## IMF Staff Concludes Visit to Kazakhstan

_IMF News, May 29, 2025_

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## Bibliographic details
- Published: May 29, 2025

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### Economic outlook and growth
- Real GDP growth accelerated to 6 percent in the first four months of 2025 from 4.8 percent at end-2024.
- Growth drivers: strong activity in the services, transport, construction, manufacturing, and extractive sectors.
- Domestic demand supported by strong consumer credit growth and a loose fiscal stance; increased contribution from public infrastructure investment.
- IMF projection for 2025: growth to moderate to about 5 percent.
- IMF medium-term non-oil GDP growth projection: about 3½ percent, described as in line with current estimated non-inflationary sustainable growth.

### Inflation and monetary policy
- Inflation accelerated to 10.7 percent in April 2025.
- IMF projects inflation for 2025 at about 10½ percent.
- Contributing factors: broad-based price pressures from domestic and external factors, including exchange rate pass-through from the depreciation of the tenge in 2024Q4.
- Policy recommendation: Monetary policy should remain restrictive/tight until inflation is close to its 5 percent target.
- Planned measure: Reduce excess banking system liquidity with higher reserve requirements may help ease inflation pressures over the medium term.

### Fiscal and external positions
- Fiscal stance in 2025 projected by the IMF to remain expansionary.
- Non-oil fiscal deficit projected to widen from 7.9 to just over 8.0 percent of GDP in 2025.
- Current account deficit expected to widen to around 3½ percent of GDP in 2025 from 1.3 percent in 2024, mainly driven by lower oil prices and sustained import demand associated with public and household spending.
- 2026 government plans welcomed by IMF: increase VAT rates, broaden the tax base, and adopt digitalization to improve revenue collection.
- Additional IMF recommendation: Reduce widespread exemptions to further widen the tax base.
- Corrective measures advised to limit fiscal deficits, help contain inflation, and support medium-term efforts to build the assets of the National Fund for the Republic of Kazakhstan.

### Banking and financial stability
- Banks remain well capitalized, liquid, and profitable overall.
- Total credit growth decelerated to about 20 percent (yoy) in March 2025.
- Consumer credit remains elevated at around 31 percent (yoy).
- Distressed assets related to consumer loans have increased but remain contained as a share of total assets.
- IMF view: Plans to tighten macroprudential policies are welcome and should help mitigate financial stability risks from rapid consumer lending growth.
- Recommendation: Monitor vulnerabilities despite broadly contained financial stability risks.

### Risks to the outlook
- Risks are tilted to the downside; large financial buffers help mitigate these risks.
- External risks: heightened uncertainties related to global trade tensions, including lower oil prices, tighter financial conditions, and slower growth in key trading partners.
- Domestic risks: weaker growth from delays in large infrastructure projects and increased inflation pressures.
- Upside potential: An acceleration of structural reforms and private sector development pose upside risks for medium-term growth.

### Structural reforms and policy priorities
- Decisive implementation of structural reforms is needed to support more diversified and resilient medium-term growth.
- Current investment areas: infrastructure projects, digitalization, AI, agriculture, and logistics.
- IMF-recommended reforms: further reduce the state’s footprint in the economy; strengthen public governance; improve labor and product market regulations; boost economic and trade diversification.

### Mission details and closing
- Mission led by Ali Al-Eyd visited Kazakhstan during May 15-23, 2025.
- End-of-mission press release date: May 29, 2025.
- IMF note: Views expressed are those of IMF staff and do not necessarily represent the views of the IMF’s Executive Board.
- IMF statement: “The IMF team is grateful to the authorities and other counterparts for their cooperation and hospitality.”

*Press Release No. 25/164 — IMF Communications Department, May 29, 2025.*

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## References

- [Republic of Kazakhstan and the IMF](http://www.imf.org/external/country/KAZ/index.htm)
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- [PRESS CENTER](http://presscenter.imf.org/)
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_Source: https://www.imf.org/en/news/articles/2025/05/28/pr-25164-kazakhstan-imf-staff-concludes-visit_