Kazakhstan
The Baikonur Report 30-Jun-2020
Top 3 Company Headlines
Privatization of Samruk-Kazyna assets postponed (Kazinform 10-Jun)
Fitch affirms Samruk-Energy at 'BB' (PR 26-Jun)
Saubota powdered camel milk hits Chinese market (Astana Times 05-Jun)
Top 3 Macro and Risk Headlines
Former President Nazarbayev contracts Covid-19 (Reuters 18-Jun)
Activists jailed in criminal probes (HRW 12-Jun)
21,819 Covid-19 cases confirmed (Kaz Inform 30-Jun)
The Baikonur’s View
COVID-19 cases are rising once again and restrictions are put back in place. The opposition is increasingly critical of the measures devised to contain the virus. The state of emergency is seen as opportunistic for the exertion of power by the ruling party.
Despite the circumstances, credit ratings of major companies remain stable. Besides oil, tourism is among the hardest hit sectors. Yet, renewed attention to the sector allows for a makeover. The Baikonur sees great opportunities for the development of ecotourism attracting local as well as international visitors.
Fun Fact: Siri and Alexa are learning to speak the Kazakh language (Kazakh-tv 29-Jun)
The Baikonur Report 30-Apr-2020
Top 3 Company Headlines
KazMunayGas keeping up production (New Europe 29-Apr)
TCO suspending work on $45bn expansion project (Reuters 14-Apr)
Air Astana delays stock market listing (Reuters 24-Apr)
Top 3 Macro and Risk Headlines
3,356 Covid-19 cases confirmed (Kaz Inform 30-Apr)
National Bank keeps interest rate at 9.5% (Kazakh TV 27-Apr)
State of emergency extended until 11-May (Kaz Inform 27-Apr)
The Baikonur’s View
Al-time low crude oil prices hit Kazakhstan especially hard. Kazakhstan derives 40% of GDP from oil and related industries. With the right govt support the country can use this crisis as a transitional period, investing in other sectors such as tourism, agriculture, and renewable energy. The long term growth and sustainability of the economy post-pandemic will depend on this diversification. Developments in this direction are already underway. A new solar plant composed of 12,798 panels opened at the start of the week and infrastructural improvements for the local tourism sector are planned.
Fun Fact: Kazakhstan will provide 5,000 tons of flour each to Kyrgyzstan and Tajikistan during the crisis (New Europe 16-Apr)
The Baikonur Report 29-Feb-2020
Top 3 Company Headlines
Kaspi.kz, may revive plans for LSE listing (Reuters 27-Feb)
KazMunayGaz plans to float its shares in Q4 (Reuters 25-Feb)
Al Rayan Bank to open branch in KZ (Kazakh-TV 25-Feb)
Top 3 Macro and Risk Headlines
Ethnic clashes kill 10, injure dozens (BBC 09-Feb)
Crackdown on opposition dashes hopes for fair polls (Al Jazeera 25-Feb)
ADB +$2bn to support projects in Central Asia (Kazkah-TV 27-Feb)
The Baikonur’s View
The political rhetoric does not match practice. While President Tokayev has loudly advocated for political change, detention of dozens during a peaceful protest in Almaty points in the other direction. Democracy remains a paper theory and opposition a delusion.
The Baikonur hopes that increasing international attention to political structures will create enough pressure to push for real democracy in the future and the economic development can be made inclusive.
No cases of the coronavirus have been reported in the country. Transport to and from China is suspended and precautions are being taken.
Fun Fact: Kazakhstan will have at least thirty athletes at Tokyo 2020 Olympics (Caspian News 26-Feb)
The Baikonur Report 31-Jan-2020
Top 3 Company Headlines
Condor receives a further US$18.7 million for sale of oilfields (Press Release 22-Jan)
Documentolog launches electronic govt, private sector document exchange service (Astana Times 10-Jan)
KAZ Minerals (LON:KAZ) target price raised to GBX 540 (Slater Sentinel 29-Jan)
Top 3 Macro and Risk Headlines
Govt commits to Fourth Industrial Revolution (Astana Times 28-Jan)
KZ to increase automobile manufacturing, export in 2020 (Times of Central Asia 29-Jan)
KZ set to boost economic growth by 4 pct (Azernews 28-Jan)
The Baikonur’s View
Kazakhstan’s plans for the new year are ambitious. Industrial policy will help to protect local firms and a concurrent liberalisation of the economy is aiming to attract increasing foreign investment. At the base of all this is a commitment to increasing living standards for the population is pronounced. Yet, exact details of how precisely this economic transformation will be achieved remain unpublished. Help is provided by the ADB as well as the EBRD who are heavily investing in local businesses and providing loans. If the plans can crystallise Kazakhstan is on a good path to foster its role as Central Asia’s leading economy.
