ADB Forecasts a Slowdown in Kazakhstan’s Economy for 2024, Followed by Acceleration in 2025
Kazakhstan is predicted to experience 3.6% growth of gross domestic product (GDP) this year, slightly lower than the Asian Development Bank’s (ADB) previous forecast of 3.8% in April 2024, according to the September edition of ADB’s flagship publication, the Asian Development Outlook (ADO).
In 2025, Kazakhstan’s economic growth is anticipated to accelerate to 5.1%.
The Asian Development Bank (ADB) has slightly revised its economic growth forecast for Kazakhstan in 2024 downward, attributing this adjustment to weaker service sector expansion in the first half of the year, along with reduced oil production, severe flooding, and a slowdown in investment.
In the first half of 2024, tax revenue collections declined, as receipts from oil duties and value-added tax fell below the levels recorded in 2023. This decrease in tax revenues was somewhat mitigated by increased transfers from the sovereign wealth fund, the National Fund of Kazakhstan, with the government utilizing three-quarters of the planned annual transfers during this period.
Consequently, this situation contributed to the appreciation of the national currency, as Kazakhstan’s Central Bank converted the National Fund’s foreign currency receipts into tenge to fulfill government transfer requests.
“While the economic growth prospects for Kazakhstan look positive in the medium term, its fiscal challenges need to be addressed to ensure sustainable and inclusive economic growth,” said ADB Country Director for Kazakhstan Utsav Kumar.(Source:astanatimes)
Average inflation in Kazakhstan decreased to 8.9% during the first seven months of 2024, down from 17.2% in the previous year. Inflation is projected to further decline to 6.1% in 2025, influenced by a tight monetary policy and a stable exchange rate supported by substantial foreign reserves and earnings from commodity exports.
As of June 2024, the combined reserves held in the National Fund and the central bank exceeded $100 billion.
Kazakhstan became a member of the Asian Development Bank (ADB) in 1994. Since then, the ADB has invested approximately $7 billion in loans to both the government and private sector, as well as in grants and technical assistance.
