Category Archives: Uncategorised

Editorial: Horse-play in Kyrgyzstan

JAN. 8 2016 (The Conway Bulletin) – Scottish welder Michael Mcfeat was seeing in the New Year at the canteen in the Kumtor gold mine high up in the Tien Shan mountains when he sent a message back home to friends in Scotland jokingly referring to the chuchuk, a horse-meat sausage, as a horse’s penis.

It was a joke that was intended to raise smiles back home, and it may well have done, but Mcfeat’s error was to make it on an open Facebook account. Locals workers read his joke. They were furious.

Mcfeat is back home now, lucky to have escaped a beating from angry locals, while the Toronto-listed Centerra Gold that runs the mine is dealing with the latest PR setback in its relations with Kyrgyzstan.

The Kyrgyz may be overly sensitive to foreigners laughing at their national identity but, 25 years after the fall of the USSR, it is still a young country. Instead, the onus should be on international companies working in Kyrgyzstan and the rest of Central Asia to educate their foreign staff and also to impose some all important social media rules and guidelines.

After all what the chuchuk is to the Kyrgyz, the haggis is to the Scots.

ENDS

(Editorial from Issue No. 262, published on Jan. 8 2016)

Utility prices rise in Kazakhstan

JAN. 1 2016 (The Conway Bulletin) – Media in Kazakhstan reported that utility companies had increased water and electricity prices by up to 15%, more evidence of latent inflation in the Kazakh economy linked to a sharp drop in the value of the tenge. Analysts have said frustration is growing among ordinary people about price rises. Electricity price rises in particular are a sensitive issue across the S.Caucasus/C.Asia region.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Georgia announces first wind farm tender

JAN. 5 2016 (The Conway Bulletin) – Georgia announced a tender to build its first wind farm in conjunction with the European Bank for Reconstruction and Development (EBRD). The project is estimated to cost $35m, with the EBRD giving a $25m loan. The wind farm will consist of 10 turbines and produce two megawatts of power. States in Central Asia and the South Caucasus are investing in wind power to help meet power demand.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Azerbaijan and Kazakhstan diversify investment strategies

ALMATY, JAN. 8 2016 (The Conway Bulletin) — Kazakhstan and Azerbaijan will diversify the investment portfolios of their Sovereign Wealth Funds in 2016 away from low yield bonds and currency holdings to high- risk equity and property investments.

Slow global economic growth has forced Sovereign Wealth Funds to ditch conservative investment strategies in search of higher yields and Kazakhstan and Azerbaijan are following a trend.

Bloomberg News quoted Berik Otemurat, director at the Kazakh Central Bank’s National Investment Corporation, as saying: “We’re sitting on a huge pile of cash and not making real returns. It’s especially urgent to address this, given the gloomy outlook for oil prices and reduced inflows into the National Fund.”

Azerbaijani officials have said that they want to increase the cap on real estate investment in its investment portfolio to 10% from 5%for 2016, as well as raising the cap for equity investment to 15% from 10%. SOFAZ, Azerbaijan’s oil fund, has been buying up high-profile property for the past couple of years and it started 2016 by buying a 19th century palazzo in Milan for 97m euro.

“In 2016, SOFAZ will be implementing investment policy, which makes it possible to get the maximum yield at low risk of capital loss,” SOFAZ said of its of strategy.

But Indra Overland, research professor at the Norwegian Institute of International Affairs, said Sovereign Wealth Funds follow market trends, rather than set them, which generates a risk that will buy at the top, rather than the bottom, of the market.

“This change is probably driven by a combination of desperation over low oil price, dissatisfaction with historically low returns on bonds and worries about the stability of financial markets, especially related to China,” Mr Overland said.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Service companies sign deals with Azerbaijan

DEC. 22-29 2016 (The Conway Bulletin) — Norway’s Agility, Britain’s KCA Deutag and British-Azerbaijani joint venture SOCAR-Cape all signed contracts with BP and Azerbaijan’s state-owned energy company SOCAR to provide services to off- shore energy projects in the Caspian Sea. These separate deals show Azerbaijan’s reliance on Western technology to operate and service its oil and gas projects.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

GAIL wants 5% of Turkmen pipeline project TAPI

DEC. 27 2016 (The Conway Bulletin) — Indian gas distributor GAIL said it wants to buy a 5% stake in the TAPI pipeline project, two weeks after construction started on the 1,700km pipeline that will run from Turkmenistan to India. TAPI will pump 33b cubic metres of Turkmen gas to India per year, via Afghanistan and Pakistan. It is expected to come online in 2019. Turkmenistan’s state-owned Turkmengaz is the operator of the project.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Kazakh government cuts flour subsidies

JAN. 6 2016, ALMATY (The Conway Bulletin) — Bread prices are beginning to rise in Kazakhstan after the government cut flour subsidies, people working in the bread-making sector told The Bulletin.

The Kazakh government ended its subsidies for flour on Jan. 1, a move it flagged up in November as part of an overhaul of government spending designed to counter an economic slowdown. It has defended dropping subsidies as fair because it means that
the money saved can be re-focused on benefits for poorer sections of society. Asylzhan Mamytbekov, minister for agriculture, has said that flour subsidies were costing the government 9b tenge a year ($26m).

But the impact of the subsidy cut on bread-makers is already being felt.

In Almaty, Yerbol Beisembayev was going about his business buying bread from factories and re-selling loaves to shops. He said that a couple of factories had already closed because the cut in flour subsidies had made them unprofitable.

“Now everything will depend on who will get the best price for the flour,” he said. “The government has allowed bread (prices) to free float, just like the tenge.”

In August, the Central Bank ditched the tenge’s peg to the US dollar. This sent the value of the tenge crashing by around 40%.

It appears that, for now, bread producers are preferring to soak up the extra cost of the flour rather than pass it on to consumers. Most shops selling bread in Almaty said there had been a small price rise of 5 tenge a loaf — roughly 8%. This below the doubling of prices that analysts had predicted once flour subsidies were cut.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Inflation accelerates in Kazakhstan

JAN 5 2016 (The Conway Bulletin) – Annualised inflation in Kazakhstan hit 13.6% for the 12-months to the end of December, its highest rate for six years, the National Statistics Committee said. Inflation shot up in October after the tenge depreciated. In September, annualised inflation in Kazakhstan measured just 4.4%.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Kyrgyzstan’s Toktogul hydropower station breaks down

DEC. 23 2015, BISHKEK (The Conway Bulletin) — Kyrgyzstan’s largest hydropower station, Toktogul, broke down after a power surge knocked out three of its four generators, forcing the government to buy extra electricity from Kazakhstan.

The breakdown at Toktogul is embarrassing for Kyrgyz President Almazbek Atmabayev because three months ago, after the completion of a transmission line linking the power- generating south with the power consuming north, he proclaimed Kyrgyzstan was self sufficient in power. Kyrgyzstan also aims to export power to Pakistan from 2018.

Engineers working on Toktogul, which was built in 1976, said they expected the power plant to be back up and running from mid-January.

In the meantime, Kyrgyzstan announced a deal to buy electricity from neighbouring Kazakhstan to cover the shortfall.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

4G licences expand in Kazakhstan

DEC. 30 2016 (The Conway Bulletin) — The Kazakh government said it has allowed local telecom operators to provide 4G services to their customers . State-owned Kazakhtelecom’s subsidiary Altel had been the only company that could use the 4G network. Other companies may now offer 4G data services, giving a much-needed competitive boost to Kazakhstan’s telecoms sector.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)