The volume of Kazakhstan's external liabilities approaching $300 billion should not be alarming: structural indicators of foreign debt and assets have declined and reached a historic low by the end of 2025 – 89% of GDP. The economy can attract more foreign capital without pain. The question is its quality. This was reported by Qazaqyia.kz citing Kursiv Media.

Kursiv Research has launched a series of materials on the growing role of external debt in financing Kazakhstan's economic growth. One of the key metrics reflecting the role of the national economy in the global capital market is the international investment position (IIP).

The IMF, followed by the National Bank of Kazakhstan, defines the IIP as the difference between the international financial resources a country holds (assets) and its debt (liabilities) to other countries. Like most external sector indicators, these assets and liabilities are denominated in dollars. However, we will present them as a percentage of Kazakhstan's GDP for the corresponding period to demonstrate the structural change of the indicator against the backdrop of the entire economy.

An important clarification: the IIP in both parts of the balance sheet reflects not only debt instruments, accounts receivable or payable, but also equity participation.

The IIP is a balance sheet indicator; unlike investment flows, it reflects the situation not over a period but at a specific date. Changes in the lines of this balance sheet allow us to judge capital flows just as tests of the same person taken at different periods indicate changes in their health.

At the end of 2025, the IIP was negative (–$35 billion, or –11% of GDP). Liabilities exceeding assets is a normal situation for the Kazakh economy over the past 20 years. But the current structural indicator is the most modest in the entire observation period (the peak was recorded in 2007 and 2020 – 42% of GDP). In other words, Kazakhstan has come as close as possible to the state where it will cease to be a net consumer of capital and become its exporter. If this trend is extrapolated linearly, Kazakhstan could reach a positive IIP by 2029.

Assets of Kazakhstan residents abroad amount to about $239 billion, or 78% of GDP. Over the past 20 years, this is a peak in absolute terms, but relative to GDP – average. Capital outflows were mainly associated with the formation of state reserves (National Fund of Kazakhstan), investments in the parent companies of Kazakh holdings, which are headquartered in global financial market centers or in zones with soft corporate taxation.

Liabilities to non-residents at the end of 2025 amount to $273 billion, comparable to 89% of GDP. Although in absolute terms Kazakhstan's liabilities to non-residents are at the highest level, the structural indicator (compared to GDP) is at a minimum.

What is behind the reduction in the influence of foreign investment? To answer this question, let's examine the structure of liabilities in different cuts – instruments, geographic, and sectoral.

The dominance of foreign direct investment (FDI), which ensures non-residents' control over Kazakh companies, is softening. If in 2016 FDI liabilities exceeded 100% of GDP, by 2025 they fell almost twice – to the range of 55–60% of GDP. This reflects the completion of the phase of large-scale investments by multinational corporations in the commodity sector. Against this background, the share of portfolio investments and loans remains stable. As a result, the share of FDI in total external liabilities is declining, giving way to bank deposits, bonds, and loans.

The lion's share of FDI is formed by investments in oil and gas extraction projects, as well as solid minerals. This has ensured the mining sector a significant share in the sectoral breakdown. As of the end of 2025, mining remains the largest recipient of external capital, but its volume in liabilities has almost halved – from 76.6% of GDP in 2020 to 39.2% of GDP in 2025.

The most striking trend is the explosive growth of the financial sector's share, whose liabilities to non-residents grew from 9.1% of GDP in 2015 and 2020 to 16.8% of GDP in 2025. The financial sector is becoming a key channel for foreign capital inflow, both through capital injections into controlled financial institutions (in 10 of 23 banks in Kazakhstan, control belongs to foreign investors; however, their capital accounts for 10% of the total capital of the banking system) and through the placement of debt securities.

The top-10 sources of investment are also being restructured. The Netherlands – a traditional center for consolidating commodity FDI and offshore capital – reduced its presence from 34.3% of GDP in 2015 and 37.2% in 2020 to 19.1% of GDP in 2025.

US investments also structurally declined from 24.5% in 2020 to 15.2% of GDP in 2025. GDP-weighted liabilities to the UK and China are also shrinking – the growing presence of the latter in Kazakhstan's economy has long frightened various experts and public figures.

Against this background, Russia shows steady growth (from 4.4% of GDP in 2015 to 7.2% of GDP in 2025), rising to the top-3 among all investors, and the UAE shows explosive growth (from 0.7% of GDP in 2015 to 4.0% of GDP in 2025).

Kazakhstan's economy's dependence on external capital inflow is gradually decreasing, but this is happening due to the reduction in the structural weight of direct investments that were directed through traditional jurisdictions (the Netherlands and other EU countries, the US), against which more mobile capital is gaining.

The entry point for new external capital is becoming the domestic financial sector, and in the geographic breakdown, the role of regional partners – Russia and the UAE – is growing.

Data for 2026, during which Kazakh issuers significantly increased borrowings in foreign currency, including in yuan, will make adjustments to the breakdown of investors by country, but will not change the overall trend – the growth of debt instruments, including through an increase in portfolio investments.

The structural indicators of Kazakhstan's external sector, in particular growing assets along with a low and declining