Category Archives: Uncategorised

Azerbaijan’s Bank Standard files for bankruptcy

OCT. 6 2016 (The Conway Bulletin) – Bank Standard, one of the largest banks in Azerbaijan, filed for bankruptcy, delivering a sharp shock to the country’s banking sector which is trying to recover from a currency crisis.

The sight of Bank Standard, considered a stalwart of the high street since the mid-1990s, going bankrupt in Azerbaijan will worry ordinary Azerbaijanis who have already seen the manat collapse and other smaller banks disappear in a harsh economic downturn.

Azad Javadov, director of the Azerbaijan Deposits Insurance Fund, a government fund that insures people’s savings in banks, told media the government had tried to save Bank Standard.

“The state tried to normalise Bank Standard, but failed. It was decided to declare the bank bankrupt to prevent more loss,” he said.

Bank Standard has, effectively, been on life-support for some time receiving funds from the government which wanted to save the bank and protect its financial sector.

But like several other smaller banks which have filed for bankruptcy this year, Bank Standard couldn’t weather the financial storm generated since 2014 by a collapse in oil prices, a recession in Russia and the fall in value of emerging market currencies.

Part of the blame, some analysts have said, lies with the Azerbaijani government which imposed heavy capital requirements on banks in 2016.

A few days after Bank Standard declared bankruptcy, the Central Bank ordered its deposits be transferred to Muganbank, a mid-sized bank. Zaminbank, another small bank, was also declared bankrupt on Oct. 4.

ENDS

(News report from Issue No. 299, published on Oct. 7 2016)

Azerbaijan and Kazakhstan’s oil and gas

OCT. 7 2016 (The Conway Bulletin) – As shown in our charts this week, markets were upbeat, especially due to a steady increase in oil prices over the past two weeks, following a landmark agreement among the world’s top oil exporters.

OPEC, the exporters’ lobby group, decided to cut oil output by around 1.5% in an effort to put pressure on the US dollar and send oil prices higher.

This is OPEC’s first production cut in eight years, since the 2008 Global Financial Crisis. And the decision is an important one.

It marks a formal agreement between Saudi Arabia and Iran, whose diplomatic spats had been at the core of OPEC’s inability to decide in the past year.

It also has an important effect on countries around the Caspian Sea.

Azerbaijan has quickly eroded its reserve base, pumping its oil money into the budget to contain its currency crisis. This could have not lasted much longer. Now, if oil prices continue to float around $50/barrel, a good 20% higher than two months ago, transfers from the oil fund can slow down and the leadership can breathe.

Perhaps out of excitement from the impending re-start of Kashagan in the Caspian Sea, Kazakhstan is also rallying on higher oil prices, cutting interest rates and transfers from its oil fund into the budget.

Two caveats, however, are needed for Azerbaijan and Kazakhstan. First, don’t believe in any proposal from these two non- OPEC countries on freezing or cutting production. If their output falls it is because of economics.

Second, you need to wait until their mega projects, from Kashagan to Shah Deniz II, come online before making long-term assumptions on the energy might held by Kazakhstan and Azerbaijan.

ENDS

(News report from Issue No. 299, published on Oct. 7 2016)

Emir’s falcon dies in Kazakhstan

OCT. 4 2016 (The Conway Bulletin) – A prized hunting falcon belonging to Tamim bin Hamad Al Thani, Emir of Qatar died in a Kazakh customs warehouse. The precise reasons for the falcon’s death have not been released to the public. The Emir was a regular visitor to Kazakhstan, where he liked to hunt with falcons near Lake Balkhash. Kazakhstan is a popular destination for Middle Eastern rich with a penchant for falconry.

ENDS

(News report from Issue No. 299, published on Oct. 7 2016)

Uzbekistan and Kyrgyzstan mend relations

BISHKEK, OCT. 1 2016 (The Conway Bulletin) — Uzbekistan and Kyrgyzstan reopened previously closed border crossings and pledged to improve relations after a friendly meeting in the Uzbek city of Andijan in the Ferghana Valley.

The sudden improvement in Uzbekistan-Kyrgyzstan relations comes just a month after the death of Islam Karimov, Uzbek president since independence from the Soviet Union in 1991. He was regarded as a belligerent leader who preferred to keep relations with his neighbours cool.

By contrast acting President and PM Shavkat Mirziyoyev has appeared eager to improve Uzbekistan’s relations and one of his first acts, at least according to many analysts, was to mend relations with Kyrgyzstan.

This year, both countries have strengthened their forces in a stand- off that has threatened to escalate into conflict. In August, Uzbekistan suspended rail links with Kyrgyzstan.

