Abstract
2019 Article IV Consultation-Press Release; and Staff Report
Relations with the Fund
(As of October 31, 2019)
Membership status:
The Republic of Kazakhstan joined the IMF on July 15, 1992. It accepted the obligations of Article VIII, Sections 2, 3, and 4 in 1996.
General Resources Account:
| SDR Million | Percent of Quota | |
|---|---|---|
| Quota | 1,158.40 | 100.00 |
| Fund holdings of currency | 960.23 | 82.89 |
| Reserve position in the Fund | 198.18 | 17.11 |
| SDR Million | Percent of Quota | |
|---|---|---|
| Quota | 1,158.40 | 100.00 |
| Fund holdings of currency | 960.23 | 82.89 |
| Reserve position in the Fund | 198.18 | 17.11 |
SDR Department:
| SDR Million | Percent Allocation | |
|---|---|---|
| Net cumulative allocation | 343.65 | 100.00 |
| Holdings | 352.41 | 102.55 |
| SDR Million | Percent Allocation | |
|---|---|---|
| Net cumulative allocation | 343.65 | 100.00 |
| Holdings | 352.41 | 102.55 |
Outstanding Purchases and Loans: None
Latest Financial Arrangements (in millions of SDR):
| Type | Arrangement | Date | Amount Approved (SDR million) | Amount Drawn (SDR million) |
|---|---|---|---|---|
| EFF | 12/13/99 | 3/19/02 | 329.10 | 0.00 |
| EFF | 7/17/96 | 7/16/99 | 309.40 | 154.70 |
| Stand-By | 6/05/95 | 6/04/96 | 185.60 | 185.60 |
| Type | Arrangement | Date | Amount Approved (SDR million) | Amount Drawn (SDR million) |
|---|---|---|---|---|
| EFF | 12/13/99 | 3/19/02 | 329.10 | 0.00 |
| EFF | 7/17/96 | 7/16/99 | 309.40 | 154.70 |
| Stand-By | 6/05/95 | 6/04/96 | 185.60 | 185.60 |
Projected Payments to Fund: None
Safeguards Assessments: Not applicable.
Exchange Rate Arrangements: Kazakhstan’s de jure exchange rate arrangement is free floating, and its de facto exchange rate arrangement is classified as floating. Policy interventions by the National Bank of Kazakhstan (NBK) on the foreign exchange market are not systematic and are triggered exclusively by the need to smooth out sharp destabilizing fluctuations. The NBK started publishing monthly data on net foreign exchange interventions on a regular basis from 2016. Kazakhstan has accepted the obligations of Article VIII, Sections 2, 3, and 4, and maintains an exchange system free of restriction on the making of payments and transfers for current international transactions.
Article IV Consultation:
Kazakhstan is on the standard 12-month consultation cycle. The last consultation was concluded by the IMF Executive Board on September 12, 2018 (see IMF Country Report No. 18/277).
FSAP Participation and ROSCS:
Kazakhstan first participated in the Financial Sector Assessment Program (FSAP) in 2000. FSAP updates were conducted in 2004, 2008, and 2014, with the latest Financial Sector Stability Assessment issued in August 2014 (see IMF Country Report 14/258). A fiscal transparency ROSC report was published in 2003, and a report on the update of the data ROSC was published in 2008.
AML/CFT Assessment:
Kazakhstan’s AML/CFT framework has been assessed against the AML/CFT standard, the Financial Action Task Force (FATF) 40+9 Recommendations. The evaluation was conducted by the Eurasian Group on money laundering and financing of terrorism (EAG), the FATF-style regional body of which Kazakhstan is a member. The final mutual evaluation report was adopted in 2011. The report indicated that the main sources of criminal proceeds in Kazakhstan were crimes related to fraud and abuse of public office. The evaluators found that Kazakhstan had a relatively comprehensive AML/CFT framework in place, but that deficiencies remained, notably with respect to customer due diligence and reporting of suspicious transactions. Kazakhstan is tentatively scheduled to undergo its next AML/CFT assessment by the EAG in April 2020.
