APRIL 5 2015 (The Conway Bulletin) – Kazakhstan will give car-makers 35b tenge ($188m) to help them survive the economic downturn, media reported quoting First Vice Minister for the Economy, Marat Kussainov. Kazakhstan’s car-makers have been hit hard by the sharp drop in the rouble because Russia was one of its biggest markets.
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(News report from Issue No. 226, published on April 8 2015)
APRIL 6 2015 (The Conway Bulletin) – People in Kazakhstan, it appears, are still rushing to buy cheap Russian goods.
Official data showed that in February Kazakhs across the country bought 3.5 times more roubles than they did a year earlier.
In some areas, the rise was even bigger. In Mangistau, western Kazakhstan, the increase between February 2014 and February 2015 was nearly 19 times, Almaty the increase was 18 times and in Kyzylorda region of southern Kazakhstan the increase was nearly 35 times.
Russian goods have become far cheaper over the last few months because of the near 50% devaluation of the Russian rouble. Most Central Asian states have also devalued their own currencies but Kazakhstan has said that it will resist a sudden cut.
It knocked 20% off the value of its tenge currency last year and sees defending it as the best way to retain credibility.
Still, analysts have said that it is only a matter of time before Kazakhstan relents and cuts the tenge by up to 40%.
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(News report from Issue No. 226, published on April 8 2015)
BAKU, APRIL 8 2015 (The Conway Bulletin) – – Gulnara Makhmedova, a 62-year old refugee from the disputed region of Nagorno-Karabakh stood in front of a crumbling Soviet apartment block tucked behind the whitewashed faculty of medicine at Baku State University.
Just a few hundred yards away luxury cars were parked up in front of haute couture shops and expensive restaurants.
Gulnara lives with five members of her family in a one-bedroom apartment. In her apartment block, electricity runs for only a few hours a day and the water that trickles out of the tap is brown.
“My family has been waiting for a new flat for over twenty years now,” she said.
Gulnara is one of around 600,000 internally displaced refugees from the conflict which pitted Azerbaijani forces against Armenian-backed separatists after the 1991 fall of the Soviet Union. Only a fragile 1994 cease-fire now keeps Nagorno-Karabakh from falling back into war.
They live in a precarious state of destitution in Azerbaijan’s sprawling capital.
“We all hoped we could start a new life here, but we only found ourselves living in worse conditions than the ones we left behind,” she said, pointing at the disintegrating mould stained ceiling of her apartment.
“When we arrived in Baku back in 1993 we immediately understood we were not welcome here as we represented a living reminder of Azerbaijan’s defeat,” she told the Bulletin referring to the thousands of civilians who fled Agdam, her hometown after an Armenian defeat of Azerbaijan.
Analysts have said that there may be another reason why Gulnara and her family are made to live in broken Soviet apartment blocks. It may suit Azerbaijani president Ilham ALiyev and his government to be able to show domestic television and visiting dignitaries the human suffering that the smouldering Nagorno-Karabakh conflict has generated.
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(News report from Issue No. 226, published on April 8 2015)
APRIL 1 2015 (The Conway Bulletin) – Azerbaijan’s Central Bank said it had spent more than $1b of its reserves defending the value of the manat currency since it devalued by a third in mid-February. The admission will be an embarrassment for the Central Bank as the devaluation was meant to relieve pressure on the manat and protect reserves.
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(News report from Issue No. 225, published on April 12015)
MARCH 27 2015 (The Conway Bulletin) – During a briefing, Senator Yertargyn Astayev, a member of parliament’s budget committee, said ministries might not have enough cash to fulfil projects unveiled by Mr Nazarbayev’s Nurly Zhol party.
According to Mr Astayev, the interior ministry, which deals mainly with law enforcement and migration issues, will soak up the largest budget cut of $225m.
But, importantly, Mr Astayev also said finances earmarked for large infrastructure projects were going to be “placed under strict control”.
The hint was clear. The investments envisaged by Mr Nazarbayev are under threat.
Economic turmoil in the region has forced Kazakhstan into cutting the budget.
Mr Nazarbayev said that various departments had to save a combined $3.3b.
And the cutbacks have caught the public’s attention too.
Rauan, a 43-year-old engineer from Almaty said the government should ditch various high-profile but less useful projects such as EXPO-2017.
“Now we are funding these projects, designed only to feed our pride, at our own expense,” he said. “Perhaps our ambitions are too high.”
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(News report from Issue No. 225, published on April 12015)
MARCH 31 2015 (The Conway Bulletin) – Kyrgyzstan’s Central Bank bought $11.4m worth of som to slow its devaluation, media reported, its third intervention in March. Kyrgyzstan, like other countries in the region, has been trying to manage a fall in the value of its currency.
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(News report from Issue No. 225, published on April 12015)
APRIL 1 2015 (The Conway Bulletin) – Russia used its control of gas supplies to Armenia to pressure the government into joining its Eurasian Economic Union, a parliamentary inquiry has said.
The inquiry said Russia increased gas prices to Armenia until it agreed to join the Eurasian Economic Union in 2013.
The findings are strong evidence that Russia uses its economic leverage over Central Asia and the South Caucasus for political gain.
Also in the past week, Russia approved a $1 billion development fund for Kyrgyzstan. This, again, appears linked to Kyrgyzstan’s entry to the Eurasian Economic Union later this year.
The West has long said the Kremlin’s aim in the region is to coerce governments into doing its bidding.
In Armenia and Kyrgyzstan, it has found vulnerable partners. Both are relatively poor with few natural resources. They both host Russian military bases and are reliant on Russian business and remittances from workers living in Russia for growth.
Importantly too, Gazprom owns the gas pipeline network in both Armenia and Kyrgyzstan. This has often been the choke point. Controlling a country’s gas supply gives Russia huge power.
There is one other major similarity between Armenia and Kyrgyzstan regarding membership of the Eurasian Economic Union. Bulletin correspondents in both countries report that most ordinary people, and also many of the politicians, don’t really want to join the group. Instead, they feel compelled to.
Belarus and Kazakhstan, both far larger economies, are also members of the EEU.
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(News report from Issue No. 225, published on April 12015)
MARCH 27 2015 (The Conway Bulletin) – Russia has approved a law that will create a Russia-Kyrgyzstan development fund worth $1b, media reported. Kyrgyzstan has agreed to join the Kremlin-led Eurasian Economic Union later this year and it is likely that the fund’s creation was linked to Kyrgyz membership of the group.
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(News report from Issue No. 225, published on April 12015)
MARCH 28 2015 (The Conway Bulletin) – Worsening economic conditions in Tajikistan have even knocked the value of bribes in the notoriously corrupt country, the US-funded Radio Free Europe/Radio Liberty reported. It said that the value of bribes had halved over the past few months.
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(News report from Issue No. 225, published on April 12015)
MARCH 26 2015 (The Conway Bulletin) – Georgia’s Central Bank kept its key interest rate at 4.5%, confounding expectations of another rate rise to counter a fall in the value of its lari currency. The Central Bank said the current inflation rate did not merit a rate rise although it also said that a gradual devaluation would probably push prices up.
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Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 225, published on April 12015)
