Kazakh economy’s robust growth is on track, but global risks remain
Transport was Kazakhstan’s fastest growing sector with 22.4 per cent, fuelled by higher freight volumes, and construction activity rose by 16.2 per cent.
Kazakhstan’s GDP has accelerated by six per cent in the first four months of the year, with notable growth in the transport and trade sectors. Despite a generally positive outlook for 2025, major international finance institutions advise caution due to external risks.
Data from the National Statistics Bureau indicates transport was the fastest growing sector with 22.4 per cent, fuelled by higher freight volumes in rail and pipeline transport. Regional growth was especially notable in Turkistan, Zhambyl, and Abai.
Construction activity rose by 16.2 per cent, prompting calls from officials for improved project coordination to control costs. Trade expanded by seven per cent, with wholesale and retail trade also posting gains.
The Turkistan Region saw a remarkable 60.4 per cent jump, thanks to strong sales of fruit, vegetables, and pharmaceuticals; while Akmola and Shymkent also recorded significant increases.
Industrial production rose by 6.4 per cent, driven by coal mining and manufacturing gains in sectors such as food, tobacco, chemicals, and mechanical engineering. Meanwhile, agriculture registered a 3.9 per cent increase in gross output.
The country is seeking strong economic growth with major investment projects in 2025, in areas including transport, logistics and communication, metallurgy, and chemical industry, which are expected to contribute additional growth of 1.3 per cent to Kazakhstan’s GDP.
Beyond expectations
Kazakhstan is off to a good start, with a generally positive economic outlook from major international financial institutions that have projected moderate to strong GDP growth, driven by key sectors such as oil production, services, and infrastructure.
The World Bank projected Kazakhstan’s GDP growth at 4.7 per cent in 2025, supported by increased oil production and fiscal stimulus, before slowing towards its 3.5 per cent growth potential in subsequent years.
The International Monetary Fund (IMF) and the Asian Development Bank (ADB) both forecast a 4.9 per cent growth rate for 2025, attributing this to a rebound in services and trade. Inflation is projected at 9.9 per cent.
Meanwhile, the European Bank for Reconstruction and Development (EBRD) anticipated a 5.2 per cent GDP growth in 2025, driven by the planned expansion of the Tengiz oil field, before slowing down to 4.5 per cent in 2026.
But despite the positive outlook, there are risks. The IMF notes potential external factors, including a slowdown in major economies, regional conflicts, and commodity price volatility.
Domestically, delays in infrastructure projects and fiscal underperformance could pose challenges. The World Bank also highlights concerns about low productivity and declining investments, which may affect long-term growth.
Positive, but cautious outlook
The EBRD slightly lowered its economic forecast for Central Asia in 2025, projecting regional growth at 5.5 per cent, down from 5.6 per cent in 2024, and further moderating to 5.2 per cent in 2026.
This adjustment is primarily due to declining commodity prices, which have directly affected key economies like Kazakhstan and Mongolia. In Kazakhstan’s case, the EBRD’s outlook reflects weaker terms of trade and the broader impact of global economic uncertainty.
Kazakhstan, while still expected to grow at a relatively robust pace compared to many other EBRD economies, is facing a more cautious environment, with global headwinds creating an atmosphere of uncertainty.
Although the country is not among the most directly impacted by US tariffs, the report warns that global supply chain disruptions and trade policy shifts could have indirect effects on export dynamics and investment flows.
Inflation has also picked up again across the EBRD region, with loose fiscal policies and strong wage growth. While debt levels are expected to remain stable, that stability is contingent on governments, including Kazakhstan’s, implementing strict fiscal discipline.
The report notes that while Kazakhstan and the broader Central Asian region remain among the stronger performers, they are not immune to global economic shifts. The outlook is still positive but marked by caution.
[Edited By Brian Maguire | Euractiv’s Advocacy Lab ]
