As anyone who has tried to drive across Almaty at 6pm knows, Kazakhstan’s financial capital is no sleepy city on the steppe.
Car ownership in Almaty city and the surrounding region has soared on the back of Kazakhstan’s growing oil wealth, rising from 617,000 in 2007 to 936,000 in 2011. At rush hour, police regulate the number of vehicles entering the city and traffic on the glitzy Al-Farabi avenue grinds to a halt.
On Tuesday the Kazakh government will attempt to address the gridlock, launching a roadshow in London for tender to build a ring road around the city. Read more
A mixed picture for the prospects of an economic recovery emerging Europe, according to Monday’s forecast from the European Bank of Reconstruction and Development.
The EBRD found that the more advanced countries of central Europe will probably do a bit better than expected next year, while the rest of the post-communist region is sputtering. Read more
Ukrainian President Viktor Yanukovich sounded deadly serious during a passionate speech he gave on his administration’s commitment to fighting corruption on Wednesday.
Himself accused of corrupt practices for the way he managed to occupy a lavish estate in a Kiev suburb, it was delivered at a World Economic Forum event in Kiev, a gathering to discuss the nation’s future as the EU summit nears in later this month in Vilnius. But hang on: wasn’t the EBRD supposed to be in town to sign a new anti-corruption Read more
By Nicholas Watson of bne
Europe may be in the doldrums, but some large infrastructure projects, crucially backed by multilateral lenders and export credit agencies, look set to give Emerging Europe’s economies a fillip over the next couple of years.
“The outlook for infrastructure projects is better, definitely we’ve seen a better start in 2013 and that will continue in 2014,” says Werner Weihs-Raabl, head of infrastructure finance at Erste Bank Group. “Romania and Croatia, for example, are building realistic projects; a few years ago it was rather castles in the sky.” Read more
By Erik Berglof of the EBRD
The latest forecasts show that central Asia and the Caucasus are again the fastest-growing economies in the former Communist countries of eastern Europe and the ex-Soviet Union.
Yet, given the low level of income and relatively high population growth of these countries, the numbers are disappointing. On closer inspection growth is also narrow, mainly stemming from natural resources and remittances from citizens working abroad; countries less endowed with resources are doing worse. Economic reforms are mostly stuck, as are, with a few exceptions, political reform. Read more
Smiles all round on the faces of those officials of the European Bank for Reconstruction and Development who successfully lobbied for their role to be broadened from their traditional stamping grounds in eastern Europe to Turkey, North Africa and beyond.
As any visitor to the organisation’s annual meeting in Istanbul on Friday would have seen, top officials from the likes of Poland, Ukraine and Russia were notable for their absence. But there to fill the gap were the prime ministers of Tunisia, Egypt and Jordan, not to mention the host, Turkey’s premier Recep Tayyip Erdogan. In the ex-Communist bloc, the EBRD is now old hat. In and around the Mediterranean, it still makes news. Read more
Rarely has a forecast been cut so fast. The European Bank for Reconstruction and Development on Friday slashed its 2013 growth forecast for the emerging economies of central and eastern Europe and North Africa from 3.1 per cent in January to just 2.2 per cent.
While the effects of the eurozone crisis have abated, economic activity is slowing faster than expected in the region’s biggest two markets – Russia and Poland. Structural reforms are needed, and needed now, says the bank. But it always says that. Read more
András Simor, the hawkish former governor of Hungary’s central bank who stepped down this month, has quickly found a new perch.
The European Bank for Reconstruction and Development announced on Wednesday that Simor would take a top job as vice president for policy, starting July 1. Based in London, he will be a comfortable distance from Budapest and his arch-critic prime minister Viktor Orbán, whose close ally, György Matolcsy, has been installed in Simor’s office at the central bank. Read more
By Riccardo Puliti of the EBRD
The use of nuclear power generates at least as much debate as electricity.
This is especially true in the case of Ukraine, where in 1986 the Chernobyl accident happened. The events demonstrated that in nuclear power generation safety always must be the utmost priority – from the first moment of operation to long after the active life of any nuclear reactor. Read more
At last, a breath of optimism on central and eastern Europe from one of the more cautious economic forecasters.
