29 July 2004
The Kazakhstan Country Updates provide information about recent developments, decisions, civil society concerns and recommendations related to Multilateral Development Bank (MDB) involvement in Kazakhstan including that of the World Bank (WB), International Finance Corporation (IFC), European Bank for Reconstruction and Development (EBRD) and Asian Development Bank (ADB). The updates are emailed to a list of individuals and civil society organizations in Kazakhstan and abroad who are interested in monitoring MDB investment and project impacts in the country. If you would like to be included or removed from the list, please email the moderator, Heike Mainhardt-Gibbs at . Correspondence with BIC may be conducted in Russian.
The Bank Information Center (BIC) is an independent, non-profit, non-governmental organization that aims to empower citizens in developing countries to influence World Bank and other Multilateral Development Bank (MDB) activities in a manner that fosters social justice and ecological sustainability. BIC advocates for greater citizen participation, transparency, and public accountability. For more information about BIC, see www.bicusa.org
Recent News and Developments
BTC pipeline needs Kazakhstan oil
According to the Eurasia Daily Monitor (08 June 2004), the Baku-Tbilisi-Ceyhan (BTC) pipeline cannot meet half of its capacity without oil from Kazakhstan and Russia. However, Russia is lobbying extensively to persuade the Kazaks to use Russian transit routes rather than BTC. To counter the Russian pursuit, government representatives of Azerbaijan are currently negotiating with Kazakhstan on a draft intergovernmental agreement regarding transportation of Kazakhstan oil via the BTC pipeline (AzerTag, 11 May 2004). In order to establish an Aktau-Baku system, a new terminal for storage and transfer of oil and new junction lines must be built in Kuryk. The capacity of the proposed transferring system would be 20 million tons per year.
WB promises to increase renewable energy projects
During the plenary session of the International Conference on Renewable Energies in Bonn, Germany (June 1-4), Peter Woicke announced that the World Bank Group (WBG) will commit to an average growth rate of 20% per year over the next five years in its financial support for renewable energy and energy efficiency projects. This target originated from a recommendation of the WB Extractive Industries Review authored by Pak Emil Salim. Mr. Woicke said that this increased lending would double their current commitments of approximately $200 million per year by 2010. This new commitment is contingent upon WBG Board approval. Fore more details please follow this link to the Bank’s energy web page.
Miner killed in Karaganda region
According to Interfax-Kazakhstan, on 28 May 2004 a 47-year old operator of an extraction machine was killed in the Shakhtinskaya mine in the Karaganda region when its roof caved in. This mine is part of the Ispat-Karmet coal group. In 1997, Ispat-Karmet Ltd. received $132.5 million from IFC and $200 million from EBRD. The loans mainly served to help Ispat-Karmet restore capacity in steel, power and coal operations. The status of the project at both banks is still active. In 1997, the IFC Summary of Project Information (SPI) states that this project represented the largest privatization project to date in Kazakhstan. For the IFC SPI click here and for the EBRD Project Summary Document (PSD) click on this link.
The 11th Caspian Oil and Gas Exhibition and Conference
During 1-4 June, Baku hosted the 2004 annual industry forum on the Caspian energy market. Participants and speakers of the conference included representatives from national and foreign governments, oil and gas companies, the EBRD and WB, and NGOs. The theme of the conference this year was “New Targets and Opportunities to Fulfill Global Energy Demand”. For more information and the conference program please click here.
Civil Society Activities
Last Chance for Civil Society to Improve WB Response to the Extractive Industries Review (EIR)
On 18 June, the draft World Bank Group EIR Management Response was released for public comment until 18 July 2004. The Bank’s Board of Executive Directors will meet at the conclusion of the comment period to consider comments and to approve the official Bank response. Civil society representatives who have actively followed the EIR process feel that the response is long on rhetoric and very short on meaningful commitments by the Bank. For the next month, civil society will target the Bank’s Board as a last hope for real change in the WB’s oil and mining policies and activities. The draft WB management response can be viewed at: www.worldbank.org/ogmc. Comments can be submitted via: or www.worldbank.org/eirresponse. Comments may also be submitted directly to Kurt Bayer, Austrian Executive Director representing Kazakhstan, by Fax: 202-522-3453 or by email: . For more information on civil society activities associated with the EIR contact Andrea Durbin ().
MDB Project Activities
EBRD planned support for Kenkiyak-Atyrau oil pipeline
The planned EBRD Kenkiyak-Atyrau project is a US$70 million loan that will finance up to 35% of commissioning costs for the crude oil pipeline connecting the Aktobe region with the city of Atyrau. The pipeline is intended to create large-scale production and export options for the oilfields of Central Kazakhstan. The scheduled Board Date is 22 June 2004. In addition, the EBRD plans to provide complementary Technical Cooperation (TC) intended to assist in the implementation of regulatory and institutional reforms, such as western-style tariffs. The project is assigned an environmental category C. The company-generated Environmental Impact Assessment (EIA) identifies no significant environmental liabilities. Both the Project Summary Document (released on 24 April 2004) and the EIA may be viewed by clicking the document titles in the text above.
