Tag Archives: government

Parliament votes to weaken interior ministry

JULY 8 2015 (The Conway Bulletin) – TBILISI – Georgia’s parliament voted 78-0 in favour of stripping control of the country’s security and intelligence agencies from the ministry of interior.

Under the reforms the interior ministry will retain control of policing in Georgia and the border guards, although its overall power will be much reduced.

The current interior ministry structure was created by former Georgian president Mikheil Saakashvili. He pooled counterintelligence operations and border control with other law enforcement units under the interior ministry. Mr Saakashvili argued this system was more efficient. His opponents said accountability was reduced.

Nino Dolidze, a university professor at the Georgian Institute of Public Affairs, explained.

“Together with the ministry of justice, it was the flagship of all Saakashvili’s reforms,” she told The Bulletin. “But it also became the place where his success started to melt and decrease.”

One of the main promises of the Georgian Dream coalition during 2012 parliamentary elections was to break down this concentration of power.

From Aug. 1 a new State Security Service will take over counter-terrorism, counter-intelligence, anti-corruption, surveillance and other special operations responsibilities. The head of the State Security Service will be selected by the government and approved by parliament for a single six-year term.

ENDS

(News report from Issue No. 239, published on July 9 2015)

Uzbek authorities arrest 500 police

JULY 6 2015 (The Conway Bulletin) – The authorities in Uzbekistan arrested 500 police last year on various charges including corruption, torture and abuse of power, media reported quoting a source in the interior ministry. Rights groups have accused Uzbekistan of being a police state.

ENDS

(News report from Issue No. 239, published on July 9 2015)

Kazakh government pressures oil company

JULY 8 2015 (The Conway Bulletin) – Max Petroleum, a London-listed oil company operating in Kazakhstan said that it was operating under severe financial stress because of a back-tax bill imposed by the Kazakh government. Earlier this year, Max Petroleum said the drop in oil prices was pressuring its finances.

ENDS

(News report from Issue No. 239, published on July 9 2015)

Georgian Central Bank challenges budget plans

TBILISI, JULY 7 2015 (The Conway Bulletin) — Georgia’s Central Bank scorned as inadequate the government’s plan to cut spending in the face of a region-wide economic downturn.

The statement will increase tension between the Central Bank and the Georgian Dream Coalition government which have become embroiled in a row about oversight of commercial banks.

Central Bank chief Giorgi Kadagidze, who was appointed by the former government of President Mikheil Saakaashvili, and his allies have said the government’s criticism of him is politically motivated.

“Expenditures should be cut mostly at the expense of current spending,” the Central Bank said in a statement. “If the goal of the Parliament is to ease the loan burden caused by lari depreciation or to offset further downward pressure on lari, appropriate changes should be made in the [budget], which are not envisaged by the proposed draft of the budgetary amendments.” This is rare criticism.

Last month MPs voted to cut spending across different ministries. The lari has lost just over a quarter of its value since November 2014.

ENDS

(News report from Issue No. 239, published on July 9 2015)

Azerbaijani oil fund starts buying Chinese yuan

JULY 3 2015 (The Conway Bulletin) – Azerbaijan’s State Oil Fund, or SOFAZ, said that it had bought $500m worth of Chinese yuan, part of a policy to diversify its assets.

The purchase will also endear Azerbaijan to China, another unsaid reason for SOFAZ to buy yuan. China has been boosting its interest in the South Caucasus over past few years and Azerbaijan is looking for more allies.

“In order to further broaden and diversify the currency basket, SOFAZ has started making investments in Chinese Yuan,” SOFAZ said in a statement on their website.

And that wasn’t all. SOFAZ said it was looking at further exposure to China.

“Going forward, SOFAZ is planning to gain exposure to Chinese equity markets,” it said.

Azerbaijan’s oil fund is important because at $37b it is one of the biggest investment funds in the world. Its mission is to act as a social fund for the government to dip into in special circumstances and to fund large infrastructure projects.

It has begun to diversify its investments and, over the past couple of years, has built up a property portfolio in Europe and Asia.

It has been planning to buy into China ostentatiously to further diversify its investments.

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(News report from Issue No. 239, published on July 9 2015)

Rakishev buys another stake in Kazkommertsbank

JULY 3 2015 (The Conway Bulletin) – Kenes Rakishev bought an additional 2.61% stake in Kazkommertsbank from its founder and former chairman Nurzhan Subkhanberdin, further strengthening the Kazakh elite’s grip on one of the country’s largest banks.

The share purchase gives the 35-year-old Mr Rakishev, who is regarded as a trustee for more powerful members of the Kazakh elite and is best known for helping to buy a house in England from Prince Andrew in 2008, a 25.84% stake in the bank.

Samruk-Kazyna, Kazakhstan’s national welfare fund, owns 10.7% of the bank and an investment company called Alnair, which is also close to the Kazakh elite, owns a 28% stake in it.

The London-based Mr Subkhanberdin still controls around 32% of the bank but he has been gradually pushed out of Kazkommertsbank this year. His stake in the bank has dwindled and in March he was ousted as chairman.

Mr Subkhanberdin’s mistake had been to flirt with supporting Kazakhstan’s opposition.

In 2009 he wrote an open letter to Kazakh President Nursultan Nazarbayev questioning the imprisonment of the former head of the Kazakh uranium company Kazatomprom, Moukhtar Dzhakishev on various corruption charges.

Earlier this year, the Kazakh government, through Mr Rakishev, forced Kazkommertsbank to buy the debt-ridden BTA Bank.

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(News report from Issue No. 239, published on July 9 2015)

Senators write to Azerbaijani president

JULY 8 2015 (The Conway Bulletin) – Sixteen US senators have written to Azerbaijani president Ilham Aliyev calling on him to improve human rights in the country, Radio Free Europe/Radio Liberty reported. Mr Aliyev has previously accused the West of mounting a smear campaign against Azerbaijan.

ENDS

(News report from Issue No. 239, published on July 9 2015)

Tajikistan needs $2b to fix water supply

JULY 9 2015 (The Conway Bulletin) – Tajikistan needs to invest about $2b into its infrastructure if it wants to provide clean drinking water for its entire population, Alimurod Islomzoda, head of the Tajik state public utilities company, said.

This is a rare public omission in Tajikistan but Mr Islomzoda didn’t stop there. He also said that updating the system would take 80 years.

“To date, only some 57 percent of the country’s population has access to safe drinking water,” the Asia-Plus news agency quoted Mr Islomzoda as saying. “About $2b is needed and the full rehabilitation of the water supply systems will take 80-85 years.”

Tajikistan is one of the poorest countries in the world and with vital remittances from Russia dropping by around 40% this year because of a downturn in the Russian economy, the outlook is looking worse.

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(News report from Issue No. 239, published on July 9 2015)

Kazakh oil and gas company wants to sell Kashagan stake

JUNE 30 2015 (The Conway Bulletin) – Kazmunaigaz, Kazakhstan’s state-owned oil and gas company, said it would sell half its stake in the Caspian Sea Kashagan oil field to Samruk-Kazyna, the Kazakh sovereign wealth fund.

This is a curious arrangement as Samruk-Kazyna actually owns Kazmunaigas. It may be a way for Kazmunaigas, which has been badly hit by the sharp drop in energy prices, to borrow cash cheaply.

According to a press release from the London Stock Exchange, Kazmunaigas is seeking the consent of the shareholders in the North Caspian Operating Company (NCOC) , the consortium which operates the Kashagan, to sell half of its 16.88% share to Samruk-Kazyna for approximately $4.7b.

“Samruk-Kazyna’s agreement to purchase the Kashagan Shares reflects the State’s strong support of KMG (Kazmunaigas), as a strategic national asset,” the statement said.

Part of the cash raised by the sale would be used to pay $2.2b Kazmunaigas owes in fees relating to its 2013 purchase of the Kashagan stake from US company ConocoPhillips.

Kazmunaigas said that the sale would come with an option to buy back the stake in Kashagan for the same price between 2016 and 2020.

NCOC declined to comment.

Kazmaunaigas had run up large debts, partly because of the oil price slump. Halyk Bank analyst Sabina Amangeldi said in a note last month that the company already has seven Eurobond issues outstanding worth a total of $8.8b.

She also noted that lower oil prices had knocked Kazmunaigas’ revenues by around a third and that profit had been wiped out.

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(News report from Issue No. 238, published on July 2 2015)

Tajikistan’s Central Bank cuts jobs

JULY 1 2015 (The Conway Bulletin) – Tajikistan’s Central Bank is cutting nearly 200 jobs as it restructures and streamlines its operations, media reported. It’s unclear exactly what the restructuring entails but media said that most jobs would be lost at the Central Bank’s offices in Dushanbe.

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(News report from Issue No. 238, published on July 2 2015)