Tajikistan to Receive Bailout Packa...

The International Monetary Fund would be sending a mission to Tajikistan to help the small mountain country to cope with the falling Russian Rouble ca...

Central Asia Not Looking Good Accor...

Central Asia's economic crisis has arrived according to analysts. While every investor in Central Asia knew that the economic problems have been signa...

Central Asia Against All Odds In 20...

Analysts and think-tanks focusing on Central Asian studies believe security fears have been overblown. Central Asian governments have pounced on the i...

Central Asia At Risk Of Islamic Sta...

Russia's Federal Security Service said Afghan militants had switched sides to the Islamic State posing a greater risk for Central Asia to have an IS s...

Tajikistan to Receive Bailout Package From the IMF

The International Monetary Fund would be sending a mission to Tajikistan to help the small mountain country to cope with the falling Russian Rouble causing its economy to almost collapse.

Tajikistan, the former Soviet Union’s ill-fated country, continues to suffer economically due to migrant workers’ remittances falling in value as the Russian Rouble continues to spiral due to the international communities’ sanctions against the country.

Tajikistan’s GDP had fallen sharply along with export prices.

According to IMF Central Asia and Middle East Department Director Masood Ahmed, a Fund delegation would visit the country to help it ‘reach an agreement on a programme.”

The former Soviet Union countries in Central Asia are the ones most affected by Russia’s sanctions due to its actions in annexing Crimea illegally.

Commodity prices have remained low due to consistent production by local Tajikistan manufacturers.

Azerbaijan, the region’s middle economy, is predicted to contract by 3 per cent, which is the weakest in the region since the 90s. Meanwhile, the largest Central Asian economy Kazakhstan may grow at about 0.1 per cent for 2016.

Tajikistan’s currency continues to weaken with its banking sector assets in 2014 at 30 per cent by the end of the previous year.

Central Asia Not Looking Good According To Analysts

Central Asia’s economic crisis has arrived according to analysts. While every investor in Central Asia knew that the economic problems have been signalling a downturn in the last few months.

Analysts said that it was clear Central Asia was going to enter 2016 with large difficulties. Some investors had already feared that the region might recover only loosely and uncertainty continues to loom.

Central Asia’s RFE/RL Turkmen Service created a “Majilis” or panel discussion on the issue. Participating from London was Alex Nice, who covers Russia, the Caucasus, and Central Asia for the Economist Intelligence Unit, and Nate Schenkkan, the project director for Nations in Transit, Freedom House’s annual survey of democratic governance from Central Europe to Eurasia and also author of a recent article in Foreign Policy, A Perfect Storm In Central Asia.

Most of Central Asia’s current problems originate with the falling price of oil and natural gas. This had a direct effect on Kazakhstan, where the economy is dependent on oil sales, as Nice said. “[In] Kazakhstan, the government estimates [the economy] grew by I think by 1.5 percent last year. We at the Economist Intelligence Unit think now that it will move into recession this year and contract for the first time since 1998,” Nice said.

Falling commodity prices have had an effect on Turkmenistan, where the economy is based on gas sales. However, as the panelists noted, Turkmenistan is so opaque that it is virtually impossible to know what is really happening inside the country.

Falling commodity prices also directly affected Russia, where for years, millions of migrant laborers from Central Asia have found work. Remittances from these workers fell sharply in 2015 and Tajikistan and Kyrgyzstan are the two most remittance-dependent countries in the world, with money sent home being equivalent to more than 40 percent of Tajikistan’s GDP and nearly 40 percent of Kyrgyzstan’s GDP. Until the crisis hit Russia, citizens of Uzbekistan had been sending back more than $6 billion annually.

Schenkkan pointed out that beyond the reduction in money these workers send back home, another “area of uncertainty, big uncertainty, is who comes home in terms of migrants.”

There are not many jobs waiting back in their homelands. Reports show some of these migrant laborers are migrating to other places within Russia. Some have suggested some of these Central Asian migrant laborers might simply go to another country to try to find work.

 

Central Asia Against All Odds In 2015

Analysts and think-tanks focusing on Central Asian studies believe security fears have been overblown. Central Asian governments have pounced on the information as pretext to eliminate perceived enemies in national soil. This is all in context to the concerns of the Islamic State convening in Central Asian grounds.

Analysts said that 2015 saw elections in Central Asia for both parliamentary and presidential governments. Tajikistan is one country who conducted elections. Political pluralism may have allowed governments to use security concerns to eliminate opposition permanently.

One case was the Islamic Renaissance Party of Tajikistan, which had its registration cancelled by court and soon declared an extremist group.

