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Can #Turkmenistan pay its bills?

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A prominent Turkish investor has alleged that the Turkmenistan government “has run out of financial resources” and questioned its ability to pay its bills.

Oguzhan Cakirolgu, a board member of a former Turkish investor in Turkmenistan, reportedly said the government had "run out of financial resources and it hasn’t been paying for finished contracts, let alone being able to pay for new ones”.

He went on to claim that the government of Turkmenistan, with the world's fourth-largest gas reserves, "has not been paying companies for more than 3 years”.

Cakirolgu Group has now pulled out of the country.

The regime’s record appears to confirm the bleak picture Cakirolgu portrays: Polimeks, another Turkish contractor, has stopped work on a highway to connect the Caspian port of Turkmenbashi to the capital due to non-payment of debts.

Elsewhere, a Belarussian state-owned company is said to be still owed an outstanding debt of up to $52 million.

On the subject of government debt to foreign companies the foreign ministry and the Turkmen embassy in Ankara were unavailable for comment.

The allegations come as a delegation from the Central Asian country held talks at the German-Turkmen forum in Berlin last weekend as  part of a lobbying campaign for Turkmen gas to enter EU markets.

The solvency of the Turkmen state, said to be the most unreformed of the post-Soviet Central Asian states, has recently come further into question with the announcement by its state media that the regime will no longer be providing free electricity, gas and drinking water.

The decree of the country’s president Gurbanguly Berdimuhamedov would bring to an end the free supply of utilities which have been supplied as a comprehensive universal provision since 2004.

The official state narrative is that subsidies are no longer necessary and that privatisation marks a small step towards developing a market economy.

But observers have indicated that the reality is that the nation is in experiencing an under-reported fiscal crisis.

They say the harsh reality is of bread lines and food riots thatthreaten to wreck the Turkic state, with yet another flour shortage reported in the district of Boldumsaz just this week.

Further evidence of the perilous state of the economy comes with the International Monetary Fund (IMF) estimating that the country has run a 3-digit current account deficit for the past 3 years and the US State Department publicly assessing that the country may well be in undeclared recession.

Since independence in 1991 Turkmenistan has accepted significant financing from IFIs including $4 billion from the Chinese Development Bank (CDB) and a second $4.1bn loan from the same bank.

But the black market value of the manat fell 17-18% against the dollar in 2017-18 and the IMF has declared that the government should cut spending or devalue its currency.

The poor financial outlook, it is argued, does not seem to deter the Turkmen government from spending on lavish state projects, however, including a gilded equestrian statute of the President, unveiled in 2015, a Soviet-style artificial lake project costing $4.5bn, and a $5bn indoor sports centre to host the niche Asian Indoor and Martial Arts Games.

However, with multiple arbitration cases pending against the Turkmen government before the International Centre for the Settlement of Investment Disputes (ICSI), a pattern of unpaid investors withdrawing from operations in Turkmenistan, a regime that is in “denial” about its national finances and with little to no sign of reform on the horizon, the economic outlook remains grim.

Economy

Sustainable transport: EU funds clean buses, electric charging infrastructure and more in France, Germany, Italy and Spain

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Following the EU's investment of €2.2 billion in 140 key transport projects to jump-start the green recovery, as announced in July, the EU is contributing additional €54 million to five projects that aim at delivering safer and greener transport services. Among the selection are projects deploying cleaner busses with charging infrastructure in Paris and Barcelona. The projects also involve constructing 255 new electric charging stations on Italian roads, and installing ERTMS, the European Rail Traffic Management System on 238 rail vehicles in Baden-Württemberg, Germany.

The projects will be supported through the Connecting Europe Facility (CEF), the EU's financial mechanism supporting transport infrastructure, and further contribute to decarbonizing transport as set out in the European Green Deal. These projects were selected through the CEF Blending Facility, which allows the leveraging of additional private financing for the projects, in addition to the EU's support. In total, CEF has now supported 932 projects, with €23.1bn in total. You can find more details on today's five new selected projects here.

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Defence

Security Union: EU law on combatting terrorism led to stronger criminal justice rules against terrorism and more rights for victims

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On 30 October, the Commission adopted a report assessing the measures that member states have taken to comply with the EU rules on combating terrorism (Directive 2017/541). This Directive is the main criminal justice instrument at EU level to counter terrorism. It sets minimum standards for defining terrorist and terrorism-related offences and for sanctions, while also giving victims of terrorism rights to protection, support and assistance.

The report concludes that the transposition of the Directive into national law helped strengthen member states' criminal justice approach to terrorism and the rights afforded to victims of terrorism. While the measures taken by member states to comply with the Directive are overall satisfactory, there are however gaps that are a cause for concern.

For example, not all member states criminalize in their national law all the offences listed in the Directive as terrorist offences. In addition, there are deficiencies in the measures that member states have taken to criminalize travel for terrorism purposes and the financing of terrorism, as well as to support victims.

The Commission will continue to support member states in working towards full and correct transposition of the Directive. Where necessary, the Commission will make use of its powers under the Treaties through infringement procedures. The report will now be presented to the European Parliament and the Council.

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EU

European Union joins world leaders in committing to reverse nature loss by 2030 at UN Biodiversity Summit

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On 30 September, President Ursula von der Leyen (pictured) represented the EU at the UN Biodiversity Summit in New York which brings together world leaders to step up global actions for nature and confirm their determination in agreeing a new ambitious global biodiversity framework at the 15th Conference of the Parties (COP 15) to the Convention on Biological Diversity, planned for 2021.

Prior to the summit, President von der Leyen, together with more than 70 heads of state and government endorsed the Leaders' Pledge for Nature, committing to ten decisive actions to address the nature emergency. The President pledged to put nature and the climate at the heart of the EU's recovery plan, committing to tackle the interdependent climate and biodiversity crisis, deforestation, ecosystem degradation and pollution, and move to sustainable production and consumption.

President von der Leyen said: “Nature helps us in the fight against climate change. But it is also our ally in securing prosperity, combating poverty, hunger and inequalities, and is essential to prevent future zoonotic pandemics. We need to act now and bring nature back into our lives. This is the moment for world leaders to join hands and the EU is ready to lead the way. The European Green Deal is our vision and roadmap. We call on all to join this collective effort to create a common movement of change, to make the recovery green and to protect and restore our planet - the only home we have.”

The EU Biodiversity Strategy adopted by the European Commission in May 2020 outlines an ambitious agenda for the EU internally, but also globally. It reaffirms the EU's determination to lead by example in tackling the global biodiversity crisis and in developing an ambitious new UN Global Biodiversity Framework at the 2021 UN Biodiversity Conference.

This includes overarching long-term goals for biodiversity so that by 2050 the world's ecosystems are restored, resilient, and adequately protected; ambitious global 2030 targets in line with the EU's proposed commitments; and improved means of implementation in areas such as finance, capacity, research, know-how and technology.

Ahead of the COP 15, the European Commission also launched the global coalition United for #Biodiversity, calling on all national parks, aquariums, botanic gardens, zoos, research centres, science and natural history museums, to join forces and raise their voice about the nature crisis.

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