Uzbekistan’s public debt exceeds $25 billion

According to the Ministry of Finance, the ratio of public debt to gross domestic product (GDP) has remained stable, falling from 38.9% at the beginning of the year (38.5% as of July 1) to 38.4% as of October 1 this year.

It was noted that the increase in public debt by $1.1 billion in July-September this year is mainly due to the financing of the state budget deficit and the implementation of investment projects, as well as the repayment of public debt in the amount of $356.4 million.

As a result, in the third quarter of this year: the balance of Uzbekistan’s external borrowings increased by $897.6 million;  the balance of state-guaranteed external debt increased by $42.2 million; the balance of domestic liabilities guaranteed by the state and repaid from the state budget increased by $102.2 million; as a result of the issuance of 1,196.4 billion soums of government securities (GSs) on behalf of Uzbekistan and the cancellation of GSs in the amount of 407.2 billion soums, the balance of debt on GSs increased by 789.2 billion soums.

It was noted that the downward trend in the ratio of public debt to GDP since the beginning of this year is mainly due to the prudential measures taken to keep public debt safe and effective, the growth of real GDP.

The real growth rate of GDP in the third quarter of this year was 6.9%, while the balance of public debt in US dollars increased by 4.6%.

Reportedly, the annual limits on the volume of new borrowings on behalf of Uzbekistan or under state guarantees are gradually being optimized.

The limited amount of new contracts to be signed to attract public external debt in 2020 is set at $5.5 billion (in practice, $5.35 billion of public external debt agreements have been signed). In 2021, the limited net volume of new agreements to be signed annually to attract domestic and foreign debt is set at $5.5 billion (including the net volume of government securities – 5 trillion soums).

The draft law “On the State Budget of Uzbekistan for 2022” proposes to set a limited annual volume of new agreements to attract foreign debt in 2022 at $4.5 billion, and a limited net volume of government securities issued on behalf of Uzbekistan at 6 trillion soums.