IFPRI CA NEWS DIGEST (FEBRUARY 18 – FEBRUARY 24, 2014)
News
Kazakhstan not to curb grain exports
(Kazinform, 18 Feb. 2014) Kazakhstan is not going to curb grain exports because of recent national currency adjustments, according to Minister of Agriculture, Asylzhan Mamytbekov. He stressed to the journalists that Kazakhstan has not put restrictions on grain export in the last six years and will maintain this stand. Kazakhstan exported about 5.3 million tons in grain equivalent since July 2013 till February 1, 2014, that is 25% more against the same period last year.
Food prices increase as a reaction to the devaluation of the currency (in Russian)
(Kazagromarketing, 21 Feb. 2014) Price monitoring conducted by the “Agromarketing” reveals that food retail prices increased sporadically as a response to the devaluation of national currency last week. For instance, increase in sugar prices ranged from 22% in Astana, the Capital City, to 2% in Almaty, the most populous city. An increase in wheat flour prices reached 9% in Aktobe but didn’t exceed 3% or remained unchanged in many other cities. In general, imported food commodity prices increased considerably because of more expensive imports and/or temporary suspension of imported goods by wholesalers.
Kazakhstan Takes Measures to Curb Rising Bread Prices
(Trend.az, 21 Feb. 2014) The Kazakh Ministry of Agriculture, in conjunction with local authorities and the Food Contract Corporation, has moved to curb potential price spikes for flour and bread in the aftermath of the devaluation of the tenge. The Food Contract Corporation, a division of the KazAgro holding firm under the Ministry of Agriculture, has agreed to sell 500,000 tons of grain to flour milling companies at a fixed price of 30,000 tenge per ton for a period of approximately six months. The Food Contract Corporation is a joint stock company that purchases grain for strategic reserves on behalf of the Kazakh government.
Last year food imports in Kazakhstan exceeded $ 4 billion
(Kazinform, 24 Feb. 2014) Chairman of the Statistics Agency Alikhan Smailov reported that Kazakhstan food imports exceeded 4 billion USD in 2013, and has been growing by about 5% for the second consecutive year.
European Investment Bank to fund three projects in Kyrgyzstan
(Times of Central Asia, 18 Feb. 2014) In 2014 Kyrgyzstan will be a priority country for the European Investment Bank (EIB) in Central Asia and until the year’s end the Bank plans to start funding of three projects in the country — in the energy sector, support of agricultural producers, and improvement of water supply and waste management in the cities of Osh and Jalal-Abad. The Bank’s official said that the EIB is ready to allocate from 200 million to 300 million euros a year for Central Asia.
Kyrgyzstan’s sugar industry needs state support
(Times of Central Asia, 21 Feb. 2014) More than 4,000 farms, which employ 80,000 farmers and their families, are engaged in the cultivation of sugar beet in the country. In 2013, they planted sugar beet on 7,300 hectares, 20% more than in 2012, and harvested more than 200,000 tons of sugar beet, almost twice as much as in 2012. Last year, the harvest was high due to favorable weather conditions and high quality of seeds. Sugar factories provided farmers with German high-yielding elite seeds. However, sugar beet farmers and sugar factories are facing difficulties in selling their products because of the high competition from cheap cane sugar imports. As a result, local farmers are losing their fair income. To motivate farmers to increase the sugar beet growing, in the beginning of 2013 sugar factories signed contracts with farmers on purchase of sugar beet at 2,900-3,000 Soms per ton. Under the contracts, sugar factories provided farmers with elite sugar beet seeds and fuel in the form of commodity credit with deferred payment.
New staff changes in the Tajik government
(Asia-Plus, 22 Feb. 2014) President of Tajikistan Emomali Rahmon, who is also Head of the Government, issued a decree on February 21 according to which several deputy ministers, including First Deputy Minister of Agriculture, have been replaced.
USD exchange rate falls due to additional measures taken by Tajik central bank
(Asia-Plus, 18 Feb. 2014) The National Bank of Tajikistan (NBT) took additional measures in order to stop devaluation of national currency. USD exchange rate has reportedly fallen by the end of last week due to the measures. Tajikistan saw sharp currency devaluation this month. The NBT said that the situation had nothing to do with the 19 percent devaluation of Kazakhstan's national currency, Tenge, announced last week.
World Bank Considers Allocating $22 Million for Agricultural Reform in Tajikistan
(Asia-Plus, 18 Feb. 2014) Directors of the World Bank will discuss earmarking $22 million for agricultural reform in Tajikistan at a meeting in June. The goal of the project is to strengthen Tajik farmers’ capacities in dealing with market mechanisms through trainings, consultations, grants, and credits. The World Bank has previously noted that poorly functioning markets have failed to accommodate the overall growth of agricultural production in the country. Fragmented markets, poor access to credit, low economies of scale, and business entry barriers have served to constrain growth in the agricultural sector.
World Bank to Provide $52.7 Million for Agricultural Sector Projects
(Times of Central Asia, 18 Feb. 2014) The World Bank and the Uzbek government have signed two agreements totaling $52.7 million for projects in the agricultural sector. $40 million will be allocated as continuing funds for the Rural Enterprise Support Project, which has assisted local farmers with access to finance and capital. In addition, the World Bank issued a $12.7 million grant for the development of renewable energy resources, which will be used to construct biogas and solar plants throughout the country over a period of four years.
