Page 936 – The Times Of Central Asia

08 Dec 2023

Kyrgyzstan, Kyrgyzstan Business & Economy

Chinese Investors to Build Trade and Logistics Complex in Chui Region

September 26, 2024
By Times of Central Asia

Chinese investors are set to build a trade and logistics complex in the Chui region at a total cost of over $700 million. Akylbek Japarov met with a delegation from the Chinese Chamber of Commerce for International Cooperation headed by Deputy Chairman Liu Yan. During the meeting, the head of the Cabinet of Ministers proposed the issue of investment by the Chinese side in projects in the field of renewable energy sources. In turn, Yan expressed the Chinese sides readiness to develop further bilateral cooperation in the sphere of investment.

Within the framework of the meeting, a signing ceremony was held between the Cabinet of Ministers and OcOO Kyrgyz-Chinese Investment Holding on the implementation of the investment project, Eurasian Trade and Logistics Complex. The complex will include a shopping center, an international exhibition center, a warehouse and logistics center with bonded areas, large equipment marketplaces, and housing and hotel complexes.[/vc_column_text][/vc_column][/vc_row]

08 Dec 2023

Kazakhstan, Kazakhstan Business & Economy, Kazakhstan Home

Government Buys ArcelorMittal Termirtau for $286 Million

October 1, 2024
By Times of Central Asia

The Minister of Industry and Construction of the Republic of Kazakhstan, Kanat Sharlapayev, announced at a briefing that after eleven rounds of negotiations, the purchase of Arcelor Mittal Temirtau has been completed, Kazinform has reported. Divulging the details of the deal, Sharlapayev stated that “$286 million is the cost of two fully functioning enterprises. In addition, ArcelorMittal will not make any claims against the Government of Kazakhstan. The agreement was reached within the legal framework, in full compliance with international law.”

Against a backdrop of ongoing incidents at ArcelorMittal Temirtau JSC, in August of this year, President of the Republic of Kazakhstan Kassym-Jomart Tokayev pointed out serious violations by the company. The Head of State stated that consequences for the enterprise to remain in the Kazakh market were not excluded for AMT.

At the time this statement was made, the government was already negotiating with the owners of ArcelorMittal Temirtau on the possible withdrawal of the company from the metallurgical plant. These talks began after the tragic accident that occurred on November 3^rd 2022 at the Lenin Mine, a subsidiary of AMT. As a result of these intensive negotiations, on December 9^th 2022, a “Standstill Agreement” was signed, which allowed the authorities to evaluate and audit the enterprise. During the negotiations, ArcelorMittal requested $3.5 billion, which did not correspond to the calculations of international consultants.

“This became one of the main reasons for the protracted negotiation process,” Sharlapayev said. “Our goal was to purchase the plant at a fair price without incurring costly and protracted international litigation. The urgency and acceleration of the negotiations were also dictated by the need to prevent the shutdown of the enterprise. The agreement between the Government of Kazakhstan and ArcelorMittal can be called a mega-deal, which is of exceptional importance to our country. We have avoided a lot of risks faced by the governments of other countries,” the minister stressed.

Sharlapayev also announced three key elements of the deal:

– The state has reduced the value of assets from $3.5 billion to $286 million;

– Not a single tenge was spent from the state budget on the implementation of the transaction;

– The new investor undertakes an obligation to the parent company, ArcelorMittal, to repay a short-term loan of $250 million and a long-term loan of $450 million over four years.

07 Dec 2023

Turkmenistan, Turkmenistan International Affairs, Turkmenistan Business & Economy

Ashgabat Hosts Turkmen-Turkish Business Forum

June 27, 2024
By Times of Central Asia

On December 6^th, a Turkmen-Turkish business forum was held in Ashgabat, which was attended by heads and representatives of government and business structures of Turkmenistan and Turkey. The forum participants noted the progressive development of bilateral relations, which in recent years have received new qualitative content and powerful dynamics. At the same time, it was emphasized that business meetings between Turkmen-Turkish partners are an effective mechanism for promoting economic cooperation.

In their speeches, the heads of Turkish companies drew attention to the development of the historical Great Silk Road with an extensive railway network, road transport lines, and energy corridors. The Turkmen side told its Turkish partners that a good incentive for fruitful collaboration is the comprehensive reform ongoing in the country, including in the legislative sphere, and the development of new laws that provide significant benefits and government guarantees for the work of foreign business partners. On the sidelines of the business forum, documents were signed between Turkmen and Turkish companies.

07 Dec 2023

Kyrgyzstan International Affairs, Kyrgyzstan, Business & Economy, Kyrgyzstan Business & Economy, Kyrgyzstan Features

ADB to Help Improve Agribusiness Value Chains in Kyrgyzstan

October 8, 2024
By Times of Central Asia

As per a press release on its website, on December 7^th the Asian Development Bank (ADB) has said it is providing a $20 million loan and a $20 million grant to the Kyrgyz Republic to help small and medium-sized agribusinesses improve their processing and storage capacity and reduce post-harvest handling losses through inclusive, resilient, and climate-adaptive horticultural value chains.

“The project will enhance the resilience of farmers, including women, against market volatility, natural hazards and climate change, and increase household and national food security,” said ADB Director General for Central and West Asia, Yevgeniy Zhukov. “By equipping them with climate-smart agricultural technologies and strengthening value chains, farmers and all stakeholders along the value chains will be able to minimize resource cost and increase profitability.”

The Climate-Resilient Agricultural Value Chain Development Project will provide long-term funds to qualified participating financial institutions to extend structured loans for horticulture value chain investments, including fruit and vegetables. Aiyl Bank, the most prominent bank financing the country’s agriculture sector, has been selected as the first financial institution to participate in this project.

“About 80% of small businesses in the Kyrgyz Republic are currently funded by family, friends, and informal sources,” said ADB Principal Natural Resources and Agriculture Specialist, Giap Minh Bui. “To stimulate private investment in modernizing agricultural value chains, it is critical that local banks have access to stable long-term funding sources and offer a range of term-lending products that are appropriate for and affordable to horticulture entrepreneurs, including women.”

Aside from establishing modern processing, storage and refrigerated facilities, the project will also help establish contract farming arrangements between farmers and processors and/or exporters; train women business-owners; and implement measures to facilitate cross-border trade and branding for products that are unique to the Kyrgyz Republic. These measures aim to increase profitability for horticultural producers and agribusiness enterprises, and strengthen market linkages to increase national food security.

07 Dec 2023

Kazakhstan, Kazakhstan Business & Economy

Kazakhstan Approves Plan for Oil and Gas Industry Development

June 27, 2024
By Times of Central Asia

Kazakhstan Approves Plan for Oil and Gas Industry Development

On December 6^th, the Government of Kazakhstan approved a comprehensive plan for the development of the largest oil, gas and petrochemical projects for 2023-2027. The plan is aimed at implementing 20 significant projects in the oil and gas industry, oil and gas refining, and the petrochemicals industry, with an expected investment volume of $37.3 billion.

In particular, the document provides for the implementation of large oil and gas projects in the Tengiz, Karachaganak and Kashagan fields, aimed at increasing oil production to 105.5 million tons and gas production to 82.1 billion cubic meters by 2027.

The construction of gas processing plants provided for in the plan will have a significant impact on meeting the needs of the domestic market for motor fuel. In addition, in order to supply the domestic market with petroleum products, it is planned that by 2029 the production capacity at the Shymkent Oil Refinery will be increased from 6 million to 12 million tons. As a result, the country will produce 18 million tons of fuel per year.

07 Dec 2023

Kazakhstan, Business & Economy, Kazakhstan Business & Economy

EBRD Supports Capital Markets in Kazakhstan

June 27, 2024
By Times of Central Asia

The European Bank for Reconstruction and Development (EBRD) on December 6^th said it is further developing the financial markets in Kazakhstan by introducing a new local currency interest rate swap derivative – an Overnight Indexed Swap (OIS) – in which the overnight rate is exchanged for a fixed interest rate.

An inaugural one-year OIS transaction, based on the Tenge Overnight Index Average (TONIA), was closed with one of the country’s largest lenders, Bank CenterCredit (BCC).

The OIS market will allow banks and investors to better manage their interest rate risk, thus making the financial system more stable and financial markets in Kazakhstan more attractive.

“The EBRD and Kazakhstan are making significant progress in the development of financial markets. This transaction reconfirms the role of TONIA as the interest rate benchmark in the country, stimulates local currency lending, and encourages more TONIA-linked swaps,” the EBRD’s Treasurer, Axel van Nederveen said.

The EBRD believes the new derivative instrument fills an important gap in capital markets and is keen to participate in the development of this, not only as part of its commitment to local currency financial markets, but also as an active participant.