Page 14 - Kazakh Outlook 2025

Yerlan Abdikarimov, director of the financial analysis department at Freedom Finance Global, commented in S&P Global’s recent manufacturing PMI report that November marked a significant improvement in business conditions and new orders in Kazakhstan's manufacturing sector, reaching record levels higher than those seen in August – when the manufacturing industry registered highest growth rate over the past five and a half years. This growth was driven by strong customer demand.
The manufacturing sector experienced rapid growth in production capacity, supported by increased procurement activities and workforce expansion, he added. However, the industry continues to face challenges, including logistical difficulties, rising costs of raw materials and supplies along with the substantial depreciation of the national currency.
Abdikarimov noted that despite the aforementioned hurdles, the sector remains optimistic about production growth in 2025, though expectations have moderated slightly compared to October.
According to official statistics, manufacturing sector output expanded by 5.3% y/y in the January-November period. Key areas showed strong performance, with metallurgy increasing by 7.2%, mechanical engineering by 6.9%, chemicals by 8.4% and pharmaceuticals by 21%. Food production rose by 2.1%, metal manufacturing surged by 29.5% and furniture production grew by 12.8%.
5.0 Budget and debt outlook
Kazakh President Kassym-Jomart Tokayev approved the 2025-2027 budget plan on December 4. The law indicates anticipated budget expenditures of KZT25.19 trillion ($3.2bn) in 2025, up by 7% y/y.
The plan projects revenues at KZT21.39 trillion in 2025, primarily driven by tax receipts of KZT15.19 trillion and transfers of KZT5.76 trillion.
The law projects a KZT4.1 trillion budget deficit (2.7% of GDP). Without oil revenues, this deficit would grow to KZT10.99 trillion or 7.3% of GDP. Many
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