NOV. 25 2015 (The Conway Bulletin) — Rosneft, the Russian oil and gas company, bought Armenia’s Petrol Market chain of petrol stations for $40m, media reported, extending Russian influence over the country. Media reported that the deal was made in August but only reported now.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 258, published on Nov. 27 2015)
NOV. 24 2015 (The Conway Bulletin) — Qatar Airways, the flagship carrier in Qatar, will open a new route to and from Armenia. The Yerevan- Doha-Yerevan connection will begin operations in 2016 and ensure an air link between Armenia and the Persian Gulf region after UAE’s Etihad pulled out of the country in April.
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(News report from Issue No. 258, published on Nov. 27 2015)
NOV. 24 2015 (The Conway Bulletin) – Azerbaijani president Ilham Aliyev and Armenian president Serzh Sargsyan will meet in Paris on Dec. 1 to discuss their cease-fire over the disputed region of Nagorno-Karabakh, media reported.
The two countries are still officially at war over Nagorno-Karabakh and meetings between the two leaders are rare. Their last meeting was also in Paris in 2014.
Armenian-backed rebels control Nagorno-Karabakh but there are constant skirmishes that kill soldiers almost every week. Over the past few years tension over the region has ebbed and flowed, sometimes threatening to spill over into all-out war.
Earlier this month, the Azerbaijani ministry of defence said that its forces had killed two ethnic Armenian fighters. The Armenian government confirmed this and said that two of its soldiers had been killed by an Azerbaijanji sniper.
At previous meetings between Mr Aliyev and Mr Sargsyan, these normally take place in Paris or Moscow, there have been warm words and friendly photo-ops but no lasting moves to bring about a permanent peace to the region.
Only a 1994 UN-brokered cease- fire maintains a shaky peace. The war killed an estimated 30,000 people and created thousands of refugees.
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(News report from Issue No. 258, published on Nov. 27 2015)
NOV. 20 2015 (The Conway Bulletin) – Economic activity in Armenia increased by 3.5% in the first 10 months of the year compared to the same period in 2014, media reported by quoting the statistics agency. The statistics agency also said that salaries had increased by over 9% during the same period, a reflection of the drop in the value of Armenia’s dram currency.
ENDS
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(News report from Issue No. 258, published on Nov. 27 2015)
NOV. 26 2015 (The Conway Bulletin) – Air Armenia, the national flag carrier, lost its appeal against a bankruptcy order.
ENDS
Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 258, published on Nov. 27 2015)
NOV. 26 2015 (The Conway Bulletin) — An appeals court in Armenia upheld a bankruptcy order against Air Armenia, dealing a major blow to the national flag carrier’s chances of survival.
Earlier this month a court declared Air Armenia bankrupt because it owed HSBC Armenia over 2m euro.
After losing an appeal against the bankruptcy order, Arsen Averisyan, majority owner of Air Armenia, said he would be able to pay back the loan once he had cashed in various assets.
“We can’t cash these bonds now, but if creditors uphold the recovery program, then we will remain in the market. We have 50 days,” he said.
Until 2013, Air Armenia had only flown cargo flights. After the bankruptcy of Armavia, though, it stepped into the gap and started up an ambitious network of passenger routes from Yerevan to various Russian cities, Paris, Frankfurt and Athens.
Mr Averisyan wanted to adopt the Armenian national livery and become its biggest and most important airline.
But Air Armenia’s timing was poor. The same year that Air Armenia started its passenger operation, the Armenian government liberalised air routes in and out of the country. This increased competition and drove down prices. The price of tickets on the most important routes between Yerevan and Moscow and St Petersburg plunged.
Opposition politicians have blamed the liberalisation for pushing Air Armenia into bankruptcy.
After only one year of flying passenger routes, Air Armenia stopped flights altogether.
It was handed a lifeline earlier in August when a deal was agreed with East Prospect Fund, a Ukrainian company registered in the British Virgin Islands, to buy a 49% stake in the company for $68.6m.
This cash injection, though, was clearly not enough to pay off Air Armenia’s debts. Air Armenia’s needs another deal if it is to survive.
