Kazakhstan: Economic growth speeds up in Q1
According to a preliminary estimate, year-on-year GDP growth ticked up to 4.9% in Q1, from 3.3% cumulatively through December 2022.
The acceleration was mainly driven by an increase in industrial production amid stronger expansions in manufacturing, construction and mining output. In addition, services activity also increased at a stronger pace due to an acceleration in transport and retail output. That said, growth in agricultural production slowed by a third in the quarter.
Q1’s momentum should carry into the rest of 2023. Expectations of softer inflationary pressures will likely boost private consumption. Moreover, the Central Bank has signaled that interest rates should be cut from H2 onwards, likely boosting fixed investment. Both trends should translate into stronger economic activity this year. Nevertheless, forecasts of lower export growth amid dampened global demand and lower growth in public spending should limit the expansion somewhat.