Economy of Kazakhstan
Business center in Astana
$420.6 billion (PPP, 2014)$217.9 billion (nominal, 2014)
|GDP rank||43rd (PPP, 2014)|
|4.3% (Real, 2014)|
GDP per capita
|$24,100 (PPP, 2014)|
GDP by sector
|agriculture: 5.2%; industry: 37.9%; services: 56.95% (2011 est.)|
|5.2% (CPI, 2012 est.)|
Population below poverty line
|28.8 (2008, low)|
|9.102 million (2014 est.)|
Labour force by occupation
|agriculture: 25.8%; industry: 11.9%; services: 62.3% (2012 est.)|
|oil, coal, iron ore, manganese, chromite, lead, zinc, copper, titanium, bauxite, gold, silver, phosphates, sulfur, iron and steel; tractors and other agricultural machinery, electric motors, construction materials|
|Exports||$86.93 billion (2012)|
|oil and oil products 59%, ferrous metals 19%, chemicals 5%, machinery 3%, grain, wool, meat, coal|
Main export partners
| China 21.0%
Romania 4.1% (2012 est.)
|Imports||$42.82 billion (2012 est.)|
|machinery and equipment, metal products, foodstuffs|
Main import partners
| Russia 31.6%
Ukraine 4.4% (2012 est.)
Gross external debt
|$105.5 billion (31 December 2012 est.)|
|12% of GDP (2012 est.)|
|Revenues||$43.08 billion (2012 est.)|
|Expenses||$48.04 billion (2012 est.)|
|$28.29 billion (31 December 2012)|
The economy of Kazakhstan is the largest economy in Central Asia. It possesses enormous oil reserves as well as minerals and metals. It also has considerable agricultural potential with its vast steppe lands accommodating both livestock and grain production, as well as developed space infrastructure, which took over all launches to the International Space Station from the Space Shuttle. The mountains in the south are important for apples and walnuts; both species grow wild there. Kazakhstan's industrial sector rests on the extraction and processing of these natural resources and also on a relatively large machine building sector specializing in construction equipment, tractors, agricultural machinery, and some military items. The breakup of the USSR and the collapse of demand for Kazakhstan's traditional heavy industry products have resulted in a sharp contraction of the economy since 1991, with the steepest annual decline occurring in 1994. In 1995-97 the pace of the government program of economic reform and privatization quickened, resulting in a substantial shifting of assets into the private sector. The December 1996 signing of the Caspian Pipeline Consortium agreement to build a new pipeline from western Kazakhstan's Tengiz Field to the Black Sea increases prospects for substantially larger oil exports in several years. Kazakhstan's economy turned downward in 1998 with a 2.5% decline in GDP growth due to slumping oil prices and the August financial crisis in Russia. A bright spot in 1999 was the recovery of international petroleum prices, which, combined with a well-timed tenge devaluation and a bumper grain harvest, pulled the economy out of recession.
Current GDP per capita shrank by 26% in the Nineties. In the 2000s, Kazakhstan's economy grew sharply, aided by increased prices on world markets for Kazakhstan's leading exports—oil, metals and grain. GDP grew 9.6% in 2000, up from 1.7% in 1999. In 2006, extremely high GDP growth had been sustained, and grew by 10.6%. Business with booming Russia and China, as well as neighboring Commonwealth of Independent States (CIS) nations have helped to propel this growth. The increased economic growth also led to a turn-around in government finances, with the budget moving from a cash deficit of 3.7% of GDP in 1999 to 0.1% surplus in 2000. The country experienced a slowdown in economic growth from 2014 sparked by falling oil prices and the effects of the Ukrainian crisis The country's currency was devalued by 19% in 2004 and by 22% in 2015.
In 2015, the World Economic Forum compiled its Global Competitiveness Ranking ranking Kazakhstan 50th out of 144 countries. The ranking considers multiple macroeconomic and financial factors, such as market size, GDP, tax rates, infrastructure development, etc. In 2012, the World Economic Forum listed corruption as the biggest problem in doing business in the country, while the World Bank listed Kazakhstan as a corruption hotspot, on a par with Angola, Bolivia, Kenya, Libya and Pakistan.
Kazakhstan secured 2nd position in the Central and South Asia regional ranking of the 2015 Global Innovation Index (GII) released by World Intellectual Property Organization (WIPO) together with Cornell University and INSEAD France.
Kazakhstan is listed in the 2015 Bloomberg Innovation Index among the top 50 most innovative economies.
