Identifier
Created
Classification
Origin
05ALMATY2850
2005-08-04 11:19:00
UNCLASSIFIED
US Office Almaty
Cable title:  

KAZAKHSTAN ECONOMIC AND ENERGY UPDATE

Tags:  ECON EIND ENRG EPET EFIN KZ ECONOMIC 
pdf how-to read a cable
This record is a partial extract of the original cable. The full text of the original cable is not available.
UNCLAS ALMATY 002850 

SIPDIS


DEPT PASS TO EUR/CACEN MUDGE
DEPT PASS TO OPIC - BALLINGER
DEPT PASS TO TDA FOR STEIN, EXIM FOR GLAZER
DEPT PASS TO AID - EE-PHILLIPS/RUSHING
TREASURY FOR OASIA/VELTRI
USDOC FOR 4231/ITA/MAC/MLONDON, 4201/BISNIS
USDOC FOR 6110/ITA/TD/BI/RHALPERN
ANKARA FOR CFC

E.O. 12958: N/A
TAGS: ECON EIND ENRG EPET EFIN KZ ECONOMIC
SUBJECT: KAZAKHSTAN ECONOMIC AND ENERGY UPDATE
July 10 - 23, 2005


UNCLAS ALMATY 002850

SIPDIS


DEPT PASS TO EUR/CACEN MUDGE
DEPT PASS TO OPIC - BALLINGER
DEPT PASS TO TDA FOR STEIN, EXIM FOR GLAZER
DEPT PASS TO AID - EE-PHILLIPS/RUSHING
TREASURY FOR OASIA/VELTRI
USDOC FOR 4231/ITA/MAC/MLONDON, 4201/BISNIS
USDOC FOR 6110/ITA/TD/BI/RHALPERN
ANKARA FOR CFC

E.O. 12958: N/A
TAGS: ECON EIND ENRG EPET EFIN KZ ECONOMIC
SUBJECT: KAZAKHSTAN ECONOMIC AND ENERGY UPDATE
July 10 - 23, 2005



1. Summary: This information is drawn primarily from the
Kazakhstani local press, and has not been checked for
accuracy. The opinions and policies expressed in this
report are those of the authors, not the U.S. Government.

-- National Bank Raises Refinancing Rate
-- Commerzbank to Invest in Almaty Metro Construction
-- Foreign Manpower Quota for 2005
-- Russia to Train Kazakhstani Space Specialists
-- Economic Statistics
-- Atasu-Alashankou Pipeline 30% Complete
-- Second Kazakhstani Tanker Arrives
-- PetroKazakhstan Announces New Commercial Oil Reserves
-- India, China, Russia Interested in PetroKazakhstan
-- PetroKazakhstan's Latest Fine - Financial Police
Comments


National Bank Raises Refinancing Rate
--------------


2. According to a press release from the National Bank of
Kazakhstan (NBK),the refinancing rate is raised from 7.5%
to 8% as of July 11. This decision, as well as the previous
raise from 7% to 7.5% on February 1, was caused by need to
lower inflationary pressures. The NBK reserves the right to
revise the refinancing rate every quarter. (Interfax-
Kazakhstan, July 11)

Commerzbank to Invest in Almaty Metro Construction
-------------- --------------


3. Vice-presidents of German Commerzbank, Katrine Eich and
Hans-Ulrich Betzoltd, expressed in a letter to the President
Nazarbayev their readiness to loan $800 million for the
construction of the metro in Almaty. The project is
estimated at $1.2 billion. According to the letter, the
German credit agency "Hermes" will provide $327 million in
export insurance; and the U.S. Overseas Private Investment
Corporation (OPIC) will guarantee the loan and provide
political risk insurance for $400 million. The Asian
Development Bank (ADB) provide credit in the amount of $200
million. (Golden Eagle Service, July 18)


Foreign Manpower Quota For 2005
--------------


4. Kazakhstan increased its quota for foreign manpower in
2005, up to 0.32% of the economically active population.
The GoK cancelled its previous decree, which set a quota of
0.28%. In 2003, the foreign manpower quota was 0.14%; in
2004 - 0.21%. The population of Kazakhstan is over 15
million people, including an economically active number of
about 8 million. (Interfax-Kazakhstan, July 19)

