Kazakhstan Targets Over 5% Economic Growth, Analyst Cites Productive Capacity as Key

Kazakhstan's government has set an ambitious target of achieving more than 5% annual economic growth through 2029, coupled with a significant reduction in the budget deficit to 0.4% of GDP. This forecast, approved alongside the national budget for 2027-2029, signals a strong focus on economic expansion and fiscal consolidation.

Financial analyst Rassul Rysmambetov believes these targets are attainable but stresses that their realization depends critically on Kazakhstan's ability to expand its productive capacity. Key areas for development include increasing electricity generation, fostering industrial growth, and deepening the processing of raw materials. Without these foundational improvements, the ambitious growth projections may remain out of reach.

The government's strategy centers on diversifying the economy away from its traditional reliance on oil. Manufacturing, agriculture, construction, and services are identified as the primary drivers of future growth. Manufacturing, in particular, is expected to surpass mining, with sub-sectors like metallurgy, machinery, construction materials, chemicals, and food production leading the charge. Agriculture is projected to grow by at least 5% annually, while construction is slated for significant increases.

Managing inflation remains a crucial element of the macroeconomic framework. While inflation is expected to remain relatively high in 2027, it is projected to moderate in the subsequent two years. The government plans to balance budget expenditure with revenue, allocating substantial funds to the social sector and the real economy. Targeted transfers from the National Fund will support critical infrastructure and nationwide projects, underscoring the commitment to sustainable development.

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The targets are achievable, but only if Kazakhstan expands its productive capacity through greater electricity generation, industrial development and deeper processing.