Asian Development Bank (ADB) forecasts Kazakhstan’s economic growth to slowdown in 2019 and 2020, reflecting lower oil prices and reduced growth in China and Russia.
“Aside from oil revenues, public investment is expected to become a key source of economic growth in the coming years,” reads the latest ADB outlook.
The bank expects the growth of Kazakhstan’s gross domestic product to moderate to 3.5% in 2019 and 3.3% in 2020 from the 4.1% achieved in 2018. Average inflation is estimated to remain at 6% and expected to moderate to 5.5% in 2020.
Food price inflation is projected to slow down to 5.2% in 2019 and 5% in 2020 due to incentives provided for domestic food production, the institutionalization of stabilization funds for critical food items, and the imposition of selective price controls.
ADB predicts Kazakhstan’s industry to expand by 4.3% in 2019 and 4.4% in 2020, as state led-investment in the manufacturing and utilities’ sectors will partly counterbalance the limited gains in oil production, which are expected to decline in the first half of 2019 as Kazakhstan needs to meet its commitments with the OPEC and the three major oilfields (Tengiz, Karachaganak, and Kashagan) undergo planned maintenance.
The bank also expects the country’s agriculture to grow by 3% in 2019 and by 2.5% in 2020 as a result of the updated state support program.
Kazakhstan was the first Central Asian country to join ADB in 1994. During its 25-year membership, Kazakhstan has received over $5 billion in sovereign and private sector loans and about $50 million in technical assistance grants in support of transport, agriculture, water, education, health, as well as finance and public sector management. (Trend/Business World Magazine)