Relations between Kyrgyzstan and Uzbekistan have been tense for years due to border disputes, rows over gas

prices and interethnic violence in Kyrgyzstan after a revolution in 2010. The Uzbek-Kyrgyz meeting on Oct. 1 culminated in a photo-op at the Uzbek-Kyrgyz border where Uzbek deputy PM, Adkham Ikramov, and his Kyrgyz counterpart, Mukhammetkalyi Abulgaziyev, exchanged kind words.

“Today, we understand just how much Kyrgyzstan and Uzbekistan need such meetings,” Mr Ikramov said.

The unprompted thawing of relations caught many by surprise.

Ruziali, an Uzbek student living in Bishkek, said that economic gains were behind the move.

“If acting President Shavkat Mirziyoyev wins the election, relations with Russia could improve and it is quite possible that we will enter the Eurasian Economic Union, of which Kyrgyzstan is already a member,” he said.

Uzbekistan holds a presidential election in December which is expected to confirm Mr Mirziyoyev as president.

ENDS

(News report from Issue No. 299, published on Oct. 7 2016)

Armenia’s parliament approves new tax code

OCT. 4 2016 (The Conway Bulletin) – In a third and final reading, Armenia’s parliament approved a controversial new tax code that has been in the works for two years. The new code will reduce the income tax bracket for most of Armenia’s working population, liberalise VAT and tax dividends. Critics of the reform have said that the new tax code will push Armenia into a recession.

ENDS

(News report from Issue No. 299, published on Oct. 7 2016)

Azerbaijan wants to change name of F1 race

OCT. 4 2016 (The Conway Bulletin) – The management of Azerbaijan’s Formula One city circuit said they want to change the name of Baku’s grand prix race. Formula One held its first race in Azerbaijan in June, under the European Grand Prix moniker which has previously been assigned to races not fixed to specific geographic area. Azerbaijan, which sees sport as a way of promoting its brand, wants to rename the race as the Azerbaijani Grand Prix, in the style of most of the other races.

ENDS

(News report from Issue No. 299, published on Oct. 7 2016)

Stock market: Centerra Gold, Thompson Creek

OCT. 7 2016 (The Conway Bulletin) – Centerra Gold’s stock price has been on a rollercoaster this summer, closely following the ups and downs of the price of gold.

This week, both fell. Centerra contracted by 9% to 6.49 Canadian dollars and gold registered an unusual 5% fall to $1,254.38/troy ounce on Thursday. After a tense spring, when the Kyrgyz government and Centerra were at loggerheads over permits and court cases, calm now appears to reign. Importantly, though, this year Centerra has actively tried to diversify its portfolio away from Kyrgyzstan, investing in Turkey and in the US.

As part of the financing for the acquisition of Colorado-based Thompson Creek, Centerra issued new shares which analysts said will dilute the share that Kyrgyzaltyn, the government-owned gold miner, owns in Centerra from 32% to approximately 28.8%.

The deal, inked in July, put relations between the company and the government under strain once again.

ENDS

(News report from Issue No. 299, published on Oct. 7 2016)

Tajiks want President on banknote

SEPT. 30 2016 (The Conway Bulletin) – Tajikistan’s state insurance company wants to see President Emomali Rakhmon’s head on a 1,000 somoni ($127) bill. Globally, the only living heads of state with their faces on banknotes are royals, notably Queen Elizabeth II, and a few presidents-for-life in Africa and Asia. The proposal could now spark a debate around Mr Rakhmon and his growing personality cult.

ENDS

(News report from Issue No. 299, published on Oct. 7 2016)

Pakistan anticipates power supply from Kyrgyzstan

OCT. 6 2016 (The Conway Bulletin) – Pakistani media hinted that it was anticipating potential supply-side problems with CASA-1000 electricity project by saying that it had invited Russia to make up any short- fall over winter when Kyrgyzstan and Tajikistan’s hydropower stations are less productive. The World Bank-backed $1.2b project aims to send electricity from Kyrgyzstan and Tajikistan to Afghanistan and Pakistan by 2019. This year, shortages in Kyrgyzstan have cast doubts over the country’s export capacity and Pakistan has explored other suppliers, including Turkmenistan.

ENDS

(News report from Issue No. 299, published on Oct. 7 2016)

Kyrgyz Parliament bans underage marriage

OCT. 5 2016 (The Conway Bulletin) – Parliament approved a ban on underage marriage, five months after MPs had controversially voted against it. Kyrgyz law only allows people over 18 to marry, but under special religious conditions, minors could get married. The bill, which passed by a narrow margin, now needs President Almazbek Atambayev’s signature to enter into force. Around 15% of women marry before turning 18 in Kyrgyzstan, the Kyrgyz statistics committee said.

ENDS

(News report from Issue No. 299, published on Oct. 7 2016)