Category Archives: Uncategorised

Azerbaijan devalues manat by a third

FEB. 21 2015 (The Conway Bulletin) — Azerbaijan’s Central Bank cut the value of its manat currency overnight by a third in response to the falling value of the Russian rouble and the collapse in oil prices.

Many analysts said that a devaluation was long overdue although none expected such a sharp correction.

And, as a Bulletin correspondent reports from Azerbaijan, the devaluation has angered and frustrated local people. Ordinary people have watched as the value of their savings has plummeted, inflation has soared and economic growth rates have been cut.

This is the major risk that the Central Asian and South Caucasus economies run when trying to deal with an increasingly nasty economic downturn that has enveloped the region. They need to adjust their monetary policies while still retaining the trust of their populations.

Part of the problem has been the speed with which the economic downturn has hit the region.

Most Central Banks in Central Asia and the South Caucasus have allowed their currencies to depreciate slowly although Turkmenistan, and now Azerbaijan, have opted for a sudden devaluation this year.

Kazakhstan is still resisting another correction — it cut the value of its tenge currency by 20% last year — but it must now only be a matter of time before it succumbs.

ENDS
Copyright ©The Conway Bulletin — all rights reserved

(News report from Issue No. 220, published on Feb. 25 2015

Nazarbayev opponent dies in jail

>>Former son-in-law alleged to have committed suicide>>

FEB. 24 2015 (The Conway Bulletin) — Rakhat Aliyev, an opponent and former son-in-law of Kazakh President Nursultan Nazarbayev, died in prison days before the end of a pre-trial hearing linked to the 2007 murders of two Kazakh bankers.

He was found hanged in the toilet, the only corner of his solitary cell without constant surveillance. The prison administration described his death as a suicide but Aliyev’s lawyer, Klaus Ainedter, cast immediate doubt on this explanation.

“I have significant doubts about this without wanting to blame anyone. I visited him yesterday. There could be no talk whatsoever of danger of suicide,” Mr Ainedter told the local press.

Aliyev had at one time been viewed as a potential successor to Mr Nazarbayev but he fell from grace in 2007 and was forced to flee Kazakhstan before the authorities could arrest him for the murder of the two bankers.

In exile, Aliyev, who had been married to Mr Nazarbayev’s eldest daughter, set himself up as a vocal opponent of his former father-in-law from his bases in Malta and Vienna. He always denied any link to the bankers’ murders.

Last year, Aliyev turned himself in to the authorities in Vienna days before police planned to arrest him. The Austrian authorities had declined to deport Aliyev back to Kazakhstan but they had agreed to try him in Vienna for the murders.

Aliyev’s death rids Mr Nazarbayev of another major opponent. In 2013, French police arrested Mukhtar Ablyazov, a former Kazakh banker and minister, who was also a high profile opponent of Mr Nazarbayev.
ENDS
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(News report from Issue No. 220, published on Feb. 25 2015)

Uzbekistan blocks rights activist

FEB. 18 2015 (The Conway Bulletin) — Two Uzbek human rights campaigners said they had been prevented from leaving Uzbekistan to pick up awards in South Korea. Shukhrat Rustamov and Elena Urlaeva said they had been denied exit visas to receive the Tji Haksoon Peace Award on March 11. Uzbek citizens need to apply for an exit visa to leave the country.
ENDS
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(News report from Issue No. 220, published on Feb. 25 2015)

Kazakhstan-US law deal

FEB. 20 2015 (The Conway Bulletin) — Kazakhstan and the US have signed an agreement that will smooth law enforcement issues between the two countries, the US State Department said. In particular the deal, which the US State Department described as an “important step forward”, will help the transfer of evidence between the two countries.
ENDS
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(News report from Issue No. 220, published on Feb. 25 2015)

Delay for Almaty metro

FEB. 18 2015 (The Conway Bulletin) — Kazakh president Nursultan Nazarbayev ordered work on the Almaty Metro system to stop because of a shortage of funds, media reported. The first phase of Almaty’s metro was unveiled in 2011 but high costs and low passenger numbers have combined with a drop in government funds to delay a planned extension.
ENDS
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(News report from Issue No. 220, published on Feb. 25 2015)

