Category Archives: Uncategorised

Economic downturn threatens to shut Georgian factories

MARCH 11 2016, RUSTAVI, Georgia (The Conway Bulletin) — The growing economic malaise is starting to bite in Georgia. Just ask 51-year-old Manana who works at the Azot chemical plant in Rustavi, an industrial town around 25km from Tbilisi.

The factory, which employs 2,000 people, is faced with closure within a month unless it can secure a reduction in the price it pays for gas.

“I don’t know what I would do, if they really close for good,” she said. Her face wrinkled, she sighed and then turned towards the entrance of the Soviet-built factory. Today she would work but she wasn’t sure what the future held.

This is a story playing out across Georgia, where industrial unrest is growing as the lari currency drops in value and inflation starts to rise. Like the rest of the region, vital remittances from abroad, mainly Russia, have fallen and frustration is growing with the government.

Factories and mines are reporting worker unrest and bosses are warning of closures and redundancies.

Revaz Karanadze is an activist with the Tbilisi Solidarity Network, a grassroots organisation supporting regional labour protests. She said falling global oil prices had undermined the economy.

“The economic situation in the region, and especially oil-producing neighbour Azerbaijan, hits the factory and mining,” she said.

The Azot chemical plant produces fertilisers, as well as ammonia, sodium cyanide, nitric acid and liquid oxygen. It uses more than 300m cubic meters of gas per year, the highest consumption in Georgia. Two-thirds of its costs are gas.

The problem is that it negotiated an 8 year price deal for gas in 2011 when oil prices, which drive gas prices, were around $115/barrel. They are now around a third of that price.

Georgian ministers and SOCAR, the Azerbaijani state-owned company that supplies the gas, have said that a deal is in sight but Manana, the factory worker, was less optimistic.

“They always say it’ll get better, but we are not the only ones struggling. Who knows what tomorrow will bring,” she said.

ENDS

(News report from Issue No. 271, published on March 11 2016)

Uzbek leader creates new ministry

MARCH 4 2016 (The Conway Bulletin) – Uzbek president Islam Karimov officially appointed Aziz Abdukhakimov as minister for labour, a new ministry formed out of the ministry for labour and social protection. Mr Abdukhakimov had previously been the minister for labour and social protection. It is unclear why Mr Karimov wanted to change the name of the ministry.

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(News report from Issue No. 271, published on March 11 2016)

Malaysia buys up field in Kazakhstan

MARCH 7 2016 (The Conway Bulletin) – Malaysia’s Reach Energy Berhad said it offered $154.9m for a 60% stake in Palaeontol B.V., a Dutch-registered company that operates an onshore block in the Mangistau oblast in Western Kazakhstan. The fields in the block are known as Emir Oil. China’s MIE Holdings Corp owns Palaeontol. According to Reach Energy, the fields holds oil reserves of 10m tonnes.

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(News report from Issue No. 271, published on March 11 2016)

Women march through Kyrgyz capital on March 8 to demand more rights

MARCH 8 2016, BISHKEK (The Conway Bulletin) — Dozens of women protested in Bishkek against what they said was the patronising message sent out by the traditional March 8 International Women’s Day celebrations.

The march was a rare challenge to what has become one of the former Soviet area’s most popular and enduring holidays.

“Don’t sell 8th of March for flowers,” the marchers chanted. “We don’t want flowers, we need rights.”

Civic demonstrations, especially by pro-women’s rights groups are rare, if not unheard of, in Central Asia, where governments retain strict control and generally mistrust the rise of women in society.

Kyrgyzstan is something of an exception. It has more political plurality than other countries and counts a woman, Roza Otunbayeva, as a former head of state. She was president of Kyrgyzstan in 2010 and 2011, after a revolution overthrew her successor Kurmanbek Bakiyev. None of the other Central Asian states have had any significant female political or business leadership other than daughters of presidents.

Saadat, one of the march participants, told the Bulletin’s Bishkek correspondent that March 8 was not a holiday to celebrate spring and woman but something much more important.

“Instead of buying flowers and making profit for local flower shops, people would better support women’s crisis centres or female entrepreneurs,” she said.

“I think, one of reason why we were not dispersed on the square (bpolice) is that two female MPs were also with us on the square,” she added.

There is supposedly a quota of women in the Kyrgyz parliament of 30% although activists said the proportion of women in parliament had dropped to 12.4% from 19% in 2004.

Arina Sinovskaya, a member of a Kazakh feminist group, said their rally had been banned in Kazakhstan.

