2014年-世界发展银行全球_Kazakhstan_Growth_Slows_as_External_Pressures_Rise___Kazakhstan_Economic_Update_Fall_2014_46页_1mb

Kazakhstan: Growth Slows as External Pressures Rise

Core Content

Kazakhstan experienced a slowdown in economic growth in 2014, driven by both supply-side constraints and weaker domestic and external demand. The country's real GDP growth dropped from 6% in 2013 to 4% in the first nine months of 2014, primarily due to declining oil production and reduced demand for its metal products from key trading partners, China and Russia. The February 2014 devaluation of the tenge led to higher import prices, which dampened domestic demand and increased inflationary pressures.

Despite the slowdown, poverty and unemployment remained low, with the poverty incidence at around 3% in the first half of 2014. However, informality and irregular migration continued to be significant issues, with a large portion of the labor force working in the informal sector, especially in agriculture, construction, and trade.

The Kazakh government implemented expansionary fiscal and monetary policies to stimulate demand and support the economy. A $5.5 billion economic support program was launched for 2014-15, funded partly by the Oil Fund and planned Eurobond issuance. The National Bank of Kazakhstan (NBK) took steps to stabilize the tenge by injecting liquidity into the market, managing the exchange rate, and introducing a currency-swap program to address dollarization and long-term tenge funding shortages.

Main Views

• Economic Growth Moderation:

  • Real GDP growth slowed from 6% in 2013 to 4% in 2014 due to supply-side issues and weaker demand.
  • Decline in oil production and reduced demand from China and Russia were key factors.
  • Domestic demand weakened due to devaluation, lower real wages, and tighter credit conditions.

• Balance of Payments Improvement:

  • The trade surplus increased significantly, reaching $22.6 billion in the first half of 2014.
  • This was driven by a contraction in merchandise imports and increased exports.
  • FX reserves held by the NBK increased by $1.6 billion in 2014, though some were sterilized through the Oil Fund's foreign investments.

• Inflationary Pressures:

  • Inflation rose from 4.5% in January 2014 to 7.4% by September 2014.
  • Producer prices increased more sharply, reaching 9.7% in September 2014.
  • Price controls on food and utilities helped contain inflation, but adjustments in controlled prices (e.g., gasoline) were expected to drive further inflation.

• Labor Market and Migration:

  • Poverty incidence stabilized, and the unemployment rate decreased slightly.
  • Informality remains high, with about 33% of the labor force working informally.
  • Irregular migration from Central Asian countries is a chronic issue, with over 1 million migrant workers estimated to be in the country annually.

• Government Response:

  • The government tapped the Oil Fund and planned to issue Eurobonds and increase borrowing from IFIs to finance its support programs.
  • Fiscal policies aimed at alleviating the devaluation impact included wage increases in the public sector and social transfers.
  • The NBK implemented measures to stabilize the tenge, including repo market interventions and FX swaps, to restore confidence in the currency.

Key Information

• GDP Growth: 4% in the first nine months of 2014, down from 6% in 2013.
• Oil Production: Declined by 0.9% y-o-y in the first nine months of 2014, with Kashagan oil field expected to come online in 2016/17.
• Trade Surplus: Increased to $22.6 billion in the first half of 2014, contributing to a better balance of payments.
• Inflation: Rose to 7.4% in September 2014, with producer prices increasing more sharply.
• FX Reserves: Reached $97 billion by the end of September 2014, with $7 billion added in the first nine months.
• Poverty Incidence: Stabilized at around 3% in the first half of 2014.
• Unemployment: Fell slightly to 5.1% in the first half of 2014.
• Informality: Remained at around 33% of the labor force.
• Irregular Migration: Estimated at over 1 million annually, with most migrants from Uzbekistan, Kyrgyzstan, and Tajikistan.
• Government Support: A $5.5 billion program for 2014-15, with measures to support private investment and reduce non-performing loans.
• Exchange Rate Management: The NBK maintained a tight exchange rate regime, with the tenge fluctuating between 182 and 185 KZT/USD.
• Dollarization: Remained high, with FX deposits accounting for 45% of the total deposit base in July 2014.
• Policy Measures:
  • The NBK introduced a $10 billion FX-swap program.
  • The UAPF increased deposits in local commercial banks.
  • The government plans to reform the regulatory and governance framework to improve transparency and efficiency.

Structural Reforms and Future Outlook

The government is focusing on structural reforms to diversify the economy and expand the non-oil sector. These include:

• Attracting foreign direct investment (FDI) through subsidies, tax incentives, and improved business services.
• Supporting SMEs with credit access improvements and targeted assistance.
• Enhancing the regulatory and governance framework to improve transparency and private sector participation.
• Reforms in customs administration and the judiciary to improve efficiency and fairness.

Despite the slowdown, Kazakhstan's GDP growth is expected to rise gradually to 5.5% by 2017, mainly due to increased oil production. However, risks such as further slowdown in China and Russia, oil price volatility, and global economic uncertainty could impact growth. The government needs to improve the efficiency of its support programs, better target assistance, and strengthen institutions to build economic resilience.

Conclusion

Kazakhstan's economy is facing challenges due to external pressures and a slowing growth trend. The government's response includes both short-term fiscal and monetary measures to stabilize the economy and long-term structural reforms to diversify the economy and reduce dependence on oil. While poverty and unemployment remain low, informality and irregular migration are still pressing issues. The success of these policies will depend on effective implementation, improved targeting of support, and institutional reforms to ensure sustainable growth.