Tag Archives: Uzbekistan

Uzbekistan to launch tunnel

JUNE 20 2016 (The Conway Bulletin) – The Uzbek government said it will launch the Angren-Pap railway service from July, opening the longest tunnel in Central Asia. The project, completed in the past few months, cost $1.6b and was partly funded by Chinese and World Bank loans. Uzbek President Islam Karimov and his Chinese counterpart Xi Jinping inaugurated the new tunnel during a ceremony in Tashkent.

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(News report from Issue No. 286, published on June 24 2016)

GM- Uzbekistan woes worsen

JUNE 23 2016 (The Conway Bulletin) – Rustam Radjabov, the new director of the GM-Uzbekistan joint venture, was detained by police and held in jail since the end of May on embezzlement charges, RFE/RL reported quoting sources in the company. Mr Radjabov replaced Tokhirjon Jalilov who was arrested in April for masterminding a criminal scheme over car exports to Russia. The Uzbek authorities have not confirmed the arrest. The anonymous source also said operations at the GM Uzbekistan plant are “practically suspended.” GM Uzbekistan is one of the country’s most important factories.

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(News report from Issue No. 286, published on June 24 2016)

Uzbekistan closes borders for SCO summit

JUNE 15 2016 (The Conway Bulletin) – The Uzbek government ordered the closure of land borders for ten days to try to insulate the country from potential Islamic militant attacks ahead of a meeting of Shanghai Cooperation Organisation (SCO) heads of states, scheduled for next week.

Leaders from Russia, China, Kazakhstan, Kyrgyzstan, Tajikistan will join Uzbek President Islam Karimov at the annual SCO summit in Tashkent on June 23/24.

Uzbekistan has emphasised its efforts in combating terrorism, one of the pillars of the SCO, and wants to demonstrate its ability to become a safe haven of peace in Central Asia.

Analysts said that closing its border crossing checkpoints is a way of demonstrating control over its territory and its capacity to fence off potential terrorists from abroad.

The authorities dismissed earlier rumours that Tashkent would be closed off during the summit.

“There will be enhanced security checks, but the city will operate in normal mode,” the Uzbek ministry of interior said in a statement.

In the weeks leading up to the summit, the Tashkent city administration ordered a clean-up of the capital. Reports said that hundreds of satellite dishes were removed from houses on Prospekt Kosmonavtov,a main road in Tashkent which runs down to Mr Karimov’s official residence.

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(News report from Issue No. 285, published on June 17 2016)

US court to seize Uzbek President’s daughter’s accounts

JUNE 12 2016 (The Conway Bulletin) – A US court said that it is ready to seize assets linked to Gulnara Karimova, daughter of Uzbekistan’s President Islam Karimov, in Ireland, Belgium and Luxembourg, if a corruption case in New York courts is not resolved soon. US authorities said these assets are valued €269m ($303m). In February, Ms Karimova was named as the beneficiary of bribes paid by telecoms companies seeking licences in Uzbekistan, the largest foreign corruption probe in US history.

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(News report from Issue No. 285, published on June 17 2016)

EgyptAir bomb threat plane diverts to Uzbekistan

JUNE 8 2016 (The Conway Bulletin) — An EgyptAir passenger plane flying to Beijing from Cairo diverted to Urgench airport in western Uzbekistan after Egyptian authorities received information that a bomb had been planted on the plane. The plane was evacuated and searched before being allowed to fly on to China after the Uzbek authorities gave the all-clear.

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(News report from Issue No. 284, published on June 10 2016)

Germany invests on Uzbek bank

JUNE 8 2016 (The Conway Bulletin) — ALWA, a German plastics manufacturer, bought a 15% stake in Orient Finance Bank, an Uzbekistan-based lender, for 9.3b sum ($3.2m), news agency Trend reported. The bank was able to sell the stake by increasing its capitalisation. This is in line with the government policy of selling off stakes in state-owned or state-participated assets.

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(News report from Issue No. 284, published on June 10 2016)

New Hyatt hotel to open in Uzbekistan

JUNE 7 2016 (The Conway Bulletin) — A new Hyatt hotel will open in mid- June in Uzbekistan’s capital, Tashkent, sources told local media. The US-based company had planned to open the new hotel in 2013. The original plan was a $113m investment and completion by early 2015. According to reports, costs have now grown to around $205 and include an investment from the government. The hotel will open just days before a meeting of the Shanghai Cooperation Organisation in Tashkent.

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(News report from Issue No. 284, published on June 10 2016)

Uzbek court jails ISIS sympathisers

JUNE 9 2016 (The Conway Bulletin) — An Uzbek court in Samarkand jailed six locals who had planned to join the radical group ISIS in Syria and had incited others to practice Sharia law. The court handed out sentences of six to nine years. All the accused, five men and one woman, pleaded guilty. Official reports say that dozens of Central Asians travel to Syria every month to ISIS.

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(News report from Issue No. 284, published on June 10 2016)

Business comment: Banking mergers

JUNE 10 2016 (The Conway Bulletin) — A wave of mergers, acquisitions and privatisations has hit Central Asia and the South Caucasus.

At The Bulletin, we’ve extensively covered the Kazkommertsbank buyout over the past two years. But elsewhere, from Azerbaijan to Uzbekistan, the banking sector is in a restructuring phase.

A renovation of the financial sector had become crucial after an extended economic downturn hit the money markets, from currency exchange rates to loan sustainability. What’s more, low oil prices, besides depressing budget capacity and economic growth, have hindered investment and project financing.

From small local lenders to country-wide behemoths, banks across Central Asia and the South Caucasus have equally suffered, albeit for different reasons.

And since the beginning of 2016, small quakes have shaken the sector.

In Azerbaijan, immediately after the sharp depreciation of the manat, middle and small-sized banks were unable to maintain the newly set capital ratio requirements, triggering failures and mergers.

This week a rather obscure deal involving an Uzbek bank and a German plastics manufacturer marked the beginning of the new privatisation era in Uzbekistan.

And of course, across the border in Tajikistan, we are now three weeks into the care-taking administration of the country’s second-largest bank.

This is both a stress test and an opportunity. 25-year-old countries cannot afford to have a banking crisis every decade. Dependent as they are on commodity prices and regional trade, they need to seize this occasion to build more reliable and stable foundations for their finance sector.

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(News report from Issue No. 284, published on June 10 2016)

Telia to sell subsidiaries in Azerbaijan, Georgia, Uzbekistan

JUNE 6 2016 (The Conway Bulletin) — Investigations into corruption allegations at its subsidiaries in Central Asia has slowed a sale by Swedish telecoms operator Telia Company, formerly TeliaSonera, of its 59% stake in Netherlands-based holding company Fintur to Istanbul-based Turkcell, sources involved in the sale told Bloomberg News. Fintur is valued at $1b and owns telecoms subsidiaries in Kazakhstan, Azerbaijan, Georgia, Tajikistan, and Moldova.

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(News report from Issue No. 284, published on June 10 2016)