Tag Archives: economy

Kazakhstan’s Kashagan close to opening

SEPT. 13 2016 (The Conway Bulletin) – Kazakhstan’s energy minister, Kanat Bozumbayev, said that production at the offshore oil field of Kashagan will resume on October 23, three years after its sudden interruption due to leaky pipes. Kashagan, discovered in 2000, is one of the largest finds in the oil industry’s recent history. Its reopening has been touted as crucial to give the Kazakh energy sector the boost it needs to move into the World’s premier division of producers.

ENDS

(News report from Issue No. 296, published on Sept. 16 2016)

Georgia’s trade balance worsens

SEPT. 13 2016 (The Conway Bulletin) – Georgia’s foreign trade balance worsened, as imports increased and exports decreased in the first eight months of 2016 compared to the same period last year, the Statistics Committee said. Exports fell by 10% to $1.3b, while imports rose to $6.1b, a 23% jump.

ENDS

(News report from Issue No. 296, published on Sept. 16 2016)

Azerbaijan’s GDP to drop, says IMF

SEPT. 13 2016 (The Conway Bulletin) – The IMF published a report on the state of Azerbaijan’s economy, forecasting a GDP contraction of 2.4% in 2016. The IMF said that lower oil prices, weak regional growth, currency devaluations, and lower hydrocarbon production have impacted Azerbaijan’s economic performance. In its report, the IMF said Azerbaijan’s GDP will resume growth in 2017.

ENDS

(News report from Issue No. 296, published on Sept. 16 2016)

Tajikistan’s trade turnover drops

SEPT. 15 2016 (The Conway Bulletin) – Tajikistan’s foreign trade turnover in Jan.-Aug. 2016 fell by 7.6% compared to the same period last year, on account of lower imports, Tajikistan’s Central Bank said. Tajikistan exported goods worth around $600m, a decrease of 1.9% compared to last year. Notably, Tajikistan imported less than $2b- worth of goods in the first eight months of the year, a 9% decline compared to 2015.

ENDS

(News report from Issue No. 296, published on Sept. 16 2016)

Currency booths start selling US dollars again in Azerbaijan

BAKU, SEPT. 15 2016 (The Conway Bulletin) – Currency exchanges in Azerbaijan have started selling US dollars once again after the Central Bank sold $300m and increased interest rates to their highest level since 2008 to support the manat.

The near-emergency measures were taken last week after currency booths stopped selling US dollars because of a lack of confidence in the Azerbaijani manat which had lost 11% of its value since the start of June. Confidence in the manat was destroyed last year when two devaluations wiped 50% off the value of the currency.

Azerbaijan’s economy is reliant on oil for its revenues and the government has been slashing projects to account for the drop in revenues. Even so, economists forecast a GDP drop this year.

“There is a crisis in every single sector of the economy, starting from trade, ending in construction, agriculture, and services,” Zohrab Ismayilov, a Tbilisi-based Azerbaijani economist told The Conway Bulletin.

And this is being felt at street level where jobs have been lost, savings cut in half and prospects diminished. Earlier this year a series of protests across the country, unusual in Azerbaijan where the security forces normally maintain a tight grip, shook the government.

Rashad, 31, the owner of a small catering business in Baku, told the Conway Bulletin that like most Azerbaijanis he has had to resort to using the Black Market to exchange manat into US dollars.

“I had to have dollars and at the weekend I could not find an open bank which has a running exchange service. So, I found a friend who knows an illegal exchange place and did my exchange there,” he said.

And the economy is tightening.

“Because of the economic situation, companies are cutting their costs and the market is becoming too narrow,” he said.

Mr Ismayilov, the economist, said that the Azerbaijani government could only prop up the currency for so long.

“Everybody now expects the third devaluation,” he said.

“It is very likely to happen by the end of this year. And it will be a big blow to the economy.”

ENDS

(News report from Issue No. 296, published on Sept. 16 2016)

Inflation raises in Tajikistan

SEPT. 14 2016 (The Conway Bulletin) – Tajikistan’s Central Bank said that annualised inflation amounted to 6.4% in August, an increase from last year’s level of 5.1%. Inflation is volatile in Tajikistan, as it is closely tied to the Central Bank’s currency interventions. Despite repeated Central Bank’s interventions, the Tajik somoni has lost 19% against the US dollar in the past 12 months.

