June 8, 2022
SurveysSanctions rebound
Jusan Analytics team have surveyed representatives of small and medium–sized businesses – clients of Jusan Bank. The purpose of the survey is to determine the scale of the impact of anti–Russian sanctions on Kazakhstan business. Specifically, some questions allowed us to determine the degree of business dependence on the Russian Federation to assess its subsequent reaction to the growth of economic uncertainty.
The survey was conducted in May 2022 and was attended by 227 respondents-companies from all over Kazakhstan. Their distribution according to the regions is quite diversified. According to the number of employees, 44% of the surveyed companies are representatives of microbusinesses, 43% – are small-sized, 10% – are medium-sized, and 3% – are large businesses. Thus, the presented sample can be considered transparent and can reliably reflect the current trends.
Main conclusions
- The survey results confirm the existence of a strong dependence of business on the Russian Federation – 41%. More than half of the companies interacting with the Russian Federation cannot switch to other partners;
- Anti-Russian sanctions harm the domestic business: purchase prices are rising, problems with bank transfers, and the supply of goods are appearing;
- The inevitable import of inflation through trade channels with Russia during the maintenance of the volume of demand in Kazakhstan. The surveyed companies do not feel a decrease in demand;
- After the sanctions shock in business issues, there were problems with payments and transfers. To date, we do not note the presence of this problem while considering banking business processes. The presence of such a problem could affect the extension of the supply chains of goods if it were not for the rapid reorientation of the STB;
- Domestic business is highly dependent on external factors, primarily the exchange rate volatility, and to a lesser extent on internal, operational ones;
- 37% of respondents noted that they expect a decrease in production. It is due to disruption and extension of supply and production chains, not an internal economic downturn or a demand contraction;
- Kazakh businesses are planning to increase prices for their goods or services. It is the most optimal business solution to maintain marginality in the prevailing conditions. If administrative regulation is introduced, the business will be forced to decrease production. It may lead to an even further decline in GDP growth and an increase in unsatisfied demand, prices;
- The businesses are going to increase prices in the next 3 months by an average of 5.36 p.p. Selling final goods companies – by 6.52 p.p. Companies that are selling raw materials and goods for further processing by 5.57 p.p. Companies providing services – 3.3 p.p.
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Vladislav Turkin
Department DirectorJune 8, 2022
Surveys06 September 23
Financial analytics: How much do we spend on routine expenditures?
We face a variety of expenses that vary depending on our needs, circumstances and preferences in our daily lives. Some people need quality food, others need to repay loans regularly and for some entertainment and recreation become a priority. However, the question often arises: Do we have enough income to meet all these needs? What amount of money is needed to achieve a comfortable standard of living? Is it possible to classify yourself as middle class by your expenses?
In this regard, we decided to analyze the core expenditures that each person or family needs to achieve a minimum level of comfort and meet basic life needs. As a result of the study, we divided the employees of Astana and Almaty cities into 6 groups depending on their income and expenses and also determined the size of each class: the least well-off, low-income, lower middle class, middle class, prosperous and well-off.
Key insights:
- An average of 246.3 thousand tenge or 60% of salary is spent on core expenditures every month.
- The largest amount of daily expenses is observed in the first 4 days after receiving a wage.
- At least 450 thousand tenge per month is required to satisfy all basic needs for a comfortable life in megapolicies.
- Almost half of the employed in Astana and Almaty cities (49%) do not have enough earnings to cover their daily expenses.
- The is an essential disparity between workers and cities - there are 4 times more workers with financial difficulties in Almaty than in the capital.
- Only 4.4% of employees with wages from 700 thousand to 1.2 million tenge, whose daily expenses account for 40-50% of income, can be attributed to the middle class.
- Employees with above-average incomes make up the smallest share of the employed population - 2%.
One-off Researches
Standard of livingConsumptionAlexandra Molchanovskaya
24 August 23
Analysis of the food service industry
Our research is devoted to the analysis of the global food service industry and the two largest cities of Kazakhstan - Almaty and Astana. The work includes a variety of businesses, such as restaurants and cafes, bars, fast food restaurants, as well as food delivery.
