Category Archives: Uncategorised

Stock market: Tethys, Nostrum

JUNE 17 2016 (The Conway Bulletin) – Central Asia and South Caucasus-linked stocks fell this week, driven down by lower oil prices. As shown in the table, Tethys and Nostrum shares dropped significantly over the past week after a rather stable month.

Roxi, on the other hand, moved against the tide, gaining 15.3% in one week.

On June 14, the company’s non-executive director Edmund Limerick purchased 500,000 shares at 9.8p/share, for a total of £49,000. Mr Limerick and his wife now own 1.15m shares, or 0.12% of the company, up from 0.07% before the purchase.

The deal pushed up the share price, giving it a boost after weeks of downward pressure.

Kuat Oraziman, CEO, and Kairat Satylganov,CFO and director, own Roxi, which operates in Western Kazakhstan, not far from the massive Tengiz oilfield.

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(News report from Issue No. 285, published on June 17 2016)

Business comment: Gold in Central Asia

JUNE 17 2016 (The Conway Bulletin) – Gold prices climbing up towards $1,300/ounce, but not everyone in the mining sector in Central Asia is happy.

In Kazakhstan, Russian miner Polymetal received a much-needed lifeline from Sberbank to push forward with its Kyzyl project in north-eastern Kazakhstan. The gold sector in Kazakhstan is enjoying a positive season, as production numbers in the country are up 3.7% to 13 tonnes of fine gold in the first five months of the year, compared to Jan.-May 2015.

The steady growth is paired with increased investment, as Polymetal is focusing its growth outside Russia on Kazakhstan and Armenia.

But this year has not brought only good news in Kazakhstan. In March, Alhambra Resources said it was seeking damages against Kazakhstan’s government, via the World Bank’s International Centre for Settlement of Investment Disputes, for the bankruptcy of its Kazakh subsidiary.

Recovering commodity prices, however, can do little to improve the mood in Kyrgyzstan, where Centerra Gold and the government are increasingly entangled in what could become a decisive legal battle.

Centerra sought the resolution of the continuous fines and corruption probes at the Stockholm court of arbitration.

The Kyrgyz government responded with more fines and charged a former director of Kyrgyzaltyn — which owns a stake in Centerra — of taking bribes from the Canadian miner.

These charges, fuelled by allegations from a former Centerra director, would make the Canadian company guilty of paying bribes, serving an order to the government, which is trying hard to show Centerra under a bad light.

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(News report from Issue No. 285, published on June 17 2016)

Azerbaijan’s SOCAR becomes EURO sponsor

JUNE 10 2016 (The Conway Bulletin) – SOCAR, Azerbaijan’s state-owned energy company, is a major sponsor of the UEFA Euro 2016 football tournament currently taking place in France. Neither SOCAR, nor UEFA disclosed the amount paid for the sponsorship, although local media outlets have said it is around 120m manat ($80m).Azerbaijan’s government had previously sponsored Spain’s Atletico Madrid and England’s Sheffield Wednesday.

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(News report from Issue No. 285, published on June 17 2016)

Tajikistan’s TSB resumes transactions

JUNE 10 2016 (The Conway Bulletin) – Tojiksodirotbonk, Tajikistan’s second largest lender, said it resumed money transfer transactions, and that it continued to operate under the administration of the Central Bank. TSB, as it is commonly known, is awaiting confirmation from the EBRD for a funding lifeline of around $165m. The investment would give the EBRD a 25% stake in the bank.

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(News report from Issue No. 285, published on June 17 2016)

Newspaper risks closure in Azerbaijan

JUNE 14 2016 (The Conway Bulletin) – The editors of Azadlig, an opposition newspaper in Azerbaijan, said they had received a letter from their publisher that warned of a possible closure by the end of the month. Azadlig, which means freedom, has to pay an outstanding debt of around 18,000 manat ($12,500) by June 27. Azadlig editors said that the state-owned press agency owes the newspaper around 70,000 manat ($46,000) and that this is an attempt to silence opposition voices.

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(News report from Issue No. 285, published on June 17 2016)

Chinese company opens hospital near Georgian capital

TBILISI, JUNE 14 2016 (The Conway Bulletin) — Hualing Georgia, a private Chinese company, opened a 100-bed hospital near Tbilisi, increasing its commitment to a new urban development and entering the crowded healthcare services market.

The new hospital cost 4.5m lari ($2.1m) to build and is located at the Tbilisi Sea New City, which is being built on the shores of an artificial lake near Georgia’s capital city. Georgian PM Giorgi Kvirikashvili opened the hospital and highlighted the significance of the project.

“This hospital is really an important project for this district. I wish good health to everyone but it’s important to have this type of medical facility close to where you live, and in this district there was no hospital before,” Mr Kvirikashvili said at the inauguration ceremony.

