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Kazakhstan's National Bank talks 2021 balance of payments forecast

Finance Materials 17 March 2021 12:04 (UTC +04:00)
Kazakhstan's National Bank talks 2021 balance of payments forecast

BAKU, Azerbaijan, Mar. 17

By Nargiz Sadikhova - Trend:

Kazakhstan’s National Bank expects the country’s current account deficit of the balance of payments to amount to $4.8 billion by the end of 2021, Trend reports citing the Bank.

According to the preliminary results of 2020, the current account of the balance of payments was formed with a deficit of $5.9 billion, which is a result of the fact that import flows and income to foreign investors exceeded the proceeds from the export of goods and services.

The volume of goods import declined slightly to 4.3 percent, while exports declined by 19 percent. Imports were supported by strong demand for teleworking gadgets, medicines, medical equipment, as well as goods needed to implement large infrastructure projects. In turn, the main reason for the export slump was a 29 percent decline in revenues from oil sales on international markets.

“Thus, the state of Kazakhstan's foreign economic sector is determined by a number of internal and external conditions. Among them are the situation on the world oil markets, including the decisions of the participants in the OPEC+ agreement, as well as external demand for Kazakh products, investment activity of enterprises in the mining industry, etc,” the Bank said.

The Bank expects a decrease in the current account deficit of the balance of payments to $4.8 billion in 2021, which will be primarily due to more boost of trade, in particular, higher oil prices.

According to the Bank’s estimates, the export of goods will grow at a faster pace than imports, 12 percent against 2.5 percent. The positive dynamics in the balance of payments will also be reflected in the financial account, in which the Bank expects a stable inflow of foreign investment.

“These factors taken together are a reflection of a significant improvement in the external economic situation,” the Bank noted.

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