JAN. 26 2016 (The Conway Bulletin) -The organisers of Kazakhstan’s flagship EXPO-2017 event have cut its budget by 53b tenge ($140m) to keep pace with demands from the government to slash spending during this period of low oil revenue. Previously, nothing had seemingly been too expensive or too extravagant for EXPO-2017.
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Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 265, published on Jan. 29 2016)
JAN. 28 2016 (The Conway Bulletin) — Despite increasing copper production by 300% in 2015, KAZ Minerals still posted a 3% reduction in copper cathode, its finished product. The company, focused on Kazakhstan, said the quality of the copper ore it mined was below average. London-listed KAZ Minerals, previously known as Kazakhmys, also said its copper cathode production dropped from 83,500 to 81,100 tonnes.
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(News report from Issue No. 265, published on Jan. 29 2016)
JAN. 27 2016, ALMATY/Kazakhstan (The Conway Bulletin) — Human rights abuses, crackdowns on freedom of speech and endemic corruption still blight Central Asia and the South Caucasus, western watchdogs said in a series of annual reports.
According to New York-based Human Rights Watch (HRW) civil liberties worsened in Kazakhstan and Azerbaijan last year as an economic crisis battered the region.
“Central Asian governments are becoming increasingly intolerant of dissent, criticism, and human rights scrutiny – an alarming trend,” said Hugh Williamson, Europe and Central Asia director at HRW.
Specifically, Mr Williamson said that Kazakhstan had used courts to silence opposition figures and that Azerbaijan’s crackdown on journalists and rights advocates was “unprecedented.”
Freedom House, another US- based civil rights lobby group, also criticised governments in Central
Asia and the South Caucasus for their record on freedom of speech.
“The [November parliamentary in Azerbaijan] elections followed another year of intense suppression of civil society and independent media,” Robert Ruby, Freedom House’s director of communication, said.
Corruption watchdog Transparency International projected a slightly more positive outlook for the region but, while Azerbaijan, Armenia, Georgia, Kyrgyzstan and Tajikistan all improved their rankings in its global index, absolute scores in the region were mostly unchanged or down from 2014.
Transparency International’s director for Europe and Central Asia, Anne Koch said little had improved.
“While a handful of countries in Europe and Central Asia have improved, the general picture across this vast region is one of stagnation,” she said in the report.
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(News report from Issue No. 265, published on Jan. 29 2016)
JAN. 25 2016 (The Conway Bulletin) — China’s COFCO and Rifa Holding Group were part of a group of Chinese companies to sign a $1.7b investment deal in Kazakhstan’s agribusiness, Gulmira Isayeva the Kazakh deputy minister of agriculture said. Twelve of the 19 projects will focus on the Almaty region. The projects will focus on processing animal and vegetable products for export to China.
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(News report from Issue No. 265, published on Jan. 29 2016)
JAN. 25 2016 (The Conway Bulletin) — Scottish distiller Inver House, which produces a range of alcoholic drinks from whisky to gin to beer, said it would target Kazakhstan, among other countries, after a 20% increase in production following a £10m ($14.3m) investment in its manufacturing site in Scotland.
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(News report from Issue No. 265, published on Jan. 29 2016)
JAN. 21 2016 (The Conway Bulletin) – Kazakhstan’s Central Bank increased interest rates on tenge held bank deposits by four percentage points to 14% in an attempt to defend the value of its currency. The Central Bank has maintained different interest rates on tenge and US dollar deposits for several years. US dollar deposits now earn interest of 2%, down from 3%.
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(News report from Issue No. 264, published on Jan. 22 2016)
JAN. 17 2016 (The Conway Bulletin) — Italian beef processing company Inalca and Kazakh company Aktep signed a deal to create a joint venture and build new factories in the country. The new company will increase Aktep’s current production five-fold to 12,000 tonnes per year of meat products. Inalca Eurasia, Inalca’s daughter company, said it will invest €100m ($109m) in the project.
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(News report from Issue No. 264, published on Jan. 22 2016)
JAN. 22 2016 (The Conway Bulletin) – There is much excitement in our region over the emergence of Iran after over a decade of US-imposed sanctions.
New flight connections, new pipelines, new transmission lines and more is what a sanctions-free Iran could bring to the South Caucasus and Central Asia.
Iran has struck a deal with Air Astana to open the Almaty-Tehran air route. It has also revived talks with Turkmenistan about gas fields and pipelines around the Caspian.
Potentially, a new network to the east of the Caspian Sea could facilitate the European Union’s plans to import gas from the region. Azerbaijan may well be interested in such deals as well. In addition, Iran could become an important supplier of gas to both Armenia and Georgia.
On the flip side, Iran’s accession to the global oil market will undoubtedly drive the price of oil further down, it has huge oil reserves and production capacity, increasing the pressure on the budgets of oil-exporting economies in the region.
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Editorial from Issue No. 264, published on Jan. 22 2016)
JAN. 21 2016 (The Conway Bulletin) – Inflation in Kazakhstan in 2015 measured 13.6%, nearly double the rate of 2014, media reported quoting the state statistics agency. The final tally confirms that prices increased rapidly after a tenge devaluation in August. The tenge has lost around 55% of its value since Feb. 2014.
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(News report from Issue No. 264, published on Jan. 22 2016)
JAN. 22 2016 (The Conway Bulletin) — At the end of December, Berik Otemurat, a senior official at Kazakhstan’s Central Bank, picked up the phone and called several newspapers to speak out against the way the sovereign wealth fund was being managed.
He was promptly sacked after his quotes started populating articles. He had said that Kazakhstan’s sovereign wealth fund to be doomed.
Mr Otemurat’s argument was that the sovereign wealth fund was risk averse and that it was pilfering away its cash on low yield investments making low returns.
Low oil prices and the economic slump would combine, he said, to wipe away the fund’s reserves in 6 to 7 years.
Timur Kulibayev, President Nursultan Nazarbayev’s son-in-law and powerful businessman, spoke out against Kazakh money managers to but he’s not in any real danger of losing his job.
He has criticised for months the behaviour of the Central Bank and, effectively, said their management of the economic crisis has been poor.
Mr Kulibayev repeated his criticism last week. His bottom line was: “The government cannot continue spending its reserves to prop up the tenge or the reserves will be extinguished in three years.”
Of course, Mr Kulibayev, the second-richest man in Kazakhstan, is in a much stronger position than Mr Otemurat, so his words will not make him a pariah of the elite. This parallel goes to show that there are only few people who can speak out against Kazakhstan’s economic policy and face no consequences.
The managers of the sovereign wealth fund have said they will change their policy this year. Let’s see if they can stop the drain.
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(News report from Issue No. 264, published on Jan. 22 2016)
