NUR-SULTAN – Moody’s Investors Service (Moody’s) report upgraded Kazakhstan’s rating outlook to stable from positive on Aug. 11.
“The decision to upgrade the ratings is driven by Moody’s assessment that Kazakhstan’s sovereign balance sheet and credit profile demonstrates resilience that is consistent with peers at the Baa2 rating level,” reads the release.
It is expected that the country’s sovereign wealth assets “will grow and continue to exceed the level of government debt for the foreseeable future, as well as the lengthening and ongoing track record of credible enhancements to the macroeconomic policy framework that promotes external stability.”
Moody’s positively assessed the use of fiscal buffers for countercyclical fiscal policy, which limited the contraction of Kazakhstan’s real GDP to around 2.5 percent in 2020.
Moody’s expects that the economy of Kazakhstan will grow by 3.5-4 percent this year and 4-4.5 percent in 2022.
The institutional and economic reforms have “the potential to strengthen Kazakhstan’s governance framework beyond Moody’s current expectations.” This will also increase the investment attractiveness of the country.
The newly established Supreme Council for Reforms and Agency for Strategic Planning and Reforms, may accelerate the pace of implementation if it effectively institutionalizes and improves the design and coordination of reforms.
Kazakhstan is one of five countries out of 144 covered countries to be upgraded. Since the beginning of this year, less than 15 percent of Moody’s rating actions have been linked to a rating upgrade.
