The Chairman of the National Bank of Kazakhstan, Kairat Kelimbetov, has predicted an increase in the country's gross domestic product of up to five percent at the end of 2014.
From January to September of this year, Kazakhstan's GDP grew at four percent. According to the results from the first half of the year, the current account surplus is USD 6.6 billion, a figure two times higher than that of the first half of 2013.
He noted that the increase was caused by a trade surplus of 17.4 percent, or approximately USD 22.6 billion. The overall inflation rate for 2014 is forecasted at 7.4 percent.
The main reason behind the revision of the national budget's total revenue figure for 2014 was the refinement of macroeconomic indicators via an analysis of the economic situation in the country and adjustment of calculations based on actual revenue intake for January through September 2014.
Kazakhstan's Minister of National Economy Yerbolat Dossayev stated at the briefing that three factors influenced the approved forecast, including preliminary economic development data for January-September 2014 and updated indicators of economic growth by sector in 2014, trends in world commodity prices (the world price of oil was earlier estimated at USD 95.0 per barrel, while the forecast level of metal prices decreased from 104.1 percent to 93.7 percent compared to 2013) and the revised report on GDP in 2013.
Dossayev reported that the growth volume of industrial production shrank from 2.7 percent to 0.8 percent, while oil production reached 81.8 million tons instead of 83 million tons as planned. "Amid a decrease in demand for Kazakhstan's exports and the falling price of oil and metals around the world, exports are projected to reach $81 billion, USD 5.3 billion lower than the previous forecast indicated. Imports, according to the new forecast, amounted to $48.6 billion, or $3.6 billion lower than the previously released predictions," he said.
"Taking into account the reduction in GDP and imports, the national budget revenue (excluding transfers) in 2014 is estimated at 3,940.4 billion tenge (USD 21.79 billion), 420.7 billion tenge (USD 2.33 billion) below the earlier approved forecast. The biggest decrease in revenue is expected in VAT on imported goods (225.3 billion tenge/USD 1.2 billion) and taxes on international trade and foreign operations (173.8 billion tenge/USD 958 million). The size of the guaranteed transfer from the National Fund was kept at the approved level of 1,480 billion tenge (USD 8.18 billion)," the minister said.
He added that in order to partially compensate for the expected loss in income, the ministry proposed increasing the budget deficit from 2.3 percent to 2.6 percent of the nation's GDP. "In addition, on the basis of decisions made by the managing board of the National Fund, funds from the national budget for 2014 would include additional target transfers from the National Fund amounting to 325 billion tenge (USD 1.80 billion). Considering other additional targeted transfers, budget expenditures are projected to reach 7,190.3 billion tenge (USD 39.75 billion)," added Dossayev.
At the same briefing, Minister of Finance Bakhyt Sultanov stated that the obligations of the government in paying wages, pensions and benefits would not shrink.
"Along with optimising costs, the new GDP calculation includes the redistribution of funds totaling 55 billion tenge (USD304 million) to support domestic economic activity, particularly infrastructure development around the country, preparations for EXPO 2017, the assurance of information security and a decrease in debt spanning the next three years," he added.