GDP of Kazakhstan has grown by 1.7% in 1999, production - by 2.2% - Ministry of Finance

/IRBIS, Feb.09, 00/ - REUTERS cites the Ministry of Finance reference shown today at the government meeting. According to the provisional data of government, the gross domestic product (GDP) of Kazakhstan in 1999 has grown by 1.7% after its decrease by 2.5% in 1998. Commercial production in 1999 has grown by 2.2%, the consumer price index in December, 1999 has increased by 17.8% in comparison with December, 1998. The growth of GDP has been stipulated by increase in the industrial and agricultural production in the third and fourth quarters of the year. The growth in agriculture in 1999 has made 28.9%. In 1999 the gross gold-currency reserves of the National bank have grown by 2%, the net ones - by 17.7%. The higher growth net reserves is connected with the National bank liabilities reduction: the IMF credits Stand- by 1 including credit were paid off. Within the first half-year of 1999 the gross reserves decreased by 23.9%, the net reserves -by 29.2%, in the second half-year, due to stabilization in the exchange market and devaluation expectations decrease, their level has grown considerably: the gross reserves - by 34%, the net - by 66.2%. The main growth in the exchange reserves has been observed in the fourth quarter of the year, when the gross reserves has increased by 22, and net - by 36.5%. According to the Ministry of Finance it is connected to improvement of the foreign trade conditions by the end of a year, and also with the Eurobonds -2004 placement, privatization and World bank loans. It is stated also that the exchange reserves growth has caused a money base expansion. Within 1999 the money base has extended by 53.7% to 125.1 billion tenges. The money supply has increased in 1999 by 83.4% to 272.4 billion tenges, the maximum growth was in December (26.3%). A major factor of the money supply increase has become growth in the net external assets more than 2 times in tenge and by 48.4% in dollar equivalent) and growth in bank's credits by 51.3%. Share of the deposits has grown from 53.7% to 62.0% that has caused the multiplier increase to 2.18 from 1.82. In connection with redemption by the end of a year of the pensions and allowances indebtedness, the maximum money aggregates growth has appeared in the fourth quarter: the money base - on 47.6% (including in December - by 30.7%), money supply - by 38.1% (including in December - by 26.3%. As an example of the financial market stabilization the government considers refunding rate decrease by the National bank to 18% (since November 10) from 25% of n the beginning of 1999.