Egyptian President Abdel Fattah al-Sisi has paid a rare visit to Kazakhstan, where his host Nursultan Nazarbayev hailed the visiting Arab leader as a force for unity and stability in his troubled home country.
These themes are close to the heart of Kazakhstan’s long-ruling leader, who never misses a chance to tout the benefits of unity and stability as a bulwark against political unrest and revolution.
“We are very glad that, despite the internal conflicts, bloodshed and revolution that have taken place in recent years, the people of Egypt have united and expressed their trust in the new president,” Nazarbayev said after a meeting in Astana on February 26, in remarks quoted by his office.
Sisi rose to power through the type of political upheaval that Nazarbayev — who has ruled Kazakhstan with an iron fist since independence a quarter of a century ago — views as anathema.
Egypt’s president was installed following a bloody military coup in 2013 that overthrew the elected president, Mohamed Morsi of the Muslim Brotherhood, since which time around 1,000 have since been killed in unrest stemming from opposition to Sisi’s rule. Morsi had come to power after the toppling of Hosni Mubarak during the Arab Spring in 2011.
Sisi’s visit to Kazakhstan launched an Asian tour that the Egypt Independent newspaper described as part of a foreign policy tilt eastward by Cairo.
Kazakhstan has slashed its growth forecast for this year, finally acknowledging the scale of damage wrought to its economy by the slump in the price for its main export commodity.
The government now predicts that the economy will expand by 0.5 percent in 2016, down from its previous forecast of 2.1 percent, National Economy Minister Yerbolat Dosayev said on February 23.
The projection has been revised because of low oil prices, he said in remarks quoted by the Kazinform news agency. Still, Dosayev said the government was hopeful growth would still be “in the positive zone.”
Others are less optimistic.
Standard and Poor’s ratings agency released a forecast last week predicting zero growth, while the London-based Economist Intelligence Unit think-tank believes the economy will actually shrink this year for the first time since 1998, by 2 percent.
The government has now adjusted the figures in its budget to reflect low oil price forecasts and the crash of Kazakhstan’s tenge against the dollar, Dosayev said.
It is now basing the budget on a year average oil price of $30 per barrel, which is close to current levels, rather than the previous $40.
Although Astana can balance its books by adjusting prices in the budget, current oil price levels are below those many economists believe make extraction profitable for Kazakhstan.
Free speech campaigners are crying foul over a criminal investigation in Kazakhstan involving two prominent media figures on charges of embezzling nearly $1 million.
Seytkazy Matayev, head of the Union of Journalists and president of the National Press Club, and his son Aset Matayev, director of the KazTAG news agency, have been questioned over the embezzlement of some 340 million tenge ($970,000) in public funds between 2011 and 2015.
Details of the case were released on February 22 by the state’s National Bureau for Counteracting Corruption in a statement, which said that investigations are ongoing into whether another 169 million tenge ($480,000) allocated by local government bodies had also been stolen.
The statement accused Seytkazy Matayev, a well-respected figure on Kazakhstan’s media scene, of embezzling the funds and of tax evasion to the tune of 327 million tenge ($934,000), but did not name his son. The charges carry a jail term of up to 12 years.
The money was allocated by the government’s Information Technology Committee and state-owned telecoms company Kazakhtelecom for the publication of material publicizing their affairs, the anti-corruption bureau said.
The two categorically deny the accusations. “We openly state that we have not broken the law and have not stolen budget funds,” they said in a statement published on the website of the Adil Soz (Free Speech) watchdog.
Source: Communist People’s Party of Kazakhstan Facebook page
Supporters of the Communist People’s Party of Kazakhstan watching as a tractor crushes DVD and VHS tapes of Western movies.
Kazakhstan’s pro-government communist party has kicked off its parliamentary election campaign with a stunt designed to galvanize anti-Western sentiments.
The youth wing of the Communist People’s Party of Kazakhstan (KNPK) drove a tractor over a pile of foreign movies in an antic directed against “western lack of culture,” the party said on its Facebook page.
