Russia has been habitually critical of the United States’ unilateral policies in the region. On the outward, Russia has been apparently following a multilateral policy at international level and has been encouraging the United States to follow suit by adopting similar policies. However, when it comes to Central Asia and Caucasus, Russia has been itself pursuing totally unilateral policies. Russia’s political behavior in this regard has been an obstacle to multilateral cooperation with such Asian countries as India, Iran and China. Moscow is actually willing to bolster its own influence in this region. Although Russia has close ties with a country like China, its major policy and measures taken by Moscow in the strategic regions of Central Asia and Caucasus have been largely unilateral.
Tag: economy
Ruble Collapse a Problem for Central Asia | The Diplomat
Since October 9, the first day in post-Soviet history that the ruble-to-dollar exchange rate climbed above 40, the Russian currency was consistently hammered, until it managed to end last week’s rollercoaster below 60. Post-Soviet economies to the South of Russia have been hit by the financial crisis in Moscow. Although Central Asian trade with Russia is declining, in favor of a surge in business with China, all countries in Central Asia still maintain strong economic relations with Russia. This means that any crisis in Russia is immediately felt in Central Asia.
The two poorest economies in Central Asia, Tajikistan and Kyrgyzstan, are also among the most Russia-dependent in the entire post-Soviet space. Dushanbe and Bishkek’s budgets depend heavily on remittances from migrant workers living in Russia. The ruble, together with the dollar, is widely available in both countries and exchange rates are a significant indicator of the stability of their economies. With the ruble crumbling, Tajikistan’s somoni has reacted very slowly on the official market: The increase against the dollar since October 9 has been just below 3 percent. However, it is worth noting that for four consecutive days last week the official rate hiked almost 4 percent each day before rebounding back to 5.13 somoni per dollar. In the same period, the Kyrgyz som gradually weakened against the dollar, declining 4.5 percent. Notably, for the first time, the som became more valuable than the ruble.
In the past two months alone, the ruble has lost between 55 and 40 percent of its value against the dollar, and has also lost ground against the somoni and som. This could have dangerous consequences for worker remittances from expat Central Asian workers. The Kyrgyz government is preparing for windfalls from abroad to fall by at least $1 billion. The drought in remittances, accompanied by government spending to keep their currencies closer to the dollar, poses a direct threat to the budgets of Tajikistan and Kyrgyzstan.
Henry Rollins: How the Soviets Nearly Ruined Central Asia – Los Angeles | Los Angeles News and Events | LA Weekly
I am a week into my visit to Central Asia. Besides a two-day excursion into Tajikistan, I’ve been here in Uzbekistan.
The border crossing from Uzbekistan to Tajikistan was one of the coolest and strangest I have made.
I often have a déjà vu sensation when going from one country to another, especially in cold weather. It started when I would pass through East Germany to get to West Germany. The East Germans would always regard us and our van with suspicion and barely concealed hostility. They had a way of leaning into the front windows so the barrels of their rifles would point at your eyes.
It is at the crossing point where either country can decide it doesn’t want you, and you could be in for quite an ordeal. That happened to me once on tour, trying to get out of Hungary and into Austria. The Hungarians were done with us but the Austrians were not a bit pleased with the idea of us in their country. We sat in a no man’s land for a long time, our dreams of soundcheck disappearing before we were finally allowed to enter.
On the day I was to cross into Tajikistan, I was warned by my Uzbek guide that the questioning and searches could be extreme. I went in and gave the Uzbek border officer my passport. She asked me why I was in Uzbekistan and wanted to go to Tajikistan. I gave her my whole rap about the only way to know about any place is to go, so here I was.
She and all the other heavily uniformed officers simultaneously lit up. They enthusiastically thanked me for coming all the way out to visit and fairly tossed me through the back of the building.
Suddenly, I was alone on a road. It’s a fair walk to the Tajik border.
Finally I arrived at a gate. A Tajik guard looked at my passport and pointed me onward. About a city block later, I was at a window. I gave the man my passport. He looked at me, pointed and said, “Beckpeck hevee!” He gave me the stamp and I was in Tajikistan.
My guide, conveniently named Chris, walked up and introduced himself. We got in his car and off we went to Khujand city centre.
Russia’s ruble collapse shakes Central Asian neighbours
While people in Moscow are already queueing outside foreign exchange shops to get rid of the ruble, eyeing the current 9.1% price inflation rate, neighbours of the “Russian bear” are likely trembling in fear.
Until a year ago, the Russian economy was flying high on the wings of a seemingly endless oil-fuelled boom, which showered economic migrants with hard cash to send back to their origin country. With the economic depression on the horizon and investors pulling their money out of the country by the billion each month, Russian companies have already started cutting wages and making redundancies.
Poor former Soviet republics with a troubled recent past like Tajikistan and Kyrgyzstan are suffering the most. Millions of Tajik migrants live in Russia and send much of their salary back home. According to World Bank data, remittances in Tajikistan make up 42.1 % of the Central Asian republic’s GDP, making it the world’s biggest recipient.
