Over 8.8 trillion tenge was allocated to the social sector last year, according to the government.
The Parliament Ponders the Government's 2024 Budget Report: A Mixed Bag of Fiscal Stability and Growth
Take a sneak peek at the current parliamentary proceedings, as the Mazhilis deliberates the Government's review of Kazakhstan's 2024 republican budget. Finance Minister Madí Takiev reveals a mixed picture, despite hurdles faced in fiscal stability, painting a rosy财政和社会出来的情况。What's the buzz about the country's 約4.8% GDP growth last year, as reported by our source?
According to Madí, budget revenues hit a whopping 98% trillion tenge (approximately $38.5 billion), surpassing the predicted target, though expenses notably exceeded the mark, setting back 23.6 trillion 594 billion tenge. The final budget deficit pegged at a substantial 3 trillion 649 billion tenge (equivalent to $6.9 billion) or 2.7% of GDP. The public debt, conversely, remained within the stipulated boundary of 23.7%, amounting to 31.8 trillion tenge.
Certainly, the continued inflation battle was on the horizon, as it slid from 2023's 9.8% to a slightly less alarming 8.6% in 2024.
Taking the floor once more, Madí proclaimed that the Government met all its social responsibilities, committing over 7.1 trillion tenge towards regional assistance and a staggering 8.8 trillion tenge towards the social sector.
Addressing critical regional concerns, funds from the Government's reserve were diverted to handle major crises such as flood relief, the modernization of heat sources and networks, and the implementation of the national project designed to upgrade rural healthcare facilities.
A Glimpse into the Economy's Complex tapestry
Kazakhstan's overall economy in 2024 wrestled with moderate growth, yet grappled with consistent budget execution, a rising public debt burden, and inflationary pressures.
Due to sectors like services, transport, construction, manufacturing, and extractive industries, the nation's real GDP expanded by around 4.8%, with a nominal GDP of approximately $288 billion, giving each citizen a GDP per capita of roughly $14,200—well above the average global figure.
Recent predictions indicate that growth will continue its ascent in 2025, with early projections hitting 6%, though official forecasts anticipate a more restrained growth rate of around 5% in the coming years.
The Debt Conundrum and Related Challenges
Public debt has skyrocketed over the past decade, surging from 8.7 trillion tenge (approximately $16.7 billion) to a staggering 30.1 trillion tenge (around $57.9 billion) by 2024. With the debt-to-GDP ratio clocking in at 22.4%, it remains within tolerable limits, but financial experts caution about the illusion of long-term sustainability given the accelerating debt growth and persistent revenue shortfalls.
Raised eyebrows turned to increased external borrowing and National Fund withdrawals, indicating the mounting fiscal risks.
A persistent fight with inflation, now hovering above 10%, constitutes the main economic stability threat and necessitates cautious monetary management. The International Monetary Fund (IMF) anticipates inflation to linger at around 10.5% in 2025, primarily due to both domestic forces and external factors such as dipping oil prices.
All in all, Kazakhstan's 2024 economy showed moderate GDP growth of around 4.8%, while the nation grappled with ongoing fiscal challenges, including a considerable budget deficit and surging public debt amid an elevated inflation rate. Monetary management calls for tight monetary policy to gradually lower inflation to the target rate of 5%. The government ushers in continued social spending and infrastructure investments, yet faces the unenviable task of reconciling revenue collection with fiscal sustainability[1-5].
- Given the ongoing deliberations in the Parliament, it's crucial to discuss the government's finance-related policies, such as strategies to address the substantial budget deficit and the rising public debt.
- As the Finance Minister revealed, the government's focus on social responsibility, with significant investments in regional assistance and the social sector, will continue elevating finance-related challenges, including managing the nation's public debt level and combating persistent inflation.
