KAZAKHSTAN

BACKGROUND

Since 1991 Kazakhstan has pursued a democratic path with a bicameral presidential constitution. Its first president elected in 1991 and serving until his resignation in 2019 was Nursultan Nazarbayev. He was replaced by Kassym-Jomart Tokayev, who was re-elected in 2022 for a five year term.

In 2002, Kazakhstan became the first of the Former Soviet Union states to receive an investment grade rating (BBB-) from Standard & Poors. It has also been praised by the IMF for its economic management and is seen as being ahead of other Central Asian states as a place to do business.

Kazakhstan's economy and the prosperity of its people have seen improvements in recent years. Its international standing is high and it belongs to many international organisations including the United Nations, NATO's Partnership for Peace, Commonwealth of Independent States, and it has applied for membership to the World Trade Organisation.

Culturally, the population of Kazakhstan is made up 63.6% Kazakhs, 23.3% Russian, and the rest, other Central Asian groupings. The official and dominant language is Kazakh, though Russian is more widely spoken in business. Islam is the primary religion followed by orthodox Christianity. There is complete freedom of religious worship.

FACTS

ECONOMY

Kazakhstan's GDP in 2010 was approximately $113bn according to the World Bank, with per capita GDP of $7,212. It had external debt of $94.4bn at the end of 2010 and foreign exchange reserves of $19.4b in April 2009. Kazakhstan's economy grew at an average of 8% per year over the past decade and despite the uncertainty of the global economy, Kazakhstan's economy has been stable.

The banking system in Kazakhstan was partly nationalised in 2009 in response to the credit crisis. As with many other Western banks, Kazakhstan banks provided significant lending to the property sector which then became severely squeezed as prices nosedived from 2007 onwards. This happened from a relatively low base and fairly early on, meaning that the impact to the Kazakhstan economy was not as pronounced as in other countries. In addition to providing funding to banks, the Government removed the unofficial peg to the US Dollar, allowing the Kazakh Tenge to devalue by 20%. In February 2014, in response to a weakening of the Russian rouble, the Kazakh National Bank chose to devalue the Tenge by 19% against the US Dollar.

From January to September 2014, Kazakhstan's GDP grew at 4%. According to the results from the first half of the year, the current account surplus is $6.6bn, a figure two times higher than that of the first half of 2013. The overall inflation rate for 2014 is forecasted at 7.4 percent.

Oil is the most important commodity in the economy, accounting for some 65% of exports and 24% of GDP. Other important sectors are agriculture, (10% of GDP), (wheat and livestock) and minerals, especially uranium.

In October 2014 Kazakhstan introduced its first overseas dollar bonds in 14 years, issuing $2.5bn of 10-and 30-year bonds in what was the nation's first dollar-denominated overseas sale since 2000.