Technical Assistance and Training:
Kazakhstan has received IMF TA and training in all areas of economic policy during 1993–2019. The Fund has also provided resident or peripatetic advisors to the NBK, the Committee on Statistics, the Ministry of Finance, and the former Financial Supervision Agency. Other international agencies and governments also provide TA (e.g., the World Bank, EBRD, UNDP, ADB, OECD, USAID). The following summarizes Fund TA to Kazakhstan since 2010.
Monetary and Capital Markets Department
IMF TA has enabled progress in several monetary and capital markets areas, including monetary and exchange rate policy and operations, central bank accounting, payments system reform, central bank organization and management, banking legislation, banking supervision, statistics, and money-market development. Recent missions have included:
1. 2009–12: Bank stress testing—initial mission in 2009, followed by expert visits in 2009–12.
2. November 2010: Reducing nonperforming loans in the banking system (joint with LEG).
3. February 2013–14: Resolving problem assets, including posting of a long-term expert to the Problem Loans Fund (financed by the Japanese government).
4. November 2014: Enhancing the monetary policy framework.
5. March 2015: Liquidity forecasting.
6. March-April 2015: Enhancing the monetary policy framework.
7. June-July 2015: Modeling and forecasting.
8. August 2015: Monetary and exchange rate policy and operations.
9. November 2015: Monetary and exchange rate policy and operations.
10. June 2016: Monetary and exchange rate policy and operations.
11. July 2016: Banking issues.
12. April 2018: Management of distressed assets.
13. April 2018: Foreign exchange operations.
14. November 2018: Forecasting and Policy Analysis System.
15. August 2019: Forecasting and Policy Analysis System.
Fiscal Affairs Department
The IMF Fiscal Affairs Department has given advice to Kazakhstan in revenue administration and public financial management, including treasury operations, accounting, IT systems, and the introduction of a social safety net.
1. 2011–17: TA by IMF regional advisor on PFM issues.
2. May 2014: Fiscal risk management, IPSAS and accrual accounting.
3. September-October 2014: Accrual accounting and reporting for tax and customs revenues.
4. May-June 2015: Accrual budgeting and public-private partnership (PPP) issues.
5. April-May 2019: Accrual budgeting.
6. September 2019: Improving Tax Compliance Risk Management.
Statistics
1. April 2011: BOP statistics.
2. July 2013: Government finance statistics.
3. November 2014: Government finance statistics.
4. April 2015: Monetary and financial statistics.
5. June 2015: National accounts statistics.
6. August 2015: External sector statistics.
7. January 2017: National accounts statistics.
8. April 2018: Government finance statistics.
9. October 2018: National accounts statistics.
10. September 2019: Government finance statistics.
Legal Department
1. April 2010: Anti-money laundering and combating the financing of terrorism (jointly with the World Bank and United Nations Office on Drugs and Crime).
2. November 2010: Reducing nonperforming loans in the banking system (joint with MCM).
3. July 2011: Bankruptcy legislation.
Training
Officials from Kazakhstan have participated in IMF courses and workshops in Washington, at the Joint Vienna Institute, and in the region in macroeconomic management, monetary and exchange policy and operations, central bank communications, budgetary expenditure control, financial programming, taxation, and statistics.
Local Office
The IMF maintains a local office in Almaty.
