Tag Archives: Kazakhstan

Rocket crashes in Kazakhstan

JULY 2 2013 (The Conway Bulletin) — An unmanned Russian rocket crashed on take-off at the Baikonur launch site, south Kazakhstan. The rocket smashed into the empty steppe sending an orange cloud of toxic fumes into the air. Rain later dispersed the clouds but the crash raised concerns both about the safety and future of the Baikonur programme and about potential damage to the local environment.

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(News report from Issue No. 142, published on July 8 2013)

Kazakh energy minister sacked

JULY 3 2013 (The Conway Bulletin) — Kazakh President Nursultan Nazarbayev sacked his energy minister, reportedly because of continued delays to the Kashagan oil project, Kazakhstan’s flagship energy development. Sauat Mynbayev had been energy minister since 2007. He moves to head Kazmunaigas, the Kazakh state energy company. Uzakbai Karabalin, a technocrat, becomes the new energy minister.

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(News report from Issue No. 142, published on July 8 2013)

South Korean confectionery buys into Kazakh business

JULY 2 2013 (The Conway Bulletin) — Recognisable by its unreformed Soviet style packaging and logo, Rakhat chocolate is iconic in Kazakhstan; symbolism even laces the name. In Kazakh, Rakhat means “pleasure”.

Rakhat is a rare example of an established Kazakh retail brand and that makes its sale important.

According to a company announcement on July 2, Lotte Confectionery, a South Korean company, has agreed a deal to buy 76% of Rakhat from four shareholders for about $120m. On the Kazakh stock exchange website these shareholders were listed as Natalya Khilchuk (11% stake), BD Associates ltd (UK, 29% stake), Anatoliy Popelyushko (25.45% stake) and Sweet City LLP (12.2% stake).

The deal values Rakhat, which had sales of nearly $200m in 2012 and employs 4,000 people, at roughly $157m.

Rakhat is one of the most high profile Kazakh retail companies ever sold. This is not an oil and gas company nor a mining company, it is a chocolate maker and its sale highlights Kazakhstan’s growing appeal to consumer brands.

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(News report from Issue No. 142, published on July 8 2013)

Kazakhstan blocks Indian bid for Kashagan stake

JULY 3 2013 (The Conway Bulletin) — Kazakhstan disappointed India’s government by triggering its option to buy an 8.4% stake in the Caspian Sea oil field Kashagan. US energy major ConocoPhillips said last year that it was selling its stake to Indian state energy company ONGC Videsh for $5.5b. Kazakhstan, though, held the option to block this deal.

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(News report from Issue No. 142, published on July 8 2013)

Kazakhstan blocks India’s purchase of Kashagan

JULY 3 2013 (The Conway Bulletin) — The Kazakh government has a decent poker face, at least when it comes to bluffing its intentions on energy deals.

For months Kazakh officials had said that they would not use their pre-emptive right to block a deal between ConocoPhillips, a US energy firm, and India’s ONGC Videsh.

ConocoPhillips had decided that it wanted to cash in its 8.4% stake in the Kashagan oil field in the Kazakh sector of the Caspian Sea. In November last year it announced a deal to sell this stake to ONGC Videsh for $5.5b.

Kazakhstan holds the right to buy stakes in its energy fields if a foreign company wants to exit, but earlier this year government officials said they would not buy the ConocoPhillips stake. Instead, they said, they would decide between allowing India into Kashagan or letting China, an increasingly close economic partner, into the project.

China’s apparent interest now looks like a decoy.

On July 3, Lyazzat Kiinov, chairman of Kazakh state energy company Kazmunaigas, said the company would buy the 8.4% stake in Kashagan.

The deal is important for two main reasons.

It’s perhaps a coming of age for Kazakhstan which wants to retain more ownership over its energy resources. It’s also a blow for India’s energy policy. India had staked a lot on expanding into the Caspian Sea and securing a major foothold in Central Asia’s energy sector. It now has to look elsewhere.

Kazakhstan wants to become a top energy producer.

