Page 14 - bneMag Dec22

14 I Companies & Markets bne December 2022
lead to a 2022 budget deficit that is substantially higher than originally planned.
At the same time, Montenegro is suffering what some analysts have called its worst political crisis in 20 years. After the collapse of Dritan Abazovic’s short-lived government, a standoff between President Milo Djukanovic and the new majority in Parliament have prevented the formation of
a new government.
“The complexity of the political situation exacerbates already high uncertainties, and postpones the reform process, diverting the focus from imminent economic challenges,” commented the European Commission.
The World Bank warns that the unfavourable global economic outlook and high uncertainty are weighing on Montenegro’s
recovery prospects, with growth expected to moderate
over the next two years. “While still recovering from the pandemic, Montenegro is facing renewed headwinds,” it said.
The bank does not expect Montenegro to start work on the remaining sections of the Bar-Boljare highway, the biggest investment project in the country, by 2025, as fiscal space is limited. It also notes that while tourism is expected to continue recovering next year, “deteriorating growth prospects in the EU and the region can slow its recovery”.
The World Bank warns of multiple downside risks to
the outlook, and says Montenegro will “require very careful debt management and stronger control over its expenditures”, given the tightening of global financial conditions and the country’s “sizeable financing needs of around 9% of GDP in 2023”.
‘Brotherly’ Azerbaijan and Turkey build lucrative Karabakh business ties
Ulqar Natiqqizi for Eurasianet
Following Azerbaijan’s victory over Armenia in the 2020 war, one of the biggest beneficiaries has been Turkey. Turkey gave substantial military aid to Azerbaijan in the war, and the aid is now being reciprocated: Companies close to Turkish President Recep Tayyip Erdogan have received at least hundreds of millions of dollars in contracts, particularly in the reconstruction of the territories in Karabakh that Azerbaijan retook in the war.
In some cases, the relationships go beyond business and politics: In one large new agricultural complex in the Zangilan region, members of Erdogan’s family are business partners with members of President Ilham Aliyev’s family.
Erdogan and Aliyev laid the foundation for the Dost (“Friend”) Agropark in October 2021, and the two visited it again on October 20, when they took a tour around Karabakh as part
of the inauguration of a new airport in Zangilan, near the borders with Armenia and Iran.
The Dost Agropark is envisaged as a $100mn project that will eventually employ 500 people raising up to 10,000 head of cattle.
Accompanying Erdogan on his trip around Karabakh was Abdulkadir Karagoz, the owner of Dost Ziraat, the Turkish investor in the Dost Agropark. Karagoz is not just a business ally but a member of Erdogan’s family; he is married to Erdogan’s niece, the daughter of Erdogan’s brother
Mustafa Erdogan.
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Shortly after the 2016 wedding, Karagoz (via a different company, which he also headed) began winning conspicuous amounts of government contracts, in many of which his firm was the only one participating.
Also following the wedding, he began to take tighter control of Dost, which he co-founded in 2010. By 2017, the company’s other shareholders had left. Meanwhile, other Erdogan family members joined.
Documents in Turkey’s official Trade Registry Gazette reviewed by Eurasianet show that just over a year after the wedding, more of Erdogan’s family members (two nephews) became shareholders in Dost Ziraat: Usame Erdogan, son of Mustafa; and Ahmet Enes Ilgen, son of Erdogan’s sister Vesile Ilgen. By 2020, however, other documents in the registry indicate that the two nephews no longer held shares in the company and that Karagoz was the only shareholder.
“The Dost Agropark is envisaged
as a $100mn project that will eventually employ 500 people raising up to 10,000 head of cattle”