Ukrainian bonds have dropped to record lows over concerns that Kiev may default on debts this year. The Financial Times, in collaboration with the International Monetary Fund, recently released a tool that demonstrates the concerning state of Ukraine’s economy, leaving few hopeful that the conflicted nation will be able to make ongoing debt payments despite international aid doled out by the IMF. The IMF underestimated the extent to which the Ukrainian economy would contract, predicting only 5%, though recently published figures show a recession of between 8% and 10%. These predictions have been made worse by budgetary issues and a greater than expected devaluation of the Ukrainian currency.
The IMF has warned that the Ukrainian economy will need at least an additional $15bn USD in bailout funds to steer clear of a default, though it appears neither the US or the EU want to put forward the majority of the funds, causing delays that could prove disastrous. The IMF Is also prohibited from releasing “the next disbursement” unless it feels that Kiev’s debts “are sustainable,” something that it cannot guarantee at this stage.
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- Uzbek President Islam Karimov issued a decree calling the next group of Uzbek citizens into military service. The existing servicemen will be relegated to reserve duty and those of “military age” will begin service between February and March of 2015. The decree also stipulated that those declared not eligible for service and those with exemptions will not be excused from service altogether, and will similarly be put on conscription reserve.
- Central Asia Online reports on Turkmen efforts to strengthen regional transportation infrastructure. The normally reclusive Central Asian state has spearheaded projects designed to increase regional connectivity including the Kazakhstan-Turkmenistan -Iran railway also known as the North-South Transnational Corridor, and has set its sights on Afghanistan most recently. By means of the Turkmenistan-Afghanistan-Tajikistan railway (TAT) and the proposed Turkmenistan-Azerbaijan-Georgia railway, Ashgabat aims to bolster energy and commodities markets in Afghanistan and allow Kabul to access markets throughout Central Asia.
- A cohort of researchers from the Swiss Universities of Berne and Geneva warn that Central Asian populaces that depend on glacial melt water could soon face shortages. Scientists calculate that glaciers in the Tien Shan region which supply water to Bishkek, Kyrgyzstan and Almaty, Kazakhstan will lose between 60% and 100% of their total mass before 2100.
- Kazakhstan has announced plans to begin development on a new field in the Caspian Sea. The Kazakh energy ministry reported that it will work with national oil and gas giant KazMunaiGasto to begin work on the Tsentralnoye field in the Caspian. In addition to KazMunaiGas, Russia’s own Gazprom and Lukoil will be tasked with development of the project, which expects to begin operations later in 2015.
- The government of Tajikistan expressed concern over the growing number of “illegal” madrassas, or religious schools abroad. The Tajik State Committee of Religious Affairs released a statement on January 6 that more than 150 Tajiks are currently studying in madrassas in both Iran and Pakistan, and that they began to undertake studies abroad without seeking permission from the Tajik government.
- Ukraine imported 50% less gas from Russia in 2014. The well-known crisis in eastern Ukraine stands as a contributing factor to the shortage, though Ukrainian economic difficulties and a lack of subsidized gas prices stand as the principal causes for the drop. The Ukrainian government defaulted on payments scheduled to be made to Russian energy giant Gazprom, provoking the shut off of gas transmission from Russia to Ukraine for nearly six months. Ukraine produced more than half of its total gas reserves domestically, imported approximately 13% from the European Union – more than double its total imports in 2013 – and the remaining 36% from Russia.