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(News report from Issue No. 258, published on Nov. 27 2015)
NOV. 27 2015 (The Conway Bulletin) — Central Banks in the South Caucasus and Central Asia have had a rough year. Keeping up with the strengthening dollar and the falling rouble while monitoring inflation has been a tough test.
In an attempt to stick together during the economic downturn, some of the central bankers appear to have decided to use old infrastructure to continue their meetings and coordinate policies.
Confusion, however, clouds the various structures that are still in place.
The new body which met in Almaty this week was renamed the Eurasian Council of Central Bank Chiefs and is a spin-off of the now- defunct Eurasian Economic Community (EurAsEC).
It doesn’t overlap with the Eurasian Economic Union (EEU) because Armenia is not in it and is no longer representative of the old EurAsEC, which officially closed down last year, as Uzbekistan is not a member.
And this says a lot about just how confusing economic integration has been in the region.
Since the EurAsEC was disbanded, the Eurasian Economic Union (EEU) has become the integrationist body. Russia, Belarus, Kazakhstan, Kyrgyzstan and Armenia are part of the EEU.
So why brand it as EurAsEC? Why is Armenia out of the picture?
“Pressing economic questions” are the rationale behind this new body, according to Kazakhstan’s Central Bank.
The countries that form the new body are all in the midst of an economic crisis, but so are other countries that were not invited to the Eurasian banking council.
With the EEU in place and Tajikistan lined up to become a member, the decision to revive such a strange body, rather than another, is difficult to understand.
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Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 258, published on Nov. 27 2015)
NOV. 18 2015 (The Conway Bulletin) – Armenia could finalise a deal with the EU before the end of the year, Armenian foreign minister Edward Nalbandian was quoted as saying. For the EU a framework deal with Armenia, a member of the Kremlin-lead Eurasian Economic Union, would be an important victory, especially after the rejection of the Association Agreement in 2013. For Armenia, close links with the EU are important to maintain.
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(News report from Issue No. 257, published on Nov. 20 2015)
NOV. 20 2015 (The Conway Bulletin) – Officials from Iran and Armenia have signed deals which will improve cross-border trade insurance claims and investigations, media reported. The deal underlines the advanced relations between Armenia and Iran. The neighbours need each other to boost trade.
ENDS
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(News report from Issue No. 257, published on Nov. 20 2015)
NOV. 20 2015 (The Conway Bulletin) — The Kazakh tenge was steady this week, trading at around 307.2/$1, off an all-time low against the US dollar of 311/$1 earlier in November.
There is still much speculation by analysts on just how monetary policy in Central Asia’s biggest economy is going to change under new Central Bank chief Daniyar Akishev. He said that inflation was too high and appeared to make this his priority.
With this in mind, expect another interest rate rise at the Central Bank’s policy meeting next month — if the policy wonks don’t cancel it again. There are, though, two urgent problems, it seems to me, with the Kazakh monetary policy. People don’t know what it is or whether it works.
The new key interest rate — overnight repo rates — was only introduced in September. It was raised in October to 16% from 12% and then ignored in November when the Central Bank cancelled its policy meeting at the last moment. Does this interest rate have any credibility? Does the market even care about it? It doesn’t appear to have had any effect so far.
And Mr Akishev appeared to acknowledge as much when he said that a fall in oil price would send the tenge tumbling further. Oil prices, outside the Kazakh Central Bank’s control, are the driver of tenge value and not its key interest rate.
In neighbouring Kyrgyzstan, the som currency did continue to set new records against the US dollar. It hit an all-time low on Friday of 72.5/$1 versus 71.9/$1 at the start of the week. On Oct 1, the som had been valued at 68.8/$1, meaning that it has lost over 5% of its value in the past seven weeks.
As the Bulletin reports in the main section of the newspaper, information coming out of Turkmenistan is that its manat currency has devalued and that the government has placed restrictions on the amount of cash people can withdraw from the banks. Earlier this month, The Bulletin also reported on the devaluation of the Uzbek soum.
Even staunchly controlled currencies are feeling the pressure, it seems.
And over in the South Caucasus, it is a similar story. Since its sharp 33% devaluation in February, the Azeri manat has been kept steady but analysts have increased chat of a need to devalue again.
Both the Armenian dram and the Georgian lari were steady through the week.
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Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 257, published on Nov. 20 2015)
