The Asia Development bank (ADB) has improved growth prospects for the Central Asia region, according to the bank's supplement to its Asian Development Outlook 2017 report published July 20.
"Growth [in the Central Asia] is expected to reach 3.2 percent in 2017 and 3.8 percent in 2018 compared to the 3.1 percent and 3.5 percent original projections, respectively," the bank said.
The outlook for Central Asia has improved as stronger domestic demand and exports in some countries have fueled an unexpected recovery in the subregion driven by both domestic and external factors, said the report.
Reflecting the more favorable economic outlook for the subregion as a whole, inflation is now forecast to reach 8.1 percent in 2017, up from 7.8 percent in Asian Development Outlook 2017 published in April, before easing to 7.4 percent in 2018, slightly higher than the 7.3 percent earlier forecast, trend.az reports.
Central Asia comprises Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, Uzbekistan and Armenia, according to the ADB.
According to ADB, lower public investment and inflows of foreign direct investment will likely result in a more moderate growth in Turkmenistan next year. Kazakhstan, Central Asia's largest economy, enjoyed an unexpected economic upswing in the first quarter of 2017, with GDP growing by 3.6 percent.
Mining, manufacturing, and trade together contributed 2.1 percentage points to growth in the first quarter of 2017. Rising domestic demand reflected further growth in households' real incomes in the first quarter of 2017 after a strong increase in the last quarter of 2016. GDP growth is now expected to reach 2.6 percent in 2017, up from the 2.4 percent forecast in Asian Development Outlook 2017 in April.
Assuming stable domestic demand and increasing exports, economic recovery in Kazakhstan is likely to continue. The growth forecast for 2018 is substantially upgraded from 2.2 percent to 2.9 percent.
According to the ADB, government efforts to contain inflation in Turkmenistan should help to moderate consumer price pressures there. Inflation in Kazakhstan has held close to the projection, averaging 7.7 percent in the first 6 months of 2017 while tracing a slightly declining trajectory.