Tag Archives: Kazakhstan

Sliding rouble pressures Kazakhstan’s tenge

OCT. 31 2014 (The Conway Bulletin) – A 40% drop in the value of the rouble this year is placing extreme pressure on Russia’s main trade partners, including Kazakhstan, experts have said.

Banking analysts have said that it is increasingly likely the Kazakh Central Bank will have to follow the rouble and devalue its own tenge currency for the second time this year.

The Tengrinews website quoted Raimbek Batalov, director at Raimbek Group, as saying that the fluctuating value of the tenge was hurting exporters. Kazakh goods are now far too expensive for their main export market — Russia.

And reports have emerged from across Kazakhstan that people are rushing to banks to sell their tenge before an imminent devaluation.

Falling oil prices and sanctions imposed by the West have pressured the rouble while the Kazakh Central Bank has insisted on keeping the tenge pegged to the US dollar since its 20% devaluation in February.

Luca Anceschi, professor of Central Asian Studies at the University of Glasgow explained that the rouble was introduced in 1993 to reduce Kazakhstan’s dependency on the rouble. Instead, he said, the opposite has happened.

“The policies pursued since 1993, if anything, have de facto re-established such dependency,” he said.

Increased economic integration with the Eurasian Economic Union gives Kazakh President Nursultan Nazarbayev even less room to manoeuvre.

A second devaluation, to keep pace with Russia’s currency slide, must be approaching fast despite the Central Bank’s denials.

ENDS

(News report from Issue No. 207, published on Nov. 5 2014)

Russia to supply fuel to Kazakhstan

SEPT. 30 2014 (The Conway Bulletin) – Russian energy companies Lukoil and Bashneft will supply Kazakhstan with extra petrol and diesel fuel to make up for the current shortfall, Russian news agency RIA-Novosti quoted Russia’s energy minister, Alexander Novak, as saying. Kazakhstan has a shortage of refinery capacity which is causing shortages.

ENDS

(News report from Issue No. 202, published on Oct. 1 2014)

Putin meets Kazakh President

SEPT. 30 2014 (The Conway Bulletin) – In a show of mutual support, Russian president Vladimir Putin travelled to Atyrau in west Kazakhstan after a meeting of Caspian Sea littoral states in Russia to meet with Kazakh president Nursultan Nazarbayev. Russia is looking for allies over its stand-off with the West over intervention in Ukraine.

ENDS

(News report from Issue No. 202, published on Oct. 1 2014)

Kazakhstan to issue dollar denominated bond

SEPT. 25 2014 (The Conway Bulletin) – Kazakhstan will issue a US dollar denominated bond later this year, its first since 2000, Reuters reported. Government officials have launched a roadshow to drum up support for the debt issue. These are difficult times, though, because of the knock-on effect of sanctions on Russia.

ENDS

(News report from Issue No. 202, published on Oct. 1 2014)

Kazakh grain harvest drops

SEPT. 29 2014 (The Conway Bulletin) – Kazakhstan’s grain harvest is likely to top 17m tonne this year, media quoted the Kazakh agriculture ministry as saying. This is slightly down on 2013 but is more or less in line with early predictions. Grain has become an important commodity for Kazakhstan.

ENDS

(News report from Issue No. 202, published on Oct. 1 2014)

EBRD invests in Kazakh railway company

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.

ENDS

(News report from Issue No. 202, published on Oct. 1 2014)

Shares plummet for one of Kazakhstan’s biggest banks

SEPT. 30 2014 (The Conway Bulletin) – Shares in Kazkommertzbank have nose-dived since it bought a stake in BTA Bank from the Kazakh government.

By the end of September, shares in KazKom, as the bank is commonly known, traded at $1.65 on the Kazakh Stock Exchange, down by 37.5% since July when it completed buying nearly half of BTA.

Analysts said the drop highlighted the toxic nature of BTA’s bad debt portfolio and a drop in profit. KazKom said profit for the first half of 2014 was down by 6%.

A source from the banking industry said: “Most bad loans are with BTA which is unable to recover them from its debtors. This entails a huge cost.”

