The New York Times has a nice article up on how Kazakhstan feels about Mongol’s nomination. There’s a little confusion here–the NYT doesn’t seem to realize that Sergei Bodrov, the director and co-writer, is Russian. Nonetheless there’s great content here about Kazkahstan’s film industry and national pride. And of course we all have our fingers crossed as Oscar Night starts in about 24 hours!

EDIT: Unfortunately, Mongol lost to The Counterfeiters, an Austrian movie about a group of prisoners in a Nazi concentration camp who are used as part of a plot to counterfeit US and UK currency in order to flood the Allied markets and cause financial collapse. It was Austria’s first Oscar win.

Frank Giustra, the businessman who is making headlines for his alleged deal with Kazakhstan government officials in order to get uranium rights, has put out a press release listing the inaccuracies that the Bloomberg Press Service has made in covering the story. Among the errors Giustra cites:

Bloomberg: Giustra was negotiating with the Kazakhstan government to buy controlling stakes in three uranium mines.

Fact: The negotiations were with private companies, not the government…

Bloomberg: In November, 2005, Giustra flew back to Kazakhstan for another meeting with the President of Kazakhstan to get the uranium deal back on track.

Fact: There was no such meeting.

Bloomberg: Giustra stipulated that funds donated by him or Canadian mining companies to the Clinton Giustra Sustainable Growth Initiative, which is aimed at fighting poverty and building sustainable economies in developing countries, be deployed where he does most of his business.

Fact: The work of the initiative is, in fact, global, with a particular focus on helping local economies where mining takes place. In other words, the world’s mining sector is giving something back that can be sustained long after mining is finished. There is no “stipulation” that funds be spent only in countries where Giustra has business interests. In fact, of the several programs being introduced on March 1, only one will be in a country where Giustra is doing business.

Giustra also criticized in general terms the New York Times article which broke the story as being inaccurate. However he does not directly dispute the basic facts that he met once with Nazarbayev and President Clinton, that his company acquired uranium rights in Kazakhstan, or that he has made large donations to Clinton’s charity.

The Bloomberg story, like those in both The New York Times and The Wall Street Journal, contains errors of fact, uses innuendo, and omits key facts, either intentionally or through a lack of due diligence, to construct an article designed to suggest improprieties in the relationship where none exist.

The head of KazAtomProm in a recent interview also gave a similar response to the effect that something happened, but it was nothing illegal. He alleged that the American journalists who claim impropriety were paid by someone trying to defame Hilary Clinton and her Presidential campaign.

In a government meeting this week, Prime Minister Massimov assured the cabinet of ministers that work to renegotiate contracts with foreign investors will continue and that abrogations will be made on new contracts.

…officials announced that they would no longer negotiate production sharing agreements, or PSAs, which tend to be favored by international energy conglomerates because they tend to clearly outline taxation obligations. Prime Minister Karim Masimov said that all existing PSAs between Kazakhstan and foreign entities would be honored. The rule would only apply to new investors, he added.

What is more, oil companies are not to be the only targets of renegotations. Steel giant Arcleor Mittal whose mines have come to public attention for disasters that killed miners late last year and in 2006, is under pressure as well:

“The owner has been warned that if measures are not taken to assure safety the question of revoking rights to subsoil use will be raised,” Emergencies Minister Vladimir Bozhko – who heads a commission investigating a January accident at ArcelorMittal’s Abay mine which killed 30 workers - told the cabinet.

In fact it would appear that high profile companies are not the only victims of the government strategy to regulate foreign investors.

Energy Minister Sauat Mynbayev added to the pressure on investors by stating during the session that Kazakhstan had abrogated nearly 100 contracts in 2007. Government monitoring of 831 firms found that just over half were fully meeting their financial obligations, Mynbayev said, while 97 companies were meeting less than a third of them.

“These 97 contracts have to date been broken off. Notification has been sent to a further 182 [companies] about violations of contractual obligations and licensing conditions,” Mynbayev said. The ministry did not immediately respond to a request for clarification about which companies were implicated, but Kazakhstani analysts suggested most were probably minor subcontractors.

The mass investigation and cancellation of contracts may be aimed at reconciling breaches of contract, safety violations, and unfair terms of contracts made early in Kazakhstan’s independence. However some note cynically that in some cases violations years ago are being cited only today as reasons for canceling contracts. Critics note that likely this means that either monitoring institutions are not doing their job or that earlier informal arrangements were made to ensure that the government overlooked violations.
Others believe that the government is essentially nationalizing its resource industries by canceling contracts that do not give the government enough control or a big enough profit share.