At a joint session held on Saturday, December 12, members of the Kazakh Parliament approved the 1999 budget revenues at KZT 291bn (USD 3.5bn) and the maximum budget deficit at 3.1% of the GDP.

The original budget draft proposed by the Kazakh Government suggested a total of KZT 283.8bn in revenues. Budget spending was projected at KZT 344.8bn (USD 4.15bn), leaving a budget gap of KZT 58.5bn or 3% of the GDP. Debates over the budget continued today, Monday, 14 December. According to Kazakhstani budget law, the parliament should finalise the budget no later than 15 December. (Interfax)

Although recognising that both the money base and money mass have shrunken since the beginning of the year, the Kazakh Government and the National Bank of Kazakhstan (NBK) do not intend to emit more money into the economy "as it would increase inflation." This statement was made by the Fist Vice Prime Minister, Uraz Dzhandosov, to the Kazakh Parliament on Friday, 11 December. In his opinion, Kazakhstan first must improve the balance of payments in order to bring money to the economy. To this end, it is necessary "to use our best efforts to increase exports" while "efficiently limiting imports". He added that "international markets must have confidence in the reforms being implemented by the Kazakh government and the National Bank in order to increase the country's gold and currency reserves". (Interfax)

Kazakstan's gross gold and currency reserves are expected to be between USD 1.7-2.0bn next year, the Chairman of the National Bank of Kazakhstan, Kadyrzhan Damitov, said at a joint session of the Kazakh Parliament last week. According to the NBK, in December 1998, the country's gold and currency reserves totalled USD 1.9bn. Damitov said that the NBK will continue following its policy of a floating currency exchange rate. According to him, the average Tenge/USD rate will be 88.3 Tenge per one Dollar in 1999 and at the end of 1999, the Tenge will devalue to 92.6 per one Dollar. Inflation in the next year is expected to be about 7.0-8.5%. (Reuters)

Kazakhstan's privatisation revenues in 1999 are expected to be KZT 49.7bn (USD 598m), the Finance Minister, Sauat Mynbaev, said on Thursday, 10 December. However, "extraordinary efforts will be needed to reach this total," he said. According to him, "we need, at the very least, to break the trend of portfolio investors leaving the [Kazakhstani] market."

Taking into account next year's expected Tenge depreciation, revenues will be virtually unchanged from the 1998 level, KZT 45bn, if the targets are reached. (Reuters)

The Minister of Foreign Affairs, Kasymzhomart Tokaev, and the president of the national oil company KazakhOil, Nurlan Kapparov, were in Washington on 9 December to sign an agreement with Royal Dutch Shell and the U.S. companies Mobil and Chevron on conducting feasibility studies on the construction of a pipeline from Kazakhstan to Turkey. The pipeline would connect oil and gas fields in Western Kazakhstan with the Turkish port of Ceyhan via the Caspian Sea. The cost of the feasibility study is estimated at USD 20m. (Interfax)

According to the Kazakh Minister of Energy, Industry and Trade, Mukhtar Ablyazov, Russia's Ministry of Fuel and Energy has allocated an additional oil and gas transportation quota to Kazakhstan. From now on, Kazakhstan will be allowed to deliver an additional 1.5 million tonnes of hydrocarbons to world markets, via Russia's pipeline, per year. Ablyazov said that Kazakhstan's present annual quota totals 7.5 million tonnes, of which 3.5 million tonnes are go beyond the CIS. With the additional quota, Kazakhstan's hydrocarbons exports to Western countries will increase to 5 million tonnes per year. This is very important to Kazakhstan since 30% of its budget revenues come from oil sales. (Interfax)

The World Bank will make a development loan of USD 109m to upgrade the Uzen oil field in Western Kazakhstan next year, the Finance Minister Sauat Mynbaev said to the Parliament on Friday. The loan suggests co-financing whereby the Kazakh government puts up USD 22m. The minister said that Kazakhstan has already paid USD 9m and the remaining USD 13m was accounted for the 1999 year budget. (Reuters)