Tag Archives: Kazakhstan

Kazakhstan to subsidise mortgages

ALMATY, NOV. 8 2016 (The Conway Bulletin) — The Kazakh government will gives subsidies of 15m tenge ($43,455) to mortgages for new homes, Marat Idryshev, head of the Association of Kazakh Constructors said, part of President Nursultan Nazarbayev’s plan to breathe life into Kazakhstan’s flatlining economy.

Mr Nazarbayev announced the Nurly Zher programme in September, the name means Bright Land in Kazakh, a few months after a series of unprecedented anti- government protests focused on mortgages and land ownership showed just how frustrated ordinary Kazakhs were with the state of the economy.

Precise details of the $1.3b plan to re-energise Kazakhstan’s construction sector have been thin, so Mr Idryshev’s comments are important. He said that the mortgage market was severely undernourished in Kazakhstan.

“Today the proportion of mortgages given by commercial banks in Kazakhstan is no higher than 5%,” he told media. “In Russia it is 50-70%, a world standard. We will act in accordance with the experience of our neighbours. The government will subsidise mortgages.”

The subsidy should, Mr Idtzhev said, bring interest on mortgages down to around 10% from 17%.

The collapse of the tenge last year made it difficult for mortgage holders to pay back their loans. Almaty-based economist Zharas Akhmetov said the plan should dampen growing tension.

“This, firstly, will support the housing market. Secondly, this will remove tension in society,” he told the Bulletin. “One of the drivers of economic growth is construction, and not only construction of houses but also roads and industrial objects.”

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(News report from Issue No. 304, published on Nov. 11 2016)

WHO says Kyrgyzstan is free of malaria

NOV. 11 2016 (The Conway Bulletin) — >> I’ve just read that the World Health Organisation (WHO) has declared Kyrgyzstan to be free of malaria. Is this important? What does this mean?

>>Put simply, it means that Kyrgyzstan has done a good job at stamping out malaria. To be declared free of malaria, a country has to prove that there have been no cases for three consecutive years. It’s good PR for Kyrgyzstan and should make it a more attractive destination for tourists to visit. It’s an image thing. Malaria was never a major problem in Kyrgyzstan but publicity from WHO about combating it will go down well.

>> Got it. You say that it wasn’t a major problem but how serious was malaria in Kyrgyzstan, then?

>> It had been more or less stamped out under the Soviet Union, mainly due to industrialisation and living standards rising, but it re-appeared in the 1990s. This was a tough period, after the collapse of the Soviet Union, with the economy performing badly. There were very few jobs in Kyrgyzstan and healthcare was underfunded. Migrant workers brought malaria back to Kyrgyzstan and in 2002, it suffered what the WHO described as a “malaria epidemic” with 2,700 reported cases. Backed by the WHO, the Kyrgyz government ran a malaria eradication strategy which targeted improving healthcare and strengthening awareness of the disease. By 2011, the number of malaria cases reported to have been picked up in Kyrgyzstan was three, dropping to zero in 2012. The campaign has been a success.

>> Does this all mean that Kyrgyzstan has become something of a WHO poster-boy in Central Asia?

>>Not exactly. It still has plenty of issues to deal with such as high rates of alcohol consumption and smoking, as well as HIV and tuberculosis problems. These issues are generally shared with other countries in the former Soviet Union. Public health in the region is always going to be a continual battle.

>> And what about the other countries in the region?

>> Kazakhstan has also been declared malaria-free and the number of cases in Uzbekistan and Tajikistan has fallen dramatically. Both are on course to achieving the WHO’s malaria-free certificate. For Tajikistan, in particular, this would be a major achievement. At its peak in 1997, Tajikistan reported nearly 30,000 new cases of malaria. Last year it reported zero cases and the WHO has said that it is on course to achieve malaria-free status. This is a good news story from Central Asia. Eradicating malaria will save lives and take the strain off the health sector. Of course, it may reappear but for now, malaria is being defeated in the region. The WHO has no data for Turkmenistan.

>> That’s impressive. So, is it all good news for Central Asia’s healthcare system?

