SEPT. 14 2015 (The Conway Bulletin) – The BBC’s Uzbek language news said the authorities in Uzbekistan are forcing pensioners to pick cotton or face a 50% cut in their pension handout. Uzbekistan has previously faced Western criticism over its use of children to pick its cotton harvest. Cotton is a valuable cash crop for Uzbekistan.
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(News report from Issue No. 248, published on Sept. 18 2015)
SEPT. 15 2015 (The Conway Bulletin) – The Iranian ambassador in Tashkent, Ali Mardani Fard, told news agency RIA-Novosti it wanted to increase by three or four times its trade volumes with Uzbekistan. The statement, while vague on detail, underlines Iran’s potential impact on trade in the region with its re-emergence into the global economy.
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(News report from Issue No. 248, published on Sept. 18 2015)
ALMATY, SEPT. 17 2015 (The Conway Bulletin) — Dogged by various corruption allegations against its businesses in Central Asia, Swedish-based TeliaSonera said it wanted to quit the Eurasian telecoms market to focus on European operations.
In the medium-term, TeliaSonera’s assets in the growing mobile telecoms markets of Central Asia and South Caucasus region could represent an attractive business for companies looking to enter the market. TeliaSonera owns stakes in telecoms companies in Azerbaijan, Georgia, Kazakhstan, Tajikistan and Uzbekistan. These are Azercell, Geo-cell, KcellP, Tcell and Ucell.
In most of these countries, TeliaSonera has been under the spotlight for its opaque corporate governance, an issue that its CEO, Johan Dennelind, referenced.
“Thanks to two years of hard work to improve the Eurasian operations, not least from a corporate governance and sustainability perspective, we now have better and more well-managed companies which we believe others can successfully develop further,” a TeliaSonera press release quoted him as saying.
TeliaSonera appointed Mr Dennelind as CEO in 2013 after a corruption probe into its operations in Uzbekistan forced the previous CEO and most of the directors to resign.
In the past two years, Swedish prosecutors have opened investigations into alleged bribes that the company paid to secure access to mobile networks and licences in Kazakhstan and Uzbekistan. More recently, in May 2015, a Swedish newspaper reported on another possible case of bribery in Azerbaijan.
In 2013, TeliaSonera sacked Tero Kivisaari, a senior executive, for paying $350m a few years earlier to a Gibraltar company linked to Gulnara Karimova, daughter of Uzbekistan’s President Islam Karimov, in exchange for a 3G licence. TeliaSonera owns 94% of Ucell, an Uzbekistan-based, mobile operator.
A 2013 deal that saw Kcell, in which TeliaSonera owns a 62% stake, pay Kazakh PM Karim Massimov $200m for network access has also come under scrutiny.
Analysts said that the pressure had been building on TeliaSonera and that they had been expecting TeliaSonera to cut its losses in its Eurasia division for some time.
Bakytzhan Khochshanov, an analyst at Halyk Finance, said that he thought a Russian or Turkish telecoms company might be interested in buying TeliaSonera’s stakes.
“Potential buyers are likely to be the largest ones, and among them either Megafon or MTS, as Vimpelcom already has an exposure to Kazakhstan’s market with its Beeline brand,” he said.
“Among the other potential bidders could also be Turkish operators, with Turkcell already having a stake in Kcell through Fintur Holding.”
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(News report from Issue No. 248, published on Sept. 18 2015)
SEPT. 16 2015 (The Conway Bulletin) – The IMF increased its GDP growth forecast for Uzbekistan to 6.8% from an earlier estimate of 6.2% although it also raised its inflation forecast to over 10%. The increase in inflation will all but cancel out any real GDP growth increase in Uzbekistan this year.
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(News report from Issue No. 248, published on Sept. 18 2015)
SEPT. 14 2015 (The Conway Bulletin) — LG CNS, a Korea-based global IT service provider and subsidiary of LG, signed an agreement with the Uzbek government to manage its various databases. The parties have created the joint venture, LG CNS Uzbekistan. CEO Kim Daehoon said he wanted to use the joint-venture to pursue more government-orientated projects in Central Asia.
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(News report from Issue No. 248, published on Sept. 18 2015)
SEPT. 14 2015 (The Conway Bulletin) – The Uzbek government said it would increase all utility prices from Oct 1, a decision prompted by the regional economic malaise.
The state water supply company said drinking water rates would increase by 8% and hot water by 5% in Tashkent; electricity prices will increase by 8%; gas prices by 7.3%.
The announcements will pile extra pressure onto ordinary people who are already dealing with price inflation for food and petrol as well as a drop in their own spending power because of a major fall in remittances.
Data from the Russian Central Bank showed that cash sent back by Uzbek workers had halved in the first half of the year compared to the same period in 2014.
Inflation has been creeping up across Uzbekistan. Earlier this month, the government said that it was going to increase public sector salaries by 10%.
Unofficial reports from Uzbekistan have said that this injection of cash into the economy has also inflated food prices by 30%.
Higher tariffs will pose especially serious challenges to the Uzbek population given the approaching winter coupled with plummeting money remittances from abroad, the increasing staples and services prices as well as anticipated shortages of fuel, gas and electricity.
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(News report from Issue No. 248, published on Sept. 18 2015)
SEPT. 8 2015 (The Conway Bulletin) — Russian energy company Lukoil said it is negotiating with Korea Eximbank, South Korea’s state export credit agency, on funding for its projects in Uzbekistan. Lukoil is building a $2.66b gas processing plant in Kandym, 100km south-west of Bukhara, with South Korea’s Hyundai Engineering and is developing several projects along the Turkmen-Uzbek border.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 7 2015 (The Conway Bulletin) – Uzbek media reported that Usman Khaknasarov, described as a local political analyst with good access to the ruling elite, had said that Uzbekistan’s President Islam Karimov may be lining up his youngest daughter, Lola, to succeed him. The 77-year-old Mr Karimov has yet to announce a successor. His eldest daughter, Gulnara, has lost her power and influence.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 4 2015 (The Conway Bulletin) – A bomb exploded near a mosque in central Tashkent. Nobody was hurt in the explosion. Police said they are looking for two people who left the bomb in a bag at a bus stop.
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(News report from Issue No. 247, published on Sept. 11 2015)
SEPT. 9 2015 (The Conway Bulletin) — Car-maker GM Uzbekistan’s sales to Russia in Jan.-Aug. fell by 53% compared to the same period last year, it said. GM Uzbekistan is a joint venture between General Motors and the Uzbek government. It sold 13,752 cars to Russia in Jan.-Aug.
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Copyright ©The Conway Bulletin — all rights reserved
(News report from Issue No. 247, published on Sept. 11 2015)
