WB reveals forecast for Kazakhstan’s GDP growth

Business Materials 5 April 2019 14:20 (UTC +04:00)

Baku, Azerbaijan, Apr. 5

By Rashid Shirinov – Trend:

The World Bank expects Kazakhstan’s GDP growth to decelerate slightly in 2019-2020 and flatten thereafter, Trend reports citing the WB Europe and Central Asia Economic Update, Spring 2019: Financial Inclusion.

The bank forecasts the country’s GDP growth at 3.5 percent in 2019, and at 3.2 percent in 2020 and 2021.

“The outlook reflects slow productivity growth and the underlying structural weaknesses of the economy, including market dominance by state-owned enterprises, unequal regulatory treatment of enterprises, and a low level of competition,” reads the report. Decelerating economic growth in Kazakhstan’s main trading partners — particularly China, the EU, and Russia — is also forecast to dampen growth in 2019.

The WB believes that consumer spending will continue to drive economic activity, though to a lesser extent than in previous years. The non-oil fiscal deficit is expected to decline further in line with the government’s medium-term fiscal consolidation strategy.

“Assuming that prices, oil demand, and oil and mining profit repatriation remain stable, the current account will be roughly balanced in the forecast period,” reads the report.

Also, the National Bank of Kazakhstan is expected to raise the key policy rate to counter inflationary pressures from real wage growth, thereby keeping inflation within the 2019 target range, according to the WB.


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