Relations with Other International Financial Institutions
World Bank: https://www.worldbank.org/en/country/kazakhstan
European Bank for Reconstruction and Development: https://www.ebrd.com/kazakhstan.html
Asian Development Bank: https://www.adb.org/countries/kazakhstan/main
Statistical Issues
(As of November 2019)
| I. Assessment of Data Adequacy for Surveillance | |
| General: Data provision has some shortcomings, but is broadly adequate for surveillance. The most affected areas are the balance of payments and national accounts. | |
| National accounts: The Committee on Statistics (CS) under the Ministry of National Economy has made considerable progress in improving the statistical infrastructure and making the coverage of the business register more comprehensive. Annual estimates of the oil and gas sector are compiled and disseminated following international standards, but only in Russian. The CS also compiles quarterly GDP, but on a cumulative basis—instead of a discrete basis—and using “comparable prices” instead of fixed base or previous year prices. It is also in the process of updating the method used to compile volume movements for taxes on products used to construct movements in real GDP. Despite further progress being made on both issues prior to and following the most recent TA mission in October 2018, a target date to publish discrete quarterly GDP estimates by June 2019 was missed, partly due to staff turnover; further TA is scheduled (March 2020) to assist in pushing developments forward. | |
| Price statistics: Kazakhstan compiles consumer, producer, and import/export prices indices. The quality of the monthly consumer price index is affected by occasional use of administrative price controls. Typically, for each good or service administrative controls are imposed on the variety that is included in the CPI basket. Since producers/importers are not compensated by the government for any losses due to the price controls, they may switch to non-controlled varieties and/or compensate by increasing the prices of non-controlled varieties. | |
| Government finance statistics: While the nationally based budget data do not follow international standards, progress is gradually being made in the classification of the fiscal statistics to align with the Fund’s Government Finance Statistics Manual 2014 (GFSM 2014). The authorities have expanded coverage of data reported for the IMF government Finance Statistics Yearbook to include both the National Fund of the Republic of Kazakhstan, State Social Insurance Fund, and the Compulsory Health Insurance Fund. Consequently, the authorities are now able to report annual data for the consolidated general government, including a financial balance sheet. However, statistics on the enlarged government (including public enterprises) are not available. Classification of assets and liabilities does not fully comply with GFSM 2014. | |
| Monetary statistics: The National Bank of Kazakhstan (NBK) reports the Standardized Report Forms (SRFs) 1SR for the central bank and 2SR for other depository corporations (ODCs) on a monthly basis for publication in the IMF’s International Financial Statistics (IFS) with a lag of about one month. Following IMF TA, the NBK developed a framework for compiling SRF 4SR for other financial corporations (OFCs) and started publishing quarterly data from March 2015. While good progress has been made on data compilation and dissemination, more efforts are needed to address remaining inconsistencies in the reporting of inter-bank positions, which are due to the lack of information on the counterpart sector of certain transactions. Kazakhstan reports data on several indicators of the Financial Access Survey (FAS) including the two indicators (commercial bank branches per 100,000 adults and ATMs per 100,000 adults) adopted by the UN to monitor Target 8.10 of the Sustainable Development Goals (SDGs). | |
| Financial sector surveillance: Kazakhstan participates in the IMF’s Coordinated Direct Investment Survey (CDIS) and Coordinated Portfolio Investment Survey (CPIS). The country reports 34 financial soundness indicators (FSIs) for posting on the IMF’s FSI website on a quarterly basis—all 12 core FSIs and 11 of the 13 encouraged FSIs for deposit takers, and 11 encouraged FSIs for other sectors and markets (two FSIs for OFCs, four FSIs for nonfinancial corporations, two FSIs for households, and three FSIs for real estate markets). | |
| Balance of payments: The NBK is reporting quarterly BOP and IIP data in line with the sixth edition of the IMF Balance of Payments Statistics Manual (BPM6) and the Reserves Template. It also participates in the World Bank’s Quarterly External Debt Statistics (QEDS). A new Law on Currency regulation and Currency Control, adopted in July 2018, changes the status of branches and representative offices of foreign companies from nonresident to resident and introduces stronger reporting requirements for financial transactions. In external debt statistics, there are discrepancies between data compiled by different governmental agencies owing to methodological differences, including coverage of external debt of publicly-owned corporations. The authorities are cooperating with relevant agencies in the ECU partner countries to resolve these problems. | |
| II. Data Standards and Quality | |
| Kazakhstan has subscribed to the Special Data Dissemination Standard (SDDS) since March 2003. | Data ROSC published in 2008. |
| I. Assessment of Data Adequacy for Surveillance | |