EBRD planned support for Tasbulat oil and gas fields
The EBRD plans to lend US$60 million to Tasbulat Ltd., a subsidiary of SNP Petrom (Romania state oil company), for the development of three oil and gas fields in the Mangyshlak Basin. The Board approval date is 6 July 2004. For general information, click on Project Summary Document (EBRD, 20 April 2004). The project is assigned an environmental category C. The environmental impact assessment (EIA), based on company documents, identifies no significant environmental risks. A summary of the EIA is available in Russian and English. The full EIA report in both languages may be accessed at http://www.petrom.ro/engleza/publicdisclosure/.
Kazakhstan signs the EBRD Atyrau-Aktau Road Reconstruction loan
The Parliament of Kazakhstan has ratified an agreement with the EBRD for a $119.2 million loan that will repair a 900km road between Atyrau and Aktau in Western Kazakhstan. The project environmental category is B. The Project Summary Document (PSD) is available on the Bank’s website.
Upcoming EBRD Board meeting on Oil Sector Sub-contractor II (COC) project
The Board of Directors will meet on June 22, 2004 to review the Oil Sector Sub-contractor II (COC) project. The $7 million loan would finance purchase of barges and tugs that are needed to fulfill COC's (Caspian Offshore Construction) contract with BAVOF. COC Kazakhstan and BAVOF are working for Agip KCO to complete construction of artificial islands in the Caspian Sea. Click on this link to access the Project Summary Document (PSD) disclosed on November 10, 2003.
WB updates Kazakhstan Forestry Report & continues planning on Forest Protection Project
The WB has updated its Kazakhstan report “Forest Sector in Transition: The Resources, the Users and Sustainable Use”. It is available in English and in Russian. To request a copy of the report contact Jessica Mott (WB) at or Heike Mainhardt-Gibbs (BIC) at . Furthermore, the WB Forest Protection and Reforestation Project remains under development. WB Board approval is tentatively scheduled for July 2006. Interested NGOs should submit comments to Jessica Mott (see above). Available WB documents include the Project Information Document (PID) and the Integrated Safeguards Data Sheet (ISDS) released in 2003. To access these documents click on their titles in the text. In early June, the WB met with a few NGOs and the Association of Wood Processors in Kazakhstan to discuss the pending forest project.
New World Bank agriculture sector project documents
The World Bank’s Integrated Safeguards Data Sheet (ISDS) for the Second Agricultural Post-Privatization Assistance Project is now available. Click on the title of the document above to read more. The WB is preparing to give a $35 million loan to the Government of Kazakhstan for the second phase of a three-phase project. The first loan of $15 million was made in 1998. The Bank’s Project Information Document and the environmental assessment were released on 1 March 2004.
On 16 March 2004, the WB released the Integrated Safeguards Data Sheet (ISDS) for the Agricultural Competitiveness Project. To view the document, click on this link. The Project Information Document was made public on 12 February 2004. The Bank approval date is scheduled for 15 February 2005.
MDB Consultations and Policy Updates
WB meets in Kazakhstan to discuss new Country Partnership Strategy
On 1-2 June, the World Bank met in Almaty with civil society organizations (CSOs) and the private sector to discuss the new Country Partnership Strategy (CPS) (formerly known as a Country Assistance Strategy, CAS). The Government and the Bank are jointly developing this document. According to the Bank, the CPS, unlike a CAS, will not lock in a 3-year lending program but rather, will establish a lending framework based on a year-to-year business cycle. At the meetings, civil society recommended greater involvement of NGOs in the design, implementation, and monitoring of the strategies and projects financed by the World Bank in Kazakhstan. Furthermore, the CSOs asked for better information dissemination on Bank projects and activities. The full WB press release can be found by clicking here and more information can be found on the WB website in English and in Russian. In addition, BIC has prepared the briefing, “Preparing the World Bank Country Assistance Strategy for Kazakhstan”.
Consultation on EBRD lending strategy for Kazakhstan
The EBRD Board of Directors will meet in mid-October 2004 to review Kazakhstan’s country strategy (CS). The EBRD will release the draft country strategy for public comments at the end of July 2004. For more information and to view the current CS for Kazakhstan go to http://www.ebrd.com/country/country/kaza/index.htm .
Last chance for Civil Society to improve WB’s new adjustment lending policy
The public comment period on the WB draft structural adjustment lending policy (OP 8.60) ends on 30 June 2004. In April, NGOs from ten countries met with Bank staff during the WB Spring Meetings in Washington to express concern over the draft policy. NGOs pointed out that the new policy ignores global consultations on the Forest Policy and Extractive Industries Review, which specifically called upon the Bank to strengthen its transparency, accountability, and participation regarding social and environmental impacts associated with adjustment lending. Comments may be submitted to and to Kurt Bayer, Austrian Executive Director representing Kazakhstan, . In addition, the WB is offering to hold video conferences to discuss the new policy with NGOs around the world. If your group is interested, contact Karolina Ordon
. To view the draft policy and related documents (in Russian), click on Adjustment Policy Revision or contact Heike Mainhardt-Gibbs (). Also, please see BIC’s write-up on the draft policy at http://www.bicusa.org/bicusa/issues/structural_adjustment/1427.php .
Archive
Previous Updates and related reports can be found on BIC’s website including: Kazakhstan Country Update #1 and Update #2. These reports are available in English and in Russian. Go to the Kazakhstan page on BIC’s website to read these updates. For a summary of active MDB projects in Kazakhstan, read BIC’s report, “Multilateral Development Bank Investment in Kazakhstan: through September, 2003.” Also available in Russian.