Category Archives: Uncategorised

Editorial: Uzbek state salaries

MAY 6 2016 (The Conway Bulletin) – Paying salaries on time to its armies of state employees is one of the Uzbek government’s central tasks. If it doesn’t, it means there are some serious cracks in the system.

According to news reports, arrears for salaries in Uzbekistan now extend to a couple of months for teachers in schools and colleges.

There is a heavy economic crisis blowing through Central Asia and the South Caucasus, but where is the government’s money in Uzbekistan?

Some sources say it is being funnelled into short-term construction and renovation projects ahead of the summit of the Shanghai Cooperation Organisation coming up in June.

Last year, a leaked letter sent from the Central Bank said that the budget was short of around $620m.

Reports from Turkmenistan, another reclusive country, said that the government had been paying salaries in kind or with vouchers to some of its employees for months.

These are tough times for many Central Asians.

ENDS

(Editorial from Issue No. 279, published on May 6 2016)

Glencore to sell Kazakh mine

MAY 3 2016 (The Conway Bulletin) – Switzerland-based miner Glencore said it is considering selling its share in the Vasilkovskoye gold mine in Kazakhstan for around $2b. Glencore owns 70% of Kazzinc, the company that operates Vasilkovskoye which is located 300 km north-west of Astana. According to unnamed sources quoted in the Wall Street Journal, the buyers could be Chinese investors. China has been looking to buy Kazakh gold.

ENDS

(News report from Issue No. 279, published on May 6 2016)

Kazakhstan explains power nexus

APRIL 29 2016 (The Conway Bulletin) – Kazakhstan has sold 218m kWh of electricity to Kyrgyzstan in 2016 at a price of 9 tenge ($0.03) per kWh from the Ekibastuz power station, the Kazakh government said. Kazakhstan earned around $6m from the sale. Kyrgyzstan is a net importer of electricity from neighbouring countries due to chronic water shortages in recent years. Last year, Kazakhstan and Tajikistan exported around 400m kWh to Kyrgyzstan.

ENDS

(News report from Issue No. 279, published on May 6 2016)

Editorial: Nazarbayev and protests

MAY 6 2016 (The Conway Bulletin) – In a choreographed government meeting, Kazakh President Nursultan Nazarbayev blamed everyone but himself for the turmoil that proposed amendments to the land code have brought to the country.

The presidential press service posted parts of the government meeting on Facebook showing an angry Mr Nazarbayev.

He dressed down the ministers of economy and agriculture for having failed to explain the land reform to the population. With a patronising tone, Mr Nazarbayev said the population had been unable to understand the reform and needed to be spoon-fed details.

Once more, Mr Nazarbayev wanted to portray himself as the strong leader, the one who understands the people.

Nobody should be fooled. These were, and still are, Mr Nazarbayev’s reforms.

Everyone in Kazakhstan knows that for a bill to pass, especially an important one such as the land code, Mr Nazarbayev’s input is crucial.

He misjudged the appetite of the people to accept the land reforms.

ENDS

(Editorial from Issue No. 279, published on May 6 2016)

Business comment: Corruption in telecoms

MAY 3 2016 (The Conway Bulletin) – Telia Company, the re-branded version of Swedish company TeliaSonera, scored a small victory this week as Swedish prosecutors dropped a bribery case related to its dealings in Azerbaijan in 2008.

Allegedly, it paid bribes to public officials to obtain licences for its subsidiary, Azercell, but prosecutors said they couldn’t prove their claims.

This, though, still leaves Telia, and other companies, entangled in an investigation linked to corruption in Uzbekistan, where they allegedly paid hundreds of millions of US dollars to obtain licences.

The beneficiary of the bribes is said to be Gulnara Karimova, the once-extravagant eldest daughter of Uzbek President Islam Karimov.

VimpelCom, an Amsterdam- based Russian company, has already settled its Uzbek bribery case with US and Dutch courts by paying a penalty of $795m, effectively admitting wrongdoing.

The Uzbek case had negative repercussions across Scandinavia.

