The leader of the top 10 largest countries by nominal GDP is the US. Its GWP share is 24.67%. The following country-leaders are China and Japan with GWP shares of 14.90% and 6.56% respectively. Four of the EU countries, which are Germany, the UK, France and Italy account for 4.61%, 3.49%, 3.27% and 2.46% of GWP. India with the share of 3.00% is the seventh in ranking. Brazil (2.39%) and Canada (2.03%) are at the bottom of the top 10 ranking. Altogether, 10 leading global economies hold the major part of GWP “pie” – almost 70%, 67.38% to be exact (Fig. 1).
The EU countries, including four countries that are in the top 10, has the significant share of 21.80% of the total GWP (Fig. 2).
The CIS countries hold 2.28% of the GWA (Fig. 2). Russia takes 75% of the total GDP across the CIS countries; consequently, its GWP share is the largest among the CIS countries – 1.70% (Tab. 1). Kazakhstan’s nominal GDP in 2016 amounted to US$ 133.8, according to IMF’s estimates. It is the largest GDP, after Russia, among the CIS countries. Kazakhstan holds 7.79% of the total GDP of the CIS, and 0.18% of GWP, which is 0.06% more than Ukraine that follows Kazakhstan in the list (Tab. 1).
in the IMF’s ranking
in US$ billion
|The share in the total GDP of the CIS, in %||The share in the total GWP, in %|
|Total, the CIS||1,717||100.00%||2.28%|
Source: RA RFCA, IMF
The fact that Kazakhstan has the higher share of the nominal GDP compared to other CIS countries, except Russia, is the positive one, but the share is insignificant in terms of the World. Let us have a deeper look on the GDP of Kazakhstan and its components, according to the available data for 2016.
The volume of gross domestic product (GDP) of Kazakhstan in 2016 amounted to KZT 47 trillion (US$ 137 billion), an increase of 14.9% compared to 2015 (Fig. 3). That growth was quite significant, but the largest growth was in 2013, when GDP increased by 16.1% since 2012. The smallest growth of 3.0% was in 2015 compared to 2014. Average growth of the national GDP over the observed period of past 5 years is 10.8%.
Since the gross value added (GVA) is the measure of value of goods and services produced in the country net of the intermediate consumption, it is worth to consider this indicator in combination with GDP. According to data for 2016, total GVA of goods and services produced in Kazakhstan amounted to KZT 45 trillion (US$ 130 billion) that is 14.3% more than in 2015 (Fig. 3). Correspondent to GDP’s dynamics, the largest GVA growth (+15.3%) was in 2013 compared to 2012, and the smallest (+5.8%) was in 2015 compared to 2014. The average GVA growth rate for the period of 2011-2016 is 11.5% – slightly higher (by 0.7%) than GDP’s.
Figure 3. Volumes of GDP (by the production method), GVA and its components for 2011-2016, in KZT billion.
Source: RA RFCA, Committee on statistics MNE of RK
According to the Committee on statistics under the Ministry of national economy of the Republic of Kazakhstan (Committee on statistics MNE of RK), as of 1 January 2016, in the structure of GDP of Kazakhstan (by production method) the major “piece” of the “pie” belongs to production of services – its share is 57.9% (Fig. 4). In comparison to 2015, the share decreased by 1.4%. Production of goods has the share of 36.5% that is 0.9% up since 2015. The share of net taxes on products is 5.6% – slightly up by 0.5% since 2015. In our opinion, that kind of the distribution of production of goods and services in the structure of national GDP uncovers the main problem of the economy of Kazakhstan – industry of the country is still underdeveloped. It would be much better if the production of goods reached at least 50% share in national GDP.
Production of goods in 2016 generated KZT 17 trillion (US$ 50 billion) in GVA (Fig. 3), representing almost 40% (-1.2% compared to 2015) of the economy (Fig. 5). Production of services contributed over 60% (-1.2% compared to 2015) to total GVA 2016 (Fig. 5), which amounted to KZT 27 trillion (US$ 79 billion) in value terms (Fig. 3).
