Economic News in Brief

  • The National Bank of Kazakhstan will allocate $698 million to support the country’s loan programmes, reported Tengrinews.kz citing the National Bank’s press service. The money will be used to implement the instructions of Kazakh President Nursultan Nazarbayev from the Feb. 11 extended government sitting. The funds will be used to make mortgages more affordable, not to simply write off debts, the National Bank noted. In December, some of Kazakhstan’s domestic banks suspended mortgage programmes in tenge, the national currency, a move blamed on a tenge shortage.
  • Kazakhstan’s economy grew by 4.3 percent last year and investments in fixed assets increased by 3.9 percent, reported the Ministry of National Economy. Minister of National Economy Yerbolat Dossayev noted that the ministry had focused on implementing President Nazarbayev’s Kazakhstan 2050 Strategy over the course of 2014, as well as the Nurly Zhol economic stimulus programme announced near the end of the year. Dossayev also reported that industry had grown by 0.3 percent and agriculture by 0.8 percent. Unemployment was measured at 5 percent and inflation at 7.4 percent. The average monthly salary grew by 3.9 percent to reach 120,500 tenge (US$650.63), the minister reported. The focus in 2015 will be on counter-cyclical policies to support domestic demand, prevent an increase in unemployment and support gross domestic product growth, said Dossayev.

 

  • The Samruk Kazyna Sovereign Wealth Fund plans to sell 17 assets in 2015, reported Primeminister.kz. These include companies like KazTransGas Aimak, Alatau Zharyk, Almaty Power Stations, AlmatyEnergoSbyt and others. Samruk Kazyna is in the midst of a privatisation programme to run from 2014–2020, during which 106 of its assets are to be sold. According to Samruk Kazyna Deputy Chairman Elena Bakhmutova, in 2014, 59 of 64 assets the fund plans to sell were put to auction and five had the terms of their privatisation pushed to 2016. So far, she said, 24 companies have been sold for more than $129.5 million. She added that challenging economic conditions might result in the fund deciding to delay some privatisation activities.

 

  • Kazakhstan does not intend to cut oil production this year despite falling prices, Minister of Energy Vladimir Shkolnik announced at the Feb. 23 Central Communications Service briefing. “The target for this year is 80.5–80.8 million metric tonnes, as it was in 2014,” he said . Kazakhstan, which produced 80.845 million metric tonnes of oil last year, is heavily dependent on oil revenues. With oil prices at about half of last year and sanctions as well as low oil prices pressuring the economy of Russia, Kazakhstan’s neighbour and biggest trading partner, the country is bracing for a difficult year. Shkolnik noted at the briefing, however, that Kazakhstan increased oil production by 0.8 percent from the beginning of the year to Feb. 20, compared to the same period last year, and the country expects to meet its target for this year. Vice Minister of Energy Uzakbai Karabalin previously commented that with the high cost of oil production in the country averaging $50 a barrel, production could actually be unprofitable at some of Kazakh fields. Shkolnik said earlier that the country would reduce oil export customs duties from $80 to $60 per metric tonne.

 

  • More than 5 billion tenge (US$27 million) can be used to organise Kazakhstan’s next presidential election, said Minister of National Economy Yerbolat Dossayev at the Feb. 19 Central Communications Service briefing. He called the amount not “a huge expense.” Kazakhstan is scheduled to hold the next presidential election in 2016, but a call by the Assembly of the People of Kazakhstan to move it up to this year is gaining traction. “We support the initiative and the election given the current conditions. There is not much money [needed], but you can’t say this will be a huge expense. For 2016, we had envisioned using a little more than 5 billion tenge (US$27 million) to hold the presidential election,” said Dossayev.

 

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