BISHKEK (TCA) — There are many, well-thought-through programs in Kazakhstan that are designed to achieve a more diversified industrial and services-based growth, Masood Ahmed, director of the IMF Middle East and Central Asia Department, said at the press briefing on the IMF’s 2016 Economic Outlook for the Middle East and Central Asia, held in Washington, D.C. on October 7.
Mr. Ahmed said that this year’s economic growth in Kazakhstan would be virtually zero or a little bit negative, but later there will be an improvement, partly because of the increase in oil production coming from the huge Kashagan oil field that is planned to be put into operation this November. But it is not a substitute for the diversification of the Kazakh economy, he added.
Mr. Ahmed also said that Kazakhstan is one of the countries in Central Asia that has been quite affected by the lower price of oil. But Kazakhstan is also well placed, because it had built up reserves, financial reserves that it could use to undertake countercyclical policy. That helped it to temper the effect of lower oil prices. Also using exchange rate policy, the Kazakh government was able to mitigate some of the impact, and now the challenge for Kazakhstan is moving from just containing the impact to diversifying the economy.
Speaking about Tajikistan, Mr. Ahmed said that the country is facing a growing set of vulnerabilities particularly in the financial sector because it, too, has been impacted by the recent shock. “Tajikistan is one of the countries where remittances account for almost 14 percent of GDP, probably the largest number in the world. And so for a country that’s so dependent on remittances, where remittances have fallen by a third, you can see that this is a country that has to cope with a big shock,” he said.