>> No. While malaria may be being beaten, other diseases are still a problem. Kazakhstan reports seasonal outbreaks of the bubonic plague. These are localised and transmitted by fleas living off infected rodents. One or two people die each year from the disease but it has never threatened to become widespread. In Tajikistan, polio, which was thought to have been eradicated, was reported in the south of the country in 2011. In total, nearly 500 people were reported to be infected and the WHO declared an epidemic. At least 29 people died before the outbreak was brought under control six months later. In Kyrgyzstan, also, there have been recent public health scares. This included an outbreak of measles in 2015. Out of 22,000 recorded in the wider Europe region that year, a third were in Kyrgyzstan

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(News report from Issue No. 304, published on Nov. 11 2016)

Kazakh President heads to Asia

NOV. 7/11 2016 (The Conway Bulletin) — Kazakh President Nursultan Nazarbayev flew to Japan and South Korea on a tour of East Asian countries aimed at drumming up business. Both Japanese and South Korean companies own stakes in energy and industrial projects in Kazakhstan. Korea has particularly strong links with Kazakhstan and other countries in Central Asia.

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(News report from Issue No. 304, published on Nov. 11 2016)

Three miners die in central Kazakhstan

NOV. 10 2016 (The Conway Bulletin) — Three miners died in Karaganda, central Kazakhstan, after a monorail accident at the Saranskaya mine, local media reported. Five other workers were injured, one critically. Steelmaker ArcelorMittal Temirtau owns the Saranskaya mine and said it will investigate the accident.

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(News report from Issue No. 304, published on Nov. 11 2016)

Kazakh government approves uranium bank

NOV. 2 2016 (The Conway Bulletin) — Kazakhstan’s Parliament approved a law to establish an International Atomic Energy Agency-sponsored low-enriched uranium fuel bank in the country. For years, Kazakhstan lobbied the Agency to establish a nuclear fuel bank in its territory, as a testimony of the country’s efforts to combat nuclear proliferation. Kazakhstan is the world’s largest producer of uranium.

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(News report from Issue No. 303, published on Nov. 4 2016)

KAZ Minerals posts strong Q3

OCT. 28 2016 (The Conway Bulletin) — Kazakhstan-focused copper miner KAZ Minerals posted a strong Q3 operational report, more than tripling production compared to the same period last year, mainly due to the coming online of the Aktogay and Bozshakol projects.

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(News report from Issue No. 303, published on Nov. 4 2016)

Kazakh C. Bank aims to hire foreign managers

OCT. 28 2016 (The Conway Bulletin) — Kazakhstan’s Central Bank aims to hire foreign managers to oversee spending of the foreign currency- denominated element of its pension fund, worth around $5b. The hiring process could kick-start next year, according to one source at the Central Bank. Foreign currency-denominated assets make up around 21% of the $20b pension fund. The Central Bank aims to increase the share to 23% this year.

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(News report from Issue No. 303, published on Nov. 4 2016)

Comment: An unexpected PR boost for Kazakhstan’s prisons, writes Kilner

NOV. 4 2016 (The Conway Bulletin) — It’s not often that Kazakhstan gets praised for its prison system. Not very often at all.

And there is a reason for this. There have been improvements over the last few years but the overwhelming majority of its prisons are based on crumbling Soviet-era infrastructure accompanied by an uncompromising Soviet-era mindset. There is no Norwegian cuddliness here.

These are mainly cold, uncomfortable and dangerous places. Stories from Kazakh prisons are hooked on riots, Islamic extremism recruitment, hunger strikes and deaths — both suicides and apparent suicides.

It’s the same story across the rest of Central Asia. Human rights groups and the media criticise governments for not investing enough time or money into their prison systems and the governments get defensive.

Except in last week’s Financial Times, when Kazakhstan scored what must have been a wonderful piece of prison PR.

On a week-long trip to Kazakhstan, FT editor Lionel Barber wrote in a diary-style entry that he had been inspired by Jonathan Aitken, a British Conservative politician who went to jail for perjury, to look around a Kazakh prison. Aitken had written glowingly about them in a book he’d been paid to write by Kazakh President Nursultan Nazarbayev.

Barber was also impressed.

“It is unlikely to be wholly representative, compared with the former Soviet gulags in Kazakhstan. But its rooms are spotless; there are curtains and large glass window panes without bars, all of which would be seen as suicide risks elsewhere,” he said of prison 66/10 outside Astana which he was shown around.