Fun Fact: Kazakhstan has faster internet than Australia. (CNET 29-Jan)
The Baikonur Report 30-Nov-2019
Top 3 Company Headlines
PKOP to employ health, safety, environmental protection (Astana Times 19-Nov)
LLP Arm Wind wins solar power plant bid (New Europe 28-Nov)
Turkish defence company (Otokar) starts subsidiary (Anadolu Agency 28-Nov)
Top 3 Macro and Risk Headlines
Kazakhstan, Azerbaijan begin Caspian Sea fibre optic cable (Astana Times 22-Nov)
Kyrgyzstan, Kazakhstan to discuss new prospects for strategic partnership (New Europe 25-Nov)
Almaty gears up to become hub on new Silk Road (Xinhua 28-Nov)
The Baikonur’s View
Kazakhstan is an exceptional case in the frontier markets. This is partially due to the state's strong commitment to privatise state assets. Leading SOEs are increasingly selling shares with FDI concurrently increasing. Investments remain relatively balanced between the West and China.
Activists keep fighting for civil rights, rallying for EU pressure over local authorities. The state is being criticised for a lack of protection for women suffering from domestic violence. If the state wants to pursue a leading role in the global economy it must make this process inclusive and create the conditions in which citizens support the country and embark on this journey together.
Fun Fact: Manchester United youngsters set for Europa League showing in Kazakhstan (Sky Sports 19-Nov)
The Baikonur Report 31-Oct-2019
Top 3 Company Headlines
Kcell revenues up 6% in Q3 (Telecompaper 30-Oct)
Kazakh & British companies cooperation agreement (Astana Times 28-Oct)
KMF mandates EMGA $15m from Austria’s OeEB (Astana Times 30-Oct)
Top 3 Macro and Risk Headlines
Kazakhstan Remains Nazarbayev’s State (The Diplomat 29-Oct)
Visas waived for 57 Countries (Caspian News 02-Oct)
Oil production surging despite pledge to cut (Bloomberg 25-Oct)
The Baikonur’s View
To sustain economic growth, Kazakhstan wants to diversify its economy away from oil and into green energy. While Kazakhstan recognises the need for a shift towards green energy, oil still plays a major role. Oil production reached an all-time high this month. ENI and Total are planning yet more offshore oil explorations. On a more positive note, these very same companies are planning to launch renewable energy projects.
On the political side, the Baikonur is less positive. Nazarbayev’s sustained power shows a lack of commitment to fresh air and real changes as promised.
Fun Fact: The Polish community Polska Jedność in Astana joined the #abai175 poetry challenge, commemorating the 175th anniversary of the great Kazakh poet, Abai Kunanbayev (Kazinform 30-Oct)
The Baikonur Report 30-Sep-2019
Top 3 Company Headlines
State sells Kazatomprom stock to boost liquidity (Global Capital 26-Sep)
Italy’s ENI, GE win renewable contract in Northern Kazakhstan (New Europe 25-Sep)
IPOKazakh FinTech rumoured to aim for $5B IPO valuation (Pymnts 16-Sep)
Top 3 Macro and Risk Headlines
China, Kazakhstan strengthen ties (Manila Times 28-Sep)
Dozens detained in Kazakhstan at anti-China protests (Financial Post 21-Sep)
Kazakhstan continues to push for a nuclear-free world (UN News 24-Sep)
The Baikonur’s View
Kazakhstan keeps on pushing mutually beneficial partnership ties with China. Not everybody, however, sees these relations as being equally favourable. A part of the population worries about the growing influence China is building up in the country. In the past, the Baikonur has reported that due to its favourable geographic location and thus a trading hub for the central Asian region, Kazakhstan benefits as a transit centre for Chinese goods for instance. However, new developments and the reallocation of several Chinese manufacturing plants make China the big winner in this. The Baikonur believes in the benefits of these Chinese investments but strongly hopes to see more regulations by the Kazakh state to control these developments and achieve truly mutual benefits to foster its position in Central Asia.
Fun Fact: How many humps on a camel? In Kazakhstan, it’s complicated. Most of them are now a version of one and a half humped hybrids (NY Times 01-Sep)
The Baikonur Report 31-Jul-2019
Top 3 Company Headlines
KazUAV to provide drone services (Astana Times 23-Jul)
Citigroup continues to invest in Kazakhstan, drive market share, revenue growth (Astana Times 09-Jul)
Suntech launches first solar project (PV Magazine 26-Jul)
Top 3 Macro and Risk Headlines
Kazakhstan to create network of trade missions abroad (Kazinform 23-Jul)
Telecom market grows 4% in H1 (Telecompaper 24-Jul)
Visa-free travel introduced (Caspian News 24-Jul)
The Baikonur's View
The country is actively working to attract foreign investment. At the same time Kazakhstan seeks to cut dependence by entering new sectors and substitute former imports such as sugar and explore new opportunities in the non-extractive sector. New roads are being built which not only facilitate trade but also foster Kazakhstan's position as a transit hub. Increasingly tight relations with major economies such as India and China also contribute to Kazakhstan's position in the global economy. The Baikonur sees investment in the country at this time as a strategic move. The Baikonur expects more investors to jump on the bandwagon.
