Kazakhstan • 14 May, 2020

Non-oil deficit to be gradually reduced

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Pursuant to the instructions of the Head of State, an additional 125 billion tenge is provided for anti-epidemiological measures as part of the budget refinement for 2020. This was announced at an online briefing in the Government of Kazakhstan by the First Deputy Prime Minister – Minister of Finance Alikhan Smailov, primeminister.kz says.

In updating the republican budget for 2020, the non-oil deficit was increased from 7% of GDP to 10.8% of GDP. The factor of this growth was the increase in guaranteed transfer from the National Fund.

“This is a one-time action, we adhere to the concept of the need for savings in the National Fund. The government will take measures to reduce this guaranteed transfer from the National Fund,” Smailov said.

Moreover, he explained that the use of funds from the National Fund in 2020 was a necessary measure.

“Since the crisis that is currently experiencing not only Kazakhstan, but the whole world, is larger and deeper than all the crises that we experienced during the years of our independence. We are currently working to increase our budget revenues for the next three years, optimize and reduce budget expenditures. To reduce the non-oil deficit, we plan to reduce its level by half by 2023 — to 5.3% of GDP,” the minister said.

The government has planned work to gradually reduce the non-oil deficit.

“We planned before the end of the year the price of oil at $20 per barrel. This means that we do not plan any revenues from the oil sector. Next year, the price of oil will not be much higher than this value. This means that the Government will not rely on oil revenues in its work, but will work to increase the tax base in the non-oil sector,” Smailov emphasized.

It is worth noting that as part of the budget refinement for anti-epidemiological measures, an additional 125 billion tenge is provided, of which:

  • 40.6 billion tenge — to stimulate health care workers involved in quarantine activities.
  • 19.5 billion tenge — payment for medical services to medical organizations for the treatment of people with coronavirus infection and people hospitalized with suspicion, as well as for the purpose of isolation with suspected contact with patients with a new coronavirus infection COVID-19;
  • 14.8 billion tenge — for the construction of 3 quarantine-type medical module complexes in the cities. Nur-Sultan, Shymkent and Almaty for a total of 680 beds;
  • 30.8 billion tenge — for the provision of food and household sets to certain categories of the population (recipients of targeted social assistance, including children from 6 to 18 years old, disabled people of 1-3 groups, disabled children, persons engaged in caring for a disabled child, officially registered unemployed) for the period of emergency.
  • 8.1 billion tenge — for the payment of bonuses to employees and medical workers of the internal affairs bodies, military personnel of the National Guard and Armed forces in the amount of 1 official salary (about 66.3 thousand people will be covered);
  • 4 billion tenge — to provide communication services and the functioning of interdepartmental information systems;
  • 1.3 billion tenge — for the purchase of food and special property, as well as property for equipping a tent camp and ensuring security at checkpoints and equipping a tent camp;
  • 225 million tenge — for the acquisition of thermal imagers;
  • 200 million tenge — to conduct outreach in the framework of the fight against coronavirus infection.
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