Fitch affirms rating of Republic of Kazakhstan at "BBB"; outlook "Stable"

/Fitch Ratings, London, 17.05.24, heading by KASE/ – Fitch Ratings has affirmed Kazakhstan's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BBB' with a Stable Outlook. A full list of rating actions is at the end of this rating action commentary. KEY RATING DRIVERS Fundamental Rating Factors Stable: Kazakhstan's 'BBB' IDRs reflect very strong sovereign external and fiscal balance sheets that have been resilient to shocks, and financing flexibility underpinned by accumulated oil revenue savings. Set against these are its very high dependence on commodities, export concentration risk, high inflation, which partly reflects a less developed macroeconomic policy framework relative to 'BBB' peers, and weak governance indicators. Very Large External Buffer: Kazakhstan's official international reserves rose by USD1.6 billion in the year to end-March, to USD37.8 billion, and foreign-currency assets of the National Fund for Republic of Kazakhstan (NFRK) by USD2.3 billion, to USD60.7 billion (combined equivalent to 36% of GDP). This is despite the current account/GDP weakening 6.4pp in 2023, to a deficit of 3.3%, on less favourable terms-of-trade, and strong import growth, fuelled by higher investment. The sovereign net foreign asset position, at 30% of GDP, is the third highest in the 'BBB' category, and the external liquidity ratio, at 187%, also compares favourably with the peer group median of 128%. * The full version of the press release is available on Fitch Ratings's website. [2024-05-20]