BAKU, Azerbaijan, Nov. 1
By Fakhri Vakilov-Trend:
In 2020, Uzbekistan’s debt to China will reach $3,006 billion, Trend reports citing Uzbekistan’s Ministry of Finance.
Ministry of Finance presented this forecast in the “Draft Budget for Citizens”.
From Jan. 2015 to Jan. 2019, government debt to China gradually increased from over $1 billion to over $1, 9 billion, adding $200-$300 million a year. By early 2020, growth over 12 months will be over $1 billion, or 53 percent.
China is one of the largest investors in Uzbekistan’s economy. In 2018, trade between the two countries amounted to $6.4 billion. In Aug. 2019, China and Uzbekistan created a joint investment fund with a statutory fund of $1 billion.
Japan remains the second major creditor, to which Uzbekistan owes over $1.4 billion, as of Jan. 1, 2019. By the beginning of 2020, this amount will increase to over $1.8 billion.
France will take the third place, the public debt to which has grown 21 times over the year from $27 million to $573.1 million. The volume of borrowings from South Korea will increase almost five times from $114.1 million to $568.2 million. Liabilities to Russia will almost double from $69.8 million to $120.5 million. However, the amount of debt to the United States will decline from $28.9 million to $26.7 million.
The total size of the state debt of Uzbekistan at the beginning of 2020 is projected at $21.3 billion (36 percent of GDP). External debt will be $15.3 billion (25.4 percent of GDP). In addition, $6.7 billion were received from foreign countries, $7.7 billion from international financial institutions and $1 billion from investors.
Among the international financial institutions, the Asian Development Bank turned out to be the most “generous”; it will account for over $3.9 billion, or 51 percent of the corresponding share of Uzbekistan’s state debt. The World Bank credited over $2.7 billion (37 percent), the Islamic Development Bank - $869.7 million (11 percent).
To ensure macroeconomic stability in 2020, Uzbekistan will set limits on the formation of new debts. Thus, the volume of attracting external borrowing under new agreements on behalf of or under the guarantee of Uzbekistan’s government will not exceed $4 billion and loans attracted by the country's leadership to implement state targeted programs are limited to $1.5 billion.
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