| General: Data provision has some shortcomings, but is broadly adequate for surveillance. The most affected areas are the balance of payments and national accounts. | |
| National accounts: The Committee on Statistics (CS) under the Ministry of National Economy has made considerable progress in improving the statistical infrastructure and making the coverage of the business register more comprehensive. Annual estimates of the oil and gas sector are compiled and disseminated following international standards, but only in Russian. The CS also compiles quarterly GDP, but on a cumulative basis—instead of a discrete basis—and using “comparable prices” instead of fixed base or previous year prices. It is also in the process of updating the method used to compile volume movements for taxes on products used to construct movements in real GDP. Despite further progress being made on both issues prior to and following the most recent TA mission in October 2018, a target date to publish discrete quarterly GDP estimates by June 2019 was missed, partly due to staff turnover; further TA is scheduled (March 2020) to assist in pushing developments forward. | |
| Price statistics: Kazakhstan compiles consumer, producer, and import/export prices indices. The quality of the monthly consumer price index is affected by occasional use of administrative price controls. Typically, for each good or service administrative controls are imposed on the variety that is included in the CPI basket. Since producers/importers are not compensated by the government for any losses due to the price controls, they may switch to non-controlled varieties and/or compensate by increasing the prices of non-controlled varieties. | |
| Government finance statistics: While the nationally based budget data do not follow international standards, progress is gradually being made in the classification of the fiscal statistics to align with the Fund’s Government Finance Statistics Manual 2014 (GFSM 2014). The authorities have expanded coverage of data reported for the IMF government Finance Statistics Yearbook to include both the National Fund of the Republic of Kazakhstan, State Social Insurance Fund, and the Compulsory Health Insurance Fund. Consequently, the authorities are now able to report annual data for the consolidated general government, including a financial balance sheet. However, statistics on the enlarged government (including public enterprises) are not available. Classification of assets and liabilities does not fully comply with GFSM 2014. | |
| Monetary statistics: The National Bank of Kazakhstan (NBK) reports the Standardized Report Forms (SRFs) 1SR for the central bank and 2SR for other depository corporations (ODCs) on a monthly basis for publication in the IMF’s International Financial Statistics (IFS) with a lag of about one month. Following IMF TA, the NBK developed a framework for compiling SRF 4SR for other financial corporations (OFCs) and started publishing quarterly data from March 2015. While good progress has been made on data compilation and dissemination, more efforts are needed to address remaining inconsistencies in the reporting of inter-bank positions, which are due to the lack of information on the counterpart sector of certain transactions. Kazakhstan reports data on several indicators of the Financial Access Survey (FAS) including the two indicators (commercial bank branches per 100,000 adults and ATMs per 100,000 adults) adopted by the UN to monitor Target 8.10 of the Sustainable Development Goals (SDGs). | |
| Financial sector surveillance: Kazakhstan participates in the IMF’s Coordinated Direct Investment Survey (CDIS) and Coordinated Portfolio Investment Survey (CPIS). The country reports 34 financial soundness indicators (FSIs) for posting on the IMF’s FSI website on a quarterly basis—all 12 core FSIs and 11 of the 13 encouraged FSIs for deposit takers, and 11 encouraged FSIs for other sectors and markets (two FSIs for OFCs, four FSIs for nonfinancial corporations, two FSIs for households, and three FSIs for real estate markets). | |
| Balance of payments: The NBK is reporting quarterly BOP and IIP data in line with the sixth edition of the IMF Balance of Payments Statistics Manual (BPM6) and the Reserves Template. It also participates in the World Bank’s Quarterly External Debt Statistics (QEDS). A new Law on Currency regulation and Currency Control, adopted in July 2018, changes the status of branches and representative offices of foreign companies from nonresident to resident and introduces stronger reporting requirements for financial transactions. In external debt statistics, there are discrepancies between data compiled by different governmental agencies owing to methodological differences, including coverage of external debt of publicly-owned corporations. The authorities are cooperating with relevant agencies in the ECU partner countries to resolve these problems. | |
| II. Data Standards and Quality | |
| Kazakhstan has subscribed to the Special Data Dissemination Standard (SDDS) since March 2003. | Data ROSC published in 2008. |
Kazakhstan: Table of Common Indicators Required for Surveillance
(As of November 29, 2019)
Any reserve assets that are pledged or otherwise encumbered should be specified separately. Also, data should comprise short-term liabilities linked to a foreign currency but settled by other means as well as the notional values of financial derivatives to pay and to receive foreign currency, including those linked to a foreign currency but settled by other means.
Both market-based and officially-determined, including discounts rates, money market rates, rates on treasury bills, notes, and bonds.
Foreign, domestic bank, and domestic nonbank financing.
The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.
Including currency and maturity composition.
Includes external gross financial asset and liability positions vis-à-vis nonresidents.
Daily (D); weekly (W); monthly (M); quarterly (Q); annually (A); irregular (I); and not available (NA).
Reflects the assessment provided in the update of the data ROSC published in February 2008, based on the findings of the mission that took place during November 29–December 13, 2006 for the dataset corresponding to the variable in each row. The assessment indicates whether international standards concerning concepts and definitions, scope, classification/sectorization, and basis for recording are fully observed (O); largely observed (LO); largely not observed (LNO); not observed (NO); and not available (NA).
Same as footnote 8, except referring to international standards concerning (respectively) source data, assessment of source data, statistical techniques, assessment and validation of intermediate data and statistical outputs, and revision studies.
Kazakhstan: Table of Common Indicators Required for Surveillance
(As of November 29, 2019)
| Date of latest observation | Date received | Frequency of Data7 | Frequency of Reporting7 | Frequency of publication7 | Memo Items | ||
|---|---|---|---|---|---|---|---|
| Data Quality-Methodological Soundness8 | Data Quality-Accuracy and Reliability9 | ||||||
| Exchange Rates | Nov/29/2019 | 11/29/2019 | D | D | D | ||
| International Reserve Assets and Reserve Liabilities of the Monetary Authorities1 | Oct/2019 | 11/29/2019 | M | M | M | ||
| Reserve/Base Money | Oct/2019 | 11/25/2019 | M | M | M | O, O, LO, LO | O, O, O, O, O |
| Broad Money | Oct/2019 | 11/25/2019 | M | M | M | ||
| Central Bank Balance Sheet | Oct/2019 | 11/29/2018 | M | M | M | ||
| Consolidated Balance Sheet of the Banking System | Oct/2019 | 11/25/2019 | M | M | M | ||
| Interest Rates2 | Oct/2019 | 11/25/2019 | M | M | M | ||
| Consumer Price Index | Oct/2019 | 11/4/2019 | M | M | M | O, O, O, O | O, O, LO, O, O |
| Revenue, Expenditure, Balance, and Composition of Financing3—General Government4 | 10/1/2019 | 10/30/2019 | M | M | M | O, LO, LO, LO | O, O, O, O, LNO |
| Revenue, Expenditure, Balance, and Composition of Financing3—Central Government | 10/1/2019 | 10/30/2019 | M | M | M | ||
| Stocks of Central Government and Central Government-Guaranteed Debt5 | 10/1/2019 | 10/25/2019 | M | M | M | ||
| External Current Account Balance | Q3/2019 | 11/8/2019 | Q | Q | Q | LO, O, O, O | O, O, O, O ,O |
| Exports and Imports of Goods and Services | Q3/2019 | 11/8/2019 | Q | Q | Q | ||
| GDP/GNP | Q3/2019 | 11/15/2019 | Q | Q | Q | O, O, O, LO | LO, O, LO, O, O |
| Gross External Debt | Q2/2019 | 9/30/2019 | Q | Q | Q | ||
| International Investment Position6 | Q2/2019 | 10/10/2019 | Q | Q | Q | ||
Any reserve assets that are pledged or otherwise encumbered should be specified separately. Also, data should comprise short-term liabilities linked to a foreign currency but settled by other means as well as the notional values of financial derivatives to pay and to receive foreign currency, including those linked to a foreign currency but settled by other means.
Both market-based and officially-determined, including discounts rates, money market rates, rates on treasury bills, notes, and bonds.
Foreign, domestic bank, and domestic nonbank financing.
The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.
Including currency and maturity composition.
Includes external gross financial asset and liability positions vis-à-vis nonresidents.
Daily (D); weekly (W); monthly (M); quarterly (Q); annually (A); irregular (I); and not available (NA).
