ASTANA — The S&P Global Ratings international rating agency affirmed Kazakhstan’s credit rating at BBB and maintained a stable outlook. According to the Halyk Finance analytical center, it is much lower than the levels set in the country’s program documents and refers to the problem of inappropriate budget forecasting.
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The country’s oil and gas sector, which accounts for 20% of gross domestic product (GDP), more than half of exports and 30% of government revenues, is vital in maintaining the positive rating.
However, S&P Global Ratings notes that the decline in oil production has had a negative impact on economic growth rates, leading to their moderate forecast for GDP growth at the end of the current year at 3.7%, reported the Halyk Finance on Sept. 2.
“The rating agency expects moderate economic growth indicators not only for the current year, but also for the next three years. Even the launch of the Tengiz future expansion project in the second half of 2025, which should increase oil production from 90 million tons in 2023 to 98 million tons in 2025, will not lead, in their opinion, to economic growth above 4.5%. Thus, the average GDP growth rate in 2025-2027 will be 3.7% per year,” the statement reads.
The agency notes that the actual rate may be higher than their forecast if the privatization program is carried out properly and leads to growth of the private sector and foreign investment.
However, according to S&P Global Ratings experts, privatization is proceeding slowly, and the centralized decision-making process, weak checks and balances, censorship, and perception of corruption are still high. The situation will remain so over the next three years.
Among the positive factors of the country’s economy, which to varying degrees allow managing external and internal risks, S&P Global Ratings named a strong position of an external net creditor given the moderate level of external debt, and high indicators of liquid assets of the government, such as government deposits and external liquid assets of the National Fund.
The current rating can be improved in the case of reforms, increased growth rates of the non-oil sector, reduced geopolitical risks and political stability.
