Expert: Kazakhstan’s economy is expected to grow in 2021

Kazakhstan’s economy is slowing down its drop. The country sees acceleration of the real sector; industrial production and the service sector also show good dynamics in the current conditions. According to analysts, Kazakhstan will begin to improve indicators more actively next year.

“There is a positive trend in the country's economic dynamics. If its drop was at 3.5 percent since the beginning of the pandemic, now it has reached 2.5 percent. We hope that economic growth will begin more actively from about the middle of next year, after the release of the vaccine, when everything will start working as usual and foreign economic relations will be fully restored. Economic development depends primarily on investments and support for small and medium-sized businesses, exports. It is consumer buying power, as well,” emphasized the economist Saparbai Zhubayev.

The dynamics of oil prices on world markets, of course, affects the exchange rate of the Kazakh currency. However, according to the expert, fluctuations in the oil price in the future will stop and the situation will stabilize. The measures taken by oil-producing countries, as well as the fact that exporting countries can fully meet demand, will help to balance the market.

“There is an increase in oil demand in the world. Prices have dropped to US$25-30 per barrel since the beginning of the pandemic. Today, the oil price has risen again up to US$45-50. Due to this, the national currency has strengthened. We see this at the exchange rate. I think that the dollar-tenge rate should not exceed 420-430 tenge to develop export potential,” shared Saparbai Zhubayev.

The share of oil and gas industry in Kazakhstan’s GDP amounted to 18 percent at the end of the year. Today the industrial companies provide nearly 60 percent of all tax revenues into the state budget. According to experts, taking into account major losses in the oil market, Kazakhstan needs to diversify the economy, but also move away from dependence on raw materials. At the same time, special attention should be focused on the development of international trade relations, first of all, with the EAEU countries, economists emphasized.