ECONOMICS

 

Main Crops: grain (mostly spring wheat), cotton; wool, livestock

Natural Resources: major deposits of petroleum, natural gas, coal, iron ore, manganese, chrome ore, nickel, cobalt, copper, molybdenum, lead, zinc, bauxite, gold, uranium

Major Industries: Oil, coal, iron ore, manganese, chromite, lead, zinc, copper, titanium, bauxite, gold, silver, phosphates, sulfur, iron and steel, nonferrous metal, tractors and other agricultural machinery, electric motors, construction materials; much of industrial capacity is shut down and/or is in need of repair

Kazakhstan's vast hydrocarbon and mineral reserves form the backbone of its economy. Geographically the largest of the former Soviet republics, excluding Russia, Kazakhstan, g possesses substantial fossil fuel reserves and other minerals and metals, such as uranium, copper, and zinc. It also has a large agricultural sector featuring livestock and grain. The government realizes that its economy suffers from an overreliance on oil and extractive industries and has made initial attempts to diversify its economy by targeting sectors like transport, pharmaceuticals, telecommunications, petrochemicals and food processing for greater development and investment. It also adopted a Subsoil Code in December 2017 with the aim of increasing exploration and investment in the hydrocarbon, and particularly mining, sectors.

Kazakhstan's oil production and potential is expanding rapidly. A $36.8 billion expansion of Kazakhstan’s premiere Tengiz oil field by Chevron-led Tengizchevroil should be complete in 2022. Meanwhile, the super-giant Kashagan field finally launched production in October 2016 after years of delay and an estimated $55 billion in development costs. Kazakhstan’s total oil production in 2017 climbed 10.5%.

Kazakhstan is landlocked and depends on Russia to export its oil to Europe. It also exports oil directly to China. In 2010, Kazakhstan joined Russia and Belarus to establish a Customs Union in an effort to boost foreign investment and improve trade. The Customs Union evolved into a Single Economic Space in 2012 and the Eurasian Economic Union (EAEU) in January 2015. Supported by rising commodity prices, Kazakhstan’s exports to EAEU countries increased 30.2% in 2017. Imports from EAEU countries grew by 24.1%.

The economic downturn of its EAEU partner, Russia, and the decline in global commodity prices from 2014 to 2016 contributed to an economic slowdown in Kazakhstan. In 2014, Kazakhstan devalued its currency, the tenge, and announced a stimulus package to cope with its economic challenges. In the face of further decline in the ruble, oil prices, and the regional economy, Kazakhstan announced in 2015 it would replace its currency band with a floating exchange rate, leading to a sharp fall in the value of the tenge. Since reaching a low of 391 to the dollar in January 2016, the tenge has modestly appreciated, helped by somewhat higher oil prices. While growth slowed to about 1% in both 2015 and 2016, a moderate recovery in oil prices, relatively stable inflation and foreign exchange rates, and the start of production at Kashagan helped push 2017 GDP growth to 4%.

Despite some positive institutional and legislative changes in the last several years, investors remain concerned about corruption, bureaucracy, and arbitrary law enforcement, especially at the regional and municipal levels. An additional concern is the condition of the country’s banking sector, which suffers from poor asset quality and a lack of transparency. Investors also question the potentially negative effects on the economy of a contested presidential succession as Kazakhstan’s first president, Nursultan NAZARBAYEV, turned 77 in 2017.

 

 

 

	1990	2000	2010	2020
GNI, Atlas method (current US$) (billions)	23.38	18.87	121.37	163.37
GNI per capita, Atlas method (current US$)	1,430	1,270	7,440	8,710
GNI, PPP (current international $) (billions)	111.67	107.82	272.75	457.78
GNI per capita, PPP (current international $)	6,820	7,240	16,710	24,410
GDP (current US$) (billions)	26.93	18.29	148.05	171.08
GDP growth (annual %)	-11	9.8	7.3	-2.5
Inflation, GDP deflator (annual %)	96.4	17.4	19.5	4.2
Agriculture, forestry, and fishing, value added (% of GDP)	23	8	5	5
Industry (including construction), value added (% of GDP)	39	38	41	33
Exports of goods and services (% of GDP)	74	57	44	30
Imports of goods and services (% of GDP)	75	49	30	26
Gross capital formation (% of GDP)	32	18	25	29
Revenue, excluding grants (% of GDP)	..	11.3	21.4	12.3
Net lending (+) / net borrowing (-) (% of GDP)	..	0.1	4.6	-6.7
States and markets
Time required to start a business (days)	..	32	25	5
Domestic credit provided by financial sector (% of GDP)	..	..	..	40.2
Tax revenue (% of GDP)	..	10.2	15.7	8.3
Military expenditure (% of GDP)	1.1	0.8	1	1.1
Mobile cellular subscriptions (per 100 people)	0	1.3	119.4	129.4
Individuals using the Internet (% of population)	0	0.7	31.6	85.9
High-technology exports (% of manufactured exports)	..	..	35	33
Statistical Capacity Score (Overall Average) (scale 0 - 100)	..	..	96	79
Global links
Merchandise trade (% of GDP)	29	76	62	49
Net barter terms of trade index (2000 = 100)	..	100	192	132
External debt stocks, total (DOD, current US$) (millions)	35	12,890	119,151	162,974
Total debt service (% of exports of goods, services and primary income)	..	32.4	57.9	56.3
Net migration (thousands)	-1,439	45	160	-90
Personal remittances, received (current US$) (millions)	..	67	226	374
Foreign direct investment, net inflows (BoP, current US$) (millions)	100	1,371	7,456	7,194
Net official development assistance received (current US$) (millions)	111.5	184.8	212	70.4