SEPT. 9 2015 (The Conway Bulletin) – The Kyrgyz military has ordered its units on high alert around the border with Tajikistan because of an increase in tension, media reported. Reports were not specific on what had triggered the alert but Tajikistan and Kyrgyzstan have rowed about border issues this year.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 4 2015 (The Conway Bulletin) – Belarusian dairy producer Turovsky Milk Factory exported its first batch of products to Kyrgyzstan, media reported quoting a company spokesman. The shipment is notable because it appears to suggest that, in this instance, the concept of the Russia-led Eurasian Economic Union trade bloc is working.
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Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 11 2015 (The Conway Bulletin) — The Kazakh tenge and the Kyrgyz som dropped to record lows this week, as economies in Central Asia and the South Caucasus continued to show structural weaknesses.
By the end of Friday, the tenge traded at around 264/$1, down from 240/$1 at the start of the week. That’s a drop of 10%. The Kyrgyz som fared slightly better but still dropped through the 67/$1 barrier. A week earlier it had traded at around 65.5/$1.
Over the border in Tajikistan, the somoni held its own. This may have had something to do with a massive cash injection from China. It agreed to buy 3b yuan ($470m) worth of somoni in a so called currency swap deal. This is a thinly disguised mechanism to prop up the ailing somoni which has lost 17% of its value this year.
In the South Caucasus the currencies were broadly stable, although the Georgian lari lost some ground, falling to around 2.40/$1 compared with a price of around 2.36/$1 a week earlier.
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(News report from Issue No. 247, published on Sept. 11 2015)
BISHKEK, SEPT. 11 2015 (The Conway Bulletin) — Kyrgyzstan’s entry to the Eurasian Economic Union last month has created confusion and extra bureaucracy for businesses, Aziz Soltobayev, founder of the online store svetofor.info, said in an interview with The Bulletin.
Mr Soltobayev, 32, said the Kyrgyz government had failed to give clear instructions on what impact membership of the Eurasian Economic Union would have.
“There is not much to be happy or thrilled about,” he said at his company’s headquarters, a converted house in central Bishkek. “For example if you want to export you have to be on the exporter’s list and this means more bureaucracy and inspections and examinations.”
Kyrgyzstan became the fifth member of the Russia-led Eurasian Economic Union last month. Kazakhstan, Belarus and Armenia are also members. The problem is that when the idea of the Eurasian Economic Union was floated, Russia was in the ascendency. Now its economy has tipped into recession.
“Oil prices were really high and it [Russia] was just booming,” Mr Soltobayev said. “But things have changed. The war with Ukraine, US sanctions and the devaluation of the rouble has made this Union miserable, just the worst place.”
And the costs are growing too. Svetofor.info buys stock from China but Mr Soltobayev said prices for imported goods had already increased significantly.
Regarding svetofor.info, which he started in 2004, Mr Soltobayev said its best-selling products were mobile phone handsets. On the streets of Bishkek, most people seemed glued to mobile phones.
Mr Soltobayev said svetofor.info was going to quit its remaining high street shops altogether in the next few years and move its operation completely online.
“With access to the internet and with the decline (in price) of data packages people are using it more and more,” he said. “We see now that people are buying products on their mobile phones. They don’t have desktop phones any more and we see people doing this not just in the city but also in the countryside.”
Fashion, he said, is all important with the latest smartphone being the number one accessory for Kyrgyz.
“They would certainly rather buy an iPhone and live in miserable conditions,” he said.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 9/10 2015 (The Conway Bulletin) — Between January and July this year, Canada increased its flow of Foreign Direct Investment into Kyrgystan by 90 times.
For Canada, read Centerra Gold, the Toronto-listed company that is part-owned by the Kyrgyz government. It owns the Kumtor gold mine in the east of the country, Kyrgyzstan’s main economic driver.
And it seems that this investment and the subsequent 49% increase in gold exports has helped Kyrgyzstan to post GDP data in Jan. – Aug. 2015 that shows growth of 7% from the same period last year. If capital flows are encouraging, however, foreign trade has shrunk significantly. The volume of import-export fell by 15% in the first 7 months of 2015.
In 2015, the fall of the som currency has led to lower purchasing power for Kyrgyzstan, and the government recently announced that Kyrgyzstan will inevitably face inflation for the next few months.
But as long as foreign investors retain their confidence in Kyrgyzstan, the country will be able to defend itself from the growing regional economic crisis.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 8 2015, BISHKEK (The Conway Bulletin) — More than a quarter of Kyrgyz citizens eligible to vote in next month’s parliamentary election have not submitted their biometric data to the authorities ahead of a Sept. 19 deadline, the State Registration Service said.
Under new election rules, if people fail to submit their personal biometric data before the deadline their right to vote will be withdrawn, drawing criticism from human rights defenders who have said this is a breach of civil liberties. They also said government agencies were not competent enough to protect the data.
The State Registration Service said it still hadn’t receive data from 1,072,080 people of the 3,777,500 electorate. The data people need to submit includes an electronic signature, photos and fingerprints.
In central Bishkek, a 22-year-old man explained why he had not to submit his data.
“Our people love freedom. I don’t want to be controlled by the state,” he said, without giving his name,
The risk for the government is that if a quarter of the electorate chooses not to register for the Oct. 4 vote, it will fail to deliver a genuine mandate.
Rita Karasartova, head of Institute of Public Analysis, a Kyrgyz NGO, told local media she thought many people were unaware that the deadline to submit biometric data was two weeks ahead of the election itself.
“Citizens will start submitting biometrics at the eve of the elections because they will not be aware of this deadline,” she said, warning this may trigger complaints about voters’
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 7 2015 (The Conway Bulletin) – On a trip to Tehran, Kyrgyz president Almazbek Atambayev said he wanted Iran to join the Russia and China-led Shanghai Cooperation Organisation (SCO). Mr Atambayev held meetings with his Iranian counter-part Hassan Rouhani to persuade Iran, which is set to become a major regional partner once Western sanctions are removed, to invest in infrastructure projects in Kyrgyzstan.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 9 2015 (The Conway Bulletin) — Toronto-listed Centerra Gold, owner of the Kumtor gold mine in east Kyrgyzstan, has paid 4.3 trillion som (around $65m) in taxes to the Kyrgyz government in the first 8 months of 2015, the ministry of finance said. In 2014, Centerra accounted for 7.4% of Kyrgyzstan’s GDP.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 9 2015 (The Conway Bulletin) — Perhaps the most important feature of news and data from the region’s money markets this week was details about the various Central Banks’ gold and currency reserves.
Kazakhstan’s Central Bank said it had increased its reserves in August to $29.1b. Kazakhstan has amassed reserves over the past 3 months after spending around $400m in April to contain the effects of the regional financial crisis.
In Kyrgyzstan, the Central Bank’s reserves hit $2b, according to the Central Bank, back up to the levels of August 2014.
In Baku it was another story. The Central Bank has been spending ferociously since it devalued its manat currency by a third in February. According to the state-linked Trend news agency, the Azerbaijani Central Bank spent 14% of its foreign currency reserves in August. In the last year, Azerbaijan has spent half its foreign currency reserves trying to defend the manat.
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(News report from Issue No. 247, published on Sept. 11 2015)
AUG. 28 2015 (The Conway Bulletin) – Gazprom, the Russian gas monopoly, will invest $700m in Kyrgyzstan’s gas infrastructure network, Kyrgyz president Almazbek Atambayev told media. Gazprom owns Kyrgyzstan’s gas network and has been promising investment, although it has yet to deliver on these promises.
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(News report from Issue No. 246, published on Sept. 4 2015)
