In Tbilisi, Georgia, the 57th Annual Meeting of the Asian Development Bank (ADB) took place. The delegation of the Ministry of Finance represented Kyrgyzstan at the event, and the negotiations were quite successful.
Kyrgyzstan and ADB are planning to sign an agreement this year for an amount of up to $300 million.
During the event, a correspondent spoke with Deputy Minister of Finance Ernst Kaldybaev, who explained the importance of these projects for the country and who will be financing the "Kambar-Atu-1" project.
Kaldybaev highlighted that the cooperation between Kyrgyzstan and the Asian Development Bank has been significant over the years. There have been more than 80 agreements in various sectors of the Kyrgyz economy. Currently, there are 15 projects totaling $700 million in the fields of energy, road infrastructure, education, and healthcare.
Kyrgyzstan has shown economic growth, with a 6.2% increase in 2023 and successfully maintaining inflation at 7.3%. The consolidated budget has doubled over the past three years, with good results in tax collection. The 2023 budget exceeded expectations, with a surplus of 10.9 billion soms.
Kaldybaev emphasized that despite the positive economic indicators, the country still requires new loans and budgetary support to fund ongoing reforms and projects.
The funds are needed to support priority areas such as housing construction, environmental improvement, transportation infrastructure, irrigation, and water supply for the population.
In the upcoming agreement with ADB for $300 million, the funds will be allocated for:
- Ecological management of Lake Issyk-Kul for sustainable tourism development - $56 million
- Enhancing fiscal policy sustainability (housing program under the state mortgage) - $50 million
- Rehabilitation of the Issyk-Kul ring road (Barskoon - Karakol section) - $109.5 million
- Additional financing for the "Rural Water Supply and Sanitation Development Program in Naryn Region" covering 19 villages - $30 million
- Modernization project of border crossing points with Kazakhstan in Talas, Chui, and Issyk-Kul regions, including the construction of modern laboratories - $30 million
The terms and conditions for Kyrgyzstan to receive the $300 million are still under discussion, with both credit and grant support being considered. As the country transitions to sustainable development, the reliance on grants is expected to decrease in the coming years.
Despite having a surplus budget, Kyrgyzstan has requested $50 million in budgetary support for housing programs and state mortgages. This support will be sourced from various sources, including the Islamic Development Bank and Arab funds.
Discussions are ongoing regarding ADB's participation in the construction of the Kambaratinsk HPP-1 project. Negotiations on financing may be finalized by 2025, with international donors showing interest in supporting the project.
Kyrgyzstan is focused on securing the necessary funds for the project to avoid cost overruns and delays, as seen in other regional projects. The Ministry of Energy is working on the technical and economic feasibility study alongside financing efforts.
