Kazakh companies not to benefit from sharp devaluation of national currency – expert
Astana, Kazakhstan, Jan.30
By Daniyar Mukhtarov - Trend:
Benefits for Kazakh raw material companies from sharp devaluation of the national currency may be apparent, the Director of the Kazakh Center for Macroeconomic Research Oljas Khudaibergenov told Trend.
"The benefits from sharp 20-30 percent devaluation (of the tenge) for raw material companies (of the republic) will be apparent," he said. "To put it more precise, it may be observed only during 3-5 months, until the costs of companies rise, and then everything will return back to its place, and we will get the new prices and imbalance."
As an example, the expert mentioned the situation with the oil producing companies.
"The average prime cost of oil production in the republic is $50 per barrel," said the expert. "Depending on the age of the deposit, the prime cost ranges from $30 to $70 per barrel. There are costs that the companies should not bear, particularly the ones on social burden. These costs must be taken by the state. But when the social burden is imposed on raw material company, it includes it in the cost of the produced raw material, hence the complaints about the high costs."
He said that besides, raw material companies have foreign currency expenses at the level of 25-30 percent, which include the purchase of equipment, hiring of foreign workers.
"During the devaluation the prices will go up, and the companies will have to raise salaries, plus their contractors will begin to complain, as they also have import content," said Khudaibergenov. "Consequently, they will also raise their prices. Thus, the benefits from the sharp devaluation, as I said, are apparent."
Earlier, Oljas Khudaibergenov worked as a counselor at the National Bank of Kazakhstan.