The analysis of the structure of GVA by different types of activities inside of the two main groups for 2016 demonstrated that the largest contribution is made by the industry sector – KZT 12 trillion (US$ 36 billion) in value terms (+20.6% compared to 2015) and 27.7% as a share of the total GVA (Fig. 6). However, it did not help the total production of goods to get a larger share than it has – 38.7% (Fig. 5). The next largest share belongs to “wholesale and retail trade; repair of motor vehicles and motorcycles” – 17.8% (Fig. 7). That stands for KZT 8 trillion (US$ 23 billion) in value terms. Real estate activities account for 9.2% of total GVA that is the third largest share among all activities related to production of goods and production of services (Fig. 7). It amounts to KZT 4 trillion (US$ 12 billion) in value terms. Despite the industry, the following two activities comprise the group of production of goods, according to General Classifier of Economic Activities of RK (GCEA of RK) of the Committee on Statistics MNE of RK: agriculture, forestry, fishery, and a construction. Each of them accounts for 4.8% and 6.2% respectively, as of 1 January 2017 (Fig. 4). In value terms, agriculture, forestry and fishery activities generated KZT 2 trillion (US$ 6 billion) (+11.1% compared to 2015)
and KZT 3 trillion (US $ 8 billion) (+12.7% compared to 2015) in 2016.
Figure 7. Share of different types of service activities to total GVA, 2016, in percent
*Full name of the activity type – “Wholesale and retail trade; repair of motor vehicles and motorcycles”
Source: RA RFCA, Committee on statistics MNE of RK
In spite of aforementioned types of service activities – leaders by their shares to GVA, there are such types of service activities like transportation and storage, professional, scientific and technical activities, as well as financial and insurance activities, which also have comparably significant shares of 8.7%, 5.3% and 3.8% respectively. Human health and social activities, as well as the education contribute only 2.0% and 3.0% to GVA of the country (Fig. 7).
So far, production of services in Kazakhstan does the bigger contribution to the economy of the country than the production of goods. The distribution of their weights in GDP of the country is approximately 60% to 40%. However, the fact that the services’ sphere is prevailed in the economy is not as negative as it can seem from the first sight. World’s largest economies show the similar distribution of weights between services and goods’ production spheres. For example, in 2015 the UK’s service sector accounted for 80% of economic output, while the production of goods – for 13% (www.parliament.uk). In Germany the service sector contributed around 70% of the total GDP, industry 29.1%, and agriculture 0.9%, according to data for 2016 (Statischtisches Bundesamt).
IMF projects Kazakhstan’s GDP to reach US$ 158.0 billion, which may lift it up by one or two positions in IMF’s ranking. The growth of national GDP is welcome in perspective, as well as the growth of the industrial, construction and agricultural sectors, which have not been expanded as much as desired in our country yet.
So far, according to IMF’s predictions, Kazakhstan’s nominal GDP may reach the volume of KZT 50.9 trillion (estimated at average exchange rate for 2017). We almost agree with IMF and predict national GDP’s growth until KZT 50.5 trillion (US$ 157.0 billion). The nominal GDP for the 1st half of 2017 is KZT 20.9 trillion (US$ 65.0 billion). The production of goods for the same period is KZT 7.6 trillion (US$ 23.7 billion). The production of services is KZT 11.8 trillion (US$ 36.6 billion). Total GVA is KZT 19.4 trillion (US$ 60.3 billion). For the year 2017 we forecast production of goods and production of services in Kazakhstan to reach the levels of KZT 17.7 trillion (US$ 55.1 billion) and KZT 29.7 trillion (US$ 92.1 billion) respectively. They may comprise the total GVA of KZT 47.4 trillion (US$ 147.2 billion) in 2017. This means net taxes may grow up until KZT 3.2 billion (US$ 9.8 billion). The above forecast is relevant under the condition of the current economic state.
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 GWP = total global gross domestic product (total global GDP).
 According to the official website of the EU, “for the time being, the United Kingdom remains a full member of the EU and rights and obligations continue to fully apply in and to the UK”.
 The method implies the summation of GVA by industry, and calculation of GDP at market prices, which means, it includes net taxes on products and imports.
 According to the Committee on Statistics MNE of RK, name of the group, which comprises service activities.
 According to the Committee on Statistics MNE of RK, name of the group, which comprises activities related to production of goods.
 Net taxes on products are taxes on products minus subsidies on products.
 Production of goods and production of services.
 According to General Classifier of Economic Activities of RK (03-2007, actualized on 06.04.2016). Committee on Statistics MNE of RK.