Welcome to the Caspian Daily, where you will find the 10 most important things you need to know on Caspian Sea Region. We appreciate ideas, reports, news and interesting articles. Send along to Caspian[at]moderndiplomacy.eu or on Twitter: @DGiannakopoulos
1As Western central banks continue their manipulation of the gold price in order to prop up flagging fiat currencies, two of the world’s largest bullion hoarders are fashioning their own gold market which will function outside the dollar system. This new approach is connected closely with the China-led New Silk Road project and the Shanghai-based Asian Infrastructure Investment Bank (AIIB). In May 2015 Beijing announced it had established a state-run gold investment fund, aiming to bolster China’s role in global gold trade. The new initiative is a part of China’s ambitious One Belt and One Road plan. The “Silk Road Gold Fund” will invest in mining projects in the regions along the New Silk Road encouraging central banks of its members to increase their holdings in the precious metal. [mining.com]
2Russia, Iran Plan To Expand Military Cooperation. Russian Foreign Minister Sergei Lavrov says the Kremlin plans to develop military and technical cooperation with Iran after international sanctions against Tehran are lifted under a nuclear deal between Iran and world powers. Lavrov made the remarks following talks in Moscow with Iranian Foreign Minister Mohammad Javad Zarif on August 17. Russian media reports said the two discussed the possible delivery of S-300 surface-to-air missiles from Russia to Iran and new contracts to build nuclear power plants in Iran.
3Trans-Caspian transport route: what does it mean for Azerbaijan? The member-states of the Trans-Caspian international transport route will be able to earn $1 billion in freight transportation for the first few years, Akif Mustafayev, TRACECA (Europe-Caucasus-Asia) transport cooperation program national secretary on Azerbaijan, told Trend News. The profit of Kazakhstan, Azerbaijan, Georgia and Turkey as a result of the transportation via this route will increase in the future. “The train has arrived from China to Azerbaijan, but it is necessary that this route gets extended through Georgia and Turkey, and then further to Europe,” he said. “Work is currently underway in this regard, and the arrival of the first train gives hope that the work will be completed in the near future.”In general, as the national secretary said, all the projects realized recently, including the construction and reconstruction of the railway in Azerbaijan, the construction of the Baku-Tbilisi-Kars railway’s section and a new international seaport in Alat, are aimed at high-level cargo transportation from China to Europe.
4Azerbaijan’s model of interfaith harmony. The Valley Outreach Synagogue, one of the most influential Jewish synagogues in Los Angeles, hosted a presentation on Azerbaijan on August 14, 2015. Attended by over 500 members of the Synagogue, the event featured Nasimi Aghayev, Azerbaijan’s Consul General in Los Angeles. Synagogue’s Spritual Leader Rabbi Ron Li-Paz noted that during the turbulent times of religious intolerance and violence in various parts of the world, especially in the Middle East, Azerbaijan stands out as a beacon of tolerance, interfaith harmony and secularism. He called Azerbaijan “a ray of hope in the darkness” and an exemplary model of religious tolerance and acceptance.
5Iran’s energy ministry and the State Agency on Alternative and Renewable Energy Sources (SAARES) are set to enter into a deal on enhancing generation of renewable energies, a deputy energy minister said. Houshang Falahatian was quotes by shana as saying on Tuesday that Iran plans to add 1,000mg it to power generation by renewables. Once sealed, Azeri companies active in the field of renewable energies will start cooperating with MAPNA group in Iran for developing projects for generation of power from renewable energy resources.
6Goods transfered from Central Asian countries to Bandar Abbas – port by Persian Gulf in southern Iran – will recieve 35 percent transfer discount, Hossein Ashouri, an official with Iran’s railroad organization said. He added that Iran also gives 40 percent discount to the transfer of goods from Central Asia to Pakistan via the Iranian railroad, IRNA news agency reported August 17. The official further said that a two-way discount is also to be given to the transfer of goods between Iran’s northeastern border city of Sarakhs and Turkey.
7Russian energy company Rosneft said on Monday it had registered to take part in the 13th licensing round organised by Brazilian national energy agency Agencia Nacional do Petroleo, Gas Natural e Biocombustiveis. Rosneft said that 10 oil basins and blocks, located onshore and offshore, would be put up for sale at the licensing round.
8More than 700 Russian and foreign companies from 30 countries will put their products on display at the MAKS-2015 aerospace show. According to exhibition director, 40 Iranian companies are also due to showcase their products and achievements in MAKS-2015, including Iran Air Show, Qom International Airport, and Sharif Hamrah Pazhouhan Science and Technology Co. Unlike previous years, Iranian firms and companies have been provided with a larger space in the exhibition this year. Several satellites and launchers, jet engines, navigation systems, helicopters and airplanes are among the Iranian products to go on display in MAKS-2015.
9Yuan’s devaluation to impact Kazakh economy. The decision of the world’s second-largest economy – China – to devalue its national currency has unsettled global financial markets. Sabit Khakimjanov, the director of research at the Halyk Finance JSC, believes that the depreciation of the yuan might increase the likelihood for the devaluation of Kazakhstan’s national currency, the tenge. “First, yuan’s depreciation will further strengthen overvaluation of tenge. This is certainly an additional handicap for Kazakh producers, but when considering the fact that tenge has greatly overvalued against the ruble by 20-25 percent in real terms, the devaluation of yuan by 2 percent is relatively not too big,” he told local media. Several experts consider the devaluation of yuan as a positive factor for Kazakh exporters; while others claim that the depreciation of the Chinese currency not will have any impact on either the Kazakh economy, or the tenge, as Kazakhstan is not a rival of China. [Azernews]
10Three days for Constitution Day in Kazakhstan. This year, Kazakhstan celebrates the 20 years anniversary of the Constitution. The anniversary of the Constitution will be celebrated along with the 20th anniversary of the Assembly of People of Kazakhstan.
The COVID-19 Shock to Kazakhstan’s Economy Largest in Two Decades
For the first time since the late 1990s Kazakhstan’s economy is expected to contract by projected 3 percent in 2020 with a moderate recovery by 2.5 percent in 2021, according to the World Bank’s latest Kazakhstan Economic Update (Summer 2020) – Navigating the Crisis report.
Although Kazakhstan’s GDP showed mild growth at 2.3 percent in the first quarter, economic activities weakened in the following months as commodity prices dropped, trade declined, and COVID-19 preventive measures slowed economic activity. Consumer demand showed moderate growth at at 1.2 percent, reflecting growing concerns over COVID-19 and the restriction measures. Investment is expected to ease to 1.0 percent annually, supported mostly by the on-going foreign direct investments into the oil and gas industry and residential construction. Supply disruptions and currency depreciation pushed up inflation to above the upper bound of the National Bank target range.
“The authorities acted early to contain the COVID-19 pandemic, and the accumulated fiscal buffers allow the government to introduce a relief package to mitigate the impacts of COVID-19 on the economy,” said Sjamsu Rahardja, Senior Country Economist, World Bank in Kazakhstan. “Weak demand and oil prices, as well as the protacted pandemic expose significant risks to the economic outlook. Authorities may want to consider using the available resources to provide relief to the poor and vulnerable, protect productive assets, and introduce reforms to sustain economic recovery.”
A prolonged crisis is likely to increase poverty and can increase inequality in Kazakhstan. Preliminary estimates suggest that poverty rate may rise in 2020 from a projected 8.3 to 12.7 percent – equating to more than 800 thousand additional people living in poverty. The shock to the labor market in Kazakhstan due to both the pandemic and the mitigation measures, is expected to have severe implications for jobs, particularly in sectors that employ low-skilled workers.
The report also argues that COVID-19 has a negative impact on human capital development in Kazakhstan. Unequal access to quality education, especially during lockdown, can negatively impact human capital development for the poor. School closures could result in learning loss of more than one-third of a school year and the impact could mean a decline in the Program for International Student Assessement (PISA) points. As most students in the country currently perform around the threshold for functional literacy and assuming some will lose more than others, the estimates suggest that the percentage of students performing below functional literacy will increase by 3 percentage points (from 64 to 67 percent).
