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16 I Companies & Markets bne September 2019
The 150,000th car rolls off production line at the Azia Avto car assembly plant in Ust-Kamenogorsk, eastern Kazakhstan.
The planned combined boost in output at Azia Avto and Saryarka AvtoProm would set the country on course to rival the only other major regional car manufacturer, Uzbekistan. For comparison, Uzbekistan’s car production, via its formerly American-Uzbek joint venture GM Uzbekistan, stood at 135,470 units in 2017 and rose to 220,667 vehicles in 2018.
“The reason for the growth in automotive production is the restoration of market demand, the opening of export markets
(329 cars were exported in 2018, 524 cars were exported in five months of 2019), as well as the programme of preferential car loans from the state and leasing buses as part of the bus fleet renewal program which together had a positive effect
on the development of the automotive sector,” Yerzhanov said.
To support domestic manufacturers, Kazakhstan launched
a bus-leasing programme in 2018. It also allocated KZT50bn on preferential car loans and leasing financing.
“For the future development of the automotive industry,
it is important to concentrate on large-scale production
by launching additional projects. The access to the large- scale production of cars will contribute to the creation in Kazakhstan of its own automotive component base. In April 2019, a program of joint actions was adopted between
the Ministry of Industry and Infrastructure Development
of Kazakhstan and the Ministry of Industry and Trade of
the Russian Federation in the development of industrial cooperation. Under this program, projects are envisaged
for the production of equipment and components for KAMAZ vehicles, for the production of Hyundai vehicles and components for them, for construction of a full-cycle car factory JSC Asia Auto Kazakhstan,” the vice minister said.
Ukraine’s economy takes off?
Economic growth jumps to 4.6% in 2H19
bne IntelliNews
Ukraine-watchers were a abuzz on August 14 after the government announced economic growth surged in the second quarter, growing by 4.6% the nation's state statistics service Ukrstat reported on August 14, well ahead of even the most optimistic expectations.
“Time for the Ukrainian economy to take off as inflation has stabilized with minimal budget deficit & strict monetary policy. The hryvnia exchange rate has risen as desired to keep labour in Ukraine. Finally, we see reasonable growth, but property rights must be secured,” Anders Aslund, economist and a Senior Fellow at the Atlantic Council, said in a tweet.
The strong gain was driven by a bumper grain harvest and soaring grain exports that allowed Ukraine to overtake Russia as the biggest exporter of grain in the world for the first time in three years.
Rising consumption and slowly recovering income levels also contributed to growth, as the economy stabilises after collapsing in 2015-2016.
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The 4.6% growth was well ahead of the 2.7% Reuters consensus for growth and was also up strongly on the 2.5%% growth in the first quarter. The country's real GDP in the second quarter of 2019 (taking into account the seasonal factor) increased by 1.6% quarter-on-quarter.
Although Ukraine’s economy is recovering from its recent crisis, it has been growing well below potential and should have grown faster given the depth of its previous fall.
The strong results will add to the growing optimism
that has come with the election of Ukrainian president Volodymyr Zelenskiy and his Servant of the People (SOTP) party that both won landslide victories this year on the promise of change.
If Zelenskiy is lucky then the increased optimism will start a virtuous circle of investment-profits-pay rises-consumption turning that drove Russia’s boom years in the noughties and allow Ukraine to final capture some of its “catch-up” potential. Ukraine is the only major country in the Former Soviet Union