Kazakhstan''s economy may grow in the first half as investments by the government of the biggest energy producer in Central Asia help prop up businesses, President Nursultan Nazarbaev said.

"The financial sector had stabilized and the construction sector revived," Nazarbaev told a Cabinet meeting in Astana on June 8.

The government has spent more than 734 billion KZT (US$4.9 billion) to support banks and businesses since the economic downturn began, including the February takeover of the biggest lender, BTA Bank. The economy shrank 2.2 percent in the first quarter as demand for commodities declined.

The Central Asian country, which holds 3.2 percent of the world''s oil reserves according to BP Plc, had average annual growth of more than 10 percent from 2000 through 2006, fueled by high commodities prices and a construction boom.

"The sharp phase of the crisis was passed through, there are signs that we are going into a positive trend at the end of the first half," Prime Minister Karim Masimov said on June 8.