The latest Regional Economic Prospects (REP) report released by the European Bank for Reconstruction and Development (EBRD) anticipates a moderation in growth for Central Asian economies in 2024, with an expected growth rate of 5.4 percent, followed by a rebound to 5.9 percent in 2025, as reported by the EBRD press service. While intermediated trade with Russia, a significant growth driver in 2023, has plateaued, severe floods in Kazakhstan and Mongolia are expected to temporarily dampen growth. Nonetheless, the outlook for the region remains positive for both 2024 and 2025. Over the past two years, Central Asia has witnessed substantial increases in investment in transport, logistics, and export-oriented manufacturing capacities, alongside robust growth in wages, real incomes, and tourism.
Inflation has receded to single-digit levels, allowing central banks to prioritize growth and adopt softer monetary policies. Looking ahead, the REP report highlights the need for urgent infrastructure improvements, tariff reforms, and regional agreements on shared resources to sustain growth momentum. Kazakhstan's economy, the region's largest, has expanded primarily due to consumer demand and public spending, with GDP growth projected at 4.5 percent in 2024 and 5.5 percent in 2025. Uzbekistan's economy saw balanced growth in 2023, driven by credit expansion, remittances, and international arrivals, with GDP forecasted to grow by 6.5 percent in 2024 and 6.0 percent in 2025, supported by ongoing tariff reforms and market-oriented reforms, despite constraints posed by energy and water deficits.
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