Uzbekistan’s state debt nears $31.5 billion

As of July 1, 2023, the state debt of Uzbekistan amounted to $31.5 billion or 36.8% of the GDP. Of this, the state’s external debt is $25.9 billion, and the state’s internal debt is $5.6 billion.

For comparison, this indicator was $29.2 billion as of January 1, 2023. The ratio of public debt to GDP was 36.4%.

In terms of countries, the largest foreign debt was obtained from China ($3.8 billion), Japan ($2.1 billion) and South Korea ($0.9 billion). In terms of international financial organizations, the largest amount of debt was attracted from the Asian Development Bank ($6.2 billion), the World Bank ($5.6 billion) and the Islamic Development Bank ($0.9 billion).

In 2023, the total value of the agreements to be signed on behalf of and under the guarantee of Uzbekistan to attract foreign debt will be $4.5 billion. Of this, $2 billion will be allocated for the support of the state budget, the budget deficit (which is $500 billion less than last year), and $2.5 billion for financing investment projects (which is $500 million more than last year).

According to the law “On the state debt”, the maximum amount of the state debt in relation to the GDP should not exceed 60%.

According to the preliminary analysis, in the medium term, in the conditions of ensuring the stability of macroeconomic and fiscal indicators, the ratio of the state debt to the gross domestic product is forecasted to be around 37% in 2024, 37.4% in 2025, and 37.9% in 2026.

In order to maintain the public debt at a safe level and effectively manage it, the Ministry of Economy and Finance plans to take the following measures in the medium term:

•  continuing the practice of setting annual limits on public debt;
•  reducing currency risks by attracting debt funds in national currency. In this regard, setting the limited net volume of the issuance of state treasury bonds to 25 trillion soums in 2024;
•  extending the average term of public debt repayment, as well as diversification of public debt by sources;
•  accelerating the process of attracting international investors to the market of government treasury bonds;
•  prevention, elimination or reduction of risks related to public debt servicing;
•  ensuring transparency of public debt information.

For information, the limited amount of the state foreign debt to be received in 2024 is $5 billion. Of this, $2.5 billion will be allocated to support the state budget, and $2.5 billion to investment projects. It is planned to issue 25 trillion soums worth of state securities on behalf of the Republic of Uzbekistan.