IMF concludes Article IV consultation with Kazakhstan

By bne IntelliNews August 15, 2013

On April 14, the International Monetary Fund (IMF) published conclusions from Article IV consultation with Kazakhstan. The Fund praised Kazakhstan’s solid macroeconomic fundamentals such as keeping the 8% annual GDP growth average over the past decade and 2.5% annual growth of employment over the last three years. IMF welcomed gradual recovery of financial sector but also pointed out that recovery is timid as the return on assets ratio for the largest banks, excluding trouble-making banks BTA and Alliance, reached just 1% last year.

IMF directors focus mostly on financial sector vulnerabilities and medium-term risks for fiscal performance. Fund urged authorities to deal more decisively with the challenge of NPLs as resolution of this problem showed so far little progress. In particular, Fund called for redesigning Problem Loans Fund, which was created as part of Kazakhstan’s strategy to improve banks’ asset quality. IMF recommended also strict supervision on NLPs as well as further enhancement of liquidity and credit risk assessments. As far as monetary policy, IMF recommended the National Bank of Kazakhstan’s (NBK) to communicate more clearly with the market about its interest rate decisions and active market operations. Fund also suggested greater exchange rate flexibility.

Finally, the Fund reiterated its traditional key priority recommendations for Kazakhstan such as lowering the non-oil deficit in the medium fiscal framework and reducing Kazakhstan’s economy dependence on oil. In particular, IMF recommended including National Fund into fiscal accounts because recently announced large-scale public spending plans are not incorporated into budget. The Fund also warned authorities that consolidation of the private pension funds into recently established United Pension Fund could exacerbate fiscal risks. In this context, the IMF urged authorizes to adopt a market-based investment strategy for the pension’s assets and maintain individual accounts.       

Related Articles

Kazakh Kazkommertsbank confirms talks on deal with Halyk Bank

Kazakhstan’s largest bank Kazkommertsbank (KKB), recently rebranded as Qazkom, has entered preliminary negotiations for an unspecified “deal” with Halyk Bank, KKB said in ... more

Russia invites Trump aides to Syria peace talks in Kazakhstan

Russia has invited incoming U.S. President Donald Trump to send aides to the planned Syria peace talks in Kazakhstan’s capital Astana, Bloomberg reported on January ... more

Narrower gauge of Kazakh GDP at 0.8% for 2016

Kazakhstan's short-term economic indicator, a narrower gauge of annual GDP growth, edged up 0.8% in 2016, data from the State Statistics Committee showed. ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss