The economy of Kyrgyzstan continues to grow, mainly due to an increase in construction and trade, while the industrial sector is slowing down. Experts predict that economic growth will start to decelerate in the near future. The data provided by the National Statistical Committee is based on official figures, but its accuracy is uncertain as there are no alternative sources of information on the country's economy.
In the first two months of the year, the economy grew by 8.6 percent. The National Statistical Committee highlighted a 39.5 percent growth in construction, 22.9 percent in wholesale and retail trade, and 1.4 percent in agriculture. Various factors such as prices, production volumes by sector, government revenues, and expenditures are taken into account when calculating the GDP changes compared to the previous year.
Kyrgyzstan heavily relies on imports, purchasing goods in dollars. Therefore, the GDP volume has been recalculated in US dollars using the official exchange rate at the end of the month. The industrial sector, which started the year with high figures, experienced a slowdown of almost half in growth within a month, mainly due to a decline in the extraction of minerals.
In February 2024, industrial production increased by 7.8 percent, with notable growth in the production of wood and paper products, rubber and plastic products, chemicals, pharmaceuticals, food products, tobacco products, and basic metals, while mining of minerals decreased by 4.3 percent. Strong domestic demand continued to play a key role in driving Kyrgyzstan's economy.
Experts anticipate that internal demand will weaken due to monetary and credit policy constraints and an expected state budget surplus. It is estimated that the GDP will grow by 4.5 percent in 2024, according to a bank's commentary. The National Bank's forecast is more conservative, expecting a real GDP growth of around 3.9 percent by the end of 2024.
The industrial sector is projected to have a positive impact on the overall GDP dynamics, while the contributions of agriculture and the energy sector to economic growth will be restrained due to an anticipated low-water season.
