Tag Archives: Kazakhstan

Kazakh minister of economy receives new roles

JULY 11 2016 (The Conway Bulletin) — In his capacity as head of the Baiterek state holding, Yerbolat Dossayev, former Kazakh minister of economy, was named chairman of Zhilstroisberbank, a top-15 bank in Kazakhstan and subsidiary of Baiterek. A few days later Mr Dossayev was also named head of KazExportGarant, an export credit agency, and chairman of Kazakhstan’s Investment Fund, which are both managed by Baiterek.

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(News report from Issue No. 289, published on July 15 2016)

Kazakh C. Bank cuts interest rates

JULY 11 2016 (The Conway Bulletin) — Kazakhstan’s Central Bank lowered its key interest rate by two percentage points to 13%, official media reported. The Central Bank cited higher oil prices, slowing inflation and the volatility in global markets after Britain’s referendum to leave the EU as the main factors leading to the rate cut. This is the second rate cut in just over two months.

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(News report from Issue No. 289, published on July 15 2016)

Stock market: Anglo Asian Mining

JULY 14 2016 (The Conway Bulletin) — Helped by the Brexit impact, shares in Azerbaijan’s Anglo Asian Mining soared at the end of June. A positive outlook has now sent them up again. Its shares closed at 19.5p on Thursday, up 5.4% in one week.

At the end of June, Anglo Asian said it would sell the remainder of its 2016 production as futures, which gave a bullish message to investors, as the company tried to raise cash to pay out some of its debt.

Despite posting a production cut in H1 2016, the company was upbeat because the second quarter outperformed the first.

“The second half of the year has historically been our best performing half due to the seasonally better weather and our production will also benefit from the second SAG mill which is due to start operating next month,” CEO Reza Vaziri said in a statement.

Overall it was a positive week for most Central Asia and South Caucasus-linked stocks, lifted by increased stability in oil and gold prices.

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(News report from Issue No. 289, published on July 15 2016)

Kazakh court fines opposition newspaper

ALMATY, JULY 12 2016 (The Conway Bulletin) — In a case that media freedom lobbyists say shows how Kazakhstan is muzzling independent media, a court in Almaty ordered the opposition newspaper Tribuna/ Ashyk Alan to pay 5m tenge ($14,836) in damages to government official Sultanbek Syzdykov after it described him as corrupt for stealing 23m tenge ($68,249) from the budget of the 2011 Asian Games.

Although police launched an investigation into Mr Syzdykov, the court ruled that the newspaper could not describe him as corrupt because he had repaid the amount he had stolen.

Denis Krivosheyev, the Tribuna journalist who wrote the story, said that the verdict was nonsense.

“This government official was convicted of corruption,” he told reporters outside the court. “It is a fact that no one denies.”

Western government and media freedom groups have accused Kazakhstan of cracking down on free speech. Earlier this year, Guzyal Baidalinova, editor of the opposition Nakanune.kz website, was convicted of slander against Kazkommertsbank, Kazakhstan’s largest bank. She was released from prison, also on July 12, although her guilty sentence remains.

The government has cracked down on the media this year, partly as a reaction to a worsening eco- nomic outlook and to increasing unrest in the country.

Yermurat Bapi, a trustee of the journalists’ union in Kazakhstan told The Conway Bulletin that the media environment was worsening.

“This authoritarian system that was developed over 15 to 20 years has become obsolete, it is dying and with its last gasp is trying to preserve and protect itself through bans, persecutions and the courts,” he said.

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(News report from Issue No. 289, published on July 15 2016)

Tuleshov paid money to protesters, says Kazakh security committee

JULY 11 2016 (The Conway Bulletin) — Kazakhstan’s National Security Committee said that imprisoned businessman Tokhtar Tuleshov paid around $200 to each of the demonstrators that rallied in several Kazakh cities against proposed amendments to the land code in April and May. The Committee said that Tuleshov, in prison since Jan. 30, had organised the protests in 2015, in an effort to overturn the government.

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(News report from Issue No. 289, published on July 15 2016)

Kazakhstan’s C. Bank bets against sterling

JULY 8 2016 (The Conway Bulletin) — Kazakhstan’s Central Bank chief Daniyar Akishev said he bet against the sterling ahead of Britain’s referendum to leave the EU, commonly known as Brexit. As he expected market volatility in the aftermath of the vote, Mr Akishev said the Central Bank opened a long position to sell off part of its sterling holdings, effectively gaining from the post-Brexit plunge of the British currency against the US dollar.

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(News report from Issue No. 289, published on July 15 2016)

Norway closes its embassy in Kazakhstan to save money

ALMATY, JULY 13 2016 (The Conway Bulletin) — Looking to cut costs Norway closed its embassy in Astana, a blow to Kazakhstan’s self-image as an important international diplomatic player.

