The National Bank of Kazakhstan has raised its economic growth forecast for 2024-2025 to 4-5% per year from the previously expected 3.5-4.5%, the regulator said in a statement citing its updated macroeconomic forecasts.
This year, GDP growth is still expected to reach 4.2-5.2%.
“Forecasts for the growth of Kazakhstan’s economy in the medium term have been improved. The expansion of business activity will be driven by sustained domestic demand, increased budget expenditures and the recovery of the oil sector. (…) The risks to the GDP forecast are associated with possible problems of access to international markets for Kazakh exports, as well as the likelihood of not achieving the planned oil production,” the statement said.
In addition, the inflation forecast has been adjusted. In the short term, uncertainty about price growth has decreased. In the baseline scenario, inflation is projected to be in the range of 10-12% this year (previous forecast – 11-14%), 7.5-9.5% in 2024 (9-11%), and 5.5-7.5% in 2025 (corresponding to the previous forecast).
“At the same time, without taking into account the direct effect of the increase in utility tariffs, to which the NBU does not respond by changing the key policy rate, the medium-term inflation target of 5% is expected to be reached by the end of 2025. This will be facilitated by the further easing of pressure from the external environment and monetary conditions that are in the restraining zone,” the statement said.
The main risks to the inflation forecast, according to the National Bank, include increased fiscal stimulus, “unanchored inflation expectations,” accelerating inflation in Russia and a possible rise in world food prices due to the failure to renew the grain initiative. Another risk in the forecast is the continuation of pricing reforms in the Kazakh fuel and lubricants market.
Kazakhstan’s economy grew by 3.1% in 2022, with inflation at 20.3%.
For more information on macroeconomics, please see the analytical programs of the Expert Club at https://youtu.be/zCJ1cU3n0sY?si=zfnGIkt5zdhX_j3x
Data from local authorities show that seven people have died and 113 hospitalized in Polish Rzeszów, which is about 100 km from the border with Ukraine, due to legionellosis (Legionnaires’ disease), Bloomberg reports.
Authorities in Rzeszów are conducting tests to find out the source of the outbreak, with results expected on Monday, regional government head Ewa Leniart told Poland’s RMF radio.
She said the contamination is believed to be caused by water in the water supply system and the situation is under control.
At the same time, it is pointed out that Poland’s Internal Security Agency (ABW) is checking whether the outbreak of legionellosis in Rzeszów could have been a sabotage, given the city’s role as a transit center for supplies to Ukraine. Such actions are aimed at ruling out any external influences that could lead to the spread of the disease, Poland’s deputy minister-coordinator of special services Stanislaw Jarin said on Twitter.
Legionellosis (Legionnaires’ disease) is an acute infectious disease caused by various types of microorganisms, which affects lung tissues and is characterized by the development of a severe form of pneumonia. According to the OIE, the most common form of transmission is inhalation of infected water splashes.
The Ministry of Justice of Ukraine reports that in the first half of 2023, Ukrainians most often named girls Anastasia, Victoria, Daria, Eva, Zlata, Kateryna, Myroslava, Maria, Sofia, and Solomia.
The Facebook page also reports that in the first half of 2023, the most popular male names were Andrii, Bohdan, Volodymyr, Vasyl, Danylo, Ivan, Matvii, Mykola, Oleksandr, and Yaroslav.
Unika Insurance Company (Kyiv), a member of the non-banking financial group Unika Ukraine, whose shareholder is UNIQA Group (Austria), increased its premium collection by 28% to UAH 1.607 billion in January-June 2023, the company’s website reports.
The largest increase was in hull insurance – +42%, up to UAH 440 million, and voluntary health insurance – +75%, up to UAH 614 million.
It is also noted that according to the results of the first half of the year, the share of premiums in motor insurance in the IC is 36%, property – 14% and personal – 50% of the portfolio.
The amount of insurance payments for the first two quarters of 2020 amounted to UAH 672.7 million.
