BAKU, Azerbaijan, April 4. The experts of the ADB (Asian Development Bank) forecast the current account deficit in Kyrgyzstan to narrow in 2023 and 2024 as gold exports resume and global energy and food prices moderate, Trend reports citing the latest outlook of the Asian Development Bank.
“Exports of other goods should continue to increase, supported by transit trade. Imports are expected to grow more slowly, with slower growth in domestic demand offsetting a rise in imports from continued regional and transit trade,” the report said.
The bank noted that converting non-monetary gold on the central bank’s balance sheet into foreign exchange and monetary gold would support and diversify international reserves.
Meanwhile, the fiscal deficit in Kyrgyzstan is expected to widen to an average of 2.5 percent of GDP in 2023 and in 2024.
The bank expects that continuing improvement to tax and customs administration will bust revenue, adding however that expenditure is expected to climb even more to cover wage and pension increases enacted in 2022 and as public debt service payments rise.
“Increased expenditure will likely keep the deficit elevated despite a planned reduction in domestically financed investment spending,” the bank said, noting that this could require further domestic borrowing.