The World Bank has downgraded the forecast for Kazakhstan’s GDP growth to 0.1% this year

Almaty. April 11. Silkroadnews – In 2016 Kazakhstan’s GDP growth will fall from 1.2% to 0.1% due to low oil prices and both domestic and external demands’ weakening, such a forecast was given by the World Bank (WB), KazTAG reports.

“According to the estimations the growth of Kazakhstan’s GDP is expected to decline from 1.2% in 2015 to 0.1% in 2016 due to low world oil prices and weakening of the domestic and external demands. It is expected to raise during 2017-2018 following the recovery in oil prices and oil production increase, yet will remain below its long-term potential,” the latest report by the World Bank for Europe and Central Asia says.

The forecast notes the inflation rate is expected to stand high for Kazakhstan making 13.7% in 2016, 4.5% in 2017 and 4.4% in 2018.

“These expectations are based on the current forecast of the oil price at the level $37 per barrel in 2016 and lack of signs for the significant improvement in the external economic environment in the short term,” the report says.
At the same time the current account deficit of the balance of payments is expected to deteriorate as the economy continues to adjust to the lower oil prices.

According to the forecast of the World Bank, GDP growth will raise to 1.9% in 2017 and 3.7% in 2018, provided the oil prices recovery up to $48 per barrel in 2017 and $51.4 per barrel in 2018. Another prerequisite for such increase will become the beginning of commercial production at Kashagan field in autumn of 2016.

According to the January forecast of the World Bank, Kazakhstan’s GDP growth should reach 1.1% in 2016, 3.3% in 2017, 3.4% in 2018, while the baseline scenario of the ministry of national economy of Kazakhstan for 2016 provides Kazakhstan’s GDP growth to reach 2.1% under the oil price of $40 per barrel.