Kazakhstan’s new policy for legalising capital from the country’s extensive shadow economy came into effect on 01 September 2014. This will represent the third such campaign within the country since Kazakhstan gained its independence from the Soviet Union in 1991. Based on a decree signed by President Nursultan Nazarbayev in June 2014, the new policy will strive to bring new and much-needed funds into Kazakh banks, thus stimulating the economy, by granting tax amnesty for any capital or property acquired outside of the formal economy that individuals declare between 01 September 2014 and 01 December 2015. The Kazakh Government estimates that as a result of this policy banks could bring in an estimated US$ 10 billion. It is important to note that although it seeks to legalise money technically garnered from illegal monetary transactions, to the extent that the funds are originating in a system outside of the established legal economy within Kazakhstan, the government has emphasised that it will not accept any property or capital stemming from corruption or acquired as a result of crimes committed against individuals or against the state constitution. However, it is not clear how the Kazakh Government plans to make this distinction, particularly considering that all three of the aforementioned sources of money play a prominent role in Kazakhstan’s informal economy. Indeed, although the government’s new policy will almost certainly have the desired effect of bringing new funds into the banking system, it will likely fall far short of curbing the country’s extensive shadow economy. In the worst case, it may even encourage and further perpetuate the informal economic system the president has claimed he wants to combat.read more
Central America has gained fame for being one of the most violent regions in the world. For example, the Guardian published an article in June 2014 on “The 10 world cities with the highest murder rates – in pictures” based on the recent data released by the UN Office on Drugs and Crime that shows that eight of the ten most violent cities in the world are in Latin America; the Central American cities are Guatemala City, Belize City, Tegucigalpa, Panama City and San Salvador. However, amid this negative press, excellent news has been announced by the Guatemalan and Honduran Presidents; that their latest homicide statistics indicate that instances of homicide have dropped over ten and twenty points in the past two years, respectively. Is this good news just too good to be true?read more
There is no overarching theme in Libya – that is, unless you count the effect political paralysis in Tripoli has on the country’s numerous security problems. The longer Prime Minister Ali Zeidan remains isolated, and the General National Congress (GNC) can override his wishes, the longer the Libyan Government will remain unable to brave the endless oil blockades in the East, as well as terrorism, assassinations and intertribal clashes. In fact, the continued political stalemate in Tripoli, as well as the tendency of authorities to divert attention toward the supposed threats of Muammar Gaddafi’s ghost, has only exacerbated these problems.
Analogies of Frankenstein’s monster have been invoked as Mexican federal forces descend on Michoacán state to prevent vigilante self-defence groups from confronting the Knights Templar drug cartel in Apatzingan city. A threat to security which both the previous and current administrations had a hand in creating, the sudden advance of the self-defence groups has presented Mexican President Enrique Peña Nieto with a complex challenge that puts his ambitious plans for reform in jeopardy.
Fuerzas autodefensas – self-defence forces – have featured in rural Mexico for decades, but began to emerge and spread with disquieting frequency in the latter half of 2013. The phenomenon has drawn increased attention, both from the Mexican government and the international community, in the early weeks of 2014, as the rapid vigilante advances seen in Michoacán state have raised concerns that the groups will tip the region over the edge from simmering violence into all-out war.read more
Today Algeria will mark the one-year anniversary of the devastating attack on the Tigantourine gas complex In Aménas, which left sixty-seven people killed, thirty-seven of whom were foreign nationals. This is a sad, but fitting timeline as international energy giants prepare to make a full return to the region. Whilst the day will likely go ahead without much fanfare, sombre reflection is expected among Algerian leaders, who are growing increasingly concerned about their country’s ability to put a stop to the tide of militancy that has swept the region in the wake of the 2011 uprisings. Meanwhile, foreign energy workers are likely to continue to press the government in Algiers for a greater security response, and present some tough inquiries to their Algerian partners. One question, in particular, remains: what, exactly, are Algerian authorities doing to quash fears of another terror attack?
This week, The Inkerman Group had the privilege of providing interested investors and avid followers of African development with insight and analysis as part of Reuters Trading Africa Forum. Discussions centred on West Africa, one of the world’s most exciting emerging markets. Below were some of the highlights: