Tag Archives: Kyrgyzstan

Kyrgyzstan introduces revolutionary holiday

APRIL 5 2016 (The Conway Bulletin) – Kyrgyz lawmakers approved a bill to introduce a new holiday on April 7, the anniversary of the 2010 revolution that toppled the regime of former President Kurmanbek Bakiyev. The 2010 revolution holds a highly symbolic meaning for Kyrgyz people and is the main source of legitimacy for the current leadership. The 2010 revolution was Kyrgyzstan’s second revolution in five years.

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(News report from Issue No. 275, published on April 8 2016)

FDI grows in Kyrgyzstan

APRIL 4 2016 (The Conway Bulletin) – Kyrgyz PM Temir Sariyev told Parliament that FDI in Kyrgyzstan grew by 12.6% to $818.8m in 2015 compared to the previous year. FDI from countries in the Former Soviet Union grew more slowly at 2.8%, due to the economic crisis that has hit the region. FDI from the UK increased by 3.5 times to $190m. FDI from China halved.

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(News report from Issue No. 275, published on April 8 2016)

EEU reschedules meeting due to Armenia-Azerbaijan fight in N-K

APRIL 6 2016 (The Conway Bulletin) – The Eurasian Economic Union moved a meeting of its PMs scheduled for April 8 in Yerevan to Moscow because of fighting between Armenia-backed fighters and Azerbaijani forces over the disputed region of Nagorno-Karabakh. Before the meeting was moved, Kazakh PM Karim Massimov had cancelled his trip to Armenia’s capital. The Moscow meeting will now be held on April 13.

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(News report from Issue No. 275, published on April 8 2016)

Unpaid gas bill pressures glass factory in Kyrgyzstan

BISHKEK, APRIL 6 2016 (The Conway Bulletin) — A row over gas debt repayment has shown just how indebted some Kyrgyz companies have become as the entire Central Asia region battles with a deepening economic downturn.

Interglass, which had employed up to 600 people in Tomok in northern Kyrgyzstan, now owes the Kyrgyz subsidiary of Russia’s Gazprom over 1.1b som, or around $16m, for unpaid gas. This is half Gazprom Kyrgyzstan’s total outstanding debt it is owed by its Kyrgyz customers.

Four years ago, Kyrgyz President Almazbek Atambayev had toured Interglass and held it up as an example of Kyrgyz regional enterprise. Now Interglass is struggling to stave off bankruptcy.

Gazprom Kyrgyzstan said that it has tried to negotiate with the glass- making company so that it can pay back its debt in a structured manner but that negotiations had collapsed.

“Taking into account the social importance of the enterprise, in March Gazprom Kyrgyzstan gave Interglass in every opportunity to settle the debt for the supplied gas,” it said in a statement.

It has previously called on the Kyrgyz government to step in to help Interglass pay off its debts and also threatened to turn off the gas to the whole of Kyrgyzstan if it doesn’t pay.

There has been no comment from Interglass or its parent company, the Germany-registered but Bishkek based, Steinert Industries.

For the Kyrgyz government, the row creates a potentially incendiary scenario. It sold off its gas distribu- tion network to Gazprom for a sym- bolic $1 in 2014 in exchange for settling its debt and agreeing to fund much needed investment. It has just renegotiated a cheaper price of gas for ordinary customers but businesses still complain that in the current economic climate Gazprom Kyrgyzstan is overcharging.

The government has said it will step in to help Interglass pay its bill but, so far, there has been little evidence to show that it has achieved any major inroads.

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(News report from Issue No. 275, published on April 8 2016)

Power consumption drops in Kyrgyzstan

APRIL 5 2016 (The Conway Bulletin) – Consumption of electricity in Kyrgyzstan was down 23% in March compared to last year, due to warm weather conditions, according to industry data. Total consumption amounted to 881m kWh. Severlektro, the largest distributor, said it delivered 438m kWh, 29% less than in March 2015. Previously an opposition MP had said a drop in electricity consumption showed the extent of the economic downturn.

