Tag Archives: economy

Armenia debates on debt calculation change

JUNE 22 2015 (The Conway Bulletin) – YEREVAN — Armenia’s government wants to change the way it measures its national debt, a con trick, its opponents have said, which is aimed at massaging the numbers by cutting out the Central Bank’s borrowings.

The Armenian parliament passed a first reading of a bill which will ditch the current state debt and instead measure the national debt.

Atom Janjughazyan, deputy finance minister, said the change was needed to meet international standards.

“The sole purpose of the bill is to improve the financial statistics of the State in accordance with international practice,” he said in parliament.

But opposition MPs said the change was merely a cover for allowing the government to borrow so that it can ease itself out of the current financial downturn, triggered by a fall in the Russian economy, the main economic driver for the former Soviet Union.

And this viewpoint appears to be backed by international economists. Teresa Daban Sanchez, the IMF representative in Armenia, told an Armenian newspaper the country’s external debt is now uncomfortable.

“The government needs to take measures so that the debt against the GDP index begins to fall,” she said.

Armenia’s government has previously said it will borrow to prop itself up through the current economic downturn. Under government rules its debt must be below 60% of GDP.

Mr Janjughazyan, the deputy finance minister, said under the new system, Armenia’s debt measured $4.4b against a GDP of $10.9m, comfortably below the 60% mark.

ENDS

(News report from Issue No. 237, published on June 25 2015)

Kazakhstan to join WTO by end of the year

JUNE 22 2015 (The Conway Bulletin) – After 19 years of negotiations, Kazakhstan will join the World Trade Organisation (WTO) later this year after officially agreeing terms with the economic group.

President Nursultan Nazarbayev was quick to appear on TV to laud the success of the WTO entry .

“The WTO membership opens up new horizons for our econ- omy,” Mr Nazarbayev said on national TV.

Commodities make up most of Kazakhstan’s foreign trade, already carried at very low tariffs.

Tariffs are at the centre of the debate on Kazakhstan’s WTO membership.

It is also part of the Russia-led Customs Union, which morphed into the Eurasian Economic Union this year. This is, essentially, an old-school trade bloc which promotes free trade between members but puts up barriers to non-members. The other members of the Eurasian

Economic Union are Russia, Belarus and Armenia. Kyrgyzstan is on the brink of joining.

Even so, the WTO and Kaza- khstan appear to have found a way around this potential stumbling block, although the details are scant.

Kazakh industrials have also been reticent about joining the WTO.

“Our community is concerned that the accession into the WTO would seriously reduce the protection levels and cause the flooding of cheap goods into our markets, which would kill our production,” Rakhim Oshak- bayev, deputy chairman of the National Chamber of Entrepre- neurs, told Kazakh media.

The terms of the accession remain classified and analysts have questioned this secrecy. When it first applied to join the organisation in 1996, Kazakhstan was a poor country which had just emerged from the ashes of the Soviet Union. Now, the scenario is different.

ENDS

(News report from Issue No. 237, published on June 25 2015)

Kazakhstan to issue Eurobond, again

JUNE 24 2015 (The Conway Bulletin) – Kazakhstan will issue a £2b Eurobond, economy minister Yerbolat Dossayev told local media.

Mr Dossayev didn’t give specific dates for the issue but Reuters reported that Citigroup and JP Morgan are joint book- runners and Kazkommerts Securities and Halyk Finance are joint lead managers for the issue.

This is the second major dollar-denominated Eurobond that Kazakhstan has issued in the last year. In 2014, Kazakhstan issued a $2.5b Eurobond, its first since 2000.

Kazakhstan has been dealing with the fall out of a slide in global oil prices and a dip in the fortunes of Russia’s economy. Although the Central Bank has not stated just why it has borrowed so heavily in the past year, it is likely linked to this economic downturn.

ENDS

(News report from Issue No. 237, published on June 25 2015)

Interest rates steady in Armenia

JUNE 23 2015 (The Conway Bulletin) – Armenia’s Central Bank kept its key interest rate unchanged at 10.5% as inflation steadied. The Central Bank increased its interest rate to 10.5% in February as it tried to defend the value of its currency.

ENDS

(News report from Issue No. 237, published on June 25 2015)

Kazakhstan’s GDP suffers high energy intensity

JUNE 25 2015 (The Conway Bulletin) – Kazakhstan is one of the least energy efficient countries in the world for generating economic growth, Tomasz Telma, regional director for Europe, Middle East and North Africa at the World Bank’s International Finance Corporation, told Bnews.kz.

ENDS

(News report from Issue No. 237, published on June 25 2015)

Georgia’s GDP deflator increasing

JUNE 19 2015 (The Conway Bulletin) – Georgia’s GDP deflator outstripped its nominal GDP growth for the second consecutive quarter, official data showed, highlighting the stagnating economy. Georgia’s GDP deflator measured 5.1% in Q1, compared to GDP growth of 3.1% nominal GDP growth. The GDP deflator is an important measure of real GDP growth. The GDP deflator last outstripped nominal GDP growth in 2011.

ENDS

(News report from Issue No. 237, published on June 25 2015)

Georgian government cuts national budget

JUNE 23 2015 (The Conway Bulletin) – TBILISI – Georgia’s finance ministry said it will cut the national budget by 140m lari ($53m), 1.75% of the original budget, because of an economic slowdown.

Cuts will be made across government but hardest hit will be education, agriculture and the interior ministry.

PM Irakli Garibashvili said the government should have revised its budget earlier.

“Almost all the countries in the region had to revise their budgets because of the crisis,” he told parliament.

The government said that Georgia’s economy would grow by around 2% this year, far below the 5% initially anticipated.

A downturn in Russia’s economy and a slump in energy prices has hit Georgia hard. It is unclear if these cuts will be enough or more will follow.

The popularity of the ruling Georgian Dream has been slip- ping, in part because of the economic slowdown.

ENDS

(News report from Issue No. 237, published on June 25 2015)

Kazakhstan increased gold reserves

JUNE 25 2015 (The Conway Bulletin) – Kazakhstan increased its gold reserves for the 32nd month in a row, the IMF said. Kazakhstan’s gold reserves measure 203.4 tonnes. Despite spending heavily to protect the tenge, the Kazakh Central Bank has maintained its policy of buying gold.

ENDS

(News report from Issue No. 237, published on June 25 2015)

MoneyGram to operate in Turkmenistan

JUNE 23 2015 (The Conway Bulletin) – MoneyGram International, a money wire transfer service, said that it had set up operations in Turkmenistan. MoneyGram’s entry into Turkmenistan will be boost to remittance flows which rely heavily on easy wire transfer services.

ENDS

(News report from Issue No. 237, published on June 25 2015)

Azerbaijani weapons exports increases

JULY 22 2015 (The Conway Bulletin) – Yaver Jamalov, Azerbaijan’s defence industry minister, said he wanted to increase the number of countries that Azerbaijan exported its weapons and ammunition to. Mr Jamalov said he had concluded a deal with Iraq’s government to supply hundreds of grenade launchers and mortars.

ENDS

(News report from Issue No. 241, published on July 23 2015)