Other Central Asian states were under duress of economic trouble only lifted by migrant laborers’ remittances from Russia. However, the West’s economic sanctions on Russia had seen the fall of the Russian rouble along with oil and gas. Significant numbers of migrant labourers were laid off and those who remained have less to provide for their families.

Uzbek migrants sending money home from Russia saw the money decreased by 40 per cent in 2015. Kazakhstan suffered most with oil devaluation. The Kazakh Tenge saw its devaluation double from 180 tenge to $1 to 330 tenge per dollar.

Central Asia At Risk Of Islamic State Spillover – Russia

Russia’s Federal Security Service said Afghan militants had switched sides to the Islamic State posing a greater risk for Central Asia to have an IS spillover. Alexander Bortnikov, the  RFSS head, said Central Asia would be the last line of defence to stop the IS from reaching Russia.

Russia made it clear they would provide military assistance to prevent the IS in Central Asia.

The Afghan militants in question were once part of the Taliban.

Renewed Interest of Both US and Russia

Central Asia comes to the attention of both US and Russia once again after Russia had taken action in Syria claiming to combat IS. Western and European Countries claim Russia is helping its ally, the Syrian President Bashar al-Assad, as it combats both IS and western-sponsored insurgents.

US Secretary of State John Kerry will visit all five central Asian republics Kyrgyzstan, Uzbekistan, Kazakhstan, Tajikistan and Turkmenistan meeting with senior government leaders to discuss regional issues, possibly the spillover of the IS included.

The Islamic State Situation

The US is looking at proposals to better fight the Islamic State. Despite claims that it would not give a combat role to US forces as they fight against the Islamic State, it had considered putting boots on the ground in Syria for the first time.

The Pentagon had suggested the deployment of Green Berets and other special forces inside the country. The men would be embedded with Syrian rebel forces and Kurdish groups fighting against the Islamic State militants.

US Asks Uzbekistan to Join Coalition

Central Asian Uzbekistan is recruited to provide close-range support against an organised Jihadi group.

The US said that Uzbekistan can choose any way to help contribute to the battle against the Islamic State.

“We have asked Uzbekistan … to join the coalition,” Daniel Rosenblum, U.S. deputy assistant secretary of state for Central Asia, told reporters during a visit to the Uzbek capital.

According to Rosenblum:

“The coalition also gathers information about the movement of people across borders and has five or six other “lines of efforts.

“Uzbekistan or any other country can choose to contribute to one or more of those elements,” he said.

A Muslim nation of 31 million individuals, Uzbekistan served key roles in many NATO operations in Central Asia and the country had been crucial to the success of the US’s war on terror against the Taliban in Afghanistan.

The country is also a top gold and cotton producer. However, long-time leader Uzbek President Islam Karimov had been criticised for his iron fist rule on the country purging most dissent and basic freedoms. However, his government had eliminated child labour in cotton fields, which had received mixed reactions from critics.

Netflix in India “Similar to Starbucks Entering India”

Direct-to-Home companies in India compare US-based Netflix’s entry into India similar to “Starbucks entering the country. Netflix has confirmed it intends to launch its operations in India by 2016. The ripple of the competitor may require local DTH companies to formulate new strategies that branch out from standard television.

Netflix is the leading on-demand internet streaming media company in the world with 62 million subscribers with 40 million in the US alone.

Communications technology is set to improve in India by 2016 with the introduction of 4G technology. Analysts believe Netflix is to predictably capitalise on the growth of the technology. This, along with India being the leading booming internet user population in the world, is enough to convince the digital entertainment to enter the country.

Netflix has not shared any specific details regarding their plans for global expansion.

According to Dish TV COO Salil Kapoor, costs will be one of Netflix’s troubles. Its current streaming costs may prove too much for the public. Kapoor added that the content must complement the price.

Meanwhile, other DTH companies, including Tata Sky is to talk with various content providers to diversify its media operations.

A Four-Month Old Boy And Many Other Villagers Saved From Kathmandu Aftermath

Post-aftershocks in Nepal’s capital Kathmandu, a four-month old boy miraculously survived the disaster under the rubble. Rescue teams from India and foreign countries continue to investigate and look for signs of survivors and the bodies of the deceased.

A teenage male stuck five days underneath the rubble had also made it to safety.

The magnitude 7.9 earthquake that hit Kathmandu has reached a death toll of 5,500.

Rain, terrain and mountains made it hard for air support to reach rescue teams. Meanwhile, the Nepal’s Armed Police Force continues its rescue operation.

