IFPRI CENTRAL ASIA NEWS WEEKLY DIGEST (SEPTEMBER 22 – OCTOBER 5, 2015)
News and Analysis
FAO urged to address land degradation, malnutrition, needs of family farms
(FAO RECA, 23 Sep 2015) Thirty-ninth session of the European Commission on Agriculture affirmed and supported combating land and soil degradation, boosting nutrition through agriculture, addressing needs of family farms and studying rural population access to social protection, according to the FAO Regional Office for Europe and Central Asia (RECA). The meeting documents are available in here.
ADB President Calls For CAREC to Boost Regional Cooperation Efforts
(ADB, 25 Sep 2015) Asian Development Bank (ADB) President Takehiko Nakao concluded the two-day 14th Central Asia Regional Economic Cooperation (CAREC) Ministerial Conference with his keynote speech inviting the group of 10 countries to strengthen regional cooperation and integration efforts. On top of continuous support and investment, ADB President informed about new initiatives. Particularly, ADB will support the CAREC Institute, which was launched in March 2015 in Mongolia, to provide knowledge support to implement action plans in four priority areas, and an initiative to strengthen cooperation in sanitary and phytosanitary measures to complement customs reforms.
Kyrgyz Republic: Staff Concluding Statement of an IMF Mission for a Staff-Monitored Program
(IMF News Release, 30 Sep 2015) An IMF mission visited Bishkek during September 16-29, 2015, to conduct the first review under the Extended Credit Facility (ECF) and hold the 2015 Article IV consultation discussions, informs the news release. Discussions centered on policies necessary to steer the economy through a difficult environment and promote inclusive growth including: (i) shifting from fiscal stimulus to consolidation to ensure debt sustainability; (ii) strengthening central bank independence and financial sector resilience; and (iii) carrying out structural reforms to promote diversified and equitable growth.
Central Asia remains the main consumer of Kazakh wheat
(UkrAgroConsulting, 2 Oct 2015) Kazakhstan reportedly exported about 3.2 MMT from September 2014 to August 2015, according to news article. Neighboring countries were the main export destinations similar to previous seasons, but, nonetheless, the structure of export destinations has changed and the share of Central Asian and Middle East exports increased further reaching about 70% of Kazakhstan’s total wheat exports, the article claims. China’s record also increased and reached its highest share of Kazakhstan exports at about 6%.
Kazakhstan Raises New Key Rate to 16% to Stabilize Tenge
(Bloomberg, 2 Oct 2015) Kazakhstan’s central bank raised its new base interest rate from 12% to 16% to tame the world’s most volatile currency, the tenge, which has struggled to find balance since policy makers moved to a free-floating exchange rate in August, according to the news article. The tenge, which had traded in a band around 185 against the dollar, has swung between 208 and 300 to the dollar since August, and the central bank has spent more than $1 billion to smooth the fluctuations. The National Bank decided to raise its base rate to 16 percent to keep inflation in the medium-term target range of 6-8 percent, informs local TengriNews news agency.
Kazakhstan Increases Meat Export to EAEU States
(The Astana Times, 5 Oct 2015) Kazakhstan increased its meat exports to the countries of Eurasian Economic Union (EAEU) by 56 times over the period of 2012 - 2014, according to Timur Zhaksykulov, the Deputy Minister of National Economy. He noted that beef exports to Russia increased from 290 tons in 2013 to 2,042 tons in 2014, or from $1.4 million to $9 million respectively. Meat export figures were highest in since independence and domestic producers will receive additional $74 million in subsidies form the government, according to Minister of Agriculure Assylzhan Mamytbekov. Considering Russian meat market at about 10.5 million tons Kazakhstan can achieve its historical export potential and become leading meat exporter in the region.
Kyrgyzstan adopts national food security, nutrition program
(FAO RECA, 6 Oct 2015) The national food security and nutrition program for 2015-2017 just adopted by Kyrgyzstan is expected to serve as a road map to fulfilling people’s rights to food, healthy nutrition and development, suggests FAO Regional Office for Europe and Central Asia (RECA). The program was developed over the last two years with the support from FAO. The national food security and nutrition program aims to solve strategic problems such as ensuring the availability of food through intensive development of the agriculture sector and regulation of food imports and exports. In addition, special attention will be paid to people’s physical and economic access to food, particularly for vulnerable rural populations. Governmental portal released the news in Russian.
Publications
How to De-Dollarize Financial Systems in the Caucasus and Central Asia?