The company’s insurance reserves as of June 30, 2023 amount to UAH 2.38 billion. The assets accepted to cover insurance reserves exceed the amount of insurance reserves by 83% and amount to UAH 4.34 billion.
The actual solvency margin of Uniqa Insurance Company amounts to UAH 1.462 billion and exceeds the regulatory one by 183%. The insurer’s equity capital is UAH 1.508 billion.
During the reporting period, Unika’s medical assistance department processed more than 733 thousand claims, and more than 92 thousand were processed by technical assistance.
UNIQA Group entered the Ukrainian market in 2006. Uniqa Ukraine currently includes Uniqa and Uniqa Life companies.
The Group is one of the leading insurance groups in its core markets in Austria, Central and Eastern Europe.
The YouTube channel “Experts Club” has published a new video in which the founder of this think tank, Maksym Urakin, provides his analysis of Ukraine’s macroeconomic indicators and the state of the global economy in the first half of 2023.
Demographic indicators of Ukraine
Speaking about the demographic factor in the development of the Ukrainian economy, the expert cited data from the Opendatabot portal, which shows that the birth rate in the country continues to decline. According to these data, about 97 thousand children were born in the first half of 2023, which is 28% less than in the same period of 2021.
“The birth rate has been declining by about 7% annually since 2013. However, the full-scale war has aggravated the situation, causing the largest crisis in natural population growth. The demography of our country continues to be under pressure due to the current circumstances,” said Maksym Urakin.
According to him, in the first half of 2023, the number of marriages fell by 17% compared to the same period last year, while the number of divorces increased by a third, especially in Kyiv.
Economic recovery
Turning to the macroeconomic sphere, the economist emphasized that the Ukrainian economy has started to show signs of recovery.
“According to the NBU, Ukraine’s economy grew by 18.3% in the second quarter relative to the same period last year. This growth is relative to the period of the greatest decline at the beginning of the war.”, – said the founder of the club of experts.
Nevertheless, Maxim Urakin expressed concerns about the long-term outlook.
“Despite the current positive trend, the main risk for the Ukrainian economy continues to be related to the duration and intensity of the war. This may complicate the recovery, as well as cause problems with inflation and currency exchange rate,” Urakin noted.
According to him, the main negative factors affecting economic activity are a decrease or instability of international aid, as well as possible further destruction of energy infrastructure and problems with electricity supply in the fall and winter period.
Analysis of Ukraine’s foreign trade
Maxim Urakin also drew attention to the factor of growth of the negative balance of foreign trade, which has been noted since the beginning of the war.
“The country’s negative foreign trade balance continues to grow, reaching $9 billion in the first five months of this year, according to Gosstat estimates. This suggests that Ukraine is spending more currency on importing goods than it earns from exporting them. We see a sharp drop in exports of mineral products by 39.3%, ferrous and non-ferrous metals by 21.4%, wood and wood products by 17.7%, machinery products by 18.2%, chemical industry by 21.4% and other industrial goods by 4.1%,” – said the candidate of economic sciences.
However, not all the news in this sphere was pessimistic. Urakin emphasized the growth of food exports by 9.9%, which indicates the potential of the Ukrainian agro-industrial complex, which will probably become one of the main drivers of the country’s economic recovery in the coming years.
As for the balance of foreign trade in services, although still negative, the pace of its reduction gave some grounds for optimism.
“We see that the deficit of foreign trade in services is shrinking, which may indicate a gradual recovery of some service sectors in Ukraine,” the expert concluded.
Ukraine’s financial situation in 2023
However, equally important aspects of the economy, according to the expert, are government debt, international reserves and inflation.
“The country’s public debt continues to increase its volume. By the middle of 2023 he Ukraine approached the mark of 140 billion dollars. At the same time, the International Monetary Fund (IMF) has adjusted its forecasts on the level of the country’s public debt, reducing it from 98.3% of GDP to 88.1% of GDP. Despite this ‘positive’ realistic revision, this level of debt represents a significant burden for the national economy,” Maxim Urakin said.
