EDB Macroeconomic Review and EAEU Members’ Economic Performance

Eurasian Development Bank (EDF) Map
Map of the members states and potential members of the Eurasian Development Bank – EDB (Credits: Bourenane Chahine, CC BY 4.0, via Wikimedia Commons)

Geopolitical Report ISSN 2785-2598 Volume 39 Issue 8
SpecialEurasia OSINT Team

The Eurasian Development Bank’s (EDB) Macroeconomic Review for the six member states offers a comprehensive analysis of the economic landscape in 2023 and insights into potential developments in 2024.

Despite global economic uncertainties, the EDB region experienced robust recovery with an aggregate GDP growth of almost 4%. Internal drivers, such as high consumer and investment demand, were pivotal in sustaining this growth.

Notably, Armenia maintained impressive growth, Belarus witnessed a surge in economic activity driven by consumer demand, and Kazakhstan displayed vigorous growth because of strategic government programs. However, the report warns of risks tied to changing investment and trade flows globally, potentially impacting regional economies.

EDB Macroeconomy:
Background Information

The EDB Macroeconomic Review underscores the global economic unevenness in 2023, anticipating a slowdown in the near to medium term. While the US exceeded growth expectations with a 2.5% GDP increase, the Eurozone teetered close to recession at 0.5%.

The persistent global trend of high inflation appears to be subsiding because of reduced transportation costs and commodity prices. However, elevated interest rates in the US and Eurozone pose significant diminishing effects on the global economy.

The EDB region, in contrast, demonstrated resilience, attributing its growth to robust internal factors.

Armenia, for the second consecutive year, reported high growth rates, culminating in deflation at the beginning of 2024. Belarus experienced accelerated economic growth in 2023, driven by consumer demand. Kazakhstan’s strategic government programs contributed to a growth rate exceeding 5%. Kyrgyzstan also exhibited positive development, with GDP increasing by 6.2%. Russia, however, witnessed a gradual weakening of business activity at the beginning of the year, raising concerns about a potential GDP growth slowdown in 2024. Tajikistan maintained strong GDP growth at 8.3%, supported by robust domestic demand and increased export supplies.

The Eurasian Development Bank (EDB) is an international financial institution established to promote economic growth and integration in the Eurasian region. Russia and Kazakhstan found it in 2006, with Armenia, Belarus, Kyrgyzstan, and Tajikistan later joining as member states. The EDB’s headquarters are in Almaty, Kazakhstan.

Read also | Opening of Eurasian Economic Union (EAEU) Trading Houses in Iran: An Intelligence Assesment Report

Why Does It Matter?

The EDB region’s resilience and growth stand out against a backdrop of global economic uncertainties. Internal drivers, including consumer and investment demand, played a pivotal role in sustaining economic growth. Understanding these dynamics is crucial for policymakers, investors, and businesses to navigate uncertainties, capitalise on growth opportunities, and implement measures to mitigate potential risks.

Looking forward, the report suggests that the EDB member states may face challenges tied to limited opportunities for export growth amid a global economic slowdown. The emphasis on domestic demand, regional cooperation, exploring new niches in the international division of labour, and redistributing production becomes crucial for sustaining growth.

Policymakers should carefully monitor global economic trends, adjust strategies to evolving trade and investment dynamics, and foster collaboration to enhance the resilience of their economies. The EDB’s insight provides a valuable foundation for proactive decision-making to ensure sustained economic development in the region.

Scenario Risk Assessment

According to EDB Marco-Economic Forecast released in December 2023, most economies in the EABR operational region expect the global economic slowdown to dampen demand for raw materials, thus limiting their export revenue potential. Active use of internal growth sources has improved the assessment for 2023, and the forecast for 2024 remains positive. Sustained stimulative budget policies and structural reforms create conditions for supporting investment and consumer activity.

In terms of specific countries, we expect an acceleration to 5% economic growth in 2024 for Kazakhstan, following its 4.8% growth in 2023. This will be driven by high investment activity and expected reductions in interest rates. By 2025-2026, Kazakhstan is expected to position itself as a leader in economic growth among the Eurasian Economic Union (EAEU) member states, thanks to structural transformations enhancing the quality of economic growth in the medium term.

Russia and Belarus have fully adapted to new conditions and reached pre-2021 levels by the third quarter of 2023. This accomplishment comes from creating new chains that provide added value and prioritising local market needs. The impetus gained is expected to sustain a 1.5% growth in Russia in 2024, with further acceleration in 2025–2026. Experts expect Belarus’s economy to surpass the average growth rates of the last decade, expanding by 2% in 2024.

Armenia, Kyrgyzstan, and Tajikistan experienced high economic activity in 2023 because of strong domestic demand. While experts anticipate a slowdown in 2024, these countries are expected to maintain their growth significantly above the global average: Armenia is forecasted to increase its GDP by 5.7%, Kyrgyzstan by 4.5%, and Tajikistan by 7.3%.

The region can experience a further deceleration of inflation in the operational region, with an aggregate inflation rate expected to decrease to 5.8% in 2024 from 7.8% in 2023. The forecast shows that inflation will continue to decelerate, although most countries will still have inflation rates above target benchmarks.

EDB analysts expect Armenia’s inflation at 3.6% in 2024, Belarus at 8%, Kazakhstan at 7.1%, Kyrgyz Republic at 7.8%, Russia at 5.4%, and Tajikistan at 6.6%.

The expected inflation slowdown in 2024 sets the stage for a gradual reduction in interest rates in most countries of the region.

Read also | United Arab Emirates and Eurasian Economic Union might establish a free trade zone


Looking ahead, the EDB’s insights suggest the member states may face challenges related to limited opportunities for export growth amid a global economic slowdown. To sustain growth, emphasis on domestic demand, regional cooperation, exploring new niches in the international division of labour, and redistributing production becomes crucial.

The Scenario Risk Assessment forecasts a positive outlook for 2024, with most economies in the EDB region expecting sustained growth through stimulative budget policies and structural reforms. Specific country assessments highlight the potential for Kazakhstan to lead in economic growth among the Eurasian Economic Union (EAEU) member states, while Russia and Belarus have adapted to new conditions, achieving pre-2021 levels.

Although we expect a slowdown in 2024 for Armenia, Kyrgyzstan, and Tajikistan, we expect these countries to maintain growth significantly above the global average. The expected deceleration of inflation in the operational region sets the stage for a gradual reduction in interest rates, providing an optimistic outlook for the region’s economic development in the coming years.

For those with an interest in acquiring comprehensive insights into the geopolitical and economic dynamics of the EDB countries, we encourage you to reach out to SpecialEurasia by emailing info@specialeurasia.com. We are ready to assist you in evaluating the possibility of acquiring a carefully crafted and customised report to meet your intelligence requirements.

Related Posts