Kyrgyz CBank leaves rates unchanged

FEB. 24 2015 (The Conway Bulletin) — Kyrgyzstan’s Central Bank left its key interest rate unchanged at 11% despite inflationary pressure from a devaluing currency and falling remittances from workers based in Russia. In February, Kyrgyzstan’s inflation was measured at 10.9%.
ENDS
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(News report from Issue No. 220, published on Feb. 25 2015)

Russia to strengthen Kyrgyz military base

FEB. 18 2015 (The Conway Bulletin) — Russia’s military will equip its Kant airbase in Kyrgyzstan with up-to-date fighter-jets, media quoted Colonel Jaroslav Roschupkin, a Russian army spokesman, as saying. Russia has, generally, been looking to beef up its military deployments in Central Asia, especially at the Kant airbase.
ENDS
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(News report from Issue No. 220, published on Feb. 25 2015)

Visa free access for Iraqis in Armenia

FEB. 24 2015 (The Conway Bulletin) — Armenia has agreed to allow Iraq Airways to fly a direct flight from Baghdad to Yerevan and also to grant Iraqis visa-free access, Iraqi media reported. If confirmed by Armenia the move will open it up to tourism and business from Iraq. Neighbouring Georgia already hosts thousands of Iraqi businessmen and tourists.
ENDS
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(News report from Issue No. 220, published on Feb. 25 2015)

IFC and ADB issue lari-denominated bonds

FEB. 25 2015 (The Conway Bulletin) — Two major inter-governmental financial organisations — the Asian Development Bank and the International Finance Corporation (IFC) — have issued lari-denominated bonds for the first time.

The IFC, which is part of the World Bank, issued a 30m lari ($13.2m) bond with an initial yield of 6.924% and the Asian Development Bank issued a 100m lari ($44.2m) bond with a floating yield.

The idea behind the issues is to help boost the Georgian capital markets and to support small businesses.

In a statement, Pierre Van Peteghem, treasury of the Asian Development Bank said: “This bond — the largest by a foreign issuer — will provide a key market benchmark and could encourage more borrowers, both domestic and foreign, to tap the Georgian bond market.”

The ADB explained that profit from the bonds would be given to TBC Bank to lend out to small and medium sized enterprises.

And they need all the help they can get at the moment.

Like its neighbours in the South Caucasus, Georgia is struggling to deal with the fallout from the economic turbulence in Russia. Its lari currency is losing value, making lari-denominated bonds a risky investment.

Still, the drive by the IFC and the ADB to sell lari denominated bonds is a boost for the ailing currency. It also shows confidence in its future. It remains to be seen if the market also holds the same confidence in the lari currency.
ENDS
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(News report from Issue No. 220, published on Feb. 25 2015)

Lithuania dairy exporters use Uzbekistan to skirt round Russia sanctions

MARCH 19 2015 (The Conway Bulletin) – Forced to look for alternative markets because of sanctions on Russia and war in Ukraine, Uzbekistan has become a major target for Lithuania’s dairy exports.

In December, dairy exports from Lithuania to Uzbekistan recorded a 19-fold increase compared to the same month in 2013, according to Russia’s Soyuzmoloko, a milk industry group.

Uzbekistan now represents over 12% of the Lithuanian dairy export market, becoming a key target for Lithuanian cheese and butter. Only Poland and Italy now import more dairy products from Lithuania.

Soyuzmoloko said there may be an alternative motive for sending products to Uzbekistan.
“Dairy products exported from Lithuania to Uzbekistan are then sent from Uzbekistan to Russia directly or via Kazakhstan, which is part of the Customs Union,” the Soyuzmoloko said in a note on its website.

The reference to the Customs Union is to an old Kremlin-led economic group. It is now called the Eurasian Economic Union.

While relations between Uzbekistan and the EU have been strained over the past few years because of rows over human rights abuses, Uzbekistan–Lithuania bilateral relations have been improving.

Last year, Lithuania’s foreign minister travelled to Tashkent for direct talks with his Uzbek counterpart.
ENDS

(News report from Issue No. 224, published on March 25 2015)