Page 6 - bneIntelliNews Small Stans & Mongolia Outlook 2025

1.2 Macro – Kyrgyzstan
Kyrgyzstan’s economy beat expectations in the first 11 months of 2024, expanding by some 9%, according to the National Statistics Committee, and its Japarov administration is bullish about producing a similar performance in 2025. However, much of the growth success stems from heavy infrastructure spending by the populist-nationalist government rather than private-sector vitality.
The Asian Development Bank’s (ADB’s) latest Kyrgyzstan growth projection for Kyrgyzstan, published in September and affirmed in December, is 5.8%. Also in September, the European Bank for Reconstruction and Development (EBRD) singled out Kyrgyzstan and Tajikistan as demonstrating strong GDP growth, and anticipates economic output to rise another 7% in the former in 2025. The two countries would be the regional growth leaders, the development bank predicted.
“Its growth potential stems from the expansion of tourism, investment in infrastructure, and silver and gold exports, but secondary sanctions related to intermediated trade remain a threat,” the EBRD said.
It added: “The Kyrgyz Republic is becoming a growing tourist destination. This is driving catering-sector turnover and boosting tourist transportation revenues. Both remittances and real wages have remained elevated, helping retail and wholesale trade to grow.”
In its September-edition Regional Economic Prospects report, the EBRD also observed: “Sophisticated manufacturing activities [in Kyrgyzstan] are gathering steam as domestic production of computers and electronics (up almost five times) and vehicles and equipment (up 1.6 times) expanded in January-July 2024. Nevertheless, overall industrial production stagnated (up just 0.8%) amid a decline in mining output.”
Kyrgyzstan remains a not-unimportant source of exports and re-exports for sanctions-hit Russia as Moscow aims to keep its war economy in good stead.
Bordering the giant economy of China and largely dependent on Russia and neighbours for gas and oil products, Kyrgyzstan, a small country of just 7mