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By the end of the first quarter of 2026, the execution of the state budget had deteriorated markedly. A slowdown in budget execution was observed in both the republican and local budgets. At the same time, local budget revenues, unlike those at the republican level, continued to exceed planned targets. The most significant weakening in execution was recorded for corporate income tax (CIT) and value-added tax (VAT) revenues. Transfers from the National Fund to the republican budget, despite increasing in nominal terms, remained substantially below planned levels.
The foreign currency assets of the National Fund have decreased. In March, pressure on global stock markets intensified amid the escalating conflict in the Middle East. This negatively affected the valuation of the National Fund's foreign currency assets. Furthermore, in the first three months of 2026, total inflows to the Fund (excluding investment income) equaled the amount of funds withdrawn from the National Fund.
In January – March 2026, economic activity demonstrated recovery following a deep decline in January. This rebound was primarily driven by the construction, trade, and manufacturing sectors. At the same time, a substantial decrease in oil production persists, which has adversely affected mining output and cargo turnover. However, Kazakhstan continued to exceed its OPEC+ quotas. Risks of further overproduction relative to Kazakhstan's commitments under the OPEC+ agreements are intensifying.
Fixed capital investment is showing growth. Own funds serve as the primary source of investment, while the contribution of budget funds, which had dominated in the first half of 2025, remains negative. Weak signs of change regarding the role of bank lending continue to be observed.
Foreign trade turnover maintains positive dynamics due to the simultaneous growth of exports and imports. Meanwhile, divergent dynamics are noted in mutual trade with Russia: a reduction in export is occurring alongside double-digit growth in import volumes. The shock in oil production has not yet been reflected in export statistics.
Read more in the Socio-Economic Development Review.
