|АКИpress CA-News Tazabek Turmush||ADVERTISE WITH US SUBSCRIBE|
AKIPRESS.COM - Economic growth in Kazakhstan is forecast to accelerate in 2017 reflecting continued fiscal spending to stimulate consumption and investment, and higher earnings from oil exports, Asian Development Bank said in its Asian Development Outlook (ADO) 2017.
Kazakhstan's GDP is projected to grow 2.4% in 2017 and 2.2% in 2018 (1% in 2016), according to the ADB.
Annual inflation in 2017 is projected at 8% - within the National Bank's target range of 6-8% - as authorities adjust the policy rate, use open market operations to control monetary growth, and maintain monopoly price controls.
Kazakhstan still needs to strengthen the banking sector as a key policy challenge.
"The measures being taken by the authorities to address the weaknesses of the banking sector are an important step in the right direction", said Giovanni Capannelli, ADB's Country Director for Kazakhstan. "But more needs to be done through stress-testing and asset quality review in line with international standards to identify which banks need additional capital and improve the assessment of non-performing loans."
The ADO suggests industry will expand by 2.4% in 2017, boosted by high infrastructure spending and increased production of oil and gas condensate. Oil production is expected to rise by 3.8% to 81 million tons with higher production at the Kashagan oil field compared to last year, and expansion of the Tengiz oil field. Agriculture is projected to grow by 3.5% in 2017 as a result of the new state support program.
Growth in Central Asia is expected to reach 3.1% in 2017 and 3.5% in 2018, on the back of rising commodity prices and increased exports, albeit with large heterogeneity among countries in the region, said the Bank.