ADB upgrades Kazakhstan's GDP growth forecast for 2017-2018

By Azernews

By Kamila Aliyeva

The Asian Development Bank (ADB) has raised the forecast for growth of Kazakhstan's gross domestic product (GDP) for 2017 from 2.7 to 3.7 percent and for 2018 - from 3 to 3.3 percent in its December report.

The forecast, published by ADB, takes into account double-digit growth in the extractive industries of Kazakhstan. In this regard, GDP growth is now expected at 3.7 percent in 2017, which is significantly higher than the previously projected 2.7 percent.

“Assuming higher oil prices in 2018 and further recovery in domestic demand, growth is likely to slow only a little in 2018, despite the higher base in 2017,” ADB analysts believe.

At the same time, the growth forecast for 2018 for Kazakhstan is increased to 3.3 percent compared with the previously forecasted 3 percent. According to ADB, Kazakhstan, which is an exporter of hydrocarbons, will benefit from the recent increase in oil prices.

Kazakhstan enjoyed a strong economic upswing in the year to September, with GDP growth at 4.3 percent backed by solid expansion in industry and transport services, according to the report.

“At the same time, growth drivers started to weaken somewhat in the third quarter of 2017. During the first nine months of 2017, the biggest driver of growth was industry, which expanded by 8.3 percent, with extractive industries growing at 11.3 percent on double-digit growth in coal, crude oil, and metals. Manufacturing expanded by 5.7 percent. Agriculture, services, and construction grew moderately,” the bank analysts said.

In general, the economic outlook for Central Asia in 2017 has further improved with recovery in several countries driven by domestic and external factors alike, the bank noted.

ADB assumes that the overall GDP growth of countries in this region will reach 3.6 percent in 2017, compared with 3.3 percent in the previous forecast. The forecast for Central Asia for 2018 did not change and amounted to 3.9 percent.

The Asian Development Bank was founded in 1966. The mission of the bank is to reduce poverty in the Asia-Pacific region (APR) through inclusive economic and environmentally sustainable growth, as well as regional integration. The head office of ADB is located in the capital of the Philippines - the city of Manila. The bank's shareholders are 67 countries, 48 of which are located in the Asia-Pacific region.