Tag Archives: Uzbekistan

Uzbek soum fluctuates heavily

AUG. 19 2017 (The Bulletin) — Uzbekistan soum currency has been volatile since last week when Reuters reported that President Shavkat Mirziyoyev and the Central Bank wanted to reform exchange rates. Uzbekistan currently has two operational exchange rates — an official one and an unofficial one. The Black Market rate rose to around 7,300/$1 by Aug. 14, from around 8,400/$1 at the start of the month. It had lost ground by the end of the week, though, and finished at around 8,100/$1.

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(News report from Issue No. 340, published on Aug. 20 2017)

Uzbek CB introduces new bank note

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AUG. 14 2017 (The Bulletin) — Reflecting sharp inflationary pressures, the Uzbek Central Bank said that it was going to introduce a 50,000 soum banknote. In June, in a rare statement, the Central Bank said that rising inflation had forced it to increase its key interest rate to 14% from 9%. Earlier this year it introduced a 10,000 soum note. The 50,000 soum note is equivalent to $12 on the official exchange market and around $6 on the unofficial market.

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(News report from Issue No. 340, published on Aug. 20 2017)

Uzbekistan repeals exit visas

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AUG. 16 2017 (The Bulletin) — Uzbek president Shavkat Mirziyoyev has signed into law a decree that will scrap exit visas from Jan. 2019, state media reported. Repealing the exit visas is one of the most high-profiles decisions taken by Mr Mirziyoyev who has crafted himself as a moderniser and a reformer since taking over the presidency after the death of Islam Karimov in September 2016.

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(News report from Issue No. 340, published on Aug. 20 2017)

Moscow court halts Uzbek reporters extradition

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AUG. 8 2017 (The Bulletin) — A court in Moscow suspended the extradition of Uzbek journalist Khudberdi Nurmatov after he said that he would be tortured and killed if sent back to Uzbekistan. Mr Nurmatov is openly gay, a crime in Uzbekistan. He was detained by police in July for allegedly breaking immigration rules. He has lived in Moscow since 2011 and has been trying to claim asylum. Uzbekistan has one of the worst media freedom records in the world.

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(News report from Issue No. 339, published on Aug. 13 2017)

Uzbekistan says to scrap exit visas

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TASHKENT, AUG. 8 2017 (The Bulletin) — Uzbekistan will lift exit-visa requirements, media reported by quoting officials, potentially making it easier for millions of Uzbeks to travel abroad to find work.

Exit-visas are a hated hangover from the Soviet Union and, even if they were not difficult to obtain for most ordinary Uzbeks, were a reminder of the authoritarian nature of the regime. Scrapping them is another indication of the liberal reforms ushered in by Shavkat Mirziyoyev, president since September 2016 when Islam Karimov died. He has also promised to change foreign currency controls and also to encourage more foreign investment, as well as relax social controls, such as laws stipulating when bars and restaurants have to close.

Uzbekistan, like the rest of Central Asia, is reliant on remittances sent back from Uzbeks working abroad to bolster its economy. Most of these remittance payments are sent back to Uzbekistan from Russia.

Uzbekistan’s foreign ministry said a presidential decree on relaxing exit visas had already been drafted and government agencies were considering various pieces of legislation.

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(News report from Issue No. 339, published on Aug. 13 2017)

Gulnara was imprisoned in 2015 says Uzbek prosecutor

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TASHKENT, JULY 28 2017 (The Bulletin) — In a rare public statement, Uzbekistan’s Prosecutor-General said that Gulnara Karimova, once considered a potential successor to her father President Islam Karimov, had been tried and found guilty of various financial crimes in August 2015.

Karimova has not been seen or heard of since being placed under house arrest in Tashkent in March 2014. Rumours had even circulated around Tashkent in the months after her father’s death from a heart attack in September last year that she had been poisoned.

The Prosecutor-General’s statement said that the globe-trotting self-styled diva had been the head of a crime gang. “Under the control and assistance of Karimova G. members of an organised crime group committed a number of crimes between 2001 and 2013,” it said.