Fun Fact: Stunts founder achieves long-held wish to work with Disney (Astana Times 23-Jul)
The Baikonur Report 30-Jun-2019
Top 3 Company Headlines
YDA $286m for 2 multi-regional hospitals (Astana Times 17-Jun)
Baiterek Holding, Euler Hermes $1.1bn export credit insurance deal (Astana Times 24-Jun)
Lives'Talk and Samsung Electronics launch livestock GPS tracking project (Times CA 28-Jun)
Top 3 Macro and Risk Headlines
Kassym-Jomart Tokayev elected president with 70.96% of vote (Astana Times 11-Jun)
Voting day marred by mass detentions (Eurasianet 09-Jun)
Kazakhstan ends bank bailouts, writes off people's debts instead (Al Jazeera 26-Jun)
The Baikonur’s View
Kassym-Jomart Tokayev won the presidential elections as expected. A wave of protests has erupted over the country. Protesters were detained and clashed with police. Kazakhstan seems to favour economic growth over political development, namely freedom of expression and an active opposition, for example. However, the Baikonur sees the greater political participation as positive which might help the transition to a full and transparent democracy and lead Kazakhstan into a new political era. The international community has been aware of the crackdowns. The Baikonur senses pressure for political change on the country to keep up positive foreign relations.
Fun Fact: Camel milk ice cream production launched in Kyzylorda (Kazakh-tv 24-Jun)
The Baikonur Report 31-May-2019
Top 3 Company Headlines
AIFC, Bitfury to jointly implement blockchain projects (Astana Times 21-May)
Tyson eyes multibillion-dollar bet on Kazakh beef as route to China (Financial Times 23-May)
Kazatomprom sells 75% of solar manufacturing business (Pv Magazine 20-May)
Top 3 Macro and Risk Headlines
US-China trade wars could benefit KZ (Caspian News 30-May)
Protests in KZ demonstrate democratic dismay (The Diplomat 03-May)
Kazakh ex-president collects yet another title, honorary senator (RFERL 30-May)
The Baikonur’s View
Increasingly, people are starting to question the apparently democratic elections set to take place in June. The population is raising concerns about being left out of national decision making processes. Demonstrations are largely non-violent. The Baikonur does not expect any major disruptions to take place. One thing, however, is clear: the people want change which they are not likely to get in the near future.
Economically the country is performing well. Exports, especially in the agricultural sector, are steadily increasing. The Baikonur is pleased to see diversification efforts which will be crucial in achieving the goal of becoming listed among the 30 most developed countries by 2050.
Fun Fact: A man in Kazakhstan held up a blank sign to see if he’d be detained. He was. (New York Times 09-May)
The Baikonur Report 30-Apr-2019
Top 3 Company Headlines
Halyk Bank to provide women entrepreneurs KZT1bn in loans (Astana Times 03-Apr)
Samruk-Kazyna net KZT343bn in Q1 (Kazakhstan Newsline 30-Apr)
Baiterek Holding joins World Bank Group’s Global Initiative (Baiterek 15-Apr)
Top 3 Macro and Risk Headlines
Succession clears roadblock to foreign investment (Financial Times 16-Apr)
Kazakhstan’s Business Roadmap 2020 financing increased 57% (Astana Times 10-Apr)
Tech modernisation of customs administration (UNCTAD 17-Apr)
The Baikonur's View
Political uncertainty persists but a sigh of relief comes with early snap elections in June. The Baikonur expects Tokayev’s interim presidency to continue. Time for new candidates to organise is limited and Nazarbayev’s daughter is unlikely to run. Tokayev, who has served with the ruling party, Nur Otan, for 25 years is likely to maintain major foreign and domestic policies if re-elected.
Large expansion in trade cooperation with Western European and East Asian countries strengthens Kazakhstan’s role as a strategic trading partner in Central Asia. The Baikonur expects a domino effect of yet more mutually beneficial cooperation.
Fun Fact: Hydroponic greenhouses supply Almaty, Nur-Sultan with fresh pesto (Astana Times 28-Apr)
The Baikonur Report 31-Mar-2019
Top 3 Company Headlines
Microsoft Kazakhstan to assist domestic companies integrate AI technology (Astana Times 18-Mar)
Kostanai car manufacturer expanding export markets (Kazakh-tv 19-Mar)
Goldman Sachs Group boosts KAZ Minerals (LON:KAZ) price target to GBX 600 (PR 22-Mar)
Top 3 Macro and Risk Headlines
President Nazarbayev to step down after three decades (Financial Times 19-Mar)
Central bank keeps rate at 9.25% (Reuters 04-Mar)
S&P affirms Kazakhstan’s credit rating at BBB (Astana Times 18-Mar)
The Baikonur's View
The sudden resignation of President Nazarbayev came as a surprise. While giving way to a new generation of leaders, he retains control in key positions. The Baikonur believes major changes are unlikely. Foreign policy remains unchanged.
Investment from France in solar energy and loans from the ADB are starting to pave a way for the sustainable energy sector. The Baikonur sees new opportunities within the sector and is optimistic.
Fun Fact: WHO studies reveal Kazakhstan has among the highest levels of salt intake globally (WHO 07-Mar)