BUSINESS/FINANCE

Finance In Brief

Turan-Alem Bank’s Assets Increased

2.5 Times

As of December 31, 1999 the Bank’s assets were 44 billion 930 million tenge, i.e. in comparison with 1998 they increased 2.5 times.

In December 1999 ordinary nominal shares of the Bank registered in the amount of 4 billion tenge. In the result the renewed Share Capital was 12 billion 870 million tenge.

As of the beginning of 2000 the paid Share Capital came to 8 billion 758 million tenge. According to the results of the year, the Bank’s profit was 886 million tenge.

The volume of deposits with fixed period increased 2.8 times and exceeded 7 billion tenge, the volume of call deposits was over 973 million tenge.

The Bank signed an agreement with the syndicate of western banks for allotment of a loan in the amount of US$ 13 million to finance export of cotton fiber. The Bank also signed a credit agreement with the International Financial Corporation for a loan in the amount of US$ 15 million for 15 years with further conversion of a part of the loan (up to US$ 5 million).

Feb 22

(THE GLOBE)

Two New Companies in the Stock Market

Summing up the results of the previous year, the official spokesman of the National Commission on Securities announced that two new companies – Halykh Invest and Halykh Capital – appeared in the stock market.

During 1999 10 issues of non-state bonds with the total nominal value of 3 million 443 thousand tenge by joint-stock companies and limited companies registered. For the first time the KASE official list category A included non-state bonds.

In 1999 the number of brokers and dealers decreased. As of January 1, 2000 it came to 58. The number of custodian banks increased (2 licenses granted). As of the beginning of the year their total number was 11, including the National Bank.

In 2000 the activity of the National Commission will be directed to save present positive trends and to settle current problems. It is supposed to modernize laws on the stock market issued in 1997, in particular, based on practical usage of the law “ON joint-stock companies”, to elaborate and concretize its many provisions. Besides, the Commission plans to work out two new bills “On investment and share capitals” and “On protection of investors’ rights and interests preserved by the law in the stock market.”

ALMATY, Feb 24

(THE GLOBE)


Imported broken brick

Nicolay Dombrovsky

ALMATY, Feb 23

(THE GLOBE)

Wonderful things emerge while reading even such an apparently dull account as the Report by the State Agency on Statistics of the Republic of Kazakhstan: who could ever imagine that ordinary broken brick and construction sand be imported from abroad (in 8 months of 1999 imported more than 15.5 thousand tons of construction sand and 300 thousand tons of broken brick for $300 and $750 thousand respectively.) Look, they were not sophisticated Spanish tiles, but mere sand and broken brick that are abundant in our area!

Not only these materials, but everything that exists in abundance in our country, including highly qualified but still not demanded manpower – no - they prefer imported ones! We would not enter the issue on manpower perhaps because it out of our competence, but the issue with broken brick was of so much interest for us that we asked a real builder that is an official of the State Committee on Construction of the Republic of Kazakhstan Kazbek Baymishev to explain why wonders like that ever happen?

Lot of customers ignores local production, - he said, - Due to lack of legislative regulation of the process of purchase of goods (works, and services) at account of out of the Budget sources. The Law “On State purchases” concerns only process of purchase of goods (works and services) that are carried out at account of the Republican and Local Budgets only.

Meanwhile resources of the State non-Budget means, which are in circulation in the Republic territory, are significant enough and, in our opinion, should be kept under State control.

For example such national companies as “Kazakhoil” “Kaztransoil”, “Kazakhstanttemirzholy” and others have a great financial potential in their possession. While upon purchase of works and services they could not take into account interests of local organizations and enterprises because the process of purchase of goods and services doesn’t fall under the Law on State Purchases, that envisage providing of assistance to the local goods (services) producers. In addition under that law doesn’t fall foreign companies’ activity on development of natural recourses on agreement with the State and of organizations that use investments credits and loans under the State guarantee. Upon realization such projects the choice of providers of necessary goods (services) usually directed toward foreign companies and firms. Under such circumstances even supply of broken brick and sand into Republic became possible.

What measures should be undertaken to direct our consumers to local producers so giving them an opportunity to extend their business?

In our opinion in order to provide assistance to the local manufactures, an amendment should be introduced into legislative deeds, including “Law on purchasing” for maintenance of a stricter control for efficient spending of non-budget means, which include assets of the State funds, State enterprises and ones where the State participates; investments, credits and loans attracted in the framework of agreement and contracts with the Government of Kazakhstan and other State Bodies or under guaranties of the State and also for protection of the national interests when the State provides natural resources for development by foreign companies. We believe that “The law on the State purchases” should be formulated as “The Law on Purchases”.

