The unfavorable external economic situation and low prices

Almaty. October 15. Silkroadnews - In the next two years, the negative impact on the outlook for economic growth in Kazakhstan will have an unfavorable external economic situation and low oil prices, according to a new report by Standard & Poors "Assessment of industry and country risks of the banking sector of the Republic of Kazakhstan".
According to S & P, the share of oil and gas account for about 60% of total exports and about 46% of budget revenues, which exposes the economy to risks associated with external stress situations.
Agency predicts slowdown in GDP growth to 1.5% in 2015 and 2% in 2016 compared to 6% on average in 2010-2014 as a result of the reduction in demand, especially from Russia and China, the decline in oil prices, the low level of investor confidence and the continuing delays in the commissioning of the Kashagan oil field. In the I half of 2015 GDP growth in Kazakhstan amounted to 1.7%.
According to the expectations of analysts of the rating agency, the positive impact on growth in 2015-2016 will assist the implementation of government stimulus programs implemented in relation to infrastructure projects and residential construction. The program also provides support to small and medium-sized businesses.
The S & P considered: fiscal and external economic flexibility of Kazakhstan remains generally high due to the presence of significant reserves accumulated in previous years, and have demonstrated a willingness and ability of the government to consolidate the budget. The level of general government debt in Kazakhstan will increase from 15% of GDP in 2014 to 22.6% in 2015 due to the financing of the budget deficit on a consolidated basis and to reduce the exchange rate, expect the rating agency.
However, the transition to a floating exchange rate has led to impairment of the tenge against the US dollar by more than 30% at the moment. But in spite of the elimination of direct external economic pressure, the ability and willingness of National Bank to continue to adhere to the new policy has not yet been tested by time. This conclusion reflects the opinion of S & P on the weak efficiency and reliability of the monetary policy of Kazakhstan, as well as the weak mechanisms for the transition.