OREANDA-NEWS. President Nursultan Nazarbayev has signed amendments to the 2007 budget allowing the government to urgently allocate additional expenditures to support construction companies as well as individual holders of mortgage loans, the Alfa Bank analytic center informs. Most of the extra $1.2 bln in budget expenditures will be transferred to the Kazyna Fund, which had earlier been instructed to consider the possibility of buying out shares of Kazakh companies traded on international markets. Government officials had blamed foreign hedge funds for instigating a massive sell-off of Kazakh securities for speculative purposes

Although the new funds are expected to be deposited in Kazyna's accounts as early as next week and may serve as a catalyst for Kazakh equities in the short term, the experts caution investors not to overreact, as they anticipate that Kazyna may decide to allocate most of the funds locally to support individual companies on a case-by-case basis. The experts believe it will do so by providing liquidity to certain construction projects, mortgage loans or any other projects that might appear socially responsible.

The increase in budget spending is funded from $1.4 bln in additional revenues resulting from an upward revision of 2007 estimated GDP. "We believe the 7% increase in nominal GDP to $108 bln is realistic, and this confirms our view that Kazakhstan's macro risk in the medium term is moderate," the experts conclude.