(Uzbekistan National News Agency, 24 Feb. 2014) President Islam Karimov reported about the country’s socioeconomic development outcomes for 2013 and the main priorities of its economic agenda for 2014 at the meeting of the Cabinet of Ministers of Uzbekistan. He reported about the successes achieved in 2013 such as 8% increase in the GDP, state budget surplus of 0.3% of the GDP, and below than projected inflation rate at 6.8%. He also presented priorities for 2014 development agenda such as enhancing competitive business environment, supporting small businesses and integration with world markets and modernize production.
Trade between China and Central Asia reached $40 billion in 2013
(Times of Central Asia, 17 Feb. 2014) Last year trade between China and Central Asian countries of Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan reached $40 billion, a 13-percent increase compared to 2012, Xinhua reported. Bilateral trade between China and Kazakhstan rose to $28.6 billion while trade between China and Uzbekistan reached $4 billion, up 11.3 percent and 58.3 percent respectively.
High hopes for Central Asia’s agriculture sector
(Times of Central Asia, 18 Feb. 2014) This article examines grain yield and export prospects in Kazakhstan, Kyrgyzstan, and Russia. Increasingly unstable weather conditions inflicting damage on winter crops have driven farmers in former Soviet republics in Central Asia towards gradual decreases in winter crops compensated by increases in spring crops. The shift comes at times when market opportunities for grain exporters in the region are on the increase – with drought and soil erosion haunting some of the USA’s most important agriculture regions and floods threaten agro-areas in Western Europe.
Central Asian Migrants Feel Pinch of Kazakh Devaluation
(RFE/RL 21, 21 Feb. 2014) Central Asian migrants working in Kazakhstan have been directly affected by the devaluation of the tenge. Remittances are conducted in U.S. dollars and the recent move to devalue the tenge has negatively impacted migrant transfers as a result. Kazakhstan has become the second largest destination for Central Asian migrant labor thanks to its burgeoning economy and growing construction sector. Around 80,000 citizens of Tajikistan are believed to be working in Kazakhstan, occupied in market trading or construction roles.
Half of remittances from Russia goes to Central Asian countries (in Russian)
(Izvestia, 21 Feb. 2014) According to the study conducted by the money transfer system “Leader”, about 55% of remittance transfers from Russia goes to Kyrgyzstan, Tajikistan and Uzbekistan. The average amount of a single money transfer rarely exceeds 500 USD for these countries. Majority of remittances are sent from major cities Moscow and St. Petersburg, 60 and 15 percent of the total remittance transfers respectively in 2013. Kazakhstan is the only CIS country which sends more money to Russia than it receives using money transfer systems. However, this might change as Russia is seeking to establish a visa-free regime with the EU and, therefore, might introduce visa regime for the CIS countries.
Publications
Prospects for Water Cooperation in Central Asia
(Rethink Institute, February 2014) This paper elaborates on the importance of the appropriate perception, definition, and approach to challenges regarding transboundary waters in the Central Asian republics. Additionally, the study aims to accentuate the economic, sociopolitical and environmental benefits for all riparian countries in the region that would result from a shift from a security-oriented outlook to a collaborative, regionally integrated approach to water management.
The Inverting Pyramid: Pension Systems Facing Demographic Challenges in Europe and Central Asia
(World Bank, February 2014) The report highlights a demand for significant reforms against the profound effects of aging populations and a shrinking labor force on overstretched state pension schemes in emerging Europe and Central Asian countries. The report finds that most pension systems have already reached “maturity,” with little possibility to expand the number of contributors due to a stagnant and declining working-age population in the region. With a realization of no one-size-fits-all solutions, the report examines two potential solutions to face the demographic challenges to pension systems: generating additional fiscal revenue to cover pension deficits, and increasing the number of contributors to the system.
Development of the Agribusiness Sector in Kazakhstan
(Warsaw University of Life Sciences: Annals of Agricultural Economics and Rural Development, Vol. 100(4), 2013) Abstract: The article examines the agricultural sector of Kazakhstan after independence in 1991, as well as problems and issues that arise during this process. The study used data from official statistics, policy documents and materials of the Department of Agriculture published on the website and articles on agrarian issues. The article highlights the social problems of agrarian sector that need to be addressed. Domestic grocery production is weak competitive both in foreign and national market due to low level of quality products. Kazakh producers are losing much part of the food market due to lack of capacity for processing of agricultural raw materials and to its low quality as well as to weak links between farmers and processors.
Reflections on the MDGs, and the post-2015 Agenda, from Europe and Central Asia
(UNDP: Working Paper no. 7, 2013) Abstract: This paper argues that ‘lessons from the MDGs’ coming from the developing and transition economies of Europe and Central Asia are profoundly relevant for the post-2015 debate. This argument may seem somewhat counterintuitive, in that this region has not been in the vanguard of global MDG efforts. Likewise, the success of efforts to push the MDGs closer to the centre of development discourse in this region has been moderate at best. However, it is precisely the difficulties encountered in the application of the ‘MDG agenda’ to this region and the responses to these difficulties that have emerged that are germane for discussions on how to make global development goals more universally relevant—both thematically and geographically—after 2015.
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