The global food service industry will continue its development, relying on the food delivery expansion, the development of technologies in the food industry, the digitalization of processes and the active introduction of innovative approaches.
Kazakhstan's food service industry is also at the stage of rapid growth, and the most popular segment is full-service restaurants. The analysis of the domestic market was carried out on the basis of our up-to-date data containing information on the amount, number and frequency of customer transactions.
And we determined that high competition causes low business survival - almost a third of restaurants in two major cities of Kazakhstan cannot stay on the market even for a year.
The average bill of catering places varies throughout the year due to many factors, such as seasonality, holidays, economic situation, etc. The average bill and visit frequency at public catering places also depend on the age of visitors. People over 35 visit are willing to spend more money although visit restaurants less often, whereas young people under 35 visit restaurants more often, but their average bill is much lower.
The results of the study can be useful for developing an industry development strategy and making decisions for a new or existing business.
One-off Researches
BusinessNargiza Makenova
09 August 23
Monetary conditions (May 2023)
According to RMCI dynamics, there is a further monetary ridigity strengthening in May 2023. The Index components have an undirectional effect on prices, while the main contribution to the monetary conditions tightening is made by the exchange rate component. And both RMCI Index components began to deviate more strongly from their equilibrium value following May 2023 results.
Despite the increasing transition of the real interest rate to the zone of positive values, provided by the weakening of price pressure while maintaining the NBK base rate at 16.75%, it has a weak deterrent effect on household consumption behaviour.
Firstly, the household decisions to save or spend come from their inflation expectations, which by the end of May 2023 were higher than the actual dynamics of price growth (17 vs. 15.9) and reflect the intuitive expectations of economic agents of further inflation growth due to the influence of price conjuncture in the housing and fuel markets. Secondly, the availability of consumer credit, as well as active fiscal leverage increases incentives to keep consumer demand excessive, which continues to create an imbalance in market forces.
The continued expansion of the positive gap in the real effective exchange rate of tenge that was provided by a high base rate leads to an increase in the restraining effect of monetary conditions on the import component of prices. Thus, the main influence of monetary conditions is mostly expressed in the control of the external component of consumer inflation. While measures aimed at limiting domestic price pressure do not work due to the inconsistency of macroeconomic policy measures and the weakness of the percentage channel of the monetary policy transmission mechanism.
Periodic Researches
InflationConsumptionBase RateAizhan Alibekova
07 August 23
Leading indicator of economy (6 months of 2023)
According to the data for the first half of the year, the economy grew by 5%, while the short-term economy indicator - by 5.6%. The widening of the difference between the short-term economic indicator and GDP data occurred as a result of the economic downturn in professional activity fields, real estate transactions and public administration and defence. Cyclical industries continue to be the main economic drivers, growing by double-digit values due to the increased government spending, growing consumer activity and the implementation of infrastructure modernization plans. We expect these industries to continue to maintain high growth rates.
The industrial sector also has an additional positive impact on the economy. Thus, the mining industry grew by 15.4% compared to June last year as a result of the base effect. Considering that last year the problems at CPC and Kashagan continued until November, we should expect the development of this industry at high levels by the end of the year.
Thus, the previously observed trends persist and the economy continues to be in the overheating zone.
Given the above, we expect the economy to maintain high growth rates in the range of 4.7-5.0% next month, followed by a slight decline to 4.5-4.8% at the end of the year. This will also be affected by improving business conditions, good demand for goods and services from the population, a boom in the construction industry and a stable situation in foreign markets.
However, there are still risks from the deterioration of the geopolitical situation, falling oil prices due to insufficient demand and accelerated price growth within the country.
We expect annual economic growth at the level of 3.9-4.2% from 2024. One of the main engines of such growth will be the hydrocarbon sector due to the expansion of oil fields and an increase in oil production, alternative routes in supply chains, as well as the introduction of new production facilities as part of the national development plan implementations.
BusinessKlara Seidakhmetova
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