Mountains of bad debt still holds back Kazakhstan’s financial sector, a legacy of the Global Financial Crisis of 2008/9 when the government had to buy up a handful of banks. One of these was BTA Bank.

At the end of last year, the Kazakh government said it wanted to sell its shares in government-owned banks.

Kenes Rakishev, a young Kazakh businessman with strong links to the elite and KazKom, controlled by the London- based businessman Nurzhan Subkhanberdin agreed in February to buy the bank. At the time, sources with knowledge of the Kazakh finance centre said buying BTA Bank made no business sense for KazKom. Instead, they said, it was a political move by Mr Subkhanberdin to win favour.

ENDS

(News report from Issue No. 202, published on Oct. 1 2014)

Individuality shunned in Kazakh film industry

ALMATY/Kazakhstan, OCT. 1 2014 (The Conway Bulletin) — Kazakhstan is enjoying something of a renaissance in film-making but it’s not easy, as one young script-writer explained over tea.

Erlan Suluhan, 25, is one of many Kazakh students who received a scholarship from the US government to pursue their studies in the United States. Last year he returned from studying at the Academy of Art University in San Francisco. One of his projects was a short movie depicting the adventures of an older woman who gets lost inside her own building.

“I was trying to find the turning point between the formation of one’s identity and the crisis that inevitably emerges,” he said in an interview in a cafe in Almaty.

He poured himself another cup of tea from a porcelain pot.

“Looking at Kazakhstan through the prism of the development of single identities could spark questions that are silenced nowadays within the society,” Suluhan said.

His film, 18’21, was acclaimed at the Cannes Festival this year. In Kazakhstan it was shunned.

KazakhFilm, the state-owned agency refused to support him, because he carried out his project independently. The message the film carried, about individualism, may have rankled too.

Still, KazakhFilm has been enjoying some success over the past couple of years. Last year another film by a Kazakh writer won the second prize at the Berlin Film Festival.

Looking ahead to his next film, Suluhan was sanguine about the complexities of writing films about personal choice in a Kazakhstan where the government places more emphasis on conformity.

“I don’t want to get explicitly political, because I don’t want to tell the audience what to think,” he said. “Instead, I’m interested in poking, rousing, inducing people to reflect on themselves by showing the significance of minor everyday chores and their impact on the creation of the self.

ENDS

(News report from Issue No. 202, published on Oct. 1 2014)

Kazakh President snubs green energy

SEPT. 30 2014 (The Conway Bulletin) – Kazakh president Nursultan Nazarbayev hinted at a meeting with Russian President Vladimir Putin that he may not be as enamoured with green energy as he has suggested.

This is important because Kazakhstan’s government has spent time and money promoting itself as a standard bearer for Green Energy, including devoting much of the sales pitch of its centrepiece event EXPO-2017 in Astana to it.

“I personally do not believe in alternative energy, such as wind, and solar,” media quoted Mr Nazarbayev as saying after meeting Mr Putin in Atyrau on the Caspian Sea coast.

“I think the shale euphoria also does not make much sense. Oil and gas are our main horses and we do not need to be afraid that they are fossil fuels.”

This view may not be that surprising, afterall the economies of both Kazakhstan and Russia are based on oil and gas exports.

Even so, Kazakhstan has given the impression it wants to move on from its reliance on oil and gas for its wealth.

Throughout Kazakhstan’s cities advertise EXPO-2017 with posters carrying the slogan ‘The Energy of the Future’ against a background of a green valley filled with wind turbines and solar panels.

Kazakhstan’s future energy policy is further complicated because it has agreed a deal with Russia to build a new nuclear power station.

ENDS

(News report from Issue No. 202, published on Oct. 1 2014)

Kazakh car production rises

SEPT. 19 2014 (The Conway Bulletin) – Kazakhstan produced 6% more cars between January and August this year compared to the same period in 2013, the state’s statistics committee reported. The data shows that the Kazakh economy is still relatively buoyant despite the decline of the all-important Russian economy.

ENDS

(News report from Issue No. 201, published on Sept. 24 2014)