In the 2014 Economic Freedom Index published by the Heritage Foundation in Washington, DC, Kazakhstan has gained 22 points over the past 17 years, which is noted by the authors as among the 20 best improvements recorded by any country. Kazakhstan ranks 11th out of 42 countries in the Asia–Pacific region, and its overall score is above the world and regional averages.
|Year||Gross Domestic Product||US Dollar Exchange||Inflation Index
|Per Capita Income
(as % of USA)
For purchasing-power parity comparisons, the US Dollar is exchanged at 59.95 Tenges only. Mean wages comprised $6.93 per man-hour in 2009.
Kazakhstan has managed its monetary policy well. Its principal challenge in 2001 was to manage strong foreign-currency inflows without sparking inflation. Inflation had, in fact, stayed under control, registering 9.8% in 2000, and appeared likely to be under 10% in 2001. Because of its strong economic performance and financial health, Kazakhstan became the first former Soviet republic to repay all of its debt to the IMF by paying back $400 million in 2000; 7 years ahead of schedule. Overall foreign debt amounts to[when?] about $12.5 billion, $4 billion of it owed by the government. This amounts to 6.9% of GDP, well within manageable levels.
The upturn in economic growth, combined with the results of earlier reforms in taxation and in the financial sector, dramatically improved government finances from the 1998 budget deficit level of 4.2% of GDP to a slight surplus in 2000. Government tax-revenues grew from 16.4% of GDP in 1999 to 20.6% of GDP in 2000. In 2000, Kazakhstan adopted a new tax-code in an effort to consolidate these gains. Its strong financial position also allowed the government to reduce the value-added tax (VAT) from 20% to 16% and to reduce social (payroll) taxes as of July 2001. Kazakhstan's stronger budget-position and strong export-earnings earned it credit-rating upgrades from Moody's, S&P, and Fitch during 2001.
Kazakhstan instituted a pension reform program in 1998 that was partly based on the model of the Chilean pension system but included modifications. By July 2001, Kazakhstanis had contributed more than $1 billion to their own personal pension-accounts, mostly managed by the private sector. The National Bank oversees and regulates the pension funds. The pension funds' growing demand for quality investment outlets triggered rapid development of the debt-securities market. Pension-fund capital is being invested almost exclusively in corporate and government bonds, including Government of Kazakhstan Eurobonds. The Kazakhstani banking system is developing rapidly. Banking systems capitalization now[when?] exceeds $1 billion. The National Bank has introduced deposit insurance in its campaign to strengthen the banking sector. Several major foreign banks have branches in Kazakhstan, including The Royal Bank of Scotland Group, Citibank, and HSBC. Kazakhstan is also a member of the Economic Cooperation Organization (ECO).
According to the Republic of Kazakhstan Agency for Statistics, in January–March 2010 production of GDP amounted to 3,881.6 billion tenge and an increase of 7.1%.
Economic Growth & GDP
Kazakhstan's GDP grew 4.1% in real terms during the period from January to September 2014.
Kazakhstan's real GDP growth is projected to reach 4.3% in 2014, the main driving force of the economy in Kazakhstan in 2014 is the consumer sector; the consumption in Kazakhstan is mainly boosted by the retail lending.
According to the Agency of Statistics of the Republic of Kazakhstan the Kazakhstan's GDP growth in the first quarter of 2014 was 3.8%.
The Government of Kazakhstan signed a Framework Partnership Agreement with IBRD, IFC, MIGA on May 1, 2014; according to this Agreement the World Bank will allocate $2.5 billion to Kazakhstan, for the diversification of the economy and reaching the sustainable development.
Oil & Gas
Oil and gas is the leading economic sector. In 2000, Kazakhstan produced 35,252,000 metric tons of oil (700,000 barrels per day), a 17.4% increase over 1999's 30,025,000 tons. It exported 28,883,000 tons of oil in 2000, up 38.8% from 20,813,000 tons in 1999. Production in 2001 has been growing at roughly 20%, on target to meet the government's forecast of 40,100,000 tons of oil (800,000 barrels per day). In 2000, production reached 11.5 km³ of natural gas, up from 8.2 km³ in 1999.
Kazakhstan has the potential to be a world-class oil exporter in the medium term. The landmark foreign investment in Kazakhstan is the TengizChevroil joint venture, owned 50% by ChevronTexaco, 25% by ExxonMobil, 20% by KazMunaiGas of Kazakhstan, and 5% by LukArco of Russia. The Karachaganak natural gas and gas condensate field is being developed by BG, Agip, ChevronTexaco, and Lukoil. The Agip-led Offshore Kazakhstan Consortium has discovered potentially huge Kashagan oil field in the northern Caspian. Kazakhstan's economic future is linked to oil and gas development. GDP growth will depend on the price of oil, as well as the ability to develop new deposits.