Nevertheless it should be pointed out that these proposals on some issues are in contradiction with existing “Low on Foreign Investments”. Perhaps it is time when some amendments to be introduced into aforementioned law that are concerned with protection of local goods manufactures and more correctly of economical interests of our country. The Ministry of Economics and the Ministry of Finance should manifest their positions in assessment of these issues.


Biggest Customer Investment In Airline History

ALMATY, Feb 24

600m investment includes new “World Traveller Plus” cabin and “Lounge in the Sky”

British Airways today presented £600m worth of new products that will be introduced over the next two years. The investment is the biggest of its kind in airline history. It has been made possible by an internal efficiency and restructuring programme which the airline embarked upon in 1996 and will be entirely funded out of existing budgets.

Today’s announcement is the result of extensive market research and work with leading product design experts. It builds on the airline’s strategy announced last year to focus on the most profitable segments of the market. For the airline’s customers, it will redefine travel for the 21st Century with the airline’s entire product portfolio being upgraded.

These new ground-breaking products, which will set benchmarks for comfort and design, include:

a new cabin, World Traveller Plus, offering more space and facilities than other economy products, as well as a doubled hand baggage allowance; making British Airways the first major airline to offer four distinct cabins

a “Lounge in the Sky” featuring the world’s first fully flat bed for business class travellers who need to work and sleep in private on longhaul trips a totally refurbished Concorde revamped First cabins rollout of the new Club Europe upgrades to airport terminals, check-in and lounges, including a completely new terminal at New York JFK

Bob Ayling, British Airways Chief Executive, said: “On service, we said we’d deliver and we have. We asked thousands of our customers what we do well and where we need to improve. They want us to be the best in the world. So do we. The £600 million investment we are making will ensure that we are. The quality of service and choice that we will be able to offer is the product of our restructuring and all the immensely hard work that has been put in over the last three years by everyone who works for British Airways. It has been tough getting there but we have done it.”

(Submitted by British Airways)


Arna Company Creates a New Network

The Project Value is US$ 3 Million

Askar DARIMBET

ALMATY, Feb 23

(THE GLOBE)

The General Director of Arna company said that the company had realized the project for construction of the new network based on the AXE-10 (Local-6) commutation platform that was the latest technology by Ericsson.

Murat Zhunusov emphasized that the project realized by Arna’s own forces, its total value was about US$ 3 million. The company introduced the station of this class one of first in the world, he added.

“Pay-back of such projects is approximately 5 to 10 years, however, the telecommunication field makes progress and often equipment becomes obsolete earlier than it is worn physically. Though it does not mean that this equipment cannot be used further. It is either modernized on the basis of the old network or a new station created parallelly,” Zhunusov said.

The Axe-10 station renders services, which are integrated by the ISDN digital network that provides a complex of standard interfaces. Zhunusov said that the principal peculiarity of the AXE platform was the integrated access to Internet along with services on opening and supporting mailboxes, registering domains and IP addresses.

According to Zhunusov, the access rate to Internet is 56 Kbytes/sec via dial-up connections and 128 Kbytes/sec via leased lines. All dial-up connections to Internet get direct access missing GroupSwitch of the exchanges without using overloading telecommunication network. Reijo Ahola, General Manager of LM Ericsson International AB said that now the company is present in 140 countries, and the switching system AXE used in 125 countries. Initially intended for wireline services, the Axe system was adapted for mobile communications.

“At present Arna is the first local operator, which introduced a new modified AXE,” “he said. Ahola emphasized that the company “will try to contribute to further development of the Kazakhstani telecommunication market by supplying world’s advanced network solutions.”


Temirbank and the Fund on Development of Small Business Signed an Agreement

A new Credit Line of US$ 1 million Opened

ALMATY, Feb 22

(THE GLOBE)

The JSC Temirbank and the Fund on Development of Small Business (FDSB) signed the agreement for a new credit line in the amount of US$ 1 million, according to the small business program, by the joint initiative of the European Bank on Reconstruction and Development (EBRD) and the Fund.

The Temirbank Board of Directors chairman Saodat Tashpulatova emphasized that the program was intended for guarantee of the population’s employment and to raise the poor people’s standard of living up to the minimal one. The deputy chairman Serikzhan Ramazanov said that in the previous year the EBRD had credited 25 enterprises. It was just a preliminary phase.

Ramazanov stated that the procedure of receiving a credit simplified and takes a week. Businessmen have to submit the business-plan and the technical-economic feasibility. The credit experts expertise makes an examination of the project free of charge and support it.

The FDSM Board of Directors chairman Bakhytzhan Sagintaev said that the Fund was interested in cooperation with big banks, as it is confident in their stability and elaborated approach to the assets.

According to EBRD spokesmen, freer access by small business to the credit resources of Kazakhstani commercial banks strengthens the country’s economy and helps to slacken tension in the manpower market.


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