2017年-世界发展银行全球_Kazakhstan___The_Economy_Has_Bottomed_Out--What_is_Next__27页_2mb

Kazakhstan Country Economic Update: Spring 2017

Core Content

This document provides an overview of Kazakhstan's economic performance and policy developments during 2016 and outlines the outlook for 2017-2019. It highlights the ongoing challenges posed by the global oil price decline and weak domestic demand, as well as the government's response through fiscal and monetary measures and structural reforms.

Main Viewpoints

• Economic Slowdown and Poverty Increase:
  Kazakhstan's real GDP growth slowed to 1% in 2016, with real wages declining further. The poverty rate increased to 19.8%, up from 19.5% in 2015 and 16.1% in 2014, due to reduced household purchasing power and limited employment opportunities.

• Inflationary Pressures:
  Inflation surged in 2016, peaking at 17% in Q3, primarily due to price increases in imported goods such as clothing, medicine, and household appliances. The inflation rate dropped to below 8% in early 2017 as the effects of currency devaluation eased.

• Fiscal and Monetary Policies:
  The government adopted an accommodative fiscal policy to support domestic demand through increased social transfers, subsidies to SOEs and SMEs, and support for the banking sector. The central bank gradually eased its contractionary monetary policy, lowering the official policy rate since May 2016. However, private sector lending remained subdued.

• External Sector Improvements:
  Despite a widening current account deficit due to lower oil prices and output, net FDI inflows, especially in the oil sector, improved the overall external balance. The NBK did not intervene in the FX market since September 2016, allowing international reserves to be replenished. The Oil Fund's FX assets, however, decreased due to the use of its funds to support the economy.

• Banking Sector Challenges:
  The banking sector faced persistent issues, including high levels of NPLs and FX exposure. While NPLs decreased from over 20% in 2014 to 6.7% in 2017, vulnerabilities remained due to weak prudential regulations, under-provisioning, and the impact of global financial conditions. Mergers of vulnerable banks may improve sector health but could reduce competition.

• Agriculture as a Growth Driver:
  The agriculture sector is seen as a potential driver of growth, with increased government support and a shift in production from individual farms to larger entities. However, low yields and limited R&D investment continue to hinder its development.

Key Information

• Currency: Kazakhstani Tenge (KZT), with an exchange rate of 313.73 KZT per US$1 as of April 1, 2017.
• GDP Growth: Real GDP growth slowed from 1.2% in 2015 to 1% in 2016, with projections of 3% growth for 2017-2019.
• Fiscal Deficit: The overall fiscal deficit decreased from 7.8% of GDP in 2015 to 5.3% in 2016, but the nonoil deficit remained elevated at 10.2% of GDP.
• Inflation: The headline inflation rate averaged 14.6% in 2016, peaking in Q3, and declined to below 8% in early 2017.
• FDI: Net FDI inflows reached US$14.3 billion in 2016, significantly offsetting the current account deficit.
• Reserves: The NBK's FX reserves increased slightly, while the Oil Fund's FX assets decreased due to economic support measures.
• Employment and Poverty: Real wages fell by 0.9% in 2016, and employment declined by 0.5%. The government expanded employment support programs to address the challenges of the labor market.
• Structural Reforms: The government introduced the "Modernization 3.0" strategy to enhance global competitiveness and diversify the economy. A new strategic development plan, Kazakhstan-2025, will outline the steps for achieving these goals.

Economic Outlook and Risks

• Growth Projections:
  Economic growth is expected to pick up slowly in the medium term, but will remain below pre-2014 levels. Oil prices and production are projected to recover, improving the current account and fiscal balances.

• Fiscal Sustainability:
  The government needs to address the elevated nonoil deficit and consider fiscal consolidation to ensure medium-term fiscal sustainability. A simulation shows that without such measures, the net fiscal reserve position will continue to deteriorate.

• Banking Sector Reforms:
  Structural transformation of the banking sector is necessary to improve its health and ensure stability. Coordination among regulatory bodies and transparent asset management are key to achieving this.

• Agricultural Development:
  While the government has increased support for agriculture, more investment in R&D and capital is needed to improve productivity and competitiveness.

Focus Section: Agriculture as a Potential Growth Driver

• Agricultural Share in GDP:
  The share of agriculture in GDP has declined steadily since 2010 but is expected to grow as part of the economic transformation.

• Production Shift:
  The share of individual farms in agricultural production has increased over time, indicating a shift towards more diversified and efficient production models.

• Government Strategy:
  The government's agriculture sector strategy remains heavily reliant on subsidies, which may not be sustainable in the long term. There is a need to shift towards more market-oriented approaches to foster productivity and growth.

• Trade and Investment:
  The agro-food trade deficit has narrowed, and FDI in agriculture remains low compared to total FDI. Capital investment in agriculture has stagnated over the past decade, limiting its potential as a growth engine.

Conclusion

Kazakhstan faces significant economic challenges due to the global oil price decline and weak domestic demand. While the external position has improved and the government has taken steps to support the economy, structural reforms and fiscal consolidation are necessary for long-term sustainability. The agriculture sector offers potential for growth, but requires more investment and policy support to realize its full potential.