ASTANA – S&P Global Ratings raised Kazakhstan’s long- and short-term sovereign credit ratings on Aug. 21 to BBB/A-2 from BBB-/A-3, while maintaining a stable outlook. The agency also raised its transfer and convertibility assessment to BBB+ and affirmed Kazakhstan’s national scale rating at kzAAA.
The upgrade strengthens Kazakhstan’s position among investment-grade sovereigns and could improve investor confidence, according to the QZ Economy analytical Telegram channel.
“A higher sovereign rating is also an increase in confidence,” the experts said on Aug. 22, noting its potential to improve financing conditions for the economy, support Kazakh companies working with foreign creditors and investors, and strengthen Kazakhstan’s overall investment attractiveness.
Growth remains a key strength
The upgrade reflects what S&P describes as Kazakhstan’s “resilient GDP growth outlook as well as its ample external and fiscal buffers that could cushion future shocks.”
Preliminary data show GDP expanded 4.1% in January-June despite a sharp slowdown in the first quarter linked to disruptions in oil exports and production. S&P forecasts growth of 5.1% in 2026, moderating to 4-4.5% in 2027-2029.
The agency expects non-oil activity to partly offset the impact of fiscal consolidation and lower global oil prices. Construction and manufacturing have already provided additional momentum.
Buffers support fiscal consolidation
Kazakhstan’s government liquid assets are forecast to stabilize at around 21% of GDP over the next four years. The National Bank and government’s external assets exceed the country’s gross external debt, giving policymakers room to maneuver during external shocks.
Fiscal performance is also improving. The national budget deficit was 1.2% of GDP in the first half this year, on track toward the 2.5% full-year target. S&P expects the general government deficit to average 1.2-1.3% of GDP in 2026-2029, compared with 3.7% in 2025.
Tax revenue increased 17% year on year in the first half, including a 42% increase in VAT collection. Efforts to broaden the tax base and control spending are expected to support further consolidation.
Political analyst Gaziz Abishev linked the upgrade to the government’s fiscal and economic policy, including tax reform, expenditure controls and a stronger focus on developing processing industries.
“Financial discipline is what international experts like. The country is rationalizing spending and supporting accumulation, protecting the National Fund from being spent down,” Abishev said.
He also highlighted the government’s work with foreign investors and President Kassym-Jomart Tokayev’s economic pragmatism, which he said aims to maximize the benefits of cooperation with relevant partners while minimizing geopolitical risks.
Investment could become the key benefit
S&P expects investment to remain high at approximately 30% of GDP, driven by infrastructure, raw-material processing and energy projects. The investment program is central to Kazakhstan’s efforts to diversify its resource-driven economy.
The QZ Economy experts said the rating upgrade could strengthen confidence among foreign investors and international financial institutions, potentially “lower the cost of attracting financing for the economy” and improve conditions for Kazakh companies working with foreign creditors and investors.
The significance therefore extends beyond the sovereign balance sheet. A stronger rating can reduce perceived country risk, but its economic impact will depend on whether investment programs generate new production, infrastructure and long-term productivity.
Oil remains the main vulnerability
Kazakhstan remains exposed to commodity-price volatility and disruptions to oil exports. Nearly 80% of oil flows through the CPC pipeline via Russia, while oil accounts for more than half of exports.
S&P’s stable outlook assumes that possible CPC disruptions will be short-lived. A prolonged fall in global oil prices or extended pipeline disruptions could result in negative rating action. Conversely, stronger fiscal performance and a reduction in the government interest bill could support a positive rating action.
The upgrade is therefore both recognition and a benchmark for Kazakhstan. S&P’s stable outlook suggests that the country’s strong buffers will help it manage possible external shocks, while continued fiscal consolidation and diversification will remain important.
“S&P raised Kazakhstan’s rating even amid uncertainty in the global economy and volatility in commodity markets. This once again confirms that our economy can remain resilient in the face of external challenges. Reforms and hard work are already bearing fruit,” the QZ Economy analytical Telegram channel said.
The next test will be whether stronger sovereign credibility translates into lower financing costs, sustained investment and broader economic diversification.
