Economic news in brief

Kazakhstan’s international gold reserves had decreased 11.8 percent to $27 billion by the end of March. The only greater decline (of 20.6 percent) happened in 2013. The drop in the price of gold by 1.8 percent to $1,302.3 per ounce was one of the reasons for this year’s decline in reserves. At the same time, the share of gold in Kazakhstan’s international reserves increased by 13.8 percent to 55.5 percent ($15 billion) by the end of March. Foreign exchange reserves declined 31.8 percent. The dynamics of changes in the gold reserves shares and currency reserves is described as de-dollarisation of reserves, reports. Excluding the International Monetary Fund, Kazakhstan is fourteenth in the world in terms of gold reserves, with 356.3 tonnes, 1.1 percent of world’s reserves.

Tariffs for housing and communal services in Kazakhstan have decreased 4 percent since the beginning of the year. The Mazhilis (lower chamber of Parliament) approved a draft legislative amendment on housing and communal services to reduce the contribution by four times to 12 tenge (US$0.03) per square metre. The cost of housing services, as well as tariffs for water, electricity, gas and heating, decreased 1.7 percent in the first quarter of 2019. In the same period in 2018, prices had increased 8.1 percent year on year. However, eight regions have seen an increase in tariffs this year. The largest increases are in the Pavlodar (2.7 percent per year), Kostanai (2.2 percent) and East Kazakhstan (1.9 percent) regions. The most significant increases in tariffs have been for garbage collection (8.4 percent), as well as for rental (4.9 percent), repair (4.4 percent) and maintenance of housing (1.2 percent).

Kazakhstan’s trade turnover increased 15.8 percent to $7.6 billion in January year-on-year. Exported goods’ share in the total trade volume increased by 31 percent to 70.4 percent or $5.3 billion. While supplies to external markets keep increasing, imports fell 9.3 percent to $2.2 billion. The Kazakh Export insurance company, a subsidiary of the Baiterek National Holding, supported exporters with insurance of 90.2 billion tenge (US$237.49 million). The export revenues of enterprises that received support as a part of export and pre-export financing from 2014 to 2023 are expected to total 1.1 trillion tenge (US$2.9 billion). According to the most recent World Bank Doing Business report, in terms of international trade Kazakhstan ranks 102nd, exceeding its goal for 2019, which was to rank 118th.

Over the past three years, foreign direct investment (FDI) to Kazakhstan increased 58 percent, though FDI globally is still falling. In 2018, global investment flows decreased by 18.4 percent to $1.2 trillion. The same year, almost half of the European Union countries reduced their investments in Kazakhstan. The gross inflow of FDI from EU countries declined 12.2 percent totalling $24.3 billion. Finland’s FDI fell by 63.3 percent to $11 million; Belgium’s by 1.9 percent to $19.9 million. The key investors in Kazakhstan’s economy remain the Netherlands at $7.3 billion (an increase of 23.8 percent), the United States at $5.3 billion (an increase of 44.7 percent) and Switzerland at $2.5 billion (a drop of 14.3 percent).

Kazakhstan’s population increased by 1.3 percent and reached 18.4 million so far this year. Demographic growth, however, is slowing. The birth rate has been declining for three years in a row. In the beginning of 2018, out of a total of 390,300 births, nearly half were the first and the second children in the family. However, for Kazakhstan’s population to continue to grow, families must have at least three children. Only 28.1 percent of all households live with three or more children. In this regard, the Kazakh government is working on a plan to increase social support, especially housing support, for vulnerable families. As a part of Nurly Zher programme, the most vulnerable families will receive housing at an unprecedented preferential mortgage rate of only 2 percent per annum. The pilot project launched in Almaty. For other regions, the programme will be introduced in May.

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