Page 10 - Uzbek Outlook 2023

3.4 Debt

By the end of 2022, Uzbekistan’s public debt to GDP ratio is set to
stand at 40%. Four years ago, it was just 10%.

Such a sharp increase is attributed to the efforts required to combat the
pandemic, adjust fiscal policy and make significant investments in key
infrastructure projects necessary for economic development.

Ron van Ruden, deputy director of the Department for the Middle East
and Central Asia at the IMF, addressed the Tashkent Economic Forum
in October. He said: "The growth was very fast. But we need to take
into account the situation with state-owned enterprises and banks,
which have been assuming more and more debt obligations over the
past couple of years. With this in mind, the national debt could reach up
to 60% of GDP."

According to van Ruden, it is important that Uzbekistan now moves to
the second phase of economic reforms — to open markets, create a
favourable business environment, ensure the rule of law and deliver
transparency. All these are important requirements for attracting private
investment.

"Economic growth should be stimulated by the private sector, not by
state borrowing. Therefore, it is important to accelerate the reforms,"
van Ruden added.

Minister of Economic Development and Poverty Reduction Jamshid
Kuchkarov observed that since the beginning of 2021, the country has
introduced a slower pace in sourcing foreign loans.

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