World Bank revises Kazakhstan's 2024 GDP growth forecast down to 3.4%

ALMATY. Feb 19 (Interfax) - The 2023-24 Kazakhstan Economic Update from the World Bank forecasts GDP growth of 3.4% in 2024.

The World Bank had previously forecast economic growth of 4.3% in 2024 and 4.5% in 2025.

The report said that economic growth is expected to slow to 3.4% in 2024 YoY, driven by lower-than-forecast oil production.

World Bank analysts said that real GDP is forecast to grow 4.5%-5% in 2025 as the expansion of production capacity in existing oilfields is set to boost exports and spur growth of the petrochemical industry in 2025 and beyond.

Investment in mining and manufacturing is anticipated to be steady. Household spending growth is expected to strengthen in 2024 as inflation subsides and financial conditions ease.

Inflation is expected to decrease to 8% in 2024, 6.7% in 2025, and 5.6% in 2026. However, it will likely remain above the National Bank's target in 2024 and 2025.

"Inflationary pressures started to ease in 2023, falling to 9.8% in December 2023, following monetary tightening. Achieving the NBK's inflation target of 5% could be possible provided there is no premature monetary loosening alongside implementation of fiscal consolidation plans. Continued measures to remove distortive subsidized interest rate policies will improve the effectiveness of the transmission of monetary policy," the report said.

Kazakhstan's economic growth reached 3.9% in January 2024, while totaling 5.1% for 2023.