“The impact of COVID-19 on education and learning losses will have a decades-long impact on the economy by an estimated 2.9 percent, amounting to an overall economic loss of up to $1.9 billion every year”, says Jean-Francois Marteau, World Bank Country Manager for Kazakhstan. “A focus on improving access to quality education, including distance learning, would be important to prevent a decline in the quality of human capital, especially among Kazakhstan’s low-income population.”
The report concludes that under the risk of a prolonged slump in the global oil market, Kazakhstan’s pathway for a resilient recovery may focus on strengthening the effectiveness of public administration and services, including the use of e-platforms to deliver key public services, better tax administration, and a mechanism to review and redeploy fiscal resources toward better state programs. A renewed emphasis on reforms in the logistics, digital telecommunications, and financial sectors could help the overall private sector explore new opportunities.
China-Eurasia Council condemns aggression of Azerbaijan
China-Eurasia Council for Political and Strategic Research strongly condemns Azerbaijani aggression which Baku started on July 12, 2020. Azerbaijani Ministry of Defense is a threat for the entire World as it is speaking about its aims to strike Metsamor Nuclear Plant, which is located in Armenia. Baku must understand that this is a crime against humanity, and it is equal to nuclear strike.The destruction of Metsamor Nuclear plant will be a disaster not only for Armenia, but also for Iran, Georgia and Azerbaijan, it will harm World’s environment and stand a real problem for several generations of the World. It is worth mentioning, that this time Baku attacked the Northern borders of Armenia, which are sovereign territory of the Republic of Armenia according to International law. Azerbaijan violated the principle of territorial integrity of a sovereign state, which is one of the important pillars of International law.
China-Eurasia Council for Political and Strategic Research condemns Azerbaijan for using force against civilian population of Armenia and calls for peaceful negotiations. Baku must show solidarity and join global ceasefire initiated by the UN secretary general Antonio Guterres and must not try to escalate the situation on the border to deflect public attention from the situation concerning the outbreak of Covid-19 in Azerbaijan. We call official Baku to take care of Azerbaijani people in the hard times of Coronavirus and not send its soldiers to real death. Being multinational Council, for us It’s terrible to hear about lossfrom both sides and we express our sincere condolences. Hopefully peace will come to South Caucasus, which is an important crossroad in Eurasian mainland and it can stand a very important link for Belt and Road Initiative, if all problems solved in a peaceful way.
Condemnation Of Armenian Aggression By Friends Of Azerbaijan (FoA)
Friends of Azerbaijan (FoA) strongly condemns the coward act of Armenians aggression in the Tovuz district of Azerbaijan that is a sheer violation of international borders and law. The act is an attempt of Armenia to drive global attention from the peaceful dialogue and negotiation process on Nagorno Karabakh.
In an online meeting of the delegates of the Friends of Azerbaijan (FoA), a joint declaration of condemnation has been issued by the honorable members of Friends of Azerbaijan (FoA).
According to this declaration, Armenian aggression can jeopardize the whole South Caucasus region. The incident on July 12, 2020, is being considered as a direct attack on Azerbaijan and the repercussions of this incident can result in massive catastrophe in the entire region.
The delegates of Friends of Azerbaijan (FoA) stressed the global powers to come forward and take serious action on Armenian intervention by violating the international border of Azerbaijan. The act of Armenia is an open challenge to the sovereignty of Azerbaijan.
Malik Ayub Sumbal founder of Friends of Azerbaijan (FoA) termed that Armenia is losing its legal and moral position on Nagorno Karabakh and there is mounting pressure on Armenia by the international community for the peaceful solution of Nagorno Karabakh according to the UN Resolutions. At this time to get rid of such kind of diplomatic moves, Armenia has launched another major front in Tovuz.
When the whole world is busy against the Covid19 Armenian Prime Minister has chosen a very dangerous path that can take the whole region into war and bloodshed.
Friends of Azerbijan (FoA) is firmly standing with shoulder by shoulder to the people of Azerbaijan and martyr’s families at this hour.
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