Nurly Zhol and structural reforms set to boost Kazakh growth to 2.5% – IMF

A combination of targeted fiscal support, exchange rate adjustment, strengthened domestic liquidity management and structural reforms have helped Kazakhstan counter the effects of lower oil prices and slower growth in Russia, China and Europe, the IMF pronounced this week; and, while GDP growth slowed to 1% in 2016, it is expected to bounce back to  2.5% in the current year.
Significantly, the fund is also  predicting that  non-oil growth will reach 4% by 2021, although overall medium-term prospects remain subdued due to continued lower oil prices and weak conditions in key trading partners.
The IMF singled out both an increase in oil production and  Nurly Zhol – Astana’s  $9bn domestic economic stimulus plan to develop and modernize the country’s  roads, railways, ports, IT infrastructure, education and civil services – as drivers for last year’s growth. This year’s performance is expected to be underpinned by further  increases in oil production and the impact of structural reforms, and an unlocking of bank lending.
The successful conclusion of the first wave of IPOs which should see government stakes in  Air Astana, KazakhTelekom, KazAtomProm sold off should also stimulate the economy. The part privatisation of KazMunaiGas, Samruk Energy, and several of the country’s electricity distributors are expected to follow.