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Uzbekistan’s Ministry of Finance defines limit state debt be repaid by state budget

Finance Materials 26 November 2019 15:56
Uzbekistan’s Ministry of Finance defines limit state debt be repaid by state budget

BAKU, Azerbaijan, Nov. 26

By Fakhri Vakilov-Trend:

The limit of Uzbekistan’s state external debt in the draft budget for 2020 is laid at $4 billion, stated Uzbekistan’s Deputy Minister of Finance Ahadbek Haydarov, Trend reports citing Uzbek media.

“Next year, the maximum amount of state external debt raised on behalf of the government of Uzbekistan or guaranteed by the country and repaid from the state budget is expected to be $4 billion,” Haydarov said.

According to Haydarov, such a public debt ceiling will reduce the budget deficit by 1.5 percent in 2022.

Uzbekistan introduces a limit on state external debt for the first time, which is reflected in the law “On the State Budget of Uzbekistan for 2020”. At the end of this week, the Senate will consider this document at a plenary meeting. Earlier, deputies of the Legislative Chamber adopted a law on the state budget.

As of July 1, 2019, the total external debt of Uzbekistan was $20.7 billion, an increase of $3.4 billion (20 percent) compared to the beginning of the year. It consists of government debt ($13.2 billion) and the private sector ($7.5 billion).

The increase in debt in the first half of the year was mainly attributable to the public sector ($3.1 billion), of which $1 billion came from international bonds. Private sector debt increased by $330.3 million as a result of increased borrowing by banks and other sectors of the economy.

According to the Ministry of Finance, Uzbekistan’s state external debt is at a moderate level by international criteria (23.5 percent of GDP). For comparison, in Azerbaijan it is 27 percent, Belarus - 33.5 percent, Georgia - 38.7 percent, Tajikistan - 38 percent and Armenia - 43.2 percent.

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