Economic news in brief

Kazakhstan plans to launch an independent verification system to certify the qualifications of professionals, Kazakh Minister of Labour and Social Protection Berdibek Saparbayev announced recently. The system will include a National Qualifications Board, National Qualifications Authority and industry councils, said Saparbayev. The ministry, state bodies and the Atameken National Chamber of Entrepreneurs hope to develop a Concept Law on Vocational Qualifications by the end of 2019. The effort is meant to raise the level of employment qualifications. The system is a part of a larger Kazakh labour market improvement initiative, which also includes establishing by the end of 2019 a national system for forecasting labour resources. The forecasts will be devised from employer surveys.

At the end of April, Kazakhstan’s gross international reserves had decreased to $27.1 billion, dropping 13.6 percent over a year. Deputy Director of the Kazakh National Bank’s Monetary Operations Department Ivan Serdyuk said that the decrease in reserves in the first quarter of this year is mainly due to a decline in the National Bank’s foreign currency correspondent funds and repayment of external liabilities, including servicing the government’s external debt. The size of correspondent accounts recorded as part of the foreign exchange reserves may vary, as banks and other customers make transfers between National Bank accounts and foreign banks. Funds in foreign currency in correspondent accounts with the National Bank can also decline as customers’ deposits are dedollarised.

Domestic research and development (R&D) cost 72.2 billion tenge (US$188.31 million) in 2018, an increase of 4.8 percent year on year. Over the last five years, R&D expenditures have decreased gradually as a share of the country’s gross domestic product (GDP) to 0.12 percent in 2018, reported finprom.kz. The main proportion of R&D funds – 48.2 percent or 34.8 billion tenge (US$90.76 million) – go toward labour. Services purchased for projects comprise 12.3 percent. Fixed assets such as machinery, equipment and building constituted 10.3 percent. In the 10 years from the end of 2013 to 2018, the number of organisations and enterprises engaged in R&D in Kazakhstan has decreased gradually by 8.8 percent (37 organisations) to 384 organisations. At the same time, the number of innovative projects has increased from 1,800 to 3,200.

A quality over quantity shift was recorded in the insurance sector at the end of April. While the number of insurance companies decreased from 32 to 27, the total assets increased 17.6 percent and reached 1.1 trillion tenge (US$2.87 billion) year on year. Securities constituted more than half of the assets, a total of 599 billion tenge (US$1.56 billion) or 53.7 percent, an increase of 31.8 percent. Deposits and reinsurance assets accounted for 19.6 percent and 10.1 percent of all assets, respectively. The share of insurance premiums in assets was 4.4 percent, 48.6 billion tenge or US$126.75 million (a 7.7 percent increase year on year). Cash and cash equivalents were 3.3 percent of assets.

Kazakh customers bought 18,838 new passenger cars in the first quarter of 2019, which is a 20.5 percent increase year on year. The two largest dealer groups in the country, BIPEK AVTO and Astana Motors, accounted for 59.9 percent of all sales. BIPEK AVTO sold 6,699 cars, conducting 35.6 percent of all sales. Astana Motors sold 24.3 percent of the total, which is 4,576 cars. More than half of the cars were sold in Almaty (5,112 cars), Nur-Sultan (3,700) and Atyrau (1,333). Among the most popular car brands are LADA (4,743), Toyota (4,115) and Huyndai (3,450). LADA and Hyundai also lead among domestically assembled cars – 4,664 and 3,405 cars, respectively. The third most popular car brand assembled in Kazakhstan is Kia with 1,240 cars.