SEOUL, July 10 (AJP) - Kazakhstan's economy is set to keep growing at a steady pace over the next two years even as the Asian Development Bank trims forecasts for much of the surrounding region, according to the bank's Asian Development Outlook released this week.
The Asian Development Bank kept its projections for Kazakhstan unchanged in the July edition of the report, with gross domestic product expected to expand 4.8 percent in 2026 and 4.5 percent in 2027. The economy grew 6.5 percent in 2025, lifted by a surge in oil output after the expansion of the Tengiz field, Kazakhstan's largest, came online ahead of schedule.
The unchanged outlook stands out in a subregion where the bank lowered several forecasts. The Asian Development Bank (ADB) cut its 2026 projections for Armenia, Turkiye and Turkmenistan, citing Russian trade restrictions, weak first-quarter growth and the higher cost of rerouting trade around Iran. Forecasts for Kazakhstan, Azerbaijan, Georgia, the Kyrgyz Republic, Tajikistan and Uzbekistan were left untouched for both years.
The wider region is under strain. The ADB projects developing Asia and the Pacific, a grouping of 43 economies that excludes Japan, South Korea and Singapore, will grow 4.9 percent in 2026, below the 5.1 percent it forecast in April. The bank blamed the conflict in the Middle East, saying it has caused prolonged disruption to energy markets and supply chains, raised production costs and dampened economic activity. Growth is expected to recover to 5.1 percent in 2027.
Kazakhstan's expansion is slowing from last year's pace for reasons the bank flagged in April. Oil production is running near capacity after the Tengiz ramp-up, leaving little room for further gains, while tighter lending conditions, higher taxes and slower real income growth are expected to cool private spending. Government investment continues to support activity.
Inflation remains the country's main weak spot. The ADB expects consumer prices to rise 10.4 percent in 2026 before easing to 9.5 percent in 2027, down from 11.4 percent in 2025 but still among the highest rates in Central Asia. The bank attributed the pressure partly to government-regulated utility tariff increases and a new tax code that raised value-added tax, prompting businesses and consumers to bring purchases forward.
Across the Caucasus and Central and West Asia, the ADB revised its 2026 inflation forecast up to 22.0 percent, a figure driven largely by Turkiye, as the Middle East crisis slows disinflation and pushes fuel prices higher across the subregion.
The report warned that the projections carry elevated uncertainty. The main risks to the regional outlook include renewed geopolitical tensions, tighter global financial conditions, higher commodity prices and trade uncertainty, the ADB said.
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