Tag Archives: economy

Labour market in Kazakhstan shrinks by 5%

MAY 20 2016 (The Conway Bulletin) — The number of employed people in Kazakhstan fell by 5% to 3.4m, the sharpest fall in recent years, signalling just how hard the economic crisis has hit the country. Unemployment data is unreliable in Kazakhstan, as the statistics can be manipulated. The data is more evidence of the impact of the economic downturn on lives of ordinary Kazakhs. Protests have broken out across Kazakhstan over the past few weeks. These started as protests against a land reform and have now morphed into wider protests against the government.

ENDS

(News report from Issue No. 282, published on May 27 2016)

Kazakhstan to receive loan from World Bank

MAY 26 2016 (The Conway Bulletin) — Kazakhstan’s Parliament ratified an agreement to receive a $1b loan from the World Bank’s International Bank for Reconstruction and Development, a cash injection that the government will use to pay for expenses in 2016. Kazakhstan’s finance ministry and the IBRD had agreed on the loan on May 11.

ENDS

(News report from Issue No. 282, published on May 27 2016)

IMF forecasts Kazakh economy

MAY 24 2016 (The Conway Bulletin) — Christine Lagarde, managing director of the IMF, said that Kazakhstan has to embark on a series of institutional reforms and deepen regional integration to face the challenges posed by sustained low oil prices. Ms Lagarde spoke from Astana, where she met President Nursultan Nazarbayev and senior government officials. Ms Lagarde also praised the ditching of the tenge’s US dollar peg last year.

ENDS

(News report from Issue No. 282, published on May 27 2016)

Kazakhstan’s GDP shrinks

MAY 19 2016 (The Conway Bulletin) – Kazakhstan’s GDP shrank by 0.2% in the first quarter of 2016, the first dip in seven years, according to the Statistics Committee. Trade, telecoms, and industrial production slowed significantly. Analysts at Halyk Finance forecast that Kazakhstan’s GDP will grow by just 0.2% this year, the lowest growth since the 2008 Global Financial Crisis. Kazakhstan, like the rest of the region, is struggling to deal with the knock on effects of a recession in Russia and collapse in oil prices.

ENDS

(News report from Issue No. 281, published on May 20 2016)

Ex-Kazakh minister to head Baiterek

MAY 17 2016 (The Conway Bulletin) – Former Kazakh minister of economy Yerbolat Dossayev took the post of chairman of Baiterek, a state-owned holding that manages several financial vehicles. This is effectively a job swap. Mr Dossayev replaces Kuandyk Bishimbayev at Baiterek. Earlier this month Mr Bishimbayev was made the minister of economy. Mr Dossayev resigned as economy minister after protests over planned changes to the land code spread across the country earlier this month.

ENDS

(News report from Issue No. 281, published on May 20 2016)

Armenian C Bank cuts interest rate

MAY 17 2016 (The Conway Bulletin) – Armenia’s Central Bank cut its key interest rate by half a percentage point to 7.75%, its lowest rate since November 2014, as it tried to counter sharply falling prices. Annualised inflation at the end of April measured minus 1.9%, the Central Bank said last week. It has steadily lowered interest rates from a high of 10.5% in July 2015.

ENDS

(News report from Issue No. 281, published on May 20 2016)

Currency woes in Uzbekistan, Georgia and Armenia

MAY 16 2016 (The Conway Bulletin) – An IMF paper on the state of money markets across the South Caucasus and Central Asia said that most currencies are still overvalued against the US dollar, despite depreciations that have taken place over the past 18 months. The IMF highlighted that in January the Uzbek sum was 30% above its market value, and the Georgian lari was around 15% overvalued. The Armenian dram was the only currency that, according to the IMF, traded below its value.

ENDS

(News report from Issue No. 281, published on May 20 2016)

Kazakh Pension Fund loans cash

MAY 17 2016 (The Conway Bulletin) – Kazakhstan’s Central Bank said it had given 62b tenge ($186m) in loans from the state’s Pension Fund to around 30 commercial banks, in an effort to boost their liquidity. Kazakhstan’s Pension Fund, previously held at commercial banks, was nationalised between 2013 and 2014. It held up to $20b. Last month, the Central Bank opened a credit line from the Fund for commercial banks.

ENDS

(News report from Issue No. 281, published on May 20 2016)

Is Tajikistan preparing to unleash its Nashi?

MAY 20 2016 (The Conway Bulletin) — So, it’s becoming increasingly clear that the authorities in Tajikistan are using students to promote their causes.

Excellent reporting from our ‘Man in Dushanbe’ has exposed this practice. He has spoken to several students who have said their universities and teachers have forced them to either march in favour of government policies or demonstrate outside the embassies of countries which have irritated President Emomali Rakhmon by giving his enemies sanctuary.

This is a well-worn strategy in the former Soviet Union. When I was a correspondent in Moscow between 2006-9 I reported heavily on the growth of a youth group called Nashi and its various offshoots. Nashi was effectively a massive mobilisation of Russian youth, often whipped up into a frenzy to support various policies promoted by Vladimir Putin and Dmitri Medvedev, who was the Russian President at the time.

Their summer camps, set up in the dense forests of northern Russia, were an eye-opener. Pictures of opposition activists dressed up as prostitutes were placed around the site. In Moscow, Nashi rallies were rowdy affairs, nationalistic and with a violent undercurrent.

The movement in Tajikistan hasn’t reached these proportions yet and is less sophisticated but the authorities are still unleashing, while trying to control, the same forces.

It’s a crude, dangerous technique.

BANKING ISSUES

Sticking with Tajikistan, news that the country’s second largest bank has been placed under administration doesn’t come as a surprise. TSB has been listing heavily for a while. The strains on the Tajik economy have just become too great and it was only a matter of time before something gave. The important issue to monitor now is whether this is contagious and other Tajik banks also cave in.

It’s also important to keep the banking failure in context. The Tajik banking system may be weaker than its neighbours but all the Central Asian economies have been under the same pressures. Remittances from Russia have dried up, currencies have halved in value and GDP growth rates are being revised down. These banks were giving out soft loans for years and many of these will have turned bad.

If a bank in Tajikistan effectively says it doesn’t have any more money left, could banks in neighbouring Kyrgyzstan and Kazakhstan be experiencing the same problem?

ENDS

(News report from Issue No. 281, published on May 20 2016)

Tajik migration slows by 10%

MAY 18 2016 (The Conway Bulletin) – The Tajik ministry of labour said that outbound migration decreased by 10% in the first four months of 2016, compared to the same period last year. Around 200,000 Tajik labour migrants left the country in Jan.-April 2016. Around 87% of the migrants are men. Most of them head to Russia for work. Remittances from migrants are an important part of Tajikistan’s economy.

ENDS

(News report from Issue No. 281, published on May 20 2016)