FEB. 23 2015 (The Conway Bulletin) — In an interview with Reuters news agency, Georgia’s economy minister Georgy Kvirikasvili said he may halve the country’s projected economic growth to 2.5% this year. Mr Kvirikasvili said the side-effects of Ukraine’s civil war and the sanctions on Russia had hurt Georgia’s economy.
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(News report from Issue No. 220, published on Feb. 25 2015)
FEB. 23 2015 (The Conway Bulletin) — Armenia’s Central Bank has said that economic growth this year could virtually stagnate at a mere 0.4%, media reported. This figure is at the lower end of its updated estimate which blamed a poor Russian economy for the general slowdown in Armenia’s own economic prospects.
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(News report from Issue No. 220, published on Feb. 25 2015)
>>Russian woes continue to weigh on South Caucasus region>>
FEB. 6 2015 (The Conway Bulletin) — Georgia became the latest country in the South Caucasus/Central Asia region to downgrade its economic forecast for this year.
Finance minister Nodar Khaduri said growth would measure 4% in 2015, down from an earlier prediction of 5%.
Like its neighbours, the slowdown in Russia’s economy is also impacting on Georgia.
“Economic growth in Armenia and Moldova this year was zero percent. A drop is expected in economic growth in Ukraine and Russia due to well-known reasons,” media quoted him as saying.
Georgia’s economy is slightly better sheltered from the economic storm swirling around Russia. The depressed state of the Russian economy has hit Armenia hard and the fall in the price of oil has dented Azerbaijan’s economy.
Georgia, though, is not reliant on either the Russian economy nor on oil prices. That said, both still filter through and impact Georgia.
The Georgian Central Bank has already said it will likely raise interest rates later this month to try and combat the falling value of its lari currency.
“Considering the challenges in the economy today and analysing the numbers and data it is necessary that we start to revise the 5% growth prognosis and plan macroeconomic and fiscal indicators from the beginning so they adequately reflect the economic policy, and respond to these challenges,”” Mr Khaduri said.
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(News report from Issue No. 218, published on Feb. 11 2015)
JAN. 30 2015 (The Conway Bulletin) — The ratings agency Standard & Poor’s downgraded Azerbaijan’s debt rating to negative from stable because of the fall in oil prices. It said 44% of Azerbaijan’s GDP and 95% of its exports were linked to the energy industry. Despite calls from various foreign institutions, Azerbaijan has failed to diversify.
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(News report from Issue No. 217, published on Feb. 4 2015)
>>Armenia’s economy is closely linked to Russia’s fortunes>>
JAN. 30 2015 (The Conway Bulletin) — Ratings agencies Fitch and Moody’s downgraded Armenia’s bond ratings to negative from stable, another sign that the Armenian economy is in for a turbulent few months.
Fitch said that it expected Armenia’s economy to slip into a recession this year and the deficit to widen.
“Remittances amount to about 15% of GDP and fell by about 30% during the last months of 2014 as 90% of the total come from Russia,” it said in a research note.
Armenia has been hit by the drop in the Russian rouble and the turmoil in Russia’s economy, triggered by a fall in oil prices and sanctions imposed by the West after the Kremlin’s intervention in Ukraine.
Over the past seven months, Armenia’s dram currency has fallen by nearly 20% against the US dollar despite a steady increase in interest rates.
Of course, it’s not just Armenia which is exposed to the drop in Russia’s economy and currency. The rest of Central Asia and the South Caucasus have also been badly hit.
Armenia, though, is particularly closely linked. It is desperately hoping that there will be some improvement in Russia’s economy.
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(News report from Issue No. 217, published on Feb. 4 2015)
JAN. 30 2015 (The Conway Bulletin) — Georgia’s GDP grew by nearly 5% in 2014, media reported, a healthy spurt despite pressures from a faltering Russian economy and a drop in global oil prices (Jan. 30).
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(News report from Issue No. 217, published on Feb. 4 2015)
JAN. 19 2015 (The Conway Bulletin) — In new 2015 predictions, the
European Bank for Reconstruction and Development (EBRD) said
Kazakhstan would grow by 1.5% this year, a sharp drop from the 5.1%
predicted in September. The EBRD downscaled Kazakhstan’s growth
estimates because of ongoing rouble and oil price falls.
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(News report from Issue No. 215, published on Jan. 21 2015)
>>Nazarbayev summons his chief economic lieutenant for talks>>
JAN. 16 2015 (The Conway Bulletin) — Kazakh president Nursultan
Nazarbayev summoned the head of Samruk Kazyna, the country’s
sovereign wealth fund, for crisis talks over the falling price of
oil and the drop in the value of the Russian rouble.
The meeting highlights just how worried Mr Nazarbayev and his
senior ministers are about the recent economic downturn. Most major
financial institutions now expect the Kazakh economy to grow by
only 1.5% this year, a relatively small amount.
When Mr Nazarbayev announced last year a new economic policy, he
aimed to enter the New Year with a Keynesian industrial programme
that would have injected billions into construction projects and
subsidies.
Currency depreciations and oil markets, however, have shattered the
plan.
After his meeting with Mr Nazarbayev, Umirzak Shukeyev, the Samruk
Kazyna chief, said: “The goal is to reduce administrative costs by
20% and investment engagements by 18%.”
This, then, is the opposite of what had been promised.
The most feared buzzwords on the streets from Almaty to Atyrau are
devaluation and austerity. Several consulting and investment firms
have forecast a devaluation in the first quarter. The research
branch of Kazakhstan’s second largest lender, Halyk Bank, told
Bloomberg that they deem a depreciation of the tenge as inevitable.
The leader of the National Business Association, Rakhim Oshakbayev
publicly asked the government to protect private companies from the
risk of devaluation (Jan. 20).
In Kazakhstan, the government is expected to act to reverse the
economic downturn but with no significant increase in hydrocarbon
and commodity output, its only option is to dig into the reserves
of the sovereign fund and hope for the best, or so it often seems.
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(News report from Issue No. 215, published on Jan. 21 2015)
JAN. 15 2015 (The Conway Bulletin) — The European Bank for Reconstruction and Development (EBRD) halved its predictions for Azerbaijan’s growth rate in 2015 to 1.5% from 3% in 2014. The downturn in the Russian economy and the fall in the value of oil have hit Azerbaijan.
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(News report from Issue No. 215, published on Jan. 21 2015)
JAN. 15 2015 (The Conway Bulletin) — Despite the downturn in Russia’s economy, the European Bank for Reconstruction and Development (EBRD) predicted decent growth for Uzbekistan’s economy in 2015 of around 7%. The EBRD heavily slashed growth rates of Uzbekistan’s neighbours. Uzbekistan’s economy is more sheltered than its neighbours.
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(News report from Issue No. 215, published on Jan. 21 2015)
