Tag Archives: Kazakhstan

Kazakhstan Airline to increase flights to China

SEPT. 28 2016 (The Conway Bulletin) – Kazakhstan’s flagship carrier Air Astana plans to increase air links to China and tap Kazakhstan’s potential as a transport hub. Peter Foster, the company’s CEO, said Air Astana aims to transport 1m Chinese tourists and businessmen within three years. To achieve this goal, the company aims to triple from 20 to 60 the flights it operates with China and to hire more Chinese-speaking staff.

ENDS

(News report from Issue No. 298, published on Sept. 30 2016)

Kazakh government appears confused over re-launching oil project

SEPT. 29 2016 (The Conway Bulletin) – Kazakhstan’s government appeared confused over when the giant Kashagan oil project in the Caspian Sea would re-start production after a three year hiatus to repairs leaky pipes. It first said that Kashagan would restart on Oct. 23, surprising analysts, before correcting themselves by announcing a year-end re-start date. Analysts have been expecting a year-end re-start.

ENDS

(News report from Issue No. 298, published on Sept. 30 2016)

Stock market: Central Asia Metals

SEPT. 30 2016 (The Conway Bulletin) – Kazakhstan-focused copper producer Central Asia Metals continued to gain this week, rallying on its positive half-year report it published in mid-September.

Its stock price in London was up 1.3% to 182.3 on Thursday compared to last week. It has averaged a growth of 1.2% over the past three weeks.

In its half-year report, published on Sept. 13, the company said it increased copper production by 27% to 6,908 tonnes, which helped its revenues to grow marginally to $30.9m despite a sharp fall in copper prices, which have fallen by 17.5% compared to last year.

Importantly too, the company managed to cut production costs by 40%.

“[H1 2016 was] another record period of copper production, resulting in a continued strong financial performance for the Group. The devaluation of the local currency has been a key factor in our reduced costs of production,” Nick Clarke, Central Asia Metals’ executive chairman said in a note.

ENDS

(News report from Issue No. 298, published on Sept. 30 2016)

Kazakh oil company revenue drops

SEPT. 28 2016 (The Conway Bulletin) – Kazakhstan-focused oil company Roxi Petroleum posted revenues of $896,000 in the first half of 2016, 7.6% lower than in the same period last year. After tax, the company posted a loss of $2.5m, compared to a profit of $13.2m last year when Roxi sold the Galaz oil field. In a statement, chairman Clive Carver stressed the importance of the company’s success in reducing operating costs.

ENDS

(News report from Issue No. 298, published on Sept. 30 2016)

Mosque staff in Kazakhstan file lawsuit

SEPT. 26 2016 (The Conway Bulletin) – Staff at the Nur-Gasyr mosque in Aktobe, the largest in the city, filed a lawsuit against their employer to claim salaries which they say have not been paid. The mosque has not commented. The unpaid salaries is a reflection of the tight economic conditions in Kazakhstan and how problems are filtering through Kazakh society. The Nur-Gasyr mosque is one of 13 Islamic worship buildings in Aktobe. It was built in 2008 and cost $16.6m to build.

ENDS

(News report from Issue No. 298, published on Sept. 30 2016)

Kazakh economy looking stronger

ALMATY, SEPT. 28 2016 (The Conway Bulletin) — Higher oil prices, cost cuts and the anticipated start-up of the Kashagan oil project will allow the Kazakh government to reduce transfers from the sovereign wealth fund into the budget for the next three years, the ministry of economy said.

For Kazakhs, who have endured two years of economic woe, a heavy devaluation of the tenge and cost cutting, the assessment by the economy ministry that things are finally looking up will come as a relief.

Kuandyk Bishimbayev, minister of economy, appeared before parliament to propose amendments to the 206-2018 budget.

“We had planned the budget with an average oil price of $30/barrel in mind. Now, given the increase over the past few months and the apparent stability at $40/barrel, we should revise the forecast to $35/barrel,” he told parliament. “Every five additional dollars in oil prices give us additional revenue in the form of export customs duties.”