Before the sale of ConocoPhillip’s stake, the consortium developing Kashagan consisted of ENI (Italy), Total (France), ExxonMobil (US), Shell (Britain) and Kazmunaigas all with a 16.81% stake. Inpex (Japan) also owns a 7.56% stake.

After this deal, Kazakhstan will be the main shareholder.

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(News report from Issue No. 142, published on July 8 2013)

Water woes for Kazakhstan

JUNE 25 2013 (The Conway Bulletin) — The Kazakh government is considering changing the name of its ministry for environmental protection to the ministry of environment and water resources, media reported. This is important as it underlines how vital water is for Kazakhstan and the wider Central Asia region.

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(News report from Issue No. 141, published on July 1 2013)

British PM visits Kazakhstan

JUNE 30 2013 (The Conway Bulletin) — David Cameron became the first British PM to visit Kazakhstan when he flew into Atyrau near the Caspian Sea coast at the start of a 2-day trip. Mr Cameron’s visit will be a huge PR boost for Kazakh President Nursultan Nazarbayev. Tony Blair, a former British PM, is an adviser to Mr Nazarbayev.

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(News report from Issue No. 141, published on July 1 2013)

Kazakhstan to host nuclear talks

JUNE 25 2013 (The Conway Bulletin) — Kazakhstan may host another round of nuclear talks between Iran and a US-led bloc this year, Iranian media reported. Almaty has already hosted two rounds of talks between Iran and the US-led bloc this year. A third round would further increase the kudos it has earned for holding the meetings relatively seamlessly.

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(News report from Issue No. 141, published on July 1 2013)

David Cameron visits Kazakhstan

JUNE 30 2013 (The Conway Bulletin) — Whatever the deals signed between British PM David Cameron and Kazakh President Nursultan Nazarbayev, Kazakhstan will emerge as a winner.

Persuading Mr Cameron to visit Kazakhstan is a PR coup for Mr Nazarbayev and will have other countries in Central Asia and the South Caucasus looking on enviously.

Mr Cameron is the first serving British PM to visit Kazakhstan, although, as one of Mr Nazarbayev’s advisers, ex-PM Tony Blair is a relatively regular visitor to Astana.

Kazakhstan has spent deeply on a small army of Western lobbyists, including the well-connected London-based Portland, and tasked them with improving its image.

Most of Europe’s leaders had already made the journey east to Astana. The EU, France and Germany have develop strong ties with Kazakhstan. Britain, though, had stood aside.

It was only a matter of time, though, before this changed.

Wealthy Kazakhs increasingly look to London as a fulcrum for their international business and lifestyle ambitions. As well as multiple business links, the Kazakh elite are sending their children to top English boarding schools and the government has been sponsoring a new generation of lawyers and civil servants through British universities.

Travel connections between London and Almaty, Kazakhstan’s financial centre, have also improved this year when British Airways finally opening a direct flight from Heathrow.

For Mr Cameron, the trip is trickier. He will want to develop economic ties with Kazakhstan but will have to tread carefully around the inevitable human rights questions to avoid upsetting his hosts. Britain also needs help from Kazakhstan to pull its military kit out of Afghanistan.

(News report from Issue No. 141, published on July 1 2013)

Kazakhstan updates its civil service

JULY 1 2013 (The Conway Bulletin) — Most of countries of the former Soviet Union are a byword for bureaucratic meddling, corruption and obfuscation.

Kazakhstan, though, is trying to change. And in a radical way. In June, the Kazakh government finished recruiting 940 civil servants for a special cadre of professional bureaucrats. The idea, first espoused in President Nursultan Nazarbayev’s state-of-the-nation address in December 2012, is to modernise the system.

This so-called A-class of civil servants had to pass an entry exam (2,204 applied for the positions, according to media) and they will receive training and coaching similar to their Western counterparts.

There is still a long way to go for Kazakhstan’s embryonic civil service reform and putting these lofty ideas into practice will be hard. Still, these are encouraging signs.

(News report from Issue No. 141, published on July 1 2013)