ENDS

(News report from Issue No. 296, published on Sept. 16 2016)

Armenia’s PM resigns

SEPT. 8 2016 (The Conway Bulletin) — Hovik Abrahamyan resigned from his post as Armenian PM, saying that new leadership was needed to restore confidence in the government.

Local media outlets in Armenia have touted Karen Karapetyan, former mayor of Yerevan and Gazprom Armenia executive, as the potential new PM.

During his resignation speech, Mr Abrahamyan, PM since April 2014, said that Armenia needed new leadership to restore confidence.

“In order to improve the current economic and social situation, both the government and the people need to make joint efforts, and this requires new approaches and new principles,” he said.

Mr Abrahamyan may have been trying to deflect criticism from Armenia’s President Serzh Sargsyan. President since 2008, Mr Sargsyan’s popularity has fallen recently.

In July a group of gunmen calling for a new government captured a police station, triggering a two week standoff with security forces. Three policemen died during the capture of the police station and the subsequent standoff. Hundreds of protesters, supporting the gunmen clashed with police, during the standoff, highlighting the frustration with the government.

Armenia’s economy has flatlined and promised improvements in relations with neighbours have not materialised. In the summer of 2015, protesters clashed with police when the government tried to increase prices for electricity. In April, too, fighting broke out between Armenian and Azerbaijani forces over the disputed region of Nagorno-Karabakh.

ENDS

(News report from Issue No. 295, published on Sept. 9 2016)

FDI grow in Georgia

SEPT. 8 2016 (The Conway Bulletin) — Foreign direct investment (FDI) in Georgia in the first half of 2016 grew by 10% compared to the same period last year. In Q2, FDI declined by 3.8% to $445m. Azerbaijan, Britain and the Czech Republic were the three largest investors in Georgia in Q2. FDI in the transport and communications sector made up more than a third of the total inflow.

ENDS

(News report from Issue No. 295, published on Sept. 9 2016)

Georgia’s Central Bank cuts interest rates

SEPT. 7 2016 (The Conway Bulletin) — Georgia’s Central Bank cut interest rates by 25 basis points to 6.5%, the fourth rate cut in five months. The Central Bank has said it wants to lower interest rates further to prop up economic activity. In April, before the first cut, Georgia’s key interest rate stood at 8%. Georgian interest rates have yoyoed from 4% for most of 2014, climbing sharply to 8% before being lowered.

ENDS

(News report from Issue No. 295, published on Sept. 9 2016)

Azerbaijan raises interest rates to 8-year high

SEPT. 9 2016 (The Conway Bulletin) — Azerbaijan’s Central Bank raised its key interest rate to 15% from 9.5%, its highest level since 2008, to try to boost confidence in the ailing currency.

The manat has been falling in value for weeks, hitting an all-time low of 1.67/$1 on Friday, setting off fears of another currency crisis. Last year, the Central Bank devalued its currency twice, undermining confidence and wiping out people’s manat-based savings. A series of protests across the country against the worsening economic conditions, almost unprecedented in Azerbaijan, unnerved the Azerbaijani leadership.

The currency had been gaining in value this year until the end of May when it began to slip again. The manat has now lost 11% of its value since May 30.

The day before, the Azerbaijani Central Bank had sold $100m to try to prop up its currency.

Last week, Bloomberg News reported that local banks and exchange bureaus had suspended sales of foreign currencies due to the high demand.

Ratings agency Moody’s said the government should change regulations on capital controls brought in earlier this year.

“The restrictions on foreign-currency sales have led to the emergence of a parallel exchange market, which in our view speaks to the challenges the central bank faces to stem dollar demand and elevates risks of an accelerated depreciation in the official exchange rate,” Moody’s analysts said in a report.

Low oil prices have hit Azerbaijan’s economy hard over the past two years. Azerbaijan ‘s economy is particularly dependent on oil revenues as it generates around 3/4 of its income.

ENDS

(News report from Issue No. 295, published on Sept. 9 2016)