A staggering 60% of those remittances come from Russia. If we consider that over a million Tajiks – half of the country’s workforce – work in the giant neighbouring country, we see why Russia’s incoming economic depression may potentially wreck those countries.
Neighbouring Kyrgyzstan is in a similarly desperate situation. The small mountainous state has a 32% share of GDP of remittances.
It has been calculated that Tajik growth will slow to 6.5% this year from 7.4% in 2013 as a result of the drop in worker remittances in the January-September period. Both Tajikistan, a state of 8 million, and Kyrgyzstan have a troubled post-soviet past. From 1992 to 1997, a civil war marred the prospect of economic growth in Tajikistan, which borders with Afghanistan and China.
Russia’s Meltdown Will Shake The World, From Tajikistan To Tokyo – BuzzFeed News
The meltdown of Russia’s currency, brought on by falling oil prices, collapsing confidence in the central government, and international financial sanctions, is now manifesting itself as a panic. It’s “the most incredible currency collapse I think I have ever seen in the 17 years in the market, and 26 years covering Russia,” wrote Timothy Ash, Standard Bank’s head of emerging market research, in a note this morning. “No one expected the ruble to hit 60 this year against the dollar, let alone 70 or 80 even. And no one is positioned for this. This will impart huge short term damage to Russia.”
And the reverberations will be felt beyond the country’s borders, globally, but most acutely by its neighbors, where the oil-fueled Russian boom of the last decade has rained cash upon exporters and economic migrants alike.
Consider Tajikistan. Remittances — cash sent home from citizens working abroad — make up 42% of the Central Asian republic’s GDP, according to World Bank data, with almost 60% of those remittances coming from Russia. In the course of just a few months, the value of those remittances has been chopped in half. The results will be devastating.
Russia’s Meltdown Will Shake The World, From Tajikistan To Tokyo – BuzzFeed News.
As Ruble Falls, Tajik Village Suffers
The Russian ruble has collapsed, but the effects are not only being felt in Russia. In the Tajik village of Eloki, marriages are being canceled and houses left half-built as remittances from migrant laborers dry up. Nearly every family has been affected — this is one family’s story. It was filmed when the ruble had lost around 40 percent of its value against the dollar, but before the dramatic plunge that shook markets on December 15-16. (RFE/RL)
The FINANCIAL – OSCE Secretary General in meeting with Tajikistan President
The FINANCIAL — The OSCE Secretary General Lamberto Zannier in a meeting with Tajikistan President Emomali Rahmon today emphasized the need to further develop the strategic partnership between Tajikistan and OSCE in politico-military, economic and environmental, and human areas, and shared views on the OSCE engagement with Afghanistan.
via The FINANCIAL – OSCE Secretary General in meeting with Tajikistan President.
Tajikistan seeks Turkmen gas as shortage looms | Reuters
Tajikistan seeks Turkmen gas as shortage looms | Reuters.
* Uzbekistan to stop gas supplies to neighbour from April
* Turkmen-Tajik deal subject to Uzbek transit accord
* Abrupt drop in supply to harm aluminium, cement plants
By Roman Kozhevnikov
DUSHANBE, March 28 (Reuters) – Tajikistan aims to secure natural gas supplies from Turkmenistan to avert a worsening fuel shortage as its traditional supplier prepares to stop pumping from next week, a high-ranking Tajik government representative told Reuters on Wednesday.
Uzbekistan, the sole supplier of natural gas to its Central Asian neighbour, had informed the Tajik government it would halt supplies from April 1 in order to meet growing demand from its main partner, China, the government representative said.
Speaking on condition of anonymity to avoid jeopardising current talks, he cited a letter from state company Uztransgaz to its equivalent gas transportation company in Tajikistan.
Mountainous Tajikistan, the poorest of 15 former Soviet republics, experiences frequent power blackouts. Only southern regions of the country and upmarket homes in the centre of the capital Dushanbe receive regular supplies of gas.
WB gives more to Tajikistan for farmland, energy projects – Central Asia Online
WB gives more to Tajikistan for farmland, energy projects – Central Asia Online.
DUSHANBE – World Bank (WB) and Tajik officials March 16 signed agreements on additional WB aid to Tajik projects meant to register farmland and to increase energy conservation, AsiaPlus.tj reported.
The WB, through its International Development Association, plans to give US $10m (47.7m TJS) to help register land and create a cadastre system, both meant to enable sustainable agricultural development. The funding will help expand the restructuring of farmland holdings. It also will enable officials to give farmers certificates entitling them to use land, further development of the cadastre system and aid the formulation of various pilot projects for registering real estate. Completion of the agricultural project is scheduled for March 2015.
The WB approved US $18m (86m TJS) in financing for the Energy Loss Reduction Project in February. Tajikistan and the WB have been partners in this project since 2005.