Norway’s embassy in Astana had been its only diplomatic mission in Central Asia since it opened in 2009. Now, a single Norwegian diplomat in Oslo will be responsible for Central Asian affairs.

Last December, Astana was listed among four other embassies for closure. These were Sofia (Bulgaria), Lusaka (Zambia) and Harare (Zimbabwe).

Norway’s foreign ministry said cutting the four embassies would reduce its diplomatic presence in the world to 83 countries.

“The ministry must adapt to the changes that are taking place in the world, taking into account the resources available to run missions abroad,” the ministry said in a note.

Norway’s income is reliant on revenue from oil and gas sales. Energy prices have halved in the last two years.

A Kazakh foreign ministry spokesman declined to comment.

With Norway’s departure there will now be 64 embassies in Astana. Norway’s exit is also a blow to Kazakhstan’s international image in the run-up to EXPO-2017 in Astana.

Just weeks ago, Kazakhstan secured a much-coveted non-permanent seat at the UN Security Council for 2017-18 and it proudly hosted a summit of the OSCE in 2010. Indra Over- land, research professor at the Norwegian Institute of International Affairs told The Conway Bulletin that a mix of international crises and lack of interest has driven Norway away from Kazakhstan.

“The general Norwegian engagement in Central Asia has gone down, because of factors such as the European refugee crisis and the Ukraine crisis,” Mr Overland said.

“The lack of interesting projects available for the Norwegian oil company Statoil in Kazakhstan and Turkmenistan also contributed [to the waning engagement].”

In 2013, Norway’s Statoil aban- doned the Abai offshore oil project after a lengthy negotiation with Kazakhstan’s state-owned Kazmunaigas.

Now the only city with a Norwegian embassy in the Central Asia/South Caucasus region is Baku. Statoil, the part-state owned Norwegian energy company, still operates projects in Azerbaijan.

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(News report from Issue No. 289, published on July 15 2016)

HM to open store in Kazakhstan

JULY 13 2016 (The Conway Bulletin) — Swedish fashion retailer H&M said it will open its first store in Kazakhstan in 2017, expanding its market into Central Asia. H&M follows other chains, such as French retailer Carrefour and food chain McDonald’s, which entered the Kazakh market in the past few months. Kazakh media said that the location for H&M’s new store is likely to be Almaty, Kazakhstan’s largest city.

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(News report from Issue No. 289, published on July 15 2016)

Boardroom battle for control of Kazakhstan’s KMG EP heats up

ALMATY, JULY 14 2016 (The Conway Bulletin) — Intensifying its fight for more control over its London-traded subsidiary KMG EP, Kazakhstan’s state-owned energy company Kazmunaigas increased by 14% its earlier buyout offer to minority shareholders and retracted demands to cut the company’s independence.

Under pressure to boost income from oil and gas sales, Kazmunaigas wants to increase its 58% stake in KMG EP. KMG EP’s assets are more profitable than the assets owned by Kazmunaigas.

The problem for Kazmunaigas, though, is that its initial buyout offer of $7.88/GDR met with strong resistance from independent shareholders at KMG EP last month. The increase to $9/GDR, which Kazmunaigas issued without an explicit explanation, also appeared to attract a withering response.

“An increase in the price of the Purchase Offer would not be consistent with the prior statements made by Kazmunaigas that it ‘is not seeking to acquire any significant additional holdings in KMG EP through this offer’,” the independent directors said in a note.

They accused Kazmunaigas of underhand tactics to try to force more control over KMG EP. Specifically, the minority shareholders rallied against a new corporate governance structure proposed by Kazmunaigas that would reduce independent control of KMG EP. Kazmunaigas wanted to impose a veto against the appointment of independent directors but has now dropped these demands.

The ongoing saga within the most powerful industrial structure in Kazakhstan acts as a rare window on Kazakhstan’s corporate governance culture after a series of high profile scandals ahead of planned new IPOs, including Kazakhtelecom, the state- owned telecoms company.

KMG EP’s GDRs have traded at between $6 to $9 in the past 12 months.

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(News report from Issue No. 289, published on July 15 2016)

Kazakhstan to solve trade row with Ukraine

JULY 8 2016 (The Conway Bulletin) — Asset Asavbayev, director of transport at Kazakhstan’s ministry of industrial development, said Kazakhstan will step in to resolve a row between Russia and Ukraine that has stalled Ukrainian cargo in transit to Central Asia via Russian territory. On July 1, Russian border police enforced a transit ban for Ukrainian goods, citing a Eurasian Economic Union regulation.

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(News report from Issue No. 289, published on July 15 2016)