In Sweden, perhaps in an effort to erase recent memories, TeliaSonera changed its name, colours and branding and is now registered as Telia Company.

In Norway, heads started rolling last year at the state-owned telecoms company Telenor, which owns 33% in VimpelCom.

CEO Svein Aaser was sacked in November and the Norwegian former CEO of VimpelCom Jo Lunder was arrested a few days later.

Last autumn, both Telia and Telenor said they wanted out of their operations in the South Caucasus and Central Asia, allegedly because of market pressures, but their exit, rebranding and apologies can only really be read as last minute attempts to pull their hands out of the cookie jar.

ENDS

(News report from Issue No. 279, published on May 6 2016)

Italy’s Saipem wins $1.5b Azerbaijan’s Shah Deniz contract

MAY 3 2016 (The Conway Bulletin) – A consortium led by Italian oil and gas service company Saipem won a $1.5b contract to transport and install a deepwater subsea production system for the second phase development of the Shah Deniz offshore gas field in Azerbaijan.

Shah Deniz, operated by BP, is central to Azerbaijan’s gas production. Once its second phase comes online, it will be the cornerstone of the so-called Southern Gas Corridor, a network of pipelines that will feed gas to Europe from the Caspian Sea.

Saipem’s management said the company will receive a fee of $1.3b from the overall deal.

“This award further strengthens Saipem’s key role in the construction of the Southern Gas Corridor where the company has a total of four contracts, in the upstream segment and in gas transportation infrastructure both onshore and offshore,” Stefano Cao, Saipem CEO, said in a statement.

Saipem, 30% owned by Eni, owns stakes in the other two companies in the consortium that won the contract – BOS Shelf and Star Gulf.

SOCAR, the Azerbaijani state energy company, owns 96% of BOS Shelf. Star Gulf owns the remaining 4%. Saipem owns 100% of Star Gulf.

ENDS

(News report from Issue No. 279, published on May 6 2016)

Armenia to debate status of Nagorno-Karabakh

May 5 2016 (The Conway Bulletin) – Armenia’s government sent a bill proposing the recognition of Nagorno-Karabakh as an independent country to parliament, teeing up another flashpoint with Azerbaijan over the disputed region.

This is the first time that the parliament will formally debate the status of Nagorno-Karabakh even though it has been run by Armenia- backed forces since a UN-brokered ceasefire was imposed in 1994.

Last month the worst fighting in two decades broke out around Nagorno-Karabakh, killing several dozen people and alarming the international community.

ENDS

(News report from Issue No. 279, published on May 6 2016)

Tourism grows in Armenia

APRIL 30 2016 (The Conway Bulletin) – The National Statistical Service of Armenia said 252,506 tourists arrived in Armenia during the first quarter of 2016. This figure is an 8.6% increase compared to the first quarter of 2015. This may reflect Armenia’s increased attractiveness to Russian tourists, who have been banned from visiting Turkey because of a row between the two neighbours.

ENDS

(News report from Issue No. 279, published on May 6 2016)

Workers complain in Kazakhstan

MAY 5 2016 (The Conway Bulletin) – A union of metal workers at the ArcelorMittal Temirtau factory in central Kazakhstan said it would appeal to the Prosecutor General against the company’s plans to cut benefits and, ultimately, lay off workers. According to Zhaktau, the union, several workers have had their full-time contract changed into freelance project work. The union also said the company plans to sack 700 workers by the end of the year. ArcelorMittal Temirtau did not comment.

ENDS

(News report from Issue No. 279, published on May 6 2016)

Cash shortage spreads to Uzbek capital

MAY 2 2016 (The Conway Bulletin) – Several employees at state-owned companies in Tashkent have not received payment since February, according to sources interviewed by Eurasianet. This is a sign that a shortage of hard currency, previously confined to the provinces, has spread to Uzbekistan’s capital. Wage arrears cause distress among the population. Last year, a leaked letter from the Central Bank revealed a shortfall of 1.5 trillion sum ($517m at the official rate) in the state budget.

ENDS

(News report from Issue No. 279, published on May 6 2016)