Tag Archives: Kazakhstan

Kazakh Mangistau receives inflow of migrants

SEPT. 14 2015 (The Conway Bulletin) – Almaty and the oil-rich region of Mangistau in the west of the country are the only regions in Kazakhstan receiving a significant inflow of people looking for work, data published on the ranking.kz website reported. The data also showed that most of the people moving to these areas settled in villages rather than cities.

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(News report from Issue No. 248, published on Sept. 18 2015)

CPC pipeline upgrades pumping stations in Kazakhstan

ALMATY, SEPT. 14 2015 (The Conway Bulletin) — The Caspian Pipeline Consortium (CPC), has finished upgrade work to two pumping stations that will boost the capacity of its oil pipeline running from west Kazakhstan to Russia’s Black Sea port of Novorossiysk.

Plans to increase the capacity of the Tengiz field near Atyrau have been delayed because of low oil prices, but the gradual expansion of the CPC’s capacity is still important.

Specifically, the latest upgrade work was focused on the pipeline’s two pumping stations in Kazakhstan. The upgrade will boost the flow of oil through the pipeline to 38m tonnes of oil from 35m.

This is a stepping stone towards hitting higher capacity. Nikolai Savin, a deputy vice-president at Russian pipeline company Transneft, explained the consortium’s ambitions.

“The expansion will allow us to increase the volume of transported oil to 67-70m tonnes a year,” local media quoted him as saying. “In the future, the Kazakh fields at Tengiz, Karachaganak and Kashagan will ship around 55m tonnes through CPC.”

CPC, which was established in 2001, is an international pipeline jointly operated by the Russian and Kazakh governments together with national and multinational oil companies led by US’ Chevron. Chevron is also the lead Western partner developing the Tengiz field in the Tengizchevroil consortium (TCO).

The Tengiz field is Kazakhstan’s main oil producer, pumping roughly 27m tonnes of oil each year. This is a third of Kazakhstan’s total oil production. Almost all of the oil produced by Tengiz is exported via CPC.

For years, TCO has been planning to expand production. The project was suspended, though, earlier this year because of the sustained low oil prices, frustrating both investors and the Kazakh government.

According to Sauat Mynbayev, Chairman of Kazmunaigas, Kazakhstan’s state-owned company which holds shares in both CPC and TCO, a final investment decision for Tengiz will be made in Jan. 2016 (Sept. 17). In any case, he said costs had been cut.

“When it was planned, the TCO expansion was quoted at $38b,” Mr Mynbayev told the Interfax news agency. “In the current circumstances, we decided to re-negotiate with all contractors to bring the cost down to around $34b.”

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(News report from Issue No. 248, published on Sept. 18 2015)

Mixed messages air over Kazakh President’s daughter promotion

SEPT. 14 2015, ALMATY (The Conway Bulletin) — Dariga Nazarbayeva, eldest daughter of Kazakh president Nursultan Nazarbayev, officially quit as a member of parliament to begin her new job as a deputy PM.

Analysts have said that her promotion to government on Sept. 11 may have been the first stage in her journey to take over from her 75-year- old father when retires.

Certainly in Almaty, Kazakhstan’s largest city and its financial centre, people interpreted her promotion as the start of dynastic succession.

David Smirnov the owner of a small trading business, said that he thought Ms Nazarbayeva would be a good fit for the top job.

“How could such a man have a bad daughter?” he asked, reflecting the popular support for President Nazarbayev. “So much money has been invested into her. She will be better than any other corrupt official, for sure.”

There has no official commentary from the Presidential Palace regarding Ms Nazarbayeva’s promotion.

Nessibeli Kozhakhmetova, a student, held a similar point of view to Mr Smirnov, the business owner.

“She knows from childhood how her father have worked,” she said. “She is better than someone whom we are not familiar with. She is trustworthy and the most reliable of the options.”

But, importantly, while most people told a Bulletin correspondent that they supported Ms Nazarbayeva’s promotion, there were some divergent opinions.

Aleksey, an advertising manager, was walking down a main street. He stopped and said quietly: “She might be a President but there is no trust in either the Presidency or Dariga.”

And KIMEP economics student Kamila Mukushova said Kazakhstan needed a break from the past and the Nazarbayev family’s grip on power.

“If she will be the President, then everything remains the same in the country,” she said. “We will still be dependent on Russia. We need a more open-minded leader.”

