Tag Archives: remittances

EBRD downgrades Georgian economic growth rate

MAY 14 2015 (The Conway Bulletin) – At its two-day annual general meeting in Tbilisi this year, the European Bank for Reconstruction and Development downgraded the host nation’s economic growth rate from 4.2% to 2.3% in 2015.

The EBRD’s latest report predicted overall stagnation in 2015 across all its 35 countries in the former Soviet Union and the Middle East. This is mainly due to a drop in oil prices and pressure on currencies generated by a strong US dollar.

Specifically, the EBRD said it had downgraded Georgia’s economic growth prospects because of the stronger than expected impact of the regional financial crisis centred on Russia. This expressed itself in lower remittances from abroad and a heavy drop in the value of national currencies.

Money transfers from abroad in April were down 25% on 2014 and the Georgian lari has also lost 34% of its value against the US dollar since November 2014.

These dreary economy forecasts pile extra pressure on the Georgian Dream coalition government although EBRD president Suma Chakrabarti did have some more comforting words for his hosts.

He said that Georgia was still performing better than average and has the strong potential for economic growth in the future.

“I don’t think it will be too long before Georgia will be able to take advantage of its productive potential going forward and the economic fundamentals here are sound,” he said.

ENDS

(News report from Issue No. 232, published on May 20 2015)

Georgia’s remittances fall

APRIL 17 2015 (The Conway Bulletin) – Georgia received 24% less money from overseas in March 2015 compared to March 2014, the Central Bank said. The biggest source of overseas remittances is Russia. Sanctions over its involvement in Ukraine and a drop in oil prices have tipped the Russian economy into recession and triggered a knock-on effect.

ENDS

(News report from Issue No. 228, published on April 22 2015)

Remittances to Georgia fall by 30%

MARCH 23 2015 (The Conway Bulletin) – Remittances to Georgia in January and February dropped 30%, media reported quoting the World Bank. Georgia, like other countries in the region, is suffering the knock-on effects generated by the fall in oil prices and economic turmoil in Russia.
ENDS

(News report from Issue No. 224, published on March 25 2015)

ADB warns Tajikistan of poor economic outlook

MARCH 24 2015 (The Conway Bulletin) – The Asian Development Bank (ADB) sent a warning to all Central Asian economies, and in particular to Tajikistan, in its Asian Development Outlook report.

Landlocked and dependent on remittances from migrant workers, Tajikistan is particularly vulnerable to the present economic crisis, the ADB said.

The ADB said Tajikistan is expected to experience a deceleration in its GDP growth. This had averaged 9% between 2010-14 but will fall to 5%.

“The decline in remittances and the traditional exports of aluminum and cotton slowed growth in 2014 and inflation worsened to 6.1%,” it said.

The ADB is also expecting rampant inflation and a further devaluation of the somoni currency by 6.5%.

Remittances, mostly from Tajik workers in Russia, represent roughly half of its GDP. The rouble crisis has affected both the value of those transfers and the capacity of these workers to retain their jobs. The ADB also said that new legislation for migrant workers in Russia will hit Tajikistan’s earnings.

“Remittances will likely contract further in 2015 as new regulations require that migrants to the Russian Federation have Russian language proficiency, as well as medical tests and health insurance that are estimated to cost about $500 per Tajik migrant,” it said.
ENDS

(News report from Issue No. 224, published on March 25 2015)

Tajikistan’s remittance will fall, says IMF

MARCH 9 2015 (The Bulletin) – In an interview to the Asia-Plus website, the head of the IMF mission in Dushanbe, Aidyn Bibolov, said remittances would drop by 30% in 2015. Such a large drop would be a big hit for Tajikistan’s economy. Remittances make up 50% of Tajikistan’s GDP.
ENDS

(News report from Issue No. 222, published on March 11 2015)

Remittances to Armenia fall by 40%

MARCH 9 2015 (The Conway Bulletin) – Remittances to Armenia, a vital part of its economy, were 40% lower in January 2015 compared to January 2015, media reported quoting the Central Bank.

Like other countries in the Central Asia/South Caucasus region, Armenia’s economy is partially reliant on workers in Russia sending back cash for their families back in Yerevan and other Armenian towns and villages.

But the Russian economy has dipped over the past 12 months because of Western imposed sanctions and a sharp drop in global energy prices.

This has had a large knock-on effect. Armenia’s economy is especially tied-in to Russia’s financial health.

