Retail trade exceeded KZT4tn in Kazakhstan in January-July 2016. It showed a 21.3% year on year growth or KZT710.6bn. However, in real terms retail trade slowed down growth back in 2015 and posted a decrease of 0.7% in January-July.

A key factor in the nominal growth of retail trade is the depreciation of the national currency that has make imported goods expensive and pushed inflation up (in July its annual rate exceeded 17%). Apart from growth in prices, real decrease in personal incomes exerted additional pressure on the purchasing power of the population (for example, the real average salary fell by 1.1% year on year in the second quarter of 2016).

Such volatility in retail trade has led to a gradual growth in the share of small enterprises in total retail trade as they are capable of quickly respond to external problems. The combined share of large and medium-sized players is at the lowest point since 2010 – 23.6%, falling from the highest point of 32.9% in 2014.

As problems grew in the entire retail sector, the biggest problems emerged in the market trade segment. Despite an almost 300% nominal growth since 2010 the share of market trade had gradually gone down from 18.7% in January-July 2010 to 12.9% in 2015, after which the country’s statistics authorities stopped specifying its share.

Fall in demand did not manage to compensate for inflation’s contribution to the level of stocks in storehouses of retail enterprises. As at 1 August 2016 total stocks of the retail sector reached KZT371.7bn in Kazakhstan, growing by KZT58.1bn or 18.5% year on year. The highest increase in stock was recorded in March 2016 – by 31.7%.

The nominal growth in stocks was accompanied by a fall in the rate of sufficiency for uninterrupted trade expressed in days. Should supplies of goods to the retail sector stop now, on average at current sales rates stocks will be enough for 59 days, two days less than a year ago. This trend shows the influence of contributions depreciation and inflation to stocks in monetary terms, whereas physical volumes show decrease.

Only two Kazakh regions posted decrease in stocks in monetary terms – Kostanay Region and Atyrau Region, whereas fall in real terms was recorded in seven regions. Astana and Akmola Region led in terms of growth in stocks: Astana led in terms of nominal growth in stocks (by KZT9.7bn), whereas Akmola Region in terms growth in sufficiency rate (by 22 days).