BISHKEK, Kyrgyzstan, January 22. Kyrgyzstan plans to clear its external debts by 2035, President of Kyrgyzstan, Sadyr Japarov, said in an interview with local media, Trend reports.
The president noted that the recent loans taken for construction of North-South road, Datka-Kemin power transmission line and thermal power plants were necessary projects but ended up costing twice as much. There was poor oversight, and instances of embezzlement occurred.
"These projects could have been completed at half the cost, with a shorter payback period. Now, it's time to repay these debts, and we have started the payments," he said.
He mentioned that there is no point in repaying the debt ahead of schedule, as, according to the contracts, the interest rates in that case would be much higher.
"It's not in our interest – unnecessary expenses. Therefore, we will be paying off the debt according to the schedule. There are no risks in this because you can see how much our budget has increased. Indeed, there used to be concerns that we would not be able to repay our external debt because our budget was weak," Japarov said.
According to him, the government of Kyrgyzstan has now precisely calculated which project, under what conditions, and when will become self-sustainable.
"Let me give you just one example. We are ready to take a loan for the construction of the Kambarata-1 HPP. We will soon receive funds. If the Kambarata-1 HPP is completed, it will pay off in 12-13 years. After that, like the Toktogul HPP, it will benefit the country for many years," the president said.
On the other hand, Japarov mentioned that the China-Kyrgyzstan-Uzbekistan railway construction project prompts contemplation. The investment involved is significant, and the project's return is expected over 35-40 years.
Despite the extended payback period, he highlighted that the endeavor could transform Kyrgyzstan from a deadlock to a transit hub. Kyrgyzstan is exploring alternative approaches to fund this project, not relaying on external borrowings.