Economic growth
Kazakhstan experienced a slowdown in economic expansion in 2014 due to negative source and call effects. Kazakhstan’s genuine GDP expansion slowed from 6% in 2013 to 4% in the first nine months of 2014. This is basically due to the decline in production in the oil industry. , weaker external demand for Kazakhstan’s steel products from China and Russia, and weaker domestic demand. Schedule effect of the slowdown in genuine wage expansion in 2013.
Macroeconomic policies
The Kazakh government is pursuing expansionary fiscal and financial policies to stimulate domestic demand.
Immediately after the devaluation of the tenge, amid the first symptoms of an economic recession, the government introduced an economic program for 2014-2015 of one trillion tenge, the equivalent of $5500 million. To finance the program, the government has appealed to the Petroleum Fund and has also issued $2. 5 billion worth of Eurobonds and has plans to accumulate loans from foreign monetary institutions.
To repair confidence in tenge and stimulate credit, the financial authority has sought to stabilize the exchange rate, accumulate the source of liquidity of the tenge and cope with the shortage of long-term financing in the tenge and the strong dollarization of the banking system.
Medium-term outlook and risks
A dubious global economic environment and regional geopolitical tensions pose dangers to Kazakhstan’s economic prospects. The country’s GDP expansion is expected to be around 4. 1% in 2014 before expanding to 5. 5% through 2017, driven basically by higher oil production. after the start-up of offshore oil production in 2016/17.
Risks to Kazakhstan’s near-term prospects may come from a further slowdown in the country’s steel production and steel processing industries, as well as investor sentiment and increased threat aversion, mainly as a reaction to the Russian-Ukrainian crisis. for the slow, a further drop in oil prices can also undermine the sentiments of Kazakh consumers and businesses and potentially generate tension in the tenge.
Social protection
If the economic recession begins to have a negative effect on the labor market, the government has put in place tools to mitigate the effect on the most vulnerable people in the population. strengthen, if you want to have a larger budget from the Petroleum Fund or a new prioritization of budgetary expenditures.
For the potency and effectiveness of aid programs, it is recommended that the government focus more on needy families and provide limited-time assistance. To make the economy more resilient, the government will want to further expand human capital through better education and outcomes.
Structural reforms
The Kazakh government has seen a set of reforms that help diversify the economy and expand the non-oil sector. The government has pursued a new set of measures to attract foreign direct investment into the economy, adding investment subsidies, tax incentives, a step-by-step term visa regime, and investor services.
The government has introduced a major programme to help the progress of small and medium-sized enterprises. Efforts are also being made for the national regulatory and governance framework that would improve the transparency and power of economic transactions, facilitate the participation of the personal sector and the delivery of facilities to the population. Ongoing reforms of customs management and the courts are components of its reform agenda.
The report also has special thematic sections on dollarization and the unobserved economy in Kazakhstan.
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