storey apartment block in Batumi on Georgia’s Black Sea coast.

Last month, the company also pulled out of projects in Azerbaijan and Brazil to protect Mr Trump’s image. In truth, though, the Batumi project, signed in 2012, lost momentum after former Georgian president Mikheil Saakashvili lost power in elections in 2012 and 2013.

The project was generally derided as part of the showmanship of Mr Saakashvili, who had a talent for eye- catching initiatives.

In an email, Trump Organisation said: “[We’ve decided] to formally end the development of Trump Tower, Batumi.”

The Silk Road Group, an industrial conglomerate that was partnering Trump in the project , said it would push ahead with the development.

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(News report from Issue No. 311, published on Jan. 6 2017)

Syria peace talks to be held in Kazakh capital, says Cavusoglu

DEC. 4 2016 (The Conway Bulletin) — Turkey’s foreign minister Mevlut Cavusoglu said that peace talks between Syria’s government and rebel groups have now been scheduled for Jan. 23 in Astana. Kazakh president Nursultan Nazarbayev wants to promote Kazakhstan as an arena to host talks. This will be the third Syria-focused peace talks held in Kazakhstan. The Syrian government did not send delegations to the two previous talks in 2015.

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(News report from Issue No. 311, published on Jan. 6 2017)

Azerbaijani becomes Reina victim

JAN. 1 2016 (The Conway Bulletin) — An ethnic Azerbaijani woman with Russian citizenship, Nurana Hasanova, was killed during an attack by an alleged member of the radical IS group on a nightclub in Istanbul on New Year’s Eve. It’s not clear ifHasanova was working at the nightclub or was visiting. At least 39 people died in the attack.

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(News report from Issue No. 311, published on Jan. 6 2017)

Kazakh President reshuffles government

DEC. 28 2016 (The Conway Bulletin) — Kazakh president Nursultan Nazarbayev sacked economy minister Kuandyk Bishimbayev and foreign minister in a government reshuffle. He promoted 38- year-old Timur Suleimenov to take over the ministry. Previously,Mr Suleimenov had been a board member of the Eurasian Economic Commission, the civil service of the Eurasian Economic Union.Mr Bishimbayev had only been in the post since May. In the reshuffle,Mr Nazarbayev also moved foreign minister Erlan Idrissov, considered to be one of the most experienced Kazakh diplomats, to be the ambassador to Britain, a position he has previously held. His replacement is Kairat Abdrakhmanov, who had been Kazakhstan’s representative to the UN.

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(News report from Issue No. 311, published on Jan. 6 2017)

Kazakh Central Bank pulls KazInvestBank licence

ALMATY, DEC. 27 2016 (The Conway Bulletin) — Kazakhstan’s Central Bank revoked the licence of KazInvestBank, triggering concern over the stability of the Kazakh banking sector.

The Central Bank tried to play down the implications of pulling KazInvestBank’s licence but analysts said the failure of Kazakhstan’s 20th largest bank may be symptomatic of structural problems across the sector.

And, ominously, only four days earlier, on Dec. 23, sources had told Bloomberg news agency that the Central Bank had given Kazkommertsbank, Kazakhstan’s biggest bank, a $1.5b loan to maintain its cashflow.

Ratings agencies have been warning for most of 2016 that Kazakhstan’s banks were increasingly exposed to an economic downturn that has wiped 50% off the value of the tenge, flattened economic growth and dented living standards.

Oleg Smolyakov, the Kazakh Central Bank’s deputy chairman, said that KazInvestBank had allowed bad debts to build up to around 80% of its total portfolio.

“Irregularities in internal credit risk management procedures allowed borrowers with unstable situations, for example with negative equity, to build up higher debt levels and losses,” he said in a statement issued by the Central Bank.

The decision to close the bank is also an embarrassment for Daniyer Akishev who, only six months ago, said that all Kazakh banks were stable and had passed a stress test.

KazInvestBank, which is linked closely to the Kazakh elite, has declined to comment.

The banking sector in Kazakhstan is still recovering from the impact of the 2008/9 Global Financial Crisis. In a matter of months, Kazakh banks had built up large chunks of bad debt. This sunk three large banks, forcing the government to step in and spend billions of dollars propping them up.

Since then the Central Bank has tried to impose checks on balances on the banking sector, but analysts have always doubted their worth.

But it’s not only the Kazakh banking sector that is under pressure. The Tajik government has announced a rescue plan for its biggest banks and in Azerbaijan a handful of smaller banks have gone bankrupt.

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(News report from Issue No. 311, published on Jan. 6 2017)

Turkmenistan cuts gas supplies to Iran

JAN. 1 2016 (The Conway Bulletin) — Turkmenistan cut gas supplies to Iran, Iranian media reported quoted Iranian officials, straining what had been considered to be a budding regional relationship. In December Turkmenistan had accused Iran of owing it $2b for unpaid gas. Iran has denied this and said that the debt had been settled or was on the way to being settled. It has now said that it will sue Turkmenistan. The row is important because relations between Iran and Turkmenistan have been improving for some time, lending weight to Turkmenistan’s mission to become a regional gas powerhouse.

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(News report from Issue No. 311, published on Jan. 6 2017)

Chinese miner operates in Kyrgyzstan

DEC. 26 2016 (The Conway Bulletin) — The Chinese company Full Gold Mining produced its first batch of concentrated gold at its Ishtamberdy gold deposit in Kyrgyzstan’s southeast region of Jalabad, the Kyrgyz government said. The project had stalled since 2011 because of a series of anti-mining protests and demonstrations against excessive Chinese control over Kyrgyzstan’s industry.

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(News report from Issue No. 311, published on Jan. 6 2017)

Journalist flees Kazakhstan

DEC. 26 2016 (The Conway Bulletin) — Bekzhan Idrisov, editor of Radiotochka.kz, one of the leading news websites in Kazakhstan, said that he had fled the country because he increasingly feared that he would be arrested by the police on trumped-up charges.Mr Idrisov’s departure is a reminder of how under-threat many Kazakhs journalists feel. Several high-profile journalists were imprisoned in 2016.

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(News report from Issue No. 311, published on Jan. 6 2017)