Mazhilis member Azat Peruashев referred to maintaining the base rate at its current level as "a cowardly burying of one's head in the sand."
"It has long been clear to everyone that inflation is not driven by an excess of tenge, but rather by a lack of domestic production of goods, which naturally leads to the import dependence of the domestic market. Against the backdrop of a strengthening dollar, or more precisely – the plummeting exchange rate of the Russian ruble, which shifts the burden of trade restrictions onto Kazakhstan (due to the conversion of rubles into tenge and the purchasing of dollars in Kazakhstan), inflation is now further pressured by the ongoing devaluation of the tenge, which will continue until the ruble, collapsing under sanctions, also buries our economy," wrote Mazhilis deputy Peruashев on his Telegram channel on January 17.
The parliamentarian believes there are two options to address the issue: "to abandon the conversion of ruble/tenge (which is impossible for both economic and political reasons); or to stimulate domestic production, filling the internal market with local goods."
Regarding the second option, Peruashев thinks it is "not a quick task." "Moreover, with such a base rate, loans for businesses will continue to cost around 20%, and it is impossible to develop production at such interest rates," he is convinced. "And the subsidies from the 'Damu' fund (which cover the difference in loan costs down to 7-9%) will not save the situation, as they only benefit 1% of businesses and do not significantly impact the structure of the economy."
Peruashев believes that "a much more effective solution in this situation would be a sharp and bold reduction of the National Bank's base rate."
Recall that on January 17, the National Bank of Kazakhstan announced its decision regarding the base rate: the value was maintained at 15.25% per annum. The interest rate corridor was set at +/- 1.0 percentage point. "The growth of the short-term economic indicator at the end of 2024 accelerated to 6.2% year-on-year, which may indicate signs of overheating in the economy. Production growth is observed across all major sectors," the National Bank provided as an argument for maintaining the rate.