Sherin Suzhikova, Counselor of Kazakhstan's Chamber of Commerce and Industry and Chao yon-chuan, Secretary-General of the Taiwan External Trade Development Council, signed an agreement on 13 October 2006 in Taipei to improve economic relations through "exchanges of market information and visits by trade professionals." TAITRA has an office in Almaty, Kazakhstan.
In 2006, North Dakota's then Lieutenant Governor Jack Dalrymple led an 18-member delegation of the North Dakota Trade Office representing seven North Dakota companies and Dickinson State University on a trip to Kazakhstan, Ukraine and Russia. North Dakota exports mostly machinery to Kazakhstan, the eighth largest destination for North Dakotan exports; machinery exports increased from $22,000 to $25 million between 2000 and 2005.
China is Kazakhstan's important trade partner. In late March 2015 the two countries signed 33 deals worth $23.6 billion. The deals cover different industries, such as oil refining, cars, steel.
During the press conference on July 20, 2015 Minister of Investment and Development of Kazakhstan said: "As of today, we export about 850 types of goods. Kazakhstan is among the top-50 best exporting countries globally and takes the 49th place."
Small and Medium-Sized Enterprises
A new program to support small businesses was launched in Kazakhstan in February 2015. 2015 is expected to be a pilot period of the program. During that period the initiative will be focused on three major areas, notably agribusiness, machinery building and production of construction materials, and is to be further extended to other industries.
According to the Global Entrepreneurship Monitor-2014, Kazakhstan has a very positive image of the entrepreneurs. Nearly 70 percent of the population sees entrepreneurship as a good choice for building a career and achieving a high status in the society. Kazakhstan can also boast one of the lowest closing index, according to the Global Entrepreneurship Monitor-2014, meaning that only 2.9% of entrepreneurs were forced to cease their business.
In May 2015 the European Bank for Reconstruction and Development (EBRD) and the government of Kazakhstan have signed three agreements to provide €41 million for technical cooperation projects, advisory support to small and medium-sized enterprises (SMEs) and a Women in Business program. This initiative demonstrates that Kazakhstan invests in developing women businesses and supports diversity in this field.
The Kazakhstan's car industry was developing rapidly in 2014 producing $2 billion worth of products annually. By 2018 the car industry in Kazakhstan is expected to reach 190,000 cars per year.
On 22 December 2014 the World Bank approved an $88 million loan that would support Kazakhstan’s efforts to facilitate commercially and socially viable innovation in technology. The Fostering Productive Innovation Project aims to improve the country in areas that are able to foster and support technological innovation.
In June 2014 Kazakhstan's President, Nursultan Nazarbayev, signed into law tax concessions to promote foreign investment, including a 10-year exemption from corporation tax, an 8-year exemption from property tax, and a 10-year freeze on most other taxes. Other measures include a refund on capital investments of up to 30 percent once a production facility is in operation.
As of July 2015, Kazakhstan attracted $16 billion in the manufacturing industry over the past five years, which is 2.5 times more than over the previous five years. Kazakhstan put into operation four hundred new products, such as car industry, railway engineering, manufacture of basic chemical products, uranium industry, the industry of rare earth metals. The volume of new enterprises amounted to 580 billion tenge.
New Economic Policy "Nurly Zhol"
On November 11, 2014 in his address to the nation for 2015 Nursultan Nazarbayev proclaimed Kazakhstan’s New Economic Policy – The Path to the Future (Nurly Zhol). The new economic policy implies massive state investment in infrastructure over the next several years. In the short term, the program "Nurly Zhol" will apply the anti-crisis measures to overcome the turbulence in the global economy. The long-term measures of the state program of infrastructure development will help to create a strong platform for new growth.
2014 and 2015 developments
The country experienced a slowdown in economic growth from 2014 sparked by falling oil prices and the effects of the Ukrainian crisis The country devalued its currency by 19% in February 2014. Another 22% devaluation occurred in August 2015.
- Yerbolat Dosayev, Minister of National Economy
- Aset Isekeshev, Minister of Industry and Development
- Vladimir Shkolnik, Minister of Energy
- Asylzhan Mamytbekov, Minister of Agriculture
- "The World Factbook". cia.gov.
- "The World Bank".
- "The World Factbook". cia.gov.
- "The World Factbook". cia.gov.
- "The World Factbook". cia.gov.
- "The World Factbook". cia.gov.
- "Doing Business in Kazakhstan 2016". World Bank. Retrieved 2016.
- "Export Partners of Kazakhstan". CIA World Factbook. 2012. Retrieved 2013-07-22.
- "Import Partners of Kazakhstan". CIA World Factbook. 2012. Retrieved 2013-07-22.
