Headlines from the Caspian: March 16, 2022
Author: Caspian Policy Center
Mar 16, 2022
Energy and Economy
Armenia Sees Influx of Russian Businesses and Capital
The Russian invasion of Ukraine and sanctions imposed on Russia have resulted in the emigration of thousands of Russians. Yerevan has become a popular destination, given that Russian citizens can travel there visa-free and the widespread use of Russian. Many IT firms, among other businesses, have sought to relocate from Moscow and elsewhere in Russia to Armenia to retain their relationships with international clients.
Foreign Ministers of Kyrgyzstan and Uzbekistan Meet to Discuss Economic Projects
On March 11, Foreign Affairs Minister of Kyrgyzstan Ruslan Kazakbaev met with his Uzbek counterpart Abdulaziz Kamilov in Antalya to discuss ways to strengthen cooperation through bilateral and multilateral forums. Proposals included using the Uzbek-Kyrgyz Fund to build a trade and logistics center for border trade. Both foreign ministers agreed to continue joint projects in trade, economic, and investment cooperation with a goal of increasing trade between the two countries to $2 billion.
Air Astana Suspends Flights to Russia
Air Astana announced that it would suspend all flights to Russia and all flights through Russian territory because of the termination of insurance coverage for commercial flights to and from Russia. Other Kazakhstani Airlines, SCAT Air and Qazaq Air continue to fly to Russia,
Source Fergana News Agency
Russian Ban on Grain and Sugar Exports Sparks Fear of Shortages
Russia’s decision to ban grain and sugar exports has raised concerns about shortages in Kazakhstan- one of the top importers of Russian grain. The Kazakhstani Agriculture Ministry has stated that wheat stocks are sufficient to cover domestic needs until the fall harvest. Logistical challenges and rising costs of imports due to the tenge weakening have led officials to caution that current sugar stocks may only last three months.
Kyrgyzstan Limits Export of Dollars
Kyrgyzstan’s central bank has taken measures to stabilize domestic foreign currency markets and limit fallout from international sanctions imposed on the Russian economy. Temporary restrictions began on March 11, banning commercial banks and other lending institutions from moving dollars abroad as cash. Kazakhstan has already begun to experience cash dollar shortages due to increased demand and logistics issues.
Tajikistan Implements Austerity Measures
Tajikistan is experiencing an inflationary spiral as a result of Russia’s invasion of Ukraine. International sanctions against Russia have caused a collapse in the value of the ruble, which has in turn heavily depreciated the value of remittances sent home by Tajik migrant laborers in Russia. The performance of the somoni is also tied to the fate of the ruble. Fuel and food prices have jumped as much as 30 percent.
Cotton Campaign Ends Boycott Of Uzbek Cotton, Citing Progress On Labor Issues
The Cotton Campaign, an international advocacy group supporting fair labor practices in cotton production, has ended its call for the boycott of Uzbek cotton and textiles after its partner, the Uzbek Forum for Human Rights, concluded there had been no forced labor in the sector in 2021.
Politics and Security
New Armenian President Takes Office
On March 13, Vahagn Khachatrian was sworn in as Armenia’s new president at a special session of the Armenian parliament. Khachatrian, an economist, previously served as the Mayor of Yerevan and sat on the board of directors for Armeconombank.
Foreign Minister of Armenia and Turkey Meet
Armenian Foreign Minister Ararat Mirzoian and his Turkish counterpart, Mevlut Cavusoglu, reaffirmed their country’s commitment to moving forward with the process of normalization, agreeing that efforts to establish relations and open borders should continue without any preconditions. FM Cavusoglu characterized the March 12 meeting in Antalya as “very productive and constructive” and additionally stressed that Azerbaijan maintained a positive view of the normalization process.
Armenia Reviews Azerbaijan’s Five Point Plan to Normalize Relations
Azerbaijan has sent Armenia a five-point plan to normalize and stabilize relations between the two states. The plan calls for both sides to respect territorial integrity, abstain from threats, demarcate the border, and open transportation between the two countries. This comes during a period of heightened tension.
Kazakhstan Promises Political Reforms
In his state of the nation address, President Tokayev outlined substantial reforms that would take place in Kazakhstan, including the creation of new administrative districts, substantial restraints on presidential power, and a reformed election process for Kazakhstan’s parliament.
Source: Astana Times
Skirmish Between Tajik and Kyrgyz Border Guards Break Out
On March 10, there was a shootout between Tajik and Kyrgyz border guards. Several guards were injured and at least one was killed. Both sides are said to be working on de-escalating the situation.
Source: Asia Plus
Turkmenistan Holds Presidential Election
Snap presidential elections were held on March 12 in Turkmenistan. The elections are generally viewed as a transfer of power from the current president, Gurbanguly Berdymukhammedow, to his son Serdar Berdymukhammedov. The Central Election Commission claimed that more than 97% of registered voters in the country had cast ballots, although the OSCE declined to send observers to the election. Serdar Berdymukhammedow has officially been declared the winner of the election with approximately 73% of the vote.
(Sources: 24.kg, Asia Plus, Astana Times, Azernews, Eurasianet, Fergana News Agency, RFE/RL, and Reuters)