Tag Archives: Kazakhstan

Helicopter crash kills 5 in southern Kazakhstan

JAN. 28 2016 (The Conway Bulletin) – A helicopter carrying a sick child to hospital crashed in a canyon in southern Kazakhstan killing all five people aboard, media reported quoting the Kazakh emergency services. It was unclear what caused the crash. Kazakhstan has a poor safety record for helicopters. A few days earlier another two-person helicopter had also crashed in southern Kazakhstan.

ENDS

(News report from Issue No. 265, published on Jan. 29 2016)

Business comment: Tough times for banks

JAN. 29 2016 (The Conway Bulletin) — Government policies towards the banking sector are key to survival during tough economic times.

In this new downturn, which has already lasted longer than the 2008/9 Financial Crisis, commodity prices have collapsed, hitting oil- exporting countries.

Kazakhstan and Azerbaijan have been among the hardest-hit economies in the South Caucasus and Central Asia.

In mid-2014, Kazakhstan planned to restructure its banking sector by imposing greater capital requirements. The Central Bank wanted the country’s banks to

increase their capital from 10b to 100b tenge ($54m to $543m at the time).

But in August 2015 the Central Bank abandoned the tenge peg to the US dollar, allowing it to fall sharply.

This relieved pressure on its currency but knocked plans to increase capital requirements for banks.

Bank deposits in Kazakhstan are now insured by the government. If the Central Bank had pushed forward with its new capitalisation plan after ditching the tenge-US dollar peg it would have meant that smaller banks would have had to close. The government would then have been under pressure to repay customers who had lost savings. Kazakh officials dodged this by scrapping the plan.

Azerbaijan, by contrast, has pushed ahead with increasing capital requirements at banks despite a 35% fall in its currency over the past month. This has forced small banks to close and larger banks to merge.

All this before introducing universal insurance on deposits. Until now, only savers with up to 30,000 manat ($18,400) were insured.

Time will tell which of the two strategies pays off.

ENDS

(News report from Issue No. 265, published on Jan. 29 2016)

LG Group scraps project in Kazakh city

JAN. 26 2016 (The Conway Bulletin) – South Korea’s LG Group dropped a $4.2b project to build a petrochemical plant near Atyrau in western Kazakhstan because of continued low oil prices. The cancellation is perhaps the biggest project to be ditched during the current economic slowdown.

ENDS

(News report from Issue No. 265, published on Jan. 29 2016)

Kazakh bank unveils strategy

JAN. 26 2016 (The Conway Bulletin) — Kazkommertsbank, one of Kazakhstan’s largest lenders, said in a statement that it is working with international consultants on developing a new business strategy to improve the quality of its assets after a merger last year with the debt-ridden BTA Bank. Earlier this month, ratings agency Fitch downgraded Kazkommertsbank’s long-term credit to CCC from B- because of the fall in the value of the tenge.

ENDS

(News report from Issue No. 265, published on Jan. 29 2016)

Hexagon Mining to increase its presence in Kazakhstan

JAN. 22 2016 (The Conway Bulletin) — Arizona-based Hexagon Mining wants to increase its presence in Kazakhstan after it signed a deal with local miner KAZ Minerals to develop two open pit copper fields. Hexagon will work with KAZ Minerals at Bozshakol and Aktogay, two of the company’s most promising greenfield sites.

ENDS

(News report from Issue No. 265, published on Jan. 29 2016)

Stock market: KAZ Minerals

JAN. 29 2016 (The Conway Bulletin) — In general, it was a positive week for Central Asia and South Caucasus focused companies, mainly because oil prices bounced back from the 12-year-lows touched last week.

After posting positive company results, shares in KAZ Minerals, previ- ously called Kazakhmys, shot up in the London Stock exchange continuing their positive trajectory picked up in mid-January. It finished trading on Jan. 28 at 122.75p – a three month high.

In its annual results KAZ Minerals said it was satisfied with its output despite a drop in copper cathode production. Although it has suffered from a slump in commodities prices, the KAZ Minerals is enjoying the cheap tenge currency. KAZ Minerals is focused on exports, so its revenue base, denominated in dollars, is solid.

A strong KAZ Minerals performance gives Central Asia/South Caucasus a cheerleader in this strife-laden period dominated by low oil prices.

ENDS

(News report from Issue No. 265, published on Jan. 29 2016)

Currency booths in Kazakh city

JAN. 26 2016 (The Conway Bulletin) – Currency exchange booths in Almaty refused to change US dollars after the price of oil started to rise slightly, highlighting the fears and weaknesses of the Kazakh economy. Like the rest of the region, Kazakhstan’s currency has slumped with the decline in oil price. Unlike some of its neighbours, Kazakhstan hasn’t imposed heavy currency controls.

ENDS

(News report from Issue No. 265, published on Jan. 29 2016)

Investor buys buses in Kazakh city

JAN. 22 2016 (The Conway Bulletin) — Green Bus Company, a private transport company from Shymkent, has bought a 70% stake in Almatyelectrotrans, the company in charge of public transit in Almaty. Baurzhan Baibek, mayor of Almaty, said the new investor has pledged to buy 200 new buses. Almaty City will retain a 30% share in Almatyelectrotrans. Almaty’s transport network has been mired in controversy after a crash last year injured several people. Dozens of bus drivers have also protested over a new ticketing system.

ENDS

(News report from Issue No. 265, published on Jan. 29 2016)

Kazakhstan sells arms to Jordan

JAN. 26 2016 (The Conway Bulletin) – Kazakhstan has sold military equipment and weapons to Jordan, Kazakh defence minister Imangali Tasmagambetov said in a statement after a delegation returned from the Middle Eastern country. Mr Tasmagambetov said Kazakhstan Paramount Engineering, a joint venture with South African arms manufacturer Paramount, will supply several Arlan armoured vehicles to Jordan. The joint venture started producing the Arlan armoured personnel carriers last year. It set up the partnership in 2014.

ENDS

(News report from Issue No. 265, published on Jan. 29 2016)

Tethys looks for a new partner as debts mount up in Kazakhstan

ALMATY, JAN. 22 2016 (The Conway Bulletin) — Guernsey-based Tethys Petroleum said it will seek alternative funding after Kazakhstan-based Olisol missed a payment on a share deal agreed last year.

In a press statement, Tethys said it had received just $5m of the $15m promised by Olisol. According to Tethys, privately-owned Olisol missed the Jan. 22 deadline to send a $2m tranche of its commitment to secure a stake in the company.

Olisol has said the delay was due to currency controls in Kazakhstan linked to the sharp depreciation of the Kazakh tenge over the few past months.

And Tethys is still hopeful that it will receive Olisol’s funding.

“Should the overdue funds under the interim facility arrive in a timely manner however, Tethys will continue to work with Olisol to close the wider transaction,” Tethys, which is involved in oil and gas projects across Georgia and Central Asia, said.

Tethys needs cash to meet its debt deadlines. Last year it missed a couple of consecutive cash calls at its project in Tajikistan, the Bokhtar exploration block. Its partners in the project, China’s CNPC and France’s Total, have called on it to drop out. The Tajik government has also said it would be interested in taking a stake in Bokhtar.

ENDS

(News report from Issue No. 265, published on Jan. 29 2016)