Kazakhstan is the biggest economy in Central Asia and is reliant on massive deposits of natural resources such as oil, gas, and other minerals. The country also has a landscape that favors considerable agriculture such as livestock keeping and grain production. The country is hugely reliant on the exportation of oil, and this has affected its revenue especially in 2016 where there was a global slump in the oil prices. The country’s industrial sector is reliant on the extraction and manufacture of the minerals and also the production of heavy machinery. The disintegration of the former USSR negatively affected the value of its GDP.
Overview Of The Economy Of Kazakhstan
The country has a population of 17.7 million with a working force of 8.965 million as at 2015. Its nominal GDP in 2015 was $271 billion while basing on the Purchasing Power Parity (PPP) was $429 billion in the same year. Its GDP based on PPP was ranked 43rd globally. In 2015, its economy grew by 1.2%. The country’s inflation rate is 5.2% while the percentage of the population below the poverty line was 2.9% in 2013. It is ranked 41st concerning ease of doing business globally. The unemployment rate was at 5% in 2015.
Leading Industries Of Kazakhstan
The primary drivers of the country’s economy are ore, manganese, chromite, lead, and zinc among others. Agriculture is also very essential accounting for 5%, industry 35%, and service 60%. The country also produces and exports oil and gas in hundreds of thousands of metric tons. It also produces uranium accounting for 35% of the global production and the second uranium reserves deposits after Australia. Kazakhstan’s vibrant service industries are related to technology and retail. In 2015 the country ranked 13 out of 30 in Global Retail Development Index.
Top Export Goods And Export Partners Of Kazakhstan
The total value of Kazakhstan export commodities was $45.37 billion in 2015. The main export commodities included oil and oil products constituting 59% of total exports, ferrous metals (19%), Chemicals (5%), and machinery (3%). Other export products include coal, wool, grain, and coal. The leading export partners for the year were China (15%), Russia (12%), France (9%) and Germany (7%).
Top Import Goods And Import Partners Of Kazakhstan
The country mainly got metallic products, foodstuff, and machinery from other countries. It purchased these from Russia (32%), China (25%), and Germany (4%). The monetary value of its import was $ 31.63 billion in 2015.
Challenges To The Economy Of Kazakhstan
The heavy reliance by the country on the revenue from oil and oil products has at times negatively impacted its economic growth. The market forces in the international arena determine the prices which have hampered its ability to plan financially. The country has experienced a contracting GDP and budgetary deficits on account of the problem.
Kazakhstan is continuously working to increase the foreign direct investments. In 2014, the government signed into law tax concessions designed to increase the FDI. It included a ten-year exemption from corporate tax, an eight-year exemption from property tax, and a further ten-year freeze on other forms of taxes. The government has also reduced VAT and other forms of levies. These measures are aimed at attracting foreign investors to boost the economic growth of Kazakhstan.