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Kazakhstan’s current account deficit narrows by nearly 10 times

3 January 2019 12:58

ALMATY. KAZINFORM - In the third quarter of 2018, Kazakhstan's current account had a surplus of $0.2 billion, for the first time since 2014, Kazinform correspondent cites the financial regulator's press service.

"In total, for the first 9 months of 2018, the current account deficit narrowed by almost 10 times year-on-year from $4.6 billion to $0.5 billion. This indicates that the country's economic situation has improved," the press-service of the National Bank of the Republic of Kazakhstan said.

The National Bank's representatives explained that the improvement in the current account in the first 9 months of 2018 was due to a 64-percent increase in the trade surplus amid the favorable situation in the global commodity markets.

"Exports of goods increased by 28.3 pct to $45.4 billion, whereas imports of goods grew by just 9.6 pct to $25.5 billion," they added.

The export revenue increase resulted in a rise in revenues of foreign direct investors by 31.8 pct to $16.1 billion, which slowed down the improvement of the current account. However, more than 60 percent of these revenues were used to finance subsidiaries in Kazakhstan, the press service informed.

As for the financial account, a net capital outflow of $1.7 billion was attributable to a decrease in residents' liabilities, which was partially offset by a decline in their foreign assets. Regarding direct investments, net inflow reached $4.9 billion.

At the same time, as for portfolio investments, a $3 billion net capital outflow was due to a decrease in residents' liabilities due to the redemption of previously issued Eurobonds, the repurchase of shares and global depositary receipts by KazMunayGas Exploration Production JSC, and the purchase of the Kazakh Finance Ministry's Eurobonds in the secondary market by residents.