Analysts of the Kazakhstan Stock Exchange (KASE) said that in November the Finance Ministry paid a maximum of KZT 8.3bn (USD 100m) to service Kazakhstan's internal debt. Starting from December, monthly internal debt payments won't exceed KZT 6bn. To lessen significantly the debt burden in 1999-2000, the Finance Ministry stopped issuing 2-year papers in April and then 12-month papers in August 1998. The Finance Ministry is and will be avoiding expensive borrowings and will be following a tough borrowing policy in 1999 since the average yields on government papers are approaching a maximum. The budget deficit of KZT 58bn (about USD 700m), which represents 3% of the GDP, is supposed to be paid through issuing T-bills. As of 2 December 1998, the Finance Ministry's debt obligations were estimated at KZT 99.2bn (USD 1.19bn). In 1998, the internal debt repayment will total KZT 67.2bn. (Reuters)

Kazakhstan believes that the issues involved in transporting Kazakhstan's oil via Russian territory will be successfully finalised during the coming visit of Russia's Prime Minister Evgeny Primakov to Kazakhstan. President Nursultan Nazarbaev made this statement while speaking to a group of diplomats in Kazakhstan on 30 November. According to experts, Kazakhstan holds the largest oil and gas reserves in the Caspian region. "We are interested in constructing many pipelines for massive exports of oil to the world's markets," the president stressed. Several moves have already been made in this respect. An accord was reached with Georgia and Azerbaijan to increase the transportation of Kazakh oil via Baku to Georgia's port at Supsa, and in 1999, this pipe will carry more than 10 million tonnes of oil. Kazakhstan also has an arrangement with Ankara to export to Turkey up to 100 billion m³ of gas per year. Kazakhstan is counting on commissioning the Caspian Pipeline Consortium's oil pipe in 2001. It also hopes that the construction of a pipeline from Kazakhstan to Western China will start soon. Plus, the president reported that the construction of an oil pipeline from Atyrau, Kazakhstan, to Samara, Russia, will begin shortly. He also has not ruled out other routes, like Baku-Ceyhan and one via Iran to the Persian Gulf. The latter he thinks would be economically beneficial. (Interfax).

Total investment in Kazakhstan's oil and gas sector will reach USD 1bn in 1998, Nurlan Kapparov, the head of the national oil company KazakhOil said at a press conference last Monday. He also said that KazakhOil expects to have made about KZT 2bn (USD 24m) in profits in 1998. This is slightly less than in 1997 due to the fall in world oil prices. According to him, Kazakhstan will be increasing its oil and gas production. By the year 2015, the country's annual production is predicted to be 200 million tonnes of oil and some 100 billion m³ of gas. Mr. Kapparov believes that despite the world economic crisis and declining oil prices, the investment outlook of the Caspian shelf is very positive. (Reuters)

According to the National Statistics Agency, the consumer price index was 100% in November, a 0.7 pp increase compared with October when there was a deflation of 0.7pp. The prices of food products fell in November and deflation totalled 99.8%. Prices of non-food products didn't change, and services became 0.4pp dearer.

Over the first 11 months of 1998, inflation in Kazakhstan totalled 1.6%. The Agency predicts that inflation will be around 2% for the entire year. (Interfax)

The National Bank of Kazakhstan (NBK) has worked out a project to issue short-term notes with a floating interest rate. This new financial instrument will emerge in 1999 and will allow investors to compensate for possible Tenge devaluation. This information was released by the director of NBK's Monetary Operations Department, Batyrbek Alzhanov. The maturity period of the notes will be one month or less. The issue of the new financial instrument is in line with a package of measures to be taken to protect the national currency, the Tenge, in case the world financial crisis aggravates Kazakhstan. Mr. Alzhanov believes that commercial banks will benefit from the new papers. (Reuters)