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Thursday, August 24, 2017

Weakened demand slows economic growth in Kazakhstan

The International Monetary Fund (IMF) announced recently that the executive board has concluded its 2014 Article IV consultation with Kazakhstan.

Growth in the first quarter of the year slowed to 3.8 percent from six percent in 2013 as a result of weaker external demand from countries such as China and Russia, heightened regional tensions, a slowdown in mining production and the devaluation of the Kazakhstani tenge in February.

At the same time, inflation increased to seven percent year-on-year in June compared to 4.8 percent at the end of last year, reflecting the devaluation and growing external uncertainties.

The IMF projected that real growth will stand at 4.8 percent in 2014, one percent lower than earlier projections, while it expects inflation to continue to rise to around nine percent this year. There are still downside risks to the outlook based on possible developments in Russia and Ukraine as well as a potential slowdown in emerging markets.

IMF directors emphasized the need to strengthen macroeconomic policies to bolster economic resilience and sustainability, according to the IMF.

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