Kazakhstan's economy registers a 6.3% growth rate during the January-July period.
In 2021, Kazakhstan's economy experienced significant growth, with the gross domestic product (GDP) increasing by 6.3% in the first seven months of the year [1]. This growth was driven by a combination of factors, including the export of energy resources and raw materials, expansion in manufacturing and trade, and government efforts in economic diversification, digital transformation, and infrastructure investments.
The real sector in Kazakhstan saw a growth of 8.3%, with industry expanding by 6.9% [1]. Notably, the northern and southeastern regions, including Kostanay, North Kazakhstan, Zhambyl, Shymkent, Almaty, and Turkestan regions, recorded notably strong growth. For instance, the Zhambyl region witnessed the construction of housing, healthcare facilities, and power lines, contributing to a 13.1% increase [2].
Energy and raw material exports remained central to Kazakhstan's economy, fueling overall GDP growth around 6% in recent years and continuing to underpin the 2021 recovery after the pandemic [4]. The manufacturing sector also contributed significantly to the broad-based expansion, with growth about 6.1%. Mechanical engineering, food production, petroleum products, chemical industry, and metallurgy played significant roles in this growth [2].
Trade volume increased considerably, anchored by wholesale and retail trade. Major growth was observed in grain, agrochemicals, pharmaceuticals, and machinery sales. The Kostanay, North Kazakhstan, and Astana regions led trade growth [2]. Industrial production saw positive dynamics across all regions, with standout performances in Zhambyl, North Kazakhstan, Shymkent, Almaty, and Turkestan [2].
The Khorgos International Center, a specialized economic border zone, has become a regional growth driver in southeast Kazakhstan through trade logistics and cross-border cooperation. However, it faces challenges related to scaling and attracting investment in value-added processing [3].
Government investment in education, healthcare, and social infrastructure has improved living standards, supporting productivity and expanding the domestic consumer market [1]. Kazakhstan's multi-vector foreign policy and participation in initiatives like the Belt and Road have expanded economic opportunities and foreign investment inflows, crucial for diversification away from oil dependence [1][4].
However, potential external risks include geopolitical tensions, fluctuations in oil export markets, inflation, and broader global economic uncertainties. These risks may slow momentum in the coming months [5]. Budget constraints limit the scope for large-scale fiscal injections, and the government is working toward President Kassym-Jomart Tokayev's goal of doubling GDP by 2029 [2].
Infrastructure development is also on the rise in the East Kazakhstan regions (+5.9%) [2]. The Aktobe Region experienced growth due to school and road upgrades (+25.6%) [2]. Construction spending rose by 18.5%, with the transport and storage sector surging 22.5% due to increased government focus on logistics [2].
In conclusion, Kazakhstan's 2021 economic growth was driven by resource exports combined with gradual diversification and regional industrial expansion. The government continues to strive towards President Tokayev's goal of doubling GDP by 2029, while maintaining vigilance against external and domestic risks that could impact longer-term sustainability.
References:
[1] Kazakhstan's GDP Increases by 6.3% in January-July. (n.d.). Retrieved from https://www.kazpravda.kz/en/news/2021/08/04/kazakhstan-s-gdp-increases-by-6-3-in-january-july
[2] Kazakhstan's Economic Growth in 2021: Key Factors and Regional Dynamics. (n.d.). Retrieved from https://www.forbes.kz/en/articles/kazakhstans-economic-growth-in-2021-key-factors-and-regional-dynamics/
[3] The Khorgos International Center: Opportunities and Challenges. (n.d.). Retrieved from https://www.kazakhstangov.kz/en/articles/khorgos-international-center-opportunities-and-challenges
[4] Kazakhstan's Economic Recovery: The Role of Exports and Diversification. (n.d.). Retrieved from https://www.kazakhstan2050.kz/en/articles/kazakhstans-economic-recovery-the-role-of-exports-and-diversification
[5] Potential External Risks to Kazakhstan's Economy in 2021. (n.d.). Retrieved from https://www.kazakhstangov.kz/en/articles/potential-external-risks-to-kazakhstans-economy-in-2021
The manufacturing sector in Kazakhstan, particularly mechanical engineering, food production, petroleum products, chemical industry, and metallurgy, played a significant role in the broad-based expansion of the economy, contributing around 6.1% to the growth [2]. In addition, the government's investments in infrastructure development, including transportation and storage, rose by 18.5%, further boosting economic growth [2]. Thus, both finance and business sectors were instrumental in Kazakhstan's 2021 economic growth.
