NOV. 3 2014 (The Conway Bulletin) – The Islamic Development Bank has agreed to loan Uzbekistan $100m to build extra rural housing, media reported. This is the second major loan by intergovernmental agencies for rural housing in Uzbekistan. In 2011, the Asian Development Bank approved a loan of $500m.
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(News report from Issue No. 207, published on Nov. 5 2014)
SEPT. 24 2014 (The Conway Bulletin) – The European Bank for Reconstruction and Development (EBRD) sold its 5% stake in Bank of Georgia.
The sale ends the EBRD’s mission to support Bank of Georgia after the 2008 Global Financial Crisis. It took control of the stake in 2012 after a financial aid package put together in December 2008 was converted into shares.
“The EBRD’s role in supporting Bank of Georgia in the aftermath of the 2008 crisis is now complete,” Reuters quoted Nick Tesseyman, the EBRD MD, as saying.
“The EBRD will continue to provide debt financing to Bank of Georgia going forward as part of our continued support to the Georgian financial sector.”
The Bank of Georgia is publicly listed on the London Stock Exchange.
In many ways the sale of the EBRD’s 5% stake in Bank of Georgia is a success for Georgia as a country. The EBRD would not have sold its stake if it didn’t think that the bank was stable enough and if there wasn’t enough investor interest in Georgia and its finance industry.
Bank of Georgia CEO Irakli Gilauri acknowledged this.
“This transaction illustrates the depth of support for the bank from international investors and signals increasing investor interest in Georgia’s capital market,” he said.
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(News report from Issue No. 202, published on Oct. 1 2014)
SEPT. 29 2014 (The Conway Bulletin) – The European Bank for Reconstruction and Development (EBRD) has agreed to lend Kazakhstan’s railway company $165m as part of its upgrade plan, media reported. This is important because it shows that Kazakhstan continues to attract investment despite declining economic growth rate predictions.
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(News report from Issue No. 202, published on Oct. 1 2014)
SEPT. 19 2014 (The Conway Bulletin) – The World Bank has offered to lend Kyrgyzstan $25m to help improve energy infrastructure ahead of the winter, media reported. Kyrgyzstan is facing a potential energy crisis this winter with water levels in its dams at a low. Energy shortages trigger frustration which bubbles over into public anger.
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(News report from Issue No. 201, published on Sept. 24 2014)
JULY 25 2014 (The Conway Bulletin) – Azerbaijani finance looks in good shape.
At a local finance level, the European Bank for Reconstruction and Development (EBRD) has handed a $42m loan to Demirbank earmarked to help smaller businesses raise funds.
At an international level, Citi Group said it is now selling more Azerbaijani debt than at any time since 2008.
Both pieces of news are good general indicators for the Azerbaijani economy. Most analysts agree that the economy is in pretty good shape although domestic consumer lending needs to be tapered.
Bloomberg quoted Citi Group as saying that it had debuted nearly $15m of debt for Kapital Bank having issued $38.5m of debt for the International Bank of Azerbaijan earlier this year.
“Investors are seeking risk in emerging markets as central bank stimulus measures suppress returns on debt issued by companies in developed nations,” Bloomberg wrote.
Even so, the yield on the Azerbaijani bank debt is high at nearly 9%, reflecting the risk involved.
The Demirbank deal is more the culmination of a long term project by the EBRD to improve access to finance for smaller businesses in Azerbaijan. In April AccessBank, another Azerbaijani bank, secured a $60m loan from 16 lenders also for micro-finance.
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(News report from Issue No. 193, published on July 30 2014)
JULY 25 2014 (The Conway Bulletin) – The European Bank for Reconstruction and Development (EBRD) has agreed to loan Tajikistan $50m to modernise a vital power station, media reported. The Qairokkum plant, built in 1958, is the only power generating plant in the north of the country and supplies electricity to 500,000 homes.
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(News report from Issue No. 193, published on July 30 2014)
JUNE 24 2014 (The Conway Bulletin) – Media in Uzbekistan reported that a drought in the south of the country means that crop expectations are low.
The uznews.net opposition website said that harvest would be 50% lower than normal on rain-fed crops.
“It did not rain this April and we expect smaller harvests,” uznews.net quoted a farmer as saying.
Officials have not commented although signs of drought are important for policymakers. Droughts and a lack of income can trigger social discontent. Throughout the year, reports have surfaced from Uzbekistan of rising prices.
Uzbekistan is particularly prone to drought. Much of its agriculture is under-resourced and lacking in investment and the land is generally arid. A government report in 2012 said that 76% of the population was living in areas at risk of drought.
And the timing of the uznews.net report is pertinent. The state’s Committee for Natural Protection organised a roundtable on June 29 specifically to discuss desertification and drought in Uzbekistan. The World Bank and the Asian Development all provide various forms of financial assistance aimed at reducing drought in Uzbekistan.
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(News report from Issue No. 190, published on July 2 2014)
JUNE 25 2014 (The Conway Bulletin) – A draft report by the World Bank appears to give a green light for Tajikistan to build its controversial Rogun dam which Tajik President Emomali Rakhmon hopes will provide much need electricity. Human rights workers have said that the giant dam will force 42,000 people from their homes.
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(News report from Issue No. 190, published on June 25 2014)
JUNE 12 2014 (The Conway Bulletin) – The World Bank agreed to give Uzbekistan a $260m loan to improve irrigation in its agriculture, media reported, angering human rights activists who accuse Uzbekistan of using child labour to pick cotton. Cotton is one of Uzbekistan’s biggest exports although many Western fashion brands refuse to use it in their clothing.
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(News report from Issue No. 189, published on June 18 2014)
MAY 23 2014 (The Conway Bulletin) – Following the European Bank for Reconstruction and Development (EBRD) and the Asian Development Bank (ADB), the Islamic Development Bank (IDB) pledged to lend Kazakhstan an extra $2b over the next three years. The deal was signed at the annual Astana Economic Forum.
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(News report from Issue No. 186, published on May 28 2014)
