IMF improves outlook for Kazakhstan’s economy

The International Monetary Fund (IMF) has improved its outlook for developing countries, including Kazakhstan, for this year and worsened the outlook for 2024.

According to the IMF, developing economies are going to grow by 4% this year, which is 0.1 percentage points more than was forecasted in April. On the other hand, in 2024, this growth will be at 4.1%, which is 0.1 percentage points lower than the previous forecast.

The IMF’s report doesn’t provide a separate outlook for Kazakhstan and other Central Asia states. The entity says that about 61% of all developing countries across the world will reach significant growth of their GDPs, although it won’t be that impressive for the remaining countries.

The IMF is expecting that the Middle East and Central Asian economies will grow by 2.5% this year. Last year, the organization forecasted a 5.4% increase in GDP for these countries. The IMF worsened its outlook for these states by 0.4 p.p. due to a decline in economic growth in Saudi Arabia (from 8.7% to 1.9%), which is going to suffer from OPEC+ countries cutting their oil output.

Developing countries in Asia are expected to reach 5.3% growth this year with the gradual cooling of their economies to 5% (by 0.1 percentage point). However, the outlook for China remained the same — 5.2% in 2023 and 4.5% in 2024. According to the IMF, China is currently less attractive to investors because of the decline in the real estate market.

The economy of Russia is going to grow by 1.5% this year (+0.8 percentage points). As the IMF noted, the first six months of the year were more successful for this country than expected due to fiscal incentives by the Russian government.

Developed countries are expected to demonstrate exactly the same level of growth by 1.5% this year (+0.2 p.p.) and by 1.4% next year. The outlook for the U.S., the EU, Japan and the U.K is 1.8% and 1%, 0.9% and 1.5%, 1.4% and 1% and 0.4% and 1%, respectively.