Hualing has invested heavily in Georgia. In October 2015, the company built a new hotel Tbilisi Sea New City. In May, it also said it will build an elevator factory in Kutaisi.

The healthcare sector in Georgia is dominated by London-listed Georgia Healthcare Group (GHG), which controls around 27% of hospital beds. In May, it bought GPC, a drugmaker that controls a 15% share of the pharmaceutical market. BGEO, a holding company that owns Bank of Georgia, owns 65% of GHG.

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(News report from Issue No. 285, published on June 17 2016)

Kazakh airline to prepare an IPO

JUNE 16 2016 (The Conway Bulletin) – Peter Foster, CEO of Kazakhstan’s flagship airline Air Astana, said the company will seek financial advisors this autumn to prepare an IPO in 2018. Mr Foster said that the company will list in Kazakhstan and in other more liquid markets, such as London or Singapore. Britain’s BAE Systems owns 49% of Air Astana, Kazakhstan’s sovereign wealth fund Samruk-Kazyna owns 51%.

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(News report from Issue No. 285, published on June 17 2016)

Azerbaijan readies for first F1 race

JUNE 16 2016 (The Conway Bulletin) – Azerbaijan hosts its first Formula 1 Grand Prix in Baku on June 17-19, a race that an estimated 350m people will watch on TV around the world.

President Ilham Aliyev hopes that the race will give Azerbaijan’s profile a major boost, but human rights campaigners are also using it as an opportunity to highlight its poor human rights record.

The newly-built Baku Circuit, a 6km circuit through the city’s historical centre, is fast, allowing cars to hit speeds of up to 340km per hour, making it the fastest street track in the world, according to the organisers.

Spanish driver Fernando Alonso said that it was a unique circuit.

“It’s good both for drivers and in terms of the show for spectators,” he told the formula1.com website.

But in the host city, few Azerbaijanis share his excitement.

With oil prices down, Azerbaijan, which depends on income from oil and gas exports, is predicted to drop into a recession this year.

Official data has not been released but Radio Free Europe/Radio Liberty has estimated that the authorities have spent $250m on hosting the F1 race — roughly half the annual healthcare budget.

Locals said the Azerbaijani government should be concentrating on improving the country’s economy.

Bahruz, a 21-year old student in Baku, told the Conway Bulletin’s Azerbaijan correspondent that unemployment has been rising fast.

“Formula 1 is a waste of money. It just serves the government to build an image as a sport-loving country,” he said.

Mr Aliyev appears to have decided to promote Azerbaijan through hosting sports events and sponsoring teams. Azerbaijan had sponsored the team shirt of Atletico Madrid football club, sponsors the European football championship in France and last year hosted the first European Games.

Azerbaijan released several journalists and rights campaigners from prison this year but Rebecca Vincent, head of the Sport for Rights Campaign and a human rights activist said Mr Aliyev was trying to whitewash his government.

“Viewers should not be fooled. The smoke and mirrors distract from a more sinister truth,” she said. “A brutal human rights crackdown taking place behind the scenes.”

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(News report from Issue No. 285, published on June 17 2016)

Editorial: Kazakhstan’s financial stimulus

JUNE 17 2016 (The Conway Bulletin) – It’s been a tough year for Kazakh President Nursultan Nazarbayev, perhaps one of the toughest. The economy has flat-lined, worrying investors and locals, who have seen jobs disappear and the value of their tenge savings fall.

Unprecedented anti-government protests swept across Kazakhstan in April and May and in June gunmen alleged to have had links to radical Islamists in Syria attacked targets in Aktobe, killing several people.

Mr Nazarbayev has already staged a parliamentary election, a favourite tactic of his to shore up support. This worked only momentarily. Now he has had to spend big. He’s chucked $712m at the economy in a Keynesian attempt to breathe life into it and create jobs and wealth.

Will it work? It’s unclear. He’s picked small and medium-sized companies and house building to target. These are good targets. Mr Nazarbayev is looking to help out ordinary Kazakhs directly. And it’s the same message with the house-building.

Of course, though, there are serious pitfalls. The plan could be badly implemented, money wasted or stolen.

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(Editorial from Issue No. 285, published on June 17 2016)

WWF suspends Kazakh athletes

JUNE 15 2016 (The Conway Bulletin) – The World Weightlifting Federation said four Kazakh athletes, Svetlana Podobedova, Maya Maneza, Zulfiya Chinshanlo and Ilya Ilyin, took performance-enhancing drugs at the 2012 London Olympic Games. All four athletes will now be suspended from global competition, including the Rio Olympics this summer. Mr Ilyin, twice Olympic gold medallist, said he was shocked by the news and denied having taken drugs. The ban will be a major blow to Kazakhstan’s medal hopes.

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(News report from Issue No. 285, published on June 17 2016)