Mr Bishimbayev also highlighted the restart of the Kashagan oil project in the Caspian Sea. Kashagan, the Great White Hope of the Kazakh energy sector, is due to restart oil production at the end of the year after a three year hiatus while leaks to pipes were repaired.

Kazakhstan’s oil production, and therefore income, is due to ramp up as soon as Kashagan comes on- stream.

The original budget plan called for 2,880b tenge ($8.5b) to be shifted from the sovereign wealth fund into the government’s budget. The amended budget cut the transfers by 401b tenge ($1.2b) or 14%.

Unsurprisingly, parliament approved the amendments.

ENDS

(News report from Issue No. 298, published on Sept. 30 2016)

Kazakh state-owned company creates subsidiary

SEPT. 27 2016 (The Conway Bulletin) – Kazmunaigas, Kazakhstan’s state-owned energy company, created a new subsidiary, KMG-Eurasia to exploit a joint Kazakh-Russian project in the Caspian Sea. The Kazakh government said total investment in the Eurasia field could reach $1.5b over the next decade. Last year, Baltabek Kuandykov, the project manager, said Kazmunaigas was due to create a subsidiary for the project in the first few months of 2016.

ENDS

(News report from Issue No. 298, published on Sept. 30 2016)

Business comment: Kazakh banking

SEPT. 21 2016 (The Conway Bulletin) – Despite countless declarations on efforts to save its banking sector, Kazakh banks are not as healthy as they say.

Last year, President Nursultan Nazarbayev instructed the Central Bank to conduct stress test to avoid a spiraling of non-performing loans similar to the crisis that followed the 2007/8 global debacle.

He had just sacked Kairat Kelimbetov, Mr Devaluation, the Central Bank chief under whom the tenge currency lost around half its value in two years.

The result of the declarations has been a sharp drop in the share of

bad loans in banks’ total portfolio. Officially, this week Kazakhstan’s Central Bank chief Daniyar Akishev said that non-performing loans had shrunk from around 30% two years ago to just 8.4%.

This raised eyebrows among analysts.

How could a broken system, hit by currency depreciation and toxic assets, recover so quickly, without undergoing a serious makeover?

The answer is simple, according to some: The problems were swept under the rug.

“Kazakhstan’s banking sector is a legalised zombie park,” an anonymous economist told Forbes Kazakhstan.

“In reality, bad loans make up around 60% of the total loan portfolio. But through refinancing, on paper, banks have written most of them off of their accounts.”

Notably, the most frequent and well attended protests in Kazakhstan for the past few years are organised by groups of mortgage holders. They mainly hold US dollar debt.

If their overdue loans are neither being refinanced, nor being accounted for, where are banks hiding them?

ENDS

(News report from Issue No. 298, published on Sept. 30 2016)

Kazakhstan’s Sunkar Air opens flight to Iran

SEPT. 20 2016 (The Conway Bulletin) – Kazakhstan’s Sunkar Air opened a new flight from the Caspian city of Aktau to Gorgan, in northern Iran. Sunkar is a small airline in Kazakhstan. Ties between Kazakhstan and Iran have improved since the lifting of international sanctions against Iran earlier this year.

ENDS

(News report from Issue No. 297, published on Sept. 23 2016)

Kazakh authorities refuse protest

SEPT. 16 2016 (The Conway Bulletin) – The Atyrau city government denied a petition by Mothers in White Headscarves, a women’s protest group in Kazakhstan, which sought to hold a rally on Sept. 17. Public protests against worsening economic conditions in Kazakhstan have been becoming more frequent in Kazakhstan. Around 1,000 Atyrau citizens demonstrated against a proposed land reform in April, the largest protest in Kazakhstan for the past few years.

ENDS

(News report from Issue No. 297, published on Sept. 23 2016)