Reflects the assessment provided in the update of the data ROSC published in February 2008, based on the findings of the mission that took place during November 29–December 13, 2006 for the dataset corresponding to the variable in each row. The assessment indicates whether international standards concerning concepts and definitions, scope, classification/sectorization, and basis for recording are fully observed (O); largely observed (LO); largely not observed (LNO); not observed (NO); and not available (NA).
Same as footnote 8, except referring to international standards concerning (respectively) source data, assessment of source data, statistical techniques, assessment and validation of intermediate data and statistical outputs, and revision studies.
Kazakhstan: Table of Common Indicators Required for Surveillance
(As of November 29, 2019)
| Date of latest observation | Date received | Frequency of Data7 | Frequency of Reporting7 | Frequency of publication7 | Memo Items | ||
|---|---|---|---|---|---|---|---|
| Data Quality-Methodological Soundness8 | Data Quality-Accuracy and Reliability9 | ||||||
| Exchange Rates | Nov/29/2019 | 11/29/2019 | D | D | D | ||
| International Reserve Assets and Reserve Liabilities of the Monetary Authorities1 | Oct/2019 | 11/29/2019 | M | M | M | ||
| Reserve/Base Money | Oct/2019 | 11/25/2019 | M | M | M | O, O, LO, LO | O, O, O, O, O |
| Broad Money | Oct/2019 | 11/25/2019 | M | M | M | ||
| Central Bank Balance Sheet | Oct/2019 | 11/29/2018 | M | M | M | ||
| Consolidated Balance Sheet of the Banking System | Oct/2019 | 11/25/2019 | M | M | M | ||
| Interest Rates2 | Oct/2019 | 11/25/2019 | M | M | M | ||
| Consumer Price Index | Oct/2019 | 11/4/2019 | M | M | M | O, O, O, O | O, O, LO, O, O |
| Revenue, Expenditure, Balance, and Composition of Financing3—General Government4 | 10/1/2019 | 10/30/2019 | M | M | M | O, LO, LO, LO | O, O, O, O, LNO |
| Revenue, Expenditure, Balance, and Composition of Financing3—Central Government | 10/1/2019 | 10/30/2019 | M | M | M | ||
| Stocks of Central Government and Central Government-Guaranteed Debt5 | 10/1/2019 | 10/25/2019 | M | M | M | ||
| External Current Account Balance | Q3/2019 | 11/8/2019 | Q | Q | Q | LO, O, O, O | O, O, O, O ,O |
| Exports and Imports of Goods and Services | Q3/2019 | 11/8/2019 | Q | Q | Q | ||
| GDP/GNP | Q3/2019 | 11/15/2019 | Q | Q | Q | O, O, O, LO | LO, O, LO, O, O |
| Gross External Debt | Q2/2019 | 9/30/2019 | Q | Q | Q | ||
| International Investment Position6 | Q2/2019 | 10/10/2019 | Q | Q | Q | ||
Any reserve assets that are pledged or otherwise encumbered should be specified separately. Also, data should comprise short-term liabilities linked to a foreign currency but settled by other means as well as the notional values of financial derivatives to pay and to receive foreign currency, including those linked to a foreign currency but settled by other means.
Both market-based and officially-determined, including discounts rates, money market rates, rates on treasury bills, notes, and bonds.
Foreign, domestic bank, and domestic nonbank financing.
The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.
Including currency and maturity composition.
Includes external gross financial asset and liability positions vis-à-vis nonresidents.
Daily (D); weekly (W); monthly (M); quarterly (Q); annually (A); irregular (I); and not available (NA).
Reflects the assessment provided in the update of the data ROSC published in February 2008, based on the findings of the mission that took place during November 29–December 13, 2006 for the dataset corresponding to the variable in each row. The assessment indicates whether international standards concerning concepts and definitions, scope, classification/sectorization, and basis for recording are fully observed (O); largely observed (LO); largely not observed (LNO); not observed (NO); and not available (NA).
Same as footnote 8, except referring to international standards concerning (respectively) source data, assessment of source data, statistical techniques, assessment and validation of intermediate data and statistical outputs, and revision studies.