Despite the progress, about eight million Nepalese are grieving for their loss. About two million require living tents as the earthquake affected about half the country’s infrastructure.

The UN reports that about 600,000 houses have been damaged or ultimately destroyed. Two million people are in need of tents, water, food and medicines in the next three months.

Nepalese were angered with the response time of the Nepalese Government and their pace of distributing international aid from foreign countries.

The government is appealing for international support for more aerial support. About 20 helicopters are in the Nepalese army. Indian army helicopters have heeded the call.

China intends to send its own helicopters on Thursday.

Indonesian Attorney General Announces Firing Squad Execution of 10 Inmates

According to Indonesian Attorney General HM Prasetyo confirms that 10 prisoners would be executed via firing squad during its next round of executions. These may include Australian nationals Andrew Chan and Myuran Sukumaran and a prisoner who was promised a second opinion on his medical condition.

The executions would take place on Nusa Kambangan in central Java

According to Prasetyo, once all preparations are complete the execution would immediately push through.

Meanwhile, Australian Prime Minister Tony Abott had appealed for clemency for Chan and Sukumaran after a phone call to Indonesian Prime Minister Joko Widodo.

Chan and Sukumaran are known drug smugglers operating alongside Filipina Mary Jane Fiesta Veloso and Nigerian Raheem Agbaje Salami.

They were known as the Bali Nine, a group convicted for the 2005 heroin smuggling plot.

Meanwhile, Indonesia’s government could possibly violate some human rights rules if it refuses to acknowledge appeals and reviews.

French Prisoner Serge Areski Atlaoui has a case underway, but he is denied presidential clemency. However, he still has the right to review. His lawyer Aristo Pangaribuan said that he would stress that his client does not deserve the death penalty.

Chan and Sukumaran’s lawyer Todung Mulya said that the appeal process takes months and during that time, his clients shouldn’t be executed, stating that if Indonesia doesn’t follow the due process, it would become the world’s laughing stock.

Russia and China Is Compressing Central Asia

With its energy provision and jobs market support, Russia holds a huge trump card in Central Asia. China’s economic power has become a factor in the decisions of many Central Asian governments. In the plight of Western sanctions and diplomatic disputes, Central Asia is stuck between a rock and a hard place.

Meanwhile, analysts see that Central Asian leaders do not want to be dominated or tied too closely to Russia or China.

Many leaders have showed a lack of support for Moscow’s attempt to tie Central Asian allies to itself through the Eurasian Economic Union. Russia’s economic troubles, forcing it to increase the interest rate to save the dying Rouble, is an indicator for Central Asian governments that Russia is not capable of supporting them for the long term.

Central Asian had also pushed away Russia diplomatically, disallowing their military and security services from using staging grounds in their countries since 2004.

Kazakhstan President Nursultan Nazarbayev said  “Our independence is our dearest treasure . . . First of all, we will never surrender it to someone, and secondly, we will do our best to protect it.”

Meanwhile, China’s economic powers had also seen lacklustre support. Turkmenistan’s growing reliance in China has alarmed its leaders. China is its biggest supplier of energy, and its losing battle against Iran for sales has put it and other gas-producing Central Asian country in trouble.

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Central Asian Economies Suffer As Ruble Falls

The Russian Ruble’s fall of 20% against the dollar is a sign of economic troubles for many countries in Central Asia. With western countries sanctioning Russia for its behaviour in the Ukraine Crisis, Kyrgyzstan, Tajikistan and Uzbekistan workers are struggling to keep up with inflation.

About 30% of Kyrgzstan’s economy depends heavily on their foreign worker’s remittances, while Tajikistan has 50% of its economy dependent on remittances. As the ruble continues to depreciate, only Turkmenistan, who sells fixed-price oil to China, remains unaffected with the current ruse.

According to Russia and CIS Economist at Renaissance Capital in Moscow Oleg Kouzmin “a weaker ruble weighs on workers’ salaries, which brings some pain to these countries.”

The IMF expects Kyrgyzstan consumer prices to grow 8% in 2014 and 8.9% in 2015. Both Kazakhstan and Tajikistan could see similar inflation.

The Russian Central Bank’s policy shift and the oil price drops puts Kazakhstan into slower economic growths. This convinced its government to recalculate its budget.

Investors also fear that panic selling may further affect economies. They are more vigilant with their expectations.

Both Kyrgyzstan and Tajikistan are using their reserves to cushion the currency fall. Kyrgyz’ Som has fallen 12% against the dollar and the Tajik Somoni by about 5%. Both currencies are expected to fall further this month.

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