BAKU, Azerbaijan, Feb.1
Trend:
Director of the Balance of Payments Department of the National Bank of Kazakhstan Azat Uskenbayev spoke about the current account of the balance of payments, Trend reports with reference to the Bank.
"In 2020, the National Bank of Kazakhstan has created a preliminary assessment of the country's payment balance balance. The dynamics of the main flows in the balance of payments was determined by the fall in world oil prices in the first half of the year, the subsequent OPEC + deal, the COVID-19 pandemic and the government's response to support the economy," he said.
"According to preliminary estimates, the current account was formed with a deficit of $5.9 billion, which is in line with the forecasted expectations of the National Bank for 2020. The main reason for the current account deficit is a decrease in exports of goods due to a decrease in oil exports. In 2020, exports decreased by $11.3 billion or 19.4 percent to $46.9 billion Over the same period, imports decreased by $3.9 billion or 9.7 percent to $36.2 billion, which is associated with a reduction in the import of investment and intermediate goods," Uskenbaev said.
"The state of the current account is determined by the equilibrium between the trade balance on the one hand and income payable to foreign investors on the other. Historically, the balance of payments is characterized by a positive balance of trade, with a negative balance of income," he said.
"In 2020, the negative balance of investment income decreased significantly, which significantly constrained the potential depth of the current account deficit. Dividends and reinvested earnings attributable to direct investors amounted to $10.4 billion, which is 35 percent compared to 2019's figure ($16 billion)," Uskenbaev noted.
"Another significant factor is the inflow of foreign currency into the country from the participants of the Karachaganak consortium in the amount of $1.3 billion, received as part of the settlement of the dispute between the country and the consortium. The receipt of this compensation payment doubled the positive balance of secondary income (transfers) to $2.1 billion, " he said.
"These positive trends in income counterbalanced the negative trade balance in the third quarter of 2020. As a result, by 2020, the current account balance grew by $1.3 billion compared to 2019," he added.