Photographs published on the page showed a crowd of several dozen people gathered in Almaty on February 21 to watch a red tractor drive over films that the party insisted “symbolized the destructive culture of the western movie industry.” One spectator was mustachioed KNPK central committee secretary Zhambyl Akhmetbekov, who could be seen in pictures clasping his hands and beaming with undisguised glee.
“The western culture of violence, which exerts a negative effect on the consciousness of the younger generation, destroys our traditional principles such as respect for elders, tolerance, patriotism and aspiration for improvement, which have been shaped over centuries,” the KNPK said in its statement.
“Traditionally communists have always spoken out, and will continue to speak out, against the politics of degrading true values that is implanted by western ideologists.”
Of course, Akhmetbekov hasn’t always been opposed to western culture or violence. When he was running for parliament in 2012, his party produced a video of Akhmetbekov rehearsing a variety of martial arts moves to the musical accompaniment of a Russian cover version of the Carl Douglas classic “Kung Fu Fighting.”
Companies in Uzbekistan have shelled out around half a billion dollars in fines after failing to pay salaries to their staff.
This is the latest indication that the country is grappling with economic problems which are absent from the rosy official picture of steady growth.
Firms were slapped with fines worth a total of 1.5 billion sum ($500 million at the official exchange rate) last year for wage arrears owed to employees, Russian state news service Sputnik reported this week.
The fines resulted from 1,300 complaints filed with the State Legal Labor Inspection service, Sputnik said.
The wage arrears were generally the result of a lack of funds at the organization in question, an unnamed labor inspection official. Other reasons included organizations holding money back to make a profit on interest, and simple bureaucratic hitches in making payments.
The revelation suggests that companies may be ailing in the face of the economic crisis that is gripping Central Asian — although the government is in denial about the impact of the region-wide crisis on Uzbekistan.
Its bullish economic forecast sees growth at 7.6 percent this year, despite falls in key commodity prices — gold, cotton and gas — and a massive drop in remittances from migrant laborers in Russia that is eating into disposable incomes.
With recession in Russia forcing many migrants out of work, the government is reporting that jobs are being created at home in Uzbekistan on a massive scale.
If Tashkent’s statistics are to be believed (and economists warn that they should be taken with a grain of salt), nearly 2 million extra jobs will have been created over two years by the end of 2016: 980,000 in 2015 and 990,000 in 2016, according to Sputnik.
Russian-owned telecommunications giant VimpelCom is to shell out $835 million in fines after admitting to securing its foothold on the market in Uzbekistan through bribery.
The U.S. Department of Justice said in a statement on February 18 that it is also seeking the forfeiture of $850 million of bribes payments allegedly made by VimpelCom another Russian-owned company, MTS, and now being held in bank accounts in Switzerland, Belgium, Luxembourg and Ireland.
U.S. government officials have described these as historic turning points.
“These cases combine a landmark [Foreign Corrupt Practices Act] resolution for corporate bribery with one of the largest forfeiture actions we have ever brought to recover bribe proceeds from a corrupt government official,” said Assistant Attorney General Caldwell.
The lion’s share of the fines — $795 million — will be paid to the U.S. and Dutch corruption-busting bodies that have been investigating the activities in Uzbekistan of VimpelCom and other telecoms companies.
VimpelCom officially admitted earlier this week to engaging in corrupt practices in Uzbekistan.
VimpelCom admitted it had “through various executives and employees, paid bribes to an Uzbek government official, who was a close relative of a high-ranking government official and had influence over the Uzbek governmental body that regulated the telecom industry,” the Justice Department said.
That individual is widely held to be Gulnara Karimova, the eldest daughter of Uzbekistan’s President Islam Karimov.
Tashkent is also seeking the return of those frozen funds, arguing that it is a victim of bribery.
An international telecoms company has admitted engaging in corrupt practices in Uzbekistan, following bribery probes spanning several continents whose tentacles reach into the heart of the ruling Karimov family.
This marks the first official admission by an international telecommunications company of illegal practices in a case that centers on the affairs of the eldest daughter of Uzbekistan’s President Islam Karimov, Gulnara Karimova, who was last heard of under house arrest in Uzbekistan on corruption charges.