Prison 66/10 is one of Kazakhstan’s new showcase prison and he knows it, but he also dangerously underplays the awfulness of most of the Kazakh prison system. Since 2011, when prisoners rioted and sliced open their stomachs in protest at the poor conditions, Kazakhstan has improved its prison system but perspective is needed.

Roger Boyes, a columnist at the London Times newspaper, picked up this theme. He said high-profile former politicians and visitors, such as Aitken and Tony Blair and Barber, were being used to whitewash Kazakhstan.

“He should have asked to see the basement,” Boyes wrote of Barber’s comments on Kazakh prison 66/10. “That’s where the truths are buried.”

By James Kilner, Editor, The Conway Bulletin

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(News report from Issue No. 303, published on Nov. 4 2016)

Kazakhs look for public sector jobs as business cuts staff to see off econ downturn

ALMATY, OCT. 29 2016 (The Conway Bulletin) — Official statistics showed that there are now more people working in Kazakhstan’s state sector than in private business, a reflection of how the economic downturn has cut into the job market.

The State Statistics Committee said that 51% of the total labour force in Kazakhstan now worked in the public sector, up from 46% in 2014 and 47% in 2015.

The jump in the proportion of the labour force working in the public sector, though, is only partially driven by an rise in state sector jobs.

The main driver has been a cut in the number of jobs in private enterprise.

Accurate data on these job losses is patchy but anecdotally there are many stories of cuts.

Madina Kuan quit her job at a media firm to look for a better one.

“I thought it would be easy to find a new one but I’ve now been jobless for six months,” she said. “My brother, as well, works in the oil sector in west of Kazakhstan and his company doesn’t have a job for him. They did not fire him though but instead just asked him to wait until things improve.”

A sharp fall in oil prices and a recession in Russia triggered a collapse in Kazakhstan’s currency. Despite fighting talk from the government, inflation has grown and businesses have been cutting staff.

The finprom.kz website has reported that the number of people employed by Kazakh private businesses has shrunk but that the public sector has increased the number of hires.

Kuralay Orazgeldy, who used to work in Almaty’s department of budget planning said people were attracted to public sector jobs because of the stability.

“Turnover is very high, staff changes often,” she said. “The salary is stable, everything is paid on time and often workers are rewarded but I can’t say that salary equals to the volume of work.”

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(News report from Issue No. 303, published on Nov. 4 2016)

Tethys deal with Kazakhstan’s Oilsol collapses

ALMATY, OCT. 27 2016 (The Conway Bulletin) — Guernsey-based oil company Tethys Petroleum said Kazakhstan-based investment group Olisol had failed to pay a final 9.8m Canadian dollars ($7.3m) instalment that it had promised in return for a stake in the company.

Olisol had been viewed as saviour by Tethys, which had been short of cash because of the collapse in oil prices since 2014 which has destroyed profits at energy companies, but failing to pay up on time effectively crushes the deal.

In a harsh statement, Tethys complained that despite its readiness to move forward, Olisol missed the payment deadline, jeopardising the deal.

“Olisol failed to provide Tethys with any of the C$9.8 million purchase price required to purchase the subscription shares under the Investment Agreement,” the company said, referring to the agreement the parties had signed in December 2015 and updated in April.

“Therefore, Tethys considers Olisol to be in breach of the Investment Agreement and reserves all of its legal rights.”

Tethys also said that Olisol also claimed to be entitled to a full refund of the $5.7m it had already invested in the company, because of mutated conditions.

Olisol could not be reached for a comment.

After a takeover offer from London-listed Nostrum Oil & Gas fell through in the summer of 2015, Tethys had placed all its hopes on Olisol, and its mystery backers, to inject enough money to settle its debts.

The battle for survival in Kazakhstan has become increasingly tough for Tethys, which is also involved in legal battles with its partners in Tajikistan, its other main focus in Central Asia.

Days before it announced that its deal with Olisol had fallen through, Tethys said that it had received a notice from Eurasia Gas Group, a local company which had worked with a Tethys subsidiary in Kazakhstan since 2012. Eurasia Gas said that it was suing Tethys Aral Gas for $2.6m for failing to deliver oil supplies.

This is part of a bigger row. Last month, Tethys Aral Gas had threatened to sue Eurasia Gas for $1.3m in unpaid oil supplies.

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(News report from Issue No. 303, published on Nov. 4 2016)