Stronger Tenge Cuts Kazakhstan's Budget Revenue by 146 Billion

While escalating conflict in the Middle East has increased volatility in global oil markets, the key constraint for Kazakhstan's state budget has been the exchange rate of the national currency, the tenge. This was stated by Finance Minister Madi Takiyev during a government meeting.

The minister explained that external macroeconomic factors significantly impacted budget revenues in the reporting quarter. "Against the backdrop of escalating conflict in the Middle East, volatility in the global oil market has intensified. The average price of oil for the quarter was $80.6 per barrel," Takiyev said.

However, he noted that most of the additional revenue from higher oil prices does not flow directly into the state budget. Under current fiscal rules, primary oil revenues are accumulated in the National Fund.

The direct positive effect for the budget was seen mainly through export customs duties on oil, which brought an additional 40.5 billion tenge. Conversely, a stronger tenge held back overall budget revenues.

"The average exchange rate in the reporting quarter was 497.7 tenge per US dollar against a forecasted rate of 540 tenge, which reduced receipts by approximately 146 billion tenge," Takiyev stated.

Thus, as emphasized by Madi Takiyev, this exchange rate differential became a key limiting factor for state budget income.

At the same time, improvements in tax and customs administration secured an additional 137.6 billion tenge for the treasury.