At one time, during the height of her powers, Karimova had acted as the unofficial gatekeeper to Uzbekistan, demanding bribes of hundreds of millions of dollars for market access. Swedish-Finnish mobile operator Telia is selling out of its FSU subsidiaries because of the reputational damage caused by a series of investigations showed that it had paid Karimova $300m to set up a company in Uzbekistan in 2007/8.

Always despised by ordinary Uzbeks who hated her opulence while they struggled, the latest revelations about her wealth have further dented her reputation.

In Tashkent, a Bulletin correspondent said that people reacted with disgust and fury about the news the Karimova had headed a gang that had stolen and extorted hundreds of millions of dollars.

“I am outraged reading today’s news,” said a 31-year-old teacher.

“My neighbour was sentenced to seven years for eluding taxes worth just 10m soum ($2,500). Imagine seven years for just 10m soum and five years for a nationwide raid. What justice?”

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(News report from Issue No. 336, published on Aug. 5 2017)

Currencies: Uzbekistan’s soum

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JULY 27 2017 (The Bulletin) — So, it looks like we already have the big currency story of the year for the region. At least, that is, unless something goes terribly wrong with some of the more wobbly currencies out there – mentioning no names – Azerbaijan, Turkmenistan and even Kazakhstan.

The IMF returned from a mission to Tashkent saying that the government there was fully intending to relax currency exchange regulations that have strangled foreign investment. The official rate of the Uzbek soum is now just over 4,000/$1. The unofficial rate is more than double. How they merge is going to be the story to watch.

In the meantime, if anybody has missed it, it is clear that the Uzbek Central Bank has been managing a steady devaluation of its currency. The chart below shows the steps it has been making to devalue it – by more than 25% since the end of January.

On the equities front, KAZ Minerals continues to outperform, mainly because of another surge in copper prices.

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(News report from Issue No. 337, published on July 27 2017)

Uzbekistan’s and Germany’s Siemens signs MoU

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JULY 24 2017 (The Bulletin) — Uzbekistan and Germany’s Siemens signed a memorandum of understanding to boost cooperation in the railway sector. The specifics of the deal were thin but it is being seen as a step towards more projects for Siemens in Uzbekistan.

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(News report from Issue No. 337, published on July 27 2017)

Telia writes down Ucell, Uzbek subsidiary

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JULY 14 2017 (The Bulletin) — Telia, the Swedish-Finnish telecoms company, said that it had written off the value of Ucell, its Uzbek subsidiary, by 2b Swedish krona ($245m) to 1.3b krona ($160m) because of currency and regulatory risks. It wants to sell out of Central Asia after a corruption row focused on its Uzbekistan unit. Earlier this year it sold its majority stake in Tajikistan’s Tcell to the Aga Khan. It appears to be having more difficulty offloading Ucell and its majority stakes in Kazakhstan’s Kcell, Azerbaijan’s Azercell and Georgia’s Geocell.

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(News report from Issue No. 337, published on July 27 2017)

Uzbek officials consider easing cafe curfew

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TASHKENT, JULY 20 2017 (The Bulletin) — Uzbek officials said they would consider softening restrictions on cafe and restaurant opening times, a curfew blamed for stunting the development of Uzbekistan’s nightlife.

Although officials didn’t give any details, cafe owners and staff welcomed the news as another step towards opening up Uzbekistan since the death last year of President Islam Karimov. A waitress who works at a small summer cafe in Tashkent told a Bulletin correspondent that she currently closes the cafe when it is still full of customers.

“We have to close at a very time when we have a good flow of clients,” she said.

Local bars and restaurants in Tashkent are, officially at least, only allowed to open until 11pm, cutting the evenings short. In neighbouring Kazakhstan and Kyrgyzstan, restaurants and cafes stay open late.

Not that the rules are applied evenly, an employee at another Tashkent restaurant explained.

“If you have money and powerful contacts you can freely serve the clients at any time of the day. All you have to do is to please the police and other officials,” he said.

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(News report from Issue No. 337, published on July 27 2017)