The data shows Armenia’s dependency on Russia in more detail. Total remittances to Armenia were $72m in January, compared to $122 in the same period in 2013. Of this, the amount from Russia fell 56% to $38m from $87m in 2015.

Economists have been lining up to say that economic growth in Armenia this year will measure around zero, below even the government’s estimates of 2% growth.
The ARKA news agency quoted economist Vilen Khachatryan.

“Given the strong dependence of Armenia on the Russian market we expect the negative developments in Russia and our region will lead to a reduction in turnover and unemployment among Armenian labour migrants in Russia which will in turn affect Armenia’s economy,” he said.

“If Russia fails to get out of the current crisis, Armenia’s economic growth this year will be zero.”
ENDS

(News report from Issue No. 222, published on March 11 2015)

Remittance data to Uzbekistan shows drop

MARCH 10 2015 (The Bulletin) – Remittances to Uzbekistan from Russia dropped by 10% in 2014, media reported quoting a survey by the Russian analytical agency TMT and the CONTACT money transfer system.

While these figures are not official, they do add credence to the picture of tumbling economies in Central Asia and the South Caucasus because of a faltering Russian economy.

Importantly, reports said that analysts expected remittances from Russia to fall by around 25% this year. This will affect most Central Asian and South Caucasus countries, especially Kyrgyzstan, Uzbekistan and Tajikistan which rely heavily on the flow of cash from Russia.

Proportionally, remittances make up a smaller proportion of the national income in Uzbekistan. In practice, though, it is a vital economic lifeline for many ordinary people.
ENDS

(News report from Issue No. 222, published on March 11 2015)

Remittance flows to Tajikistan drop

FEB. 25 2015 (The Conway Bulletin) – Remittance flows from Russia to Tajikistan dropped by 8.3% in 2014 compared to 2013, the Tajik Central Bank said. Remittances are vital to the Tajik economy but have dried up slightly since sanctions and a drop in energy prices hit the Russian economy.
-ENDS-

(News report from Issue No. 221, published on March 4 2015)

Remittances to Azerbaijan fall

>>Remittances from Russia fall>>

JAN. 21 2015 (The Conway Bulletin) — As the Russian rouble falls in value, families of Azerbaijani migrants working in Russia face an increasingly frustrating economic headache.

The Azerbaijani manat has doubled in value against the Russian rouble in the last five months ago. This means that the Russian roubles sent back by Azerbaijani workers to their families are now worth half.

Unofficially around 2m migrants from Azerbaijan work in Russia. They send home about $2-3b a year, Azerbaijani economists have estimated.

Gulsara Qurbanova, a mother of three said she and her children live on money her husband sends from Russia. “Before he used to send us around 35,000 roubles a month and we received around 800 manat when we converted it,” she said. Her voice was strained with worry.

“Now it’s about half that. Obviously we face financial hardship because of it.”

The drop in the value of the rouble is hitting exports from Azerbaijan to Russia too.
Fuad Garibov from Khachmaz, a northern town in Azerbaijan said he has decided to hold on to a consignment of dates that he had intend to sell in Russia. “If I sell it now, it’s obvious that I will lose, he said.

“I hope that something will change soon.”

Azerbaijan’s economy is also reliant on oil and gas sales. With energy prices halving over the last six months, the Azerbaijani economy, which once looked so buoyant, is looking strained.
ENDS

(News report from Issue No. 215, published on Jan. 21 2015)

Tajik C.Bank spends half reserves defending currency

>>Tajik CBank can’t afford aggressive defence of somoni again>>

JAN. 20 2015 (The Conway Bulletin) — Russia’s rouble crisis is pushing Tajikistan to the brink of bankruptcy. The Tajik Central Bank has said that it spent half the country’s reserves last year trying to prop up its currency against the falling rouble.

These are worrying times for Central Asia’s governments. A combination of falling oil prices and Russia’s economic turmoil is pressuring their own finances.

Remittances from Russia have fallen sharply in value over the past six months or so, undermining economies in Tajikistan and Kyrgyzstan especially.

Central Banks have been spending heavily to try to bolster their currencies against a falling Russian rouble but this has proved difficult.

Despite spending half its national reserves — there is now less than $500m left in the Central Bank’s reserves — the value of the Tajik somoni has still fallen over 10% against the US dollar. Inflation has also risen.

All the signs are that 2015 will be complicated too. What the Tajik government can’t afford, though, is another costly battle to defend the somoni.
ENDS

(News report from Issue No. 215, published on Jan. 21 2015)