All Over the Globe

Supply of weapons to North Korea: was there any official contract?

Announcement by the head of the Foreign Ministry of RK Tokaev arouses bewilderment

ALMATY, Oct 6

(THE GLOBE)

The sale of MIG-21fighters to North Korea by Kazakhstan aroused indignation of official Washington, Tokyo and Seoul and a lot of publications all over the world.

On September 12 the office of the Minister of Foreign Affairs issued an announcement regarding this incident. This announcement was signed by the former deputy of the Prime Minister, the head of the Foreign Department, who is now the acting Prime Minister Kasymzhomart Tokaev (THE GLOBE #69(387), September 14).

If you carefully read the text of the announcement, you will be puzzled. We quote: �The first results of the investigation prove that a group of persons evading the official contract delivered aircraft to DPRK. For the fulfillment of the contract this group gained a big amount in US dollars.� (Marked by THE GLOBE)

It is obvious from the above-mentioned text, that Mr. Tokaev announces, there was the official contract (evidently, with DPRK) and that a group of persons managed to evade the contract, and later they received cash money under the same contract. This is literally proved by the text of the present acting Prime Minister, who is, by the way, still the head of the Ministry of Foreign Affairs.

We have the following questions:

- If it was the official contract, what contract it was?

- If it was the official contract, what was Kazakhstan supposed to supply to North Korea (as it is obvious from the text)?

- Maybe, Mr. Tokaev did not read carefully the text of the announcement ?

I think, our dear readers along with THE GLOBE would like to dispel bewilderment, which aroused after we read Mr. Tokaev�s announcement sounded on behalf of the government of sovereign Kazakhstan.

There is still a hole in the budget, - the acting Finance Minister

Erkanat ABENI

ALMATY, Oct 6 (THE GLOBE)

�At the present time the total state budget deficit is US$ 550 million,� the Finance Minister of RK announced on Wednesday in Almaty.

According to Uraz Dzhandosov, it is planned to cover US$ 200 million of this amount by Kazakhstan Eurobonds to be placed in the world�s financial markets. Another part of the main country�s document in the amount of US$ 200 million � owing to credits allotted by the World Bank, but the government has not decided how to cover the balance of US$ 150 million.

Besides, according to Mr. Dzhandosov, by the end of this year Kazakhstan is to reimburse about US$ 649 million of the external debt.

�For the last half a year the volume of direct foreign investments to the Kazakhstan economy has exceeded US$ 460 million,� the acting Finance Minister stated. He also said that in the end of October the IMF delegation is expected to come, and possibly, in the middle of December they will manage to conclude an agreement with the International Monetary Fund for a new crediting program.

Mr. Dzhandosov believes that according to the preliminary estimations it is expected that by the end of the year the inflation will come to 3.5%.

�We may speak about the next reduction of the refinancing rate, as the money supply of deposits has widened,� Uraz Dzhandosov emphasised. He considers this is caused by the population�s increased trust to banks of the country.

As far as the appointment of the Prime Minister and the composition of the new government are concerned, Mr. Dzhandosov abstained from any comments. He just mentioned; �If I am proposed to be the PM, I will not reject. But it will hardly happen.�

Investment issues were discussed at �Oil and Gas� conference

Askar DARIMBET

ALMATY, Oct 6 (THE GLOBE)

�This KIOGE exhibition proves that Kazakhstan managed to save investors� trust,� the Finance Minister announced on Wednesday.

Uraz Dzhandosov said that the Kazakhstan oil and gas sector attracted up to 70% of foreign investments, and it was a peculiar base for the other branches of the economy. At the present time, in his opinion, the development of the sector is impossible without foreign investments. According to the Minister, now the main thing is to develop the two national companies �KazakhOil� and �KazTransOil�.

On the same day, at the press conference held in the National press club Mr. Dzhandosov said that it was not the time to sell the share in �Tengizchevroil� (TCO), as by 2001 it was planned to complete the construction of the Caspian Pipeline Consortium (CPC), that would result in significant profits. Most probably, new deposits at Tengiz will be promising; hence, this will increase the value of the Kazakhstan share in TCO.

On the other hand, he added, now the oil price was high and the sale of the Kazakhstan share would be profitable.

�The situation in the Kazakhstan oil and gas sector is difficult, but this industry is very promising,� the first vice-president of �KazakhOil� stated.

According to Uzakbai Karabalin, now the projects to be realised on the shelf are still most attractive.

�We are interested in the further growth of the projects,� he emphasised.

The vice-president of �KazakhOil� highly appreciated the work fulfilled by OKIOC consortium. He also affirmed that in this year �the real constructional works have been started at CPC�s sites.� In his opinion, especial attention is to be paid to the utilisation of natural gas, which is just being burnt in many oilfields.

According to the President DB Securities (Kazakhstan), the investment policy of the state often is inadequately interpreted or fulfilled at the local level.

�The policy declared on the top, is to be fulfilled below, and not only in the oil and gas industry, but in other sectors also,� Gregory Marchenko.

In his opinion, Kazakhstan needs to increase small and middle investments. Besides, according to Mr. Marchenko, it is necessary to pay attention to direct investments to non-traditional branches of the economy.

�The level of expenses towards the production of Tengiz oil has been reduced to the world�s one and is about one-third of the expenses incurred in 1993,� the General Manager of the European Business Union �Chevron Overseas Petroleum� announced.

TCO is planning to drill new wells, to construct new and to reconstruct existing objects. It is projected to build a new housing complex.

According to Reuters, regarding the sale of the Kazakhstan share in TCO Mr. Zana said �we are interested to purchase at least 5% of TCO, but we will also consider other variants.

The director of EBRD (Kazakhstan and Kyrgyzstan) emphasised the importance to raise the international competitiveness of Kazakhstan oil.

�Now the current price of the Caspian oil is a little higher than in the Northern Sea,� Michael Davi said.

According to Mr. Davi, EBRD may support all investor at the Caspian shelf.

�However, to transport the Caspian oil to the world�s market, the co-operation of countries having the outlet to the Caspian Sea, is required,� Mr. Davie resumed.