The main source of financing of Ukraine’s budget, according to the expert, is still related to foreign aid.
“Half of the budget is financed by taxes and fees, while the rest comes from international grants and loans,” he emphasized.
Nevertheless, the country’s international reserves have shown positive dynamics.
“By August this year, Ukraine’s international reserves reached a record $41.72bn, which is 6.9% higher than the previous record. This increase is probably the result of active external financial support,” the analyst said.
As for inflation, it showed a slowdown. “After a record 27% inflation in 2022, this indicator fell to close to 4% in July this year,” Urakin noted.
Thus, the economic situation in Ukraine, according to the founder of the “Experts Club”, continues to be complex and multifaceted, requiring careful monitoring and adaptation of strategies in response to changing conditions.
World economy in 2023: analysis and forecasts
In the last presented studies of the “Experts Club” the economic situation in Ukraine was actively considered, however, according to Maxim Urakin, the dynamics of the world economy also has a significant impact on our country. According to the latest data, the world economy shows stable signs of growth, but there are also certain risks.
“The IMF has recently provided its forecasts for global economic growth. A growth of 3% is forecast for 2023 and the same is expected in 2024. The decisions taken by the US to resolve issues related to the level of public debt, as well as active actions in the US and Swiss banking sectors, have helped to reduce the immediate risks of a crisis in the global financial market. However, as the IMF emphasized, “the balance of risks remains tilted towards a possible deterioration of the economic situation at the global level,” the economist explained.
Inflation continues to be in the center of experts’ attention. Although the IMF lowered its inflation forecast for the current year to 6.8%, expectations for 2024 were adjusted upward.
Based on this information, Maxim Urakin concludes that the global economy is on the way to stabilization, but the situation remains ambiguous due to a number of uncertain factors. It is important for countries and their economies interacting in the global market to monitor changes and prepare for possible challenges.
Economic development in individual countries
According to the founder of the “Experts Club”, the global economy in 2023 is showing mixed results. While some countries are overcoming the effects of the pandemic and are on the path to stable growth, others are facing challenges from internal and external factors.
“The U.S. economy exceeded expectations, posting above-forecast growth. Meanwhile, consumer spending and government spending also showed solid growth, but residential investment continues to decline. China, which is on the road to recovery from the pandemic, showed strong economic growth, although the construction industry continues to experience a crisis. The Eurozone has shown moderate growth, with the region’s largest economy, Germany, facing recession. At the same time, the UK and Japan have positive adjustments to their GDP forecasts. India continues to strengthen its economic position, showing dynamic growth. Meanwhile, Brazil, although showing growth in the current year, expects a decline by 2024,” summarized the expert.
For more details on the situation in the Ukrainian and global economy, see the video on the YouTube channel “Club of Experts” at the link:
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ECONOMICS, EXPERTS CLUB, MACROECONOMICS, REVIEW_OF_ECONOMICS, URAKIN, WORLD_ECONOMY
PJSC “Centrenergo” plans to import coal to pass the fall-winter period of 2023/2024, General Director Andriy Churkin said.
“Completely on our own coal we will not pass this winter. And in the near future, Centrenergo plans to sign contracts with foreign companies. There are already certain developments, I think that within a month there will be a result. We need to reach a volume of at least 80 thousand tons of coal per month,” he said in an interview with Interfax-Ukraine.
According to him, this would be a sufficient reserve, but the company is also preparing to work on gas and fuel oil.
“At Tripilska TPP, for example, there is an opportunity to work on fuel oil. We have already imported it, and I have already asked the technical directorate of the plant to make a trial run on this type of fuel,” Churkin said.
He specified that “the closest and most accessible for us is coal from Poland,” while the company buys fuel oil from PJSC Ukrnafta.
