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Mining companies applaud tenge devaluation in Kazakhstan

14 february 2014, 02:05
0
©RIA Novosti
©RIA Novosti
Kazakhstan mining companies that have been struggling with the depressed foreign markets have finally had a breath of air. They are among the very few groups in Kazakhstan that are welcoming the nearly 20% devaluation of tenge declared a few days ago. Mining and metallurgical companies are supportive of the tenge 'adjustment', as they call it, because it rhymes with profits for them, Tengrinews reports.

"The National Association of Mining and Metallurgical Enterprises is supportive of the adjustment of tenge exchange rate," said Tulegen Mukhanov, Deputy Executive Director of the Association.

"Revenues from our produce were hardly enough to covers the manufacturing costs. But with the adjustment in place we are getting some extra money that we can use to further modernize the enterprises and implement social projects. In the long run this makes Kazakhstan more attractive for investments," he said.

300 companies that are members of the Association export 90% of what they produce. "Their share in the country's export is 13%, and their share in GDP is 11%. Since the share is big, the stability of Kazakhstan's economy largely depends on how well our companies are working," Mukhanov said.

Eduard Ogai, Chief Executive of KazakhMys, Kazakhstan's largest copper company, also voice his support of the decision of the National Bank to devalue the country's currency, the tenge. "I think that the effect of the exchange rate adjustment will be a positive one and we will start feeling it in about six months," he said.

On February 11, 2014 Kazakhstan’s Central Bank devalued the tenge from 155 tenge per dollar to 185 tenge per dollar in one step.


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