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  • The Implementation of Fiscal Policies in the Economy of Kyrgyzstan

    08.06.2016 | E-Bulletin | 396 Ayca Simsek

    As Kyrgyzstan is an oil importer country, low oil prices in the world market have contributed to high consumption and growth in the country. As a result of a significant increase in gold exports, economic growth was also driven by net trade. Despite the recession in Russian economy, which caused a decline in the demand for Kyrgyz goods resulting a reduction in non-gold exports of the country in 2015, economic growth rate increased to 7.3% in 2015 from 3.6% in 2014, mainly due to the high performance in gold production. Recently, Kyrgyzstan has started to implement an enormous public investment program (heavily on infrastructure and energy sector), most of which was financed by external debt, mainly from China, Russia and the International Monetary Fund. While net external debt to GDP ratio was 76.3% in 2014, it increased to 81.2% in 2015. It should be emphasized that Kyrgyzstan will face a high net external debt which constitutes approximately 80% of current account receipts (CARs) between 2016-2019 while this ratio was 30% between 2012-2015. Due to high external debt together with depreciation of Kyrgyz som, gross government debt to GDP ratio is expected to reach 70% of GDP between 2016-2019 compared to 55% between 2012-2015. Besides, net foreign direct investments (FDI) increased from $292.6 million in 2013 to $757.6 million in 2014 and to $818 million in 2015. As a result of a number of confirmed foreign projects and Russia’s commitment to support Kyrgyzstan’s accession to the Eurasian Economic Union (EEU) by establishing $1 billion Russian-Kyrgyz Fund, net FDI are expected to reach 5% of GDP between 2016-2019.

    Tags: Economy, Fiscal Policy, Kyrgyzstan


  • Visiting Research Fellow

    Ayca Simsek

    Hayal Ayca Simsek was born in Izmir Turkey in 13 January 1973. She completed her primary education in Karsiyaka Cumhuriyet Primary School and her secondary and higher educations in Izmir Turkish College.