Kazakh parliament approves 2025 budget with deficit of 2.7% of GDP

ASTANA. Nov 27 (Interfax) - The lower house of the Kazakh parliament approved a law on the country's 2025-2027 budget at a plenary session on Wednesday, supporting amendments introduced by the upper house, an Interfax correspondent said.

The law is considered fully adopted by parliament and will be sent to the president for his signature.

Kazakh senators previously proposed revising certain expenditures and introduced 135 amendments to the document. The expenditures aim to support the regions and develop transportation infrastructure, water supply and sewage systems and the gas transportation network.

The budget deficit for 2025 is set at 2.7% of GDP, with reductions planned to 2.2% in 2026 and 1.9% in 2027. The non-oil deficit is projected to be 7.3% of GDP in 2025, decreasing to 4% by 2027. Budget revenues, excluding transfers, are expected to reach 15.6 trillion tenge in 2025, 16.7 trillion tenge in 2026 and 18.2 trillion tenge in 2027. Expenditures are planned at 25.8 trillion tenge or 17.1% of GDP in 2025, 23.2 trillion tenge or 13.7% of GDP in 2026 and 24.6 trillion tenge or 12.9% of GDP in 2027.

The 2025-2027 budget is based on the forecast for Kazakhstan's social and economic development, with three scenarios prepared by the government. The baseline scenario assumes an average oil price of $75 per barrel.

According to government forecasts, GDP growth will stand at 5.6% in 2025, with an average annual GDP growth rate of 5.4% over the next five years. Nominal GDP is expected to increase from 150.8 trillion tenge in 2025 to 234.2 trillion tenge or $498.4 billion by 2029. Inflation is projected at 5.5%-7.5% in 2025 and 5%-6% in 2026, and will gradually decline to 5% between 2027 and 2029.

The lower house also approved a law on amendments and additions to the budget for 2024-2026 on Wednesday.

The changes concern clarification of the budget's parameters and the volume of transfers from the National Fund for 2024. Revenues are estimated at 14.1 trillion tenge, which is 2 trillion tenge short of the approved plan. Expenditure is planned to be 24 trillion tenge. The budget deficit has increased from 3.5 trillion to 3.6 trillion tenge or 2.7% of GDP. The non-oil deficit is projected to reach 7.8% of GDP in 2024.

Due to the failure to implement the revenue part of the budget, the planned transfer from the National Fund will be increased by 2 trillion tenge to 3.6 trillion tenge. The funds will be used to maintain the level of regional growth and to finance socially significant and strategically important infrastructure projects in view of the risk of a decline in the GDP growth rate.

According to the National Economy Minister Nurlan Baibazarov, the document maintains the original forecast for 2024 where the price of oil is $80 per barrel and the exchange rate is 460 tenge per US dollar. Inflation will remain within the range of 6%-8%.

The document has been submitted to the upper house for consideration.

The official exchange rate on 27 November is 498.55 tenge/$1.