Russia to Train Kazakhstani Space Specialists
--------------


5. The best Russian aviation and space educational
institutions should be involved in training Kazakhstani
specialists. Prime-Minister Akhmetov voiced this idea at a
meeting with the representatives of Russian space education.
Both sides agreed that Kazakhstan needs qualified personnel
for the development of its space industry and Russian
specialists can help to create training centers in Moscow
and possibly in Baykonur. The Prime-Minister instructed the
Education and Science Ministry to cooperate with Russian and
other educational institutions to train a sufficient number
of specialists in the medium term. (Kazakhstan Today, July
21)

Economic Statistics
--------------


6. According to a National Statistics Agency report, the
surplus of Kazakhstan's external trade totaled $4,369.3
million in January-May 2005 versus $2,531.9 million in
January-May 2004. Kazakhstan's foreign trade turnover was
$17,445.9 million in the reported period, up 51% compared to
the same period in 2004. This figure includes exports of
$10,907.6 million (up by 54.9%) and imports of $6,538.3
million (up by 45%). (Interfax-Kazakhstan, July 11)


7. Investment in fixed capital in Kazakhstan was KZT 821.9
billion (about $6.1 billion) in January-June 2005, which is
up by 1.5 times greater than in the same period in 2004, the
National Statistics Agency reported. Major investment
sources were enterprises' own funds (59.6%) and foreign
investments (26.9%). Budget investments accounted for 10.1%
and borrowed funds 3.4% of total investments. (Interfax-
Kazakhstan, July 12)


8. Net profits of commercial banks in Kazakhstan totaled
KZT 35.1 billion (about $258 million) in January-June 2005,
which is up by 43.3% year-on-year. According to the
Financial Supervision Agency, as of July 1, 2005 the
aggregate equity capital held by the national banking
sector reached KZT 432.1 billion (about $3.18 billion),a
64.2% increase year-on-year. Credit portfolios, including
inter-bank loans, rose by 7.6% to make KZT 2,277.3 billion
(about $16.8 million). (Interfax-Kazakhstan, July 15)

Atasu-Alashankou Pipeline 30% Completed
--------------


9. Construction of the 962.2 kilometer Atasu-Alashankou
oil pipeline from central Kazakhstan to the Chinese border
is on schedule, KazTransOil Deputy Director General Sultan
stated. The pipeline, which is 30% completed, will be
commissioned on December 16. (Interfax - Kazakhstan, July
18)

Second Kazakhstani Tanker Arrives
--------------


10. On July 21, Kazakhstan received its second 12,000 ton
tanker "Almaty." It was built at the Vyborg ship building
plant (Russia) at the request of the state merchant marine
company KazMorTransFlot. The tanker will transport oil
between Aktau and Makhachkala and Baku and will make 7-8
trips per month, transporting about 7.3 million barrels of
oil annually. The third tanker "Aktau" will be built by
December this year. (Kazakhstan today, July 22)

PetroKazakhstan Announces New Commercial Oil Reserves
-------------- --------------


11. On July 12, Canadian firm PetroKazakhstan announced the
successful completion of the exploration drilling on Kolzhan
area (South Turgai basin). Two exploration wells have flow
rates of 250 barrels of oil per day (bopd) and 700 bopd,
respectively. The third well KK-43 has initial flow rate of
120 bopd. (Interfax - Kazakhstan, July 12)

India, China, Russia Interested in PetroKazakhstan
-------------- --------------


12. India's Oil & Natural Gas Corp. (ONGC) is ready to
purchase PetroKazakhstan for $3.5 billion, a representative
of ONGC Videsh Ltd. stated. China's PetroChina Co. and
Russia's Lukoil are interested as well. (Interfax -
Kazakhstan, July 18)

PetroKazakhstan's Latest Fine - Financial Police Comments
-------------- --------------


13. The Astana City Court imposed a $55 million fine on
seven local oil suppliers belonging to PetroKazakhstan for
violations of Kazakhstani antimonopoly legislation, the
company reported on July 15.


14. "The criminal investigation regarding PetroKazakhstan
Directors is not an effort to force out the company from
Kazakhstani market," Financial Police Head Kalmurzayev
stated on July 12. In April, the Financial Police brought
a charge against the President of PetroKazakhstan Kumkol
Resources and PetroKazakhstan Oil Products Thomas Dvorak
and Financial Director Clayton Clift under Article 196 of

the Criminal Code, "Monopolistic actions and competition
limitation". (Interfax - Kazakhstan, July 18)

ORDWAY


NNNN