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(News report from Issue No. 248, published on Sept. 18 2015)

Kazakhstan’s Mangistau region receives inflow of migrants

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(News report from Issue No. 248, published on Sept. 18 2015)

Kazakhstan’s CBank halts tenge slide

SEPT. 15 2015 (The Conway Bulletin) – Kazakhstan’s Central Bank intervened in the money markets to stop the tenge from dropping below 270/$1. Kairat Kelimbetov, the Central Bank chief, had told the FT earlier in the week that the Bank would not intervene again after it ditched a peg to the US dollar last month. The tenge is now trading around 266/$1.

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(News report from Issue No. 248, published on Sept. 18 2015)

Business comment: Halyk Bank & The Money Markets

SEPT. 18 2015 (The Conway Bulletin) — On Sept. 17, for the first time the Central Bank of Kazakhstan published data on the activities of Kazakh banks in the currency market. This decision greatly pleased liberal economists and advocates of transparency in Kazakhstan’s banking sector. But it didn’t please everybody. In one table, the Central Bank listed the amount of US dollars that banks

purchased and sold the day before. If a bank buys a large quantity of US dollars, it suggests that it may be engaging in speculation activities, or at least this is what the public could read into the data. By unveiling turnaround data only, the Central Bank irked Halyk Bank, who ranked first for volume traded.

The next day, in a rare complaint, Halyk Bank said the figures were “incomplete and misleading”.

Despite having traded $58m (around 12% of the whole banking sector), Halyk said it had been a net seller by $34m.

This is a much more patriotic figure.

And the bank, owned by powerful businessman Timur Kulibayev and his wife Dinara Nazarbayeva, now wants the Central Bank to publish the detailed numbers since Aug. 17, the day before the first adjustment to the tenge/dollar exchange rate, which led to the decision to let the tenge off its dollar peg, effectively spurring a new devaluation.

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(News report from Issue No. 248, published on Sept. 18 2015)

Lithuanian railway to open in Kazakhstan

SEPT. 14 2015 (The Conway Bulletin) — Lithuanian Railways will open a representative office in Kazakhstan’s capital Astana, the company said in a statement. “Kazakhstan is Lithuania’s major railway partner in Central Asia. Stasys Dailydka, a director at Lithuanian Railways, said trade volumes, mainly minerals, had been increasing rapidly over the past six years.

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(News report from Issue No. 248, published on Sept. 18 2015)

Kazakh state company director resigns

SEPT. 8 2015 (The Conway Bulletin) — Abat Nurseitov resigned as general director of KMG EP, the London-listed unit of Kazakhstan’s state oil and gas company. Mr Nurseitov had been general director since January 2013. Dastan Abdulgafarov, the CFO, was appointed interim CEO.

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(News report from Issue No. 247, published on Sept. 11 2015)

Kazakhstan justifies soft drinks tax

SEPT. 7 2015 (The Conway Bulletin) — The Kazakh government said a new tax on the extraction of groundwater is justified despite complaints from soft drinks producers, as companies have previously underpaid for water. “It is important to note that we have a serious shortage of drinking water in Kazakhstan,” Shafkhat Kudabayev, of the State Revenue Committee, told vlast.kz. The soft drink industry lobby groups have said the new tax will put companies out of business.

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(News report from Issue No. 247, published on Sept. 11 2015)

Comment: Dariga Nazarbayeva becomes deputy PM

SEPT. 11 2015 (The Conway Bulletin) – The signs have been there for all to see for the past two or three years. Now there can be no denying it. Kazakh President Nursultan Nazarbayev appears to want to set his daughter, Dariga Nazarbayeva, up as his successor.

Her rehabilitation into the mainstream of Kazakh politics has been carefully managed. First she won back a seat in the 2012 parliamentary elections, then in 2014 she appeared next to her father after his State-of-the-Nation speech and then she started to take over increasingly important roles, including deputy speaker of parliament.

More recently, Mr Nazarbayev has spoken about the Asian model of democracy. This was, it now appears, code for managed dynastic succession.

Kazakhstan needs stability at the moment. It is moving through difficult economic territory and it needs strong, talented, leadership.

But it also needs choice.

Ms Nazarbayeva, who has sung opera at the Bolshoi Theatre in Moscow, certainly has the charisma, authority and the most famous surname in Kazakhstan, but is she the right person to lead Kazakhstan in the post-Nursultan era?

Infamously in 2013, at a parliamentary committee meeting, she described disabled children as freaks birthed by teenagers having sex too young. She sounded out of touch with ordinary people and drew heavy criticism.

There are other candidates, but Ms Nazarbayeva does now appear to be in pole position. What is certain is that the succession issue in Kazakhstan is, once again, at the forefront of the country’s politics.

By James Kilner, Editor, The Conway Bulletin

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(News report from Issue No. 247, published on Sept. 11 2015)