Uzbekistan’s national debt may rise to $45 billion by 2025, according to data provided to Gazeta.uz by Ministry of Economy and Finance.
The figure is expected to reach $39.7 billion, or 35.5% of GDP, by the end of 2024. Next year, it could increase by 13.3% to $45 billion, or 36.4% of GDP. By 2027, the debt level may reach $55.9 billion, though the increase is expected to be insignificant in terms of the debt-to-GDP ratio (36.7%).
Under the proposed state budget for 2025, Uzbekistan may increase its borrowing next year. While the external borrowing limit stands at $5 billion under state guarantees this year, it will rise to $5.5 billion next year. Of this amount, $3 billion (up from $2.5 billion) will support the state budget and $2.5 billion will fund investment projects.
To diversify debt portfolio and mitigate currency risks, the government plans to set a cap on the net issuance of government securities at 30 trillion soums in 2025 (up from 25 trillion soums in 2024).
Additionally, to manage budgetary risks, the government has capped the value of new public-private partnership (PPP) projects that involve state financial commitments (either through purchases or payments) at $6.5 billion.
Expenditures on state programs financed through foreign debt are set to reach 18.8 trillion soums (up from 11.8 trillion soums in 2024).
The share of funds allocated for debt servicing in the consolidated budget — which includes the state budget, target state funds, extra-budgetary funds and the Fund for Reconstruction and Development of Uzbekistan — is expected to rise from 7.5% to 9.6%.
Debt repayments from the budget are projected to total 46.08 trillion soums (approximately $3.48 billion at next year’s average exchange rate), of which 21.1 trillion soums will go toward interest payments. In comparison, in 2024, debt repayment is projected to total 32.27 trillion soums ($2.55 billion), including 16.4 trillion soums for interest payments.
Previously, the draft budget for 2024 anticipated allocating 35.8 trillion soums for debt repayment in 2025 − 10.28 trillion soums less than the current forecast. Projections for 2026 have also increased, from 26.25 trillion to 50 trillion soums. This increase reflects Uzbekistan’s recent uptick in borrowing to fund various programs and to support its deficit budget, as the government has struggled to stay within spending limits in recent years.
To control the growth of the national debt for budget support over the medium term, the government aims to adhere to a fiscal rule limiting the consolidated budget deficit to within 3% of GDP. Future foreign borrowing will primarily fund high-return investment projects, aiming to slow debt growth relative to GDP.
Private debt
Uzbekistan’s external debt comprises both government and private debt. As of Q1 2022, private debt stood at $15.4 billion, while gross external debt totaled $43.3 billion.
According to the latest International Monetary Fund report from July, Uzbekistan’s gross external debt reached 61.3% of GDP, or $55.7 billion, in 2023.
By the middle of 2024, total external debt amounted to $63.8 billion, the Central Bank said.
S&P ratings agency anticipates that Uzbekistan’s net government debt and external debt levels will grow more rapidly than previously expected, driven by accelerated energy and infrastructure projects. While continuous and uncontrolled growth in public sector presence and external debt could pose risks, analysts believe that both the budget deficit and the current account deficit may decline after peaking in 2023.
The report also highlights the risk that non-guaranteed debt held by state enterprises and PPPs, accounting for around 8% of GDP in 2023, could crystallise in the government balance sheet. In recent years, state-affiliated companies have significantly increased borrowing — especially in foreign currency — to fund energy and infrastructure projects. Analysts warn that if certain projects underperform or if management or oversight issues arise, these enterprises could struggle with debt repayment.
