Almaty, 6 October 2011. The Eurasian Development Bank’s (EDB) Research Department published a new issue of The CIS Monitor, which reviews the CIS economies’ performance in the first six months of 2011 and provides forecasts for 2011 and 2012.
“The combination of Europe and America’s debt problems and the unresolved confrontation between lenders and borrowers, in the context of the current budget and external imbalance, have escalated risks and uncertainty in the global economy. The negative macroeconomic statistics from developed and developing countries point to recession,” write the EDB experts. “However, the CIS economies continued to grow in the first six months of 2011.”
In January-June 2011, the average GDP growth in the region is estimated at 4.2%. Turkmenistan had the highest rate (14.4%) and Azerbaijan the lowest (0.9%). The publication suggests that, judging by GDP growth, the region’s economy has recovered from the crisis.
A positive trade balance dynamics, underpinned by the favourable situation in the world markets in raw materials, have contributed to economic growth in oil and gas exporting countries (Russia, Kazakhstan, Turkmenistan, and Uzbekistan). At the same time, escalating oil and food prices have worsened balance of trade in oil and gas importing countries (Armenia, Kyrgyzstan, Moldova, Tajikistan, and Ukraine).
Economic growth in Russia and Kazakhstan had a positive effect on money transfers from labour migrants. According to the Bank of Russia, in the first six months of 2011, money transfers from Russia to the CIS were 36% higher year-on-year. In the first quarter of 2011, the reserves of the region’s central banks grew by US $19.3 billion. Azerbaijan and Kazakhstan had the highest increases in foreign exchange reserves (23.6% and 18.8% of GDP respectively). In Belarus and Armenia, however, foreign exchange reserves went down (10% and 4.5% of GDP respectively).
The average inflation rate in the region, except Belarus, fell from 11.4% in June to 10% in August 2011. The currency crisis in Belarus caused a 60.7% inflation growth in August 2011. Armenia was the most successful country to constrain inflation. Here, the annual price rise went down to 4.8% in August 2011.
Increased lending by commercial banks is also an important positive factor. In Russia and Kazakhstan, increases in private lending were 11.5% and 4.5% respectively.
In addition, The CIS Monitor provides a forecast from international and national experts that the average CIS’ GDP in 2011 and 2012 will grow at a rate of 4.5%. Turkmenistan and Uzbekistan are expected to show the highest rates in 2011 (9.6% and 7.8% respectively), while Azerbaijan, Russia and Ukraine will produce lower figures (3%, 4.4% and 4.5% respectively).
The CIS Macromonitor includes three analytical inserts:
An Overview of the Pension System of Kazakhstan, Russian Monetary Policy from 1999 to 2011: Three Years of the Bank of Russia’s Life, and Uncertainty in the Global Economy and Risks for the CIS Economies.
The electronic version of the publication is available at: https://eabr.org/rus/publications/macromonitor/
