In 2023, Kazakhstan’s GDP growth amounted to a 10-year maximum of 5%
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The economy of Kazakhstan is returning to stable growth, ACRA experts conclude in their new review. For the first half of 2023, the GDP growth of this country amounted to 5%. Such a maximum indicator over the past ten years is explained not only by the low base of last year, but also by active foreign trade, attracting investments and increasing consumer lending. ACRA predicts that in 2023-2025 the economy of Kazakhstan will grow by 4-5% annually – it is assumed that the growth drivers will be the extraction of raw materials, construction and the service sector.
As a result of August, inflation in Kazakhstan decreased to 13.1% in annual terms. Pointing to the gradual weakening of pro-inflationary pressure from outside, the National Bank lowered the base rate from 16.75% to 16.5%. ACRA predicts that the trend towards slowing inflation and easing monetary policy will continue in the medium term: it is expected that by the end of 2024 inflation will slow down to 7–8%, and the base rate will decrease to 9%.
ACRA identifies the growth of foreign trade as the main trend in the development of the economy of Kazakhstan in recent years. This is mainly about increasing exports: after almost a decade of reduction, in 2021 the volume of deliveries increased by 28%, to $60 billion, in 2022 – by 42%, to $85.4 billion. After the start of the Russian military operation in Ukraine, the volume Kazakhstan’s trade with Russia has grown significantly: at the end of 2022, it increased by 6.1% and reached $26.1 billion.
Given the growing risk of secondary sanctions for Kazakhstan, its companies and banks (in the spring, Assistant Secretary of the Treasury Elizabeth Rosenberg recalled the possibility of their introduction), Astana began to increase trade with China. According to the results of the first half of 2023, the trade turnover with it amounted to $13.6 billion, which is 20.5% more than last year’s value for the same period. As a result, China’s share in Kazakhstan’s foreign trade exceeded Russia’s for the first time (see graph).
It should be noted that in addition to the risk of secondary sanctions, ACRA names other factors that may slow down the growth of the Kazakhstan economy. Among them is the possible weakening of the ruble and the complication of the situation with export trade routes (we are talking about the problems that arise when transporting oil through the port of Novorossiysk— see “Kommersant” of June 6).
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