Sharp fall in oil price poses concern for Kazakhstan

Nov 12. Reuters. Brussels

By Adrian Croft

Sharp fall in oil price poses concern for KazakhstanKazakhstan is concerned about falls in the oil price, which have had a “tangible” impact on the Central Asian oil producer, the country’s foreign minister said on Wednesday.

Economic uncertainty, due to fallout from the Ukraine crisis and the drop in oil prices, led Kazakhstan’s President Nursultan Nazarbayev on Tuesday to tap some of the country’s $77 billion oil fund to bolster economic growth.

Oil prices have fallen about 30 percent since June, hitting countries like Kazakhstan, Central Asia’s largest economy and the second-largest former Soviet oil producer after Russia.

“The impact is quite tangible … we watch with concern the fluctuations on the global energy market,” Foreign Minister Erlan Idrissov told Reuters in an interview.

The sharp drop in Russia’s rouble has led some fund managers to say there could be knock-on devaluations in neighboring ex-Soviet states such as Kazakhstan, which devalued its currency, the tenge, by 19 percent in February.

“Our national bank is very strong and firm that there are no economic reasons and imperatives for the Kazakh tenge … to devalue further,” Idrissov said during a visit to Brussels.

“If the economic situation will change, that would be watched by the government and the central bank of Kazakhstan and prudent, well-thought and well-balanced decisions will be taken.”

Faced with instability in global politics and the economy, Kazakhstan was developing national stability plan, focusing on infrastructure development, Idrissov said.

“This will be a massive plan for public works. It is sort of a President Roosevelt’s ‘New Deal’ policy,” he said, referring to the former U.S. president’s plan to lift the U.S. economy out of the Depression in the 1930s.

Idrissov said there had been “indirect repercussions” for Kazakhstan from disruptions to Russia’s trade caused by Western sanctions over Ukraine.

Kazakhstan’s trade with Ukraine had also been hit. “Ukraine used to be a very sizeable trade partner for Kazakhstan, our trade exceeding $5 billion. Of course, today it’s very difficult to maintain that level,” he said.

Idrissov said it was not only possible, but “a reality”, for Kazakhstan to be on good terms with the West and Russia.

Kazakhstan, along with Belarus, signed a treaty in May with Russia to create a trading bloc called the Eurasian Economic Union, which comes into force on Jan. 1. In September, it wrapped up negotiations with the EU on a cooperation accord.

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Brussels hosted first meeting of the Eurasian Council on Foreign Relations

Nov 13. Kazinform. Brussels

Brussels has hosted the first meeting of the Eurasian Council on Foreign Relations (ECFR) which was attended by prominent Kazakh and European political and public figures.

“Today I am glad to announce the launch of the Eurasian Council on Foreign Relations. Outstanding political figures of the European arena will participate in the event. This organization was established for young people of Kazakhstan, who are trying to create new opportunities for a dialogue between Central Asia and Europe. We need to create a platform for cooperation between Europe and Asia. Europe and Asia should complement rather than oppose each other,” said the Minister of Foreign Affairs of Kazakhstan Erlan Idrissov.

Eminent poet, writer and public figure of Kazakhstan, a member of the ECFR board of trustees Olzhas Suylemenov noted that “the Eurasian Council on Foreign Relations was formed in the center of Europe – in Brussels at the right time, as at the moment the world is trying to find, build and define a new paradigm of sustainable development of mankind.”

He also noted that the ECFR board of trustees include 20 former heads of European states, former Prime Ministers, Foreign Ministers, Defense Ministers, and the heads of the European media.

Eurasian Council on Foreign Affairs will become a valuable and independent source of high-quality research, publications and information that will keep Europe fully abreast of the fast-changing development of the Central Asian region. This is a work-in-progress, and it will require dedication and commitment from the ECFA’s team of researchers and writers.