EBRD Lowers Kazakhstan’s 2025 Growth Forecast to 4.9%

Experts from the European Bank for Reconstruction and Development (EBRD) have revised their forecast for Kazakhstan's economic growth in 2025. While the previous projection was 5.2%, the updated estimate has been lowered to 4.9%, Orda.kz reports.

According to the EBRD’s May report, the downgrade is part of a broader adjustment. Kazakhstan is one of two countries for which forecasts were revised downward, the other being Mongolia. 

The report notes that the downward revision for Kazakhstan and Mongolia is primarily due to falling raw material prices. Kazakhstan’s economy remains highly dependent on commodity exports: oil and gas account for about 17% of GDP, metals and minerals at least 3%, and agricultural products around 2%.

The EBRD also addressed the potential effects of higher U.S. export tariffs. While the direct impact on Kazakhstan is expected to be limited due to preferential energy tariffs, the indirect consequences could be more significant if global demand for energy declines.

The direct impact on Kazakhstan is small, given the preferential tariffs for energy resources. However, indirect effects could be more serious if global demand for energy resources decreases and prices fall, the report states. 

Despite the revision, Kazakhstan started 2025 on a strong note.

Real GDP growth in the first quarter was driven by increased oil output at the Tengiz field. The EBRD estimates year-on-year growth at 8.3% — a figure even higher than the government's own projections. Still, analysts caution that Kazakhstan must navigate OPEC+ quotas and declining export demand, particularly from China.

The demand for Kazakhstan's oil, ore, copper and other export goods has decreased in China. This will negatively affect economic growth, since China remains the second largest export destination for Kazakhstan,the EBRD noted. 

Rising inflation and a tight monetary policy could also suppress domestic consumption. Planned tax reforms, including a VAT hike, are expected to add inflationary pressure. The EBRD believes growing budget revenues may reduce reliance on the National Fund.

In its final projection, the EBRD expects Kazakhstan’s GDP to grow by 4.9% in 2025 and 4.5% in 2026.

Original Author: Nikita Drobny