(S.B. Naceur, A. Hosny and G. Hadjian. 2015. IMF Working Paper No. 15/203)
Abstract: Dollarization rates in the Caucasus and Central Asia (CCA) region are among the highest in the world, with adverse consequences for macroeconomic stability, monetary policy transmission, and financial sector development. Using dynamic panel data models, we find that foreign exchange deposits and loans in the CCA are mainly driven by volatile inflation and exchange rates, low financial depth, and asymmetric exchange rate policies biased toward depreciation. Although there is no unique formula for success, empirical studies and cross-country experiences suggest that credible monetary and exchange rate frameworks, low and stable inflation, and deep domestic financial markets are essential ingredients of any de-dollarization strategy. In implementation, policymakers need to consider proper sequencing of policies, effective communication as well as risks from potential financial disintermediation and instability, and/or capital flight.
(N. Djanibekov, U. Djanibekov, R. Sommer and M. Petrick. 2015. Agriculture Systems. Vol. 141.)
Abstract Highlights: We investigate the formation of cooperative agreements among cotton-growing farms. We employ a cooperative farm game integrated into a bio-economic optimization model. Study results demonstrate that farm cooperation can fulfill multiple objectives. Benefits are larger when farms differ in biophysical and geographic characteristics. Effects of cooperation will not coincide at cooperation and individual farm levels.
Rangelands of Central Asia: Challenges and opportunities
(A. Mirzabaev, M. Ahmed, J. Werner, J. Pender and M. Louchaichi. 2015. Journal of Arid Land. Early online version.)
Abstract Excerpts: Rangelands of Central Asia (referring to Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan in this study), the largest contiguous area of grazed land in the world, serve as an important source of livelihood for pastoral and agro-pastoral communities in this region. They also play an important role in absorbing CO2 as a global carbon sink. However, unsustainable management of rangelands has led to their degradation hugely by downgrading their potential agro-ecological, environmental and socio-economical roles... There is a need to develop and widely apply the viable and locally accepted and adapted packages of technical, institutional and policy options for sustainable rangeland management. Incentivizing the collective action of small-scale pastoralists who group together to facilitate access to remote pastures can reduce the degree of overgrazing within community pastures, such as those near the settlements. We also found that migratory grazing through pooling of resources among small-scale pastoralists can increase household income… This paper presents several promising technical options, aiming at reversing the trend of rangeland degradation in Central Asia.
Russia Economic Report: Balancing Economic Adjustment and Transformation
(WB. 2015. Russia Economic Report No. 34. Washington. D.C.: World Bank Group (WB))
Summary Highlights: Low oil and gas prices, geopolitical tensions and ongoing international sanctions deepened Russia's recession in the first half of 2015. A significant increase in the poverty rate, decreased consumer demand and sharp contraction in real wages have had a severe impact on households. However, the policy response by finance authorities has managed to stabilize the economy. Country growth perspectives remain negative. The outlook hinges not only on the evolution of external factors, but also on Russia's internal capacity to adapt to an increasingly difficult macro-fiscal context. This report highlights a major demographic and economic transformation in Russia, which is driven by a rapidly aging population and by the diminishing economic importance of the natural resource sectors.
(R. Black and I. Kireeva. 2015. Journal of World Trade. Vol. 49(5).)
Abstract: This article examines the regulatory impact of SPS measures applied by the Members of the Eurasian Customs Union (CU) on trade with other countries, first, by looking at Russia’s SPS legislative regime before and after its accession to the World Trade Organization (WTO) and the degree of compliance with the principles of the WTO’s SPS Agreement. This includes references to some laws and regulations of the subjects of the Russian Federation (such as Republics, Oblast, Krai) as well as the Federal legislation applicable to the entire territory of the Russian Federation. Second, it analyses the adoption of SPS measures by the CU in relation to trade within the CU and with other countries, taking into account background provided in a related article by the same authors. Russia is a key for understanding the issues of trade regulation because Russia’s case for joining WTO was made on the basis of the CU. For this reason, the adoption of SPS measures by Kazakhstan (in accession negotiations) and by the Kyrgyz Republic (WTO Member since 1998 and candidate for membership of CU) are discussed and compared. The article concludes with a discussion of the key issues about SPS measures and trade in the CU that were raised in the introduction. It is intended that this will provide the legal/regulatory background for economic analysis of trade in food and other agricultural products within the CU and between the CU and third countries.
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