On the scandalous case of Stati and the coming catastrophe

Our estimate of Akorda’s sensitivity to freezing of Kazakhstani assets within the framework of legal confrontation between Kazakhstan and Moldovan businessmen Anatoliy and Gabriel Stati was confirmed by the rating agency S&P.

In proving this thesis will well allow ourselves a few quotes from the expert analysis, published on one of Kazakhstani websites (underlining in bold are made by us):

“On Jan. 18 2018 S&P Global Ratings proved a long-term and short-term sovereign credit ratings of the republic of Kazakhstan on liabilities in foreign and domestic currency at the level BBB-/A-3”. The forecast of changing of the ratings is to Stable. We also confirmed the rating of the country on a national scale at the level of kAA.

“In accordance with EU CRA Regulation deviations from calendar of publications are limited and allowed only in certain circumstances, and such publications must be accompanied by detailed explanation of reasons for deviation from the schedule. In this case deviation from schedule is caused by freezing of assets of National fund for the sum of 22.6 bil. dollars”.

“Government of Kazakhstan maintains a relatively stable position of a net lender despite out opinion about worsening of budgetary and foreign indicators after freezing of assets of the National fund for the sum of 22.6 bil. USD. (13% of GDP of the country in 2018). We expect, that the sum that remains in the accounts of the National fund (almost 20% of GDP) will not be frozen within the framework of continuing legal process”.


We excluded 22.6 bil. USD (13% of GDP in 2018) from the estimated of assets of the National Fund, after the funds of the fund were frozen due to disagreements between the government of Kazakhstan and foreign investors. At the same time, according to definitions, given in our criteria, the government remains a net lender, however, in 2018 the volume of assets will be exceeding the volume of liabilities by less, than what expected earlier (barely 15%).

Also, due to freezing of assets, our estimate of external indicators of Kazakhstan has also worsened. In the present time we expect that the volume of liquid assets will exceed the volume of liabilities on foreign debt by around 5% of income on STO in 2018 compared to previous estimates at the level of 20% at the moment of publication of the last report on the rating of Kazakhstan”.

“Government of Kazakhstan challenges this court decision, however it was put into effect in Belgium and the Netherland, as a result funds in the accounts of the National Fund in these countries were frozen. Due to this we excluded 22.6 bil. USD from our estimate of assets of the National Fund for the period of 2017-2021, since at the present it is unclear, for how long these assets will remain frozen (however, as far as we understand, given the information received from Kazakh officials, accounts could be unfrozen in Mar. 2018 already, after appeal hearing). Moreover, unfreezing of assets is possible if the government of Kazakhstan presents pledged collateral for sum, determined by the Swedish court. At present , government of Kazakhstan doesn’t have a access to frozen part of assets of National fund”.

“At the present moment we continue viewing relatively strong budgetary indicators of Kazakhstan as a crucial positive rating factor. By our estimates, as a result of freezing of assets liquid assets of the expanded government have shrunk from 45% of GDP in 2016 to 22% of GDP in 2017. Liquid assets of the expanded government are represented primarily by assets of the National Fund (primarily in the form of foreign investments). Considering a relatively low level of debt – around 21% of GDp, we note that the government was a net lender, but at the same time level of assets exceeded volume of liabilities by 25% of GDP in 2016. In 2017 as a result of freezing of assets difference between volume of assets and liabilities has shrunk to 1% and if the situation doesn’t change, government will become a net-debtr before 2021, with a slight excess of liabilities over assets”.

By our estimates, current loss of Akorda in their multi-year legal opposition with Anatoly and Gabriel Stati (see Akorda is risking Kashagan) will turn into a catastrophe, if in March 2018Ministry of Justice of RK and its head Marat Beketaev will not be able to win appeal hearings. Or, and its also theoretically possible, the hearings will draw on longer.

Considering high risk of such a turn of events Akorda might try to make an agreement with Moldovan investors, which will likely be resisted by both foreign legal contractors for whom, this means not only loss and image losses, but also loss of lucrative contracts and by Kazakh officials who employ them.


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