The European Bank for Reconstruction and Development on Monday predicted that growth in the region would increase slightly from 2.6 per cent in 2012 to 3.1 per cent this year. More significantly, given the EBRD’s past warnings, the bank is saying that risks of the eurozone triggering another CEE financial crisis are declining. If the bank’s right, that’s good news. Read more
Poland’s banks are generally well financed and solid, but one of their biggest problems is a mismatch between short-term deposits and long-term loans, many of which are denominated in foreign currency – largely Swiss francs. The mismatch has been a concern for regulators, who have pushed banks to make their asset structure less vulnerable to sudden changes in sentiment and to any turmoil in the eurozone.
Now Getin Noble Bank, one of the most aggressive forex lenders during the real estate boom which ended in 2008, has taken a step towards better balancing its assets by securitising a 1bn zlotys ($325m) portfolio of 33,000 car loans last week. Read more
Russia has talked a lot about economic diversification over the past two decades but it has made little progress in weaning itself off revenues from natural resources. A new report by the European Bank for Reconstruction and Development sets out recommendations that might stimulate industrial modernization and tries to make sense of Russia’s abiding addiction to oil. Read more
By Riccardo Puliti of the EBRD
Every autumn, as the cold weather approaches, Europe remembers the gas wars of 2009 when Russian gas – on which some countries are almost entirely dependent – stopped flowing via Ukraine.
But these days gas is good news. Read more
Will the European Bank for Reconstruction and Development, the bank set up to assist the former Communist countries of eastern Europe, soon be helping Greece? Maybe.
But it won’t be offering money. Just advice. Now you might thank that Athens is up to ears in foreigners bringing financial advice. But, no. It seems that the Greek government has invited a team of EBRD bankers to visit Athens next month – and the EBRD is happy to oblige. Read more
More downward GDP revisions, this time from the European Bank for Reconstruction and Development. The culprit: concern over the spreading impact of the eurozone crisis.
The EBRD slashed its overall growth forecasts for 29 countries from central Europe to central Asia. The region’s growth is now estimated to be 2.7 per cent in 2012, down from growth of 4.6 per cent in 2011.
Foreign visitors, numbering up to a million during Euro 2012, appear to have been left with an overwhelmingly positive impression of tournament co-host Ukraine. But international financial institutions look likely to need more convincing before they re-ignite their once intimate relationship with the developing nation.
Ukraine’s largest financial investor, the EBRD, has committed €7.5bn to the country since 1992, invested across 294 projects, including badly needed pre-tournament upgrades of transport in host cities Kiev and Lviv. Yet both the EBRD and IMF are calling for major political and legal reform if they are once more to step up commitments. Read more
A pioneering Chinese company is planning to buy a bank in Georgia – and become, it says, the first privately-owned Chinese group to buy a foreign bank. At around $100m, it’s a small deal for China but a pretty big one for investment-hungry Georgia – and for Xinjiang Hualing Industry and Trade Group.
The company, founded in the far western city of Urumqi in 1988, is in the process of securing regulatory approval to acquire 90 per cent of Basisbank, Georgia’s 11th largest bank in terms of assets. Read more
So the EBRD has a new, British, president, breaking the Franco-German stranglehold on the institution and elected for the first time through an open competition. Will the World Bank, International Monetary Fund and other multilateral bodies now come under pressure to do the same?
Well, possibly. Sir Suma Chakrabarti, the winning candidate, said after his victory the “open, fair and merit-based process has been a credit to the Bank and to all the other candidates”. Read more
EBRD shareholders on Friday elected Sir Suma Chakrabarti as the new president of the Bank for the next four years – official announcement from the European Bank for Reconstruction and Development. Read more
Amid all the gloom at the European Bank for Reconstruction’s annual meeting, there was a bit of sunshine from Italy’s UniCredit, which has extensive central and east European operations.
‘Credit crunch? What credit crunch?’ was the message in a 27-page presentation. Read more