- "Sovereigns rating list". Standard & Poor's. Retrieved 26 May 2011.
- Rogers, Simon; Sedghi, Ami (15 April 2011). "How Fitch, Moody's and S&P rate each country's credit rating". The Guardian. Retrieved 31 May 2011.
- "What We Do". wri.org.
- "RosBusinessConsulting - News Online". rbcnews.com.
- Kazakhs battle to stave off chill blowing in from Russian steppe, Financial Times, 21 May 2014
- "Kazakhstan beats Belgium and France in government efficiency ranking of World Economic Forum". http://en.tengrinews.kz. External link in
- "Competitiveness Rankings". http://reports.weforum.org. External link in
- OECD Investment Policy Reviews, P112, OECD, 2012
- Oil, Cash and Corruption, New York Times, 5 November 2006
- "Global Innovation Index 2015: Switzerland, UK, Sweden, Netherlands, USA are Leaders". www.wipo.int. Retrieved 2015-09-30.
- "These Are the World's Most Innovative Economies".
- "2014 Economic Freedom Index: Kazakhstan". The Heritage Foundation.
- "Edit/Review Countries". imf.org.
- "Statistical Agency". Statistical Agency.
- "asd". vestifinance.ru.
- "The Kazakhstan's GDP growth in the first quarter of 2014". newskaz.ru.
- "$2.5 billion will be allocated by the World Bank for the diversification of the Kazakhstans' economy". kapital.kz.
- "Company Overview". tengizchevroil.com.
- "USGS Minerals Information: Europe and Central Eurasia". usgs.gov.
- "Uranium in Kazakhstan - Nuclear Power in Kazakhstan". world-nuclear.org.
- "Uranium Supplies: Supply of Uranium". world-nuclear.org.
- Lt. Gov. Dalrymple (16 October 2006). "N.D. Companies To Attend Trade Mission To Kazakhstan, Ukraine And Russia". kxnet.com.
- "China, Kazakhstan Sign $23.6 Billion In Deals". http://www.ibtimes.com. External link in
- "Kazakhstan among top-50 best exporting countries". http://www.inform.kz. External link in
- "Kazakhstan launches a new program to support small businesses". Tengri News.
- "Kazakhstan has low business closing index". azernews.az.
- "More than 50% of entrepreneurs in Kazakhstan are women: Y.Tarasenko All rights reserved. Any use of the materials published on www.bnews.kz for any purpose except personal needs is possible only with placing a hyperlink to the BNews.kz website as the source. Reproducing BNews.kz materials : - in print or other forms of tangible media - paper, film, etc., the user must quote www.bnews.kz as the source in each case; - in the Internet or other electronic forms, the user must place a hyperlink to the BNews.kz News Agency home page - www.bnews.kz.". http://bnews.kz/. External link in
- "EBRD to expand SME support with €41 million from the government of Kazakhstan". http://www.ebrd.com. External link in
- "Production of Toyota Fortuner kicks off in Kostanay". en.tengrinews.kz.
- "Kazakhstan expands car production". en.tengrinews.kz.
- "World Bank finances innovation in Kazakhstan". cistranfinance.com.
- "Kazakhstan Enacts Investor Tax Breaks". tax-news.com.
- "Kazakhstan attracted $16 billion to the manufacturing industry". www.azernews.az.
- "NURLY ZHOL - THE PATH TO THE FUTURE". http://www.kazakhembus.com. External link in
- "In Surprise State of the Nation Address, Kazakh President Unveils Massive Infrastructure Investments". http://astanatimes.com. External link in
- "THE PROGRAM "NURLY ZHOL" CREATES A STRONG BASE FOR THE ECONOMIC GROWTH OF KAZAKHSTAN". ortcom.kz.
- "Tenge Fever", The Economist, 22 February 2014
- Kazakhstan's currency plunges, New York Times, 21 August 2015
|Wikimedia Commons has media related to Economy of Kazakhstan.|
- World Bank Summary Trade Statistics Kazakhstan
- U.S. Department of Energy Country Analysis Brief
- Kazakhstan Plans to Build Highway Connecting China and Europe
- Kazakh central bank misspells 'bank' on money
- International Business; China Pays Dearly for Kazakhstan Oil
- Kazakh President's Daughter Chides Steel Baron Mittal
- Commercial gold and copper discoveries in Kazakhstan
- Kazakhstan Changes Energy Strategy on the Way to WTO
- Kazakhstan to be top oil producer by 2011: Nazarbayev
- "Agriculture in Kazakhstan"
- Tariffs applied by Kazakhstan as provided by ITC's Market Acces Map, an online database of customs tariffs and market requirements