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(News report from Issue No. 275, published on April 8 2016)

Kyrgyzstan expropriates resorts

APRIL 4 2016 (The Conway Bulletin) – The Kyrgyz government signed a decree to retake possession of four Uzbek-owned resorts near Lake Issyk-Kul. Buston, Rokhat, Dilorom, and Golden Sands are all owned by Uzbek entities, both public and private. These are Soviet- era vacation resorts that had been built in the 1960s. Tensions have been running high between Kyrgyz and Uzbeks in Kyrgyzstan since ethnic fighting in Osh in 2010.

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(News report from Issue No. 275, published on April 8 2016)

Editorial: Kazakh and Kyrgyz de-dollarisation

APRIL 8 2016 (The Conway Bulletin) – Central Banks in Central Asia are boasting about de-dollarisation these days, painting a rosy picture of their success in combating their economies’ dependence on the greenback.

A closer look at the stats, however, reveals that a combination of heavy interventions in the currency markets and interest rate tweaking were the main drivers of healthier Kazakh tenge and Kyrgyz som.

But now Central Banks have to grapple with inflation, which continues to grow, and demand for credit, which continues to shrink.

Central Banks propped up local currencies, against a US dollar that has now slowed its rise against Emerging Markets currencies and commodities.

Restrictions on exchange points, bans on pricing goods in dollars and public calls for confidence have all contributed to curbing the use of dollars.

But Central Banks might have run out of options now and they need to steer away from “crisis mode” if they want to really restore confidence in their still ailing currencies.

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(Editorial from Issue No. 275, published on April 8 2016)

Kyrgyzstan bans price labels in foreign currencies

APRIL 2 2016, BISHKEK (The Conway Bulletin) — Kyrgyzstan banned labelling goods for sale in anything other than Kyrgyz som, a move it said would help strengthen the national currency and reduce its economy’s reliance on US dollars.

Since a crash in the value of local currencies in Central Asia and the South Caucasus last year, de-dollarisation has become a buzzword among Central Banks.

In Kyrgyzstan, the authorities have concentrated on persuading more people to use som over US dollars to buy goods. And this now includes banning shopkeepers from pricing goods in US dollars.

The punishment for pricing goods in US dollars still hasn’t been announced but it will be a challenge to the authorities to impose the ban successfully.

Zhumakadyr Akeneyev, a former head of oil traders association and now an economic commentator, said de-dollarisation was a positive step.

“Finally, for the first time since independence, we have turned our face to the national currency,” he said.

Other Kyrgyz said that while they broadly welcomed the move, they were also sceptical that it would work.

“I like this idea. Many people, who borrowed money from the banks in foreign currencies, suffered from devaluation of som,” said 25-year-old Saltanat. “However, I think the government should leave some space for use of foreign currencies too.”

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(News report from Issue No. 275, published on April 8 2016)

Gazprom cuts gas price for Kyrgyztan

APRIL 1 2016 (The Conway Bulletin) – Russian gas company Gazprom cut the price of gas it sells to Kyrgyzstan by 9% to $150 per 1,000 cubic metres. Kyrgyz President Almazbek Atambayev had been lobbying for this for some time, saying that a fall in global prices should mean a price reduction for consumers in Krygyzstan. Gazprom bought the Kyrgyz gas distributor in 2014 for a symbolic $1, promising to clear its debt and invest in infrastructure.

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(News report from Issue No. 275, published on April 8 2016)

Oil export ban is illogical, says ex-Kyrgyz official

APRIL 1 2016 (The Conway Bulletin) – For the past six years, there has been an informal ban on petroleum exports from Kazakhstan to Kyrgyzstan, former president of Kyrgyzstan’s Oil Traders Association, Zhumakadyr Akeneyev, said at a conference in Bishkek. According to him this practice is illogical within the framework of the Eurasian Economic Union and it has caused a rise in illegal trading. Kyrgyzstan imports almost all its petroleum products from Russia.

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(News report from Issue No. 275, published on April 8 2016)