Comment by Director of NBK Monetary Policy Department Zhandos Shaimardanov Based on Findings of Q2 2021Survey of Enterprises in the Real Sector of the Economy (Sectoral Market Survey)

Findings of a survey of enterprises held by the National Bank reveal that the second quarter of 2021 demonstrated a slight deterioration in the situation with demand for finished products in all the sectors, except for mining industry and transport and warehousing industry.

Declining growth rate of demand was highlighted in manufacturing industry, trade, and construction. In agriculture, demand indicator moved into a negative zone. In the third quarter of 2021, demand growth is expected only in agriculture, while growth in other sectors may slow down or decline.

An accelerated growth pace of prices for raw materials and materials, finished products in the second quarter of 2021 was indicated in all the industries. In the third quarter of 2021, a slowdown in the rate of price growth is expected.

Increased output volumes were pointed out in all the industries surveyed, diffusion index moved into agrowth area. The largest growth was recorded in the manufacturing industry. In the third quarter of 2021, growth rate in industries is expected to slow down.

There is still a high level of importance of competition in almost all the industries. Trade enterprises are most of all exposed to influence of market competition, thus 40.1% of the enterprises feel that competition affects their business. In the manufacturing industry, share of such enterprises reaches 31.6%, in transport - 25.6%, in construction - 24.9%. The smallest share was reported in agriculture and mining (18.2% and 16.1%, respectively).

A significant part of enterprises (34.1%) sees dissatisfaction with the economic condition in Kazakhstan as a main obstacle restraining their business activity. Along with that, manufacturing industry and trade face considerable problems with demand for their products (30.9% and 27.6%, respectively), agricultural and manufacturing enterprises point out a shortage of qualified personnel (26.8% and 25.2%, respectively).

During the next 12 months, financing in all the sectors will remain largely the same, with the largest increase in financing planned in agriculture and mining industry, and the smallest in trade and construction.

Overall, the survey has covered more than 2.6 thousand enterprises engaged in mining and manufacturing industries, construction, trade, agriculture, transport and warehousing.