Kyrgyzstan is currently at the peak of external debt payments. Since gaining independence (from 1995 to 2023), a total of 350 billion 451.4 million soms has been spent on servicing the national debt (both external and internal). Specifically, the country has managed to repay 170 billion 956.78 million soms of its external debt. However, in the next seven years, the repayment of external loans will require twice the amount of money compared to the previous 28 years.
The Ministry of Finance considers the national debt to be sustainable, with no concerns about meeting the payments. President Sadyr Japarov has also urged not to panic about this issue and asserts that the country will be able to fully settle its old debt by 2035.
Key Points:
- The most challenging year will be 2027 when nearly 50 billion soms will be needed for external debt payments.
- The lowest expenses for servicing the debt will be in 2030 at 40.7 billion soms.
In 2023, Kyrgyzstan's total debt level, measured as a percentage of GDP, stood at 45.53%. This includes 33.73% of GDP as external debt and 11.8% as internal debt. The external debt-to-GDP ratio decreased compared to 2022 figures, indicating a positive trend.
From 2011 to 2022, Kyrgyzstan signed credit and grant agreements totaling $8.3 billion. Credit funds accounted for $5.5 billion, while grants amounted to $2.8 billion. These funds were primarily allocated for budget support, investment loans, and grants.
President Japarov has pledged to only take loans for self-sustainable projects to avoid future debt accumulation. The Ministry of Finance believes that Kyrgyzstan's national debt is stable and poses a moderate risk of a debt crisis, both externally and overall.
The external debt of neighboring countries:
- Kazakhstan's external debt as of January 1, 2024, was $162.7 billion, with a year-on-year increase of $2 billion.
- Uzbekistan's debt stood at $21.1 billion on January 1, 2021, representing 36.5% of the country's GDP.
- Tajikistan's total external debt as of January 1, 2024, was $3.2 billion, comprising 89% of the country's total debt, with a debt-to-GDP ratio of 26.9% in 2023.
