The paper identifies the features and determinants of Kazakhstan's foreign trade with other members of the Customs Union of Russia, Kazakhstan and Belarus (CU), and estimates the degree of utilization of its trade potential for 1995-2011. The participation in the CU has led to an increase of Kazakhstan's turnover with Russia and Belarus mainly due to imports from these countries, while the share of exports to these countries in its total exports has been declined since 2011. The main reason is the achievement of the potential level of mutual trade for Kazakhstan. Gravity models confirms that the inter-industry trade between the CU's countries based on the comparative advantages comes to a standstill and to further expand their mutual trade, countries should specialize in the expansion of intra-industry trade.
Purpose- The article examines the key factors affecting the use of the National Fund of Kazakhstan (NFK) in 2005-2017, as well as the development of more effective methods and actions to improve its performance in the future. Methodology- The study has developed a functional model of transfers from it to the state budget (spending rule), which helps to explain the observed dynamics of its use. The model was examined by using dynamic panel estimation techniques. As result it was found that transfers from oil fund to the state budget are dependent on economic activity, non-oil budget deficit and inflation in the country. An econometric test confirmed the correctness of the assumptions about the factors used in the model. Findings- A multivariate forecast was also made for NFK's assets for the period until the end of 2022. Upon the favorable scenario, the value of the assets of the oil fund will reach 57.5 billion US dollars at the end of 2022. If world oil prices fall from 68 to 50 US dollars per barrel and remain at this level, the oil fund’s assets will be exhausted in 6-7 years. If oil prices fall to 30 US dollars, then the fund's oil assets will last only 5 years. Conclusion- The principles of the formation and use of the NFK should be revised in order to ensure the long-term preservation of the fund's assets for future generations as originally planned. Keywords: Sovereign wealth funds, oil fund, asset management, Kazakhstan JEL Codes: D25, D53, D58
Foreign direct investment (FDI) is the engine of growth of all countries, contributing to the inflow of financial capital, technology, skills, employment, to the establishment of production of modern goods and services, which enables a national economy to become more competitive in the global market. However, the developing or transition countries often lack the capital to finance their own development. Analysis of 21 developed and developing oil-producing countries from 2008 to 2014 show that the most important factors for attracting investment in the oil and gas sector are the discovery of attractive fields, the creation of a developed and modern infrastructure, increases proven reserves of hydrocarbons, and of corruption. Less important but still factors are a stable currency, an open trade regime, favorable business conditions, as well as lower taxes on oil-producing business.
The article discusses the key factors determining the National Fund of Kazakhstan (NFK) accumulation from January 2005 to February 2017. As the main factors in this model, world oil prices, the share of deductions of oil companies' income to the fund, domestic oil production, the tenge exchange rate against the U.S. dollar and interest income on the fund's investments were considered. In order to explain these factors impact on the oil fund receipts, a relevant functional model was developed. The stationarity of the data series was checked using the Augmented Dickey Fuller unit root test. Verification of the model was conducted using different econometric methods, as the primary model used the least squares method (LSM). Using the generalized method of moments (GMM) helped overcome the problem of autocorrelation and heteroscedasticity and validate the model specification. The autoregressive conditional heteroscedasticity (ARCH) method and the Generalized Linear Model (GLM) were also used to test the basic models. The built econometric models confirmed that NFK's receipts positively depend on the tax rate on oil producing firms, world oil prices, and domestic oil production and negatively on the exchange rate of tenge. However, the increase in interest rates on the U.S. Treasury bonds did not increase the fund's income. This can mean either the ineffectiveness of its investments or the periodic withdrawal of the investment income. In general, the study should help understand the factors determining NFK's revenue and increasing its amount in the future.
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