“In Kazakhstan, unfortunately, we cannot hold a march, so we came here to express our solidarity,” she said.

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(News report from Issue No. 271, published on March 11 2016)

Norway asks Tajikistan about TALCO’s ownership

MARCH 6 2016 (The Conway Bulletin) – Norway’s parliament challenged the Tajik government to reveal exactly who was the real beneficiary behind the TALCO aluminium smelter company. Newspaper reports have focused on potential corruption at the plant and in deals that included Norway’s part-state owned Norsk Hydro.

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(News report from Issue No. 271, published on March 11 2016)

Turkmen President sacks more senior government officials

MARCH 5 2016 (The Conway Bulletin) – Over the past few weeks Turkmen President Kurbanguly Berdymukhamedov has sacked and reprimanded several government officials accusing them of corruption and providing fake data, a shake up that may betray his frustration with slowing economic and social projects.

The latest officials to feel Mr Berdymukhamedov’s wrath were Akmyrat Mamedov, head of the country’s Statistics Committee, and Batyr Halliyev, the meteorological service. They were both sacked for “short- comings at work”.

And apparently signalling that more sackings were likely, Mr Berdymukhamedov said the government was not immune from corruption. He cited the case of former deputy PM, Baimurat Khodzhamukhamedov, who was found guilty last year of taking bribes of $1.5m.

He went on to harshly criticise the head of the State Commodity and Raw Materials Exchange, a local market for commodities.

Just days earlier, Mr Berdymukhamedov had reshuffled government officials in the National Security Service and the Border Service.

In countries as reclusive as Turkmenistan, government appointments give an insight on the political equilibrium within the country.

Mr Berdymukhamedov is known for publicly shaming officials for incompetence and strongly advocating against corruption. Opposition activists abroad, though, say that these charges are generally fabricated to crack down on dissenting or inefficient bureaucrats.

A regional economic crisis has hit government budgets across the region. Although reclusive and not given to releasing anything other than the most positive economic data, information leaking out of Turkmenistan suggests that this downturn has hit it hard too. Currency controls and a deferment of government salaries have all been muted.

The mass sackings is another signifier that all is not well at Mr Berdymukhamedov’s court.

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(News report from Issue No. 271, published on March 11 2016)

Greenfields buys field in Azerbaijan

MARCH 6 2016 (The Conway Bulletin) – In a $57.6m deal, Houston-based Greenfields Petroleum agreed to buy the 66% of Bahar Energy, an energy company exploiting the offshore Bahar oilfield, that it didn’t already own from Azerbaijan’s Baghlan Group. Bahar Energy, registered in Dubai, operates the field with Azerbaijan’s state-owned energy company SOCAR. Upon the completion of the $57.6m deal, Greenfields Petroleum will own 100% of Bahar Energy.

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(News report from Issue No. 271, published on March 11 2016)

FDI into Georgia falls 23%

MARCH 11 2016 (The Conway Bulletin) – Foreign direct investment (FDI) into Georgia measured $1.35b in 2015, a drop of around 23% from 2014. FDI is an important part of Georgia’s economy. It is, generally, volatile but the sharp fall may be indicative of an overall slump in economic conditions in the region.

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(News report from Issue No. 271, published on March 11 2016)

McDonalds finally opens its first restaurant in Kazakhstan

MARCH 8 2016, ALMATY (The Conway Bulletin) – Hundreds of people queued for their first taste of McDonalds in Kazakhstan when it opened its inaugural restaurant in Central Asia in Astana.

McDonalds has teamed up with Kazakh businessman Kairat Boranbayev, whose daughter is married to Kazakh president Nursultan Nazarbayev’s grandson, to bring its burgers to Kazakhstan.

The opening of McDonalds’ restaurant is a boost for Mr Nazarbayev who is looking to bolster support ahead of elections despite a worsening economic slowdown.

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(News report from Issue No. 271, published on March 11 2016)

Crowne Plaza opens in Georgia

MARCH 6 2016 (The Conway Bulletin) – UK-based InterContinental Hotels Group opened a new five-star hotel in Borjomi, a Georgian resort town. The hotel, branded Crowne Plaza, cost $32m to build. Borjomi is famous for its water. Borjomi fizzy water is one of Georgia’s biggest exports. InterContinental also owns a Holiday Inn hotel in Georgia’s capital, Tbilisi.

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(News report from Issue No. 271, published on March 11 2016)