Russian-owned VimpelCom said it is prepared to “acknowledge certain violations of the U.S. Foreign Corrupt Practices Act and relevant Dutch laws” and pay fines to corruption-busting bodies in the United States and Holland.
The admission was made in a report on final quarter results for 2015, released on February 17 by VimpelCom, which is majority owned by Russian billionaire Mikhail Fridman. Norway’s state-owned Telenor owns a minority stake that it is trying to sell.
VimpelCom said that discussions with the U.S. Department of Justice and Securities and Exchange Commission and the Dutch Public Prosecution Service had resulted in “prospective settlements” that, subject to approval, will see it admit breaking U.S. and Dutch anti-corruption laws and paying “fines and disgorgements.”
The size of the anticipated payments was not disclosed, but VimpelCom said that it was within the $900m it set aside last November to cover potential liabilities from the corruption probes.
Ethnic tensions are bubbling in southern Kazakhstan, where local authorities have stepped in to restore calm following the murder of a child by a member of an ethnic minority.
Worryingly for Astana, this is the second time in a year that the south of the country has witnessed a local dispute splitting along ethnic lines and breaking out into scenes of unrest, albeit small in scale.
A mob took to the streets in the village of Buryl in Zhambyl Region following the murder of a six-year-old child to demand the ejection from the village of the family of the murder suspect, the NewTimes.kz website reported.
The ethnic element to the dispute emerged because the child, an ethnic Kazakh, was allegedly stabbed to death by an ethnic Turk from the village during a robbery on February 15.
Local authorities held a public meeting to calm tensions on February 17, the day after a mob of 100 mainly Kazakh villagers besieged the house of the family of the suspect, who is under arrest.
Video of a meeting held in the village and attended by elders, posted by NewTimes.kz, showed elders and officials appealing to a rowdy crowd and a heavy police presence.
There were no reports of serious damage or injuries, unlike during a riot last year in the village of Yntymak in southern Kazakhstan following the murder of a Kazakh man by an ethnic Tajik neighbour.
Hot on the heels of a corruption scandal in Uzbekistan’s financial sector comes news that a commercial bank that has foreign shareholders has been barred from conducting hard currency operations.
The development is the latest sign of troubles hitting Uzbekistan’s banking industry, as Central Asia reels from an economic crisis that is slowing growth and pressuring currencies across the region.
Uzbekistan’s central bank has imposed a six-month ban on Hamkorbank conducting foreign currency operations with businesses on the grounds that it has been breaking currency laws, the Anhor.uz news website reports.
No further specifics were offered for the ban, which is unusual and will present a significant barrier to a bank with foreign capital conducting commercial operations.
The International Finance Corporation (a financing arm of the World Bank) and the Netherlands Development Finance Company (a development bank controlled by the Dutch government) between them own 30 percent of shares in Hamkorbank, according to documents filed with Uzbekistan’s stock exchange.
The time for showers of gold is over, President Nursultan Nazarbayev warned his countrymen on February 16 in his latest attempt to inculcate a popular spirit of parsimony.
Instead, the people of Kazakhstan should exploit the opportunity of a crisis caused in part by low oil prices to transform the country into a more innovative and dynamic economic performer.
“We should not expect to be showered with gold,” he said in remarks quoted by the Nur news agency.
Those remarks appear much in the same mold as recent exhortations by Nazarbayev for the people of Kazakhstan not to indulge in luxuries such as lemons.
“Every crisis is a stage ahead of new development,” which, he said, means weaning the economy off its current dependence on oil and gas.
One way the government intends to that is by raiding the state pension pot, which Nazarbayev ordered last week as part of measures to stimulate growth.
The economy is in desperate need of help. Some economists are forecasting that the economy will shrink this year for the first time in almost two decades.
In line with Nazarbayev’s order, issued on February 10, 1.5 trillion tenge ($4 billion) worth of assets will be withdrawn from the state pension fund — a quarter of its total holdings of nearly 6 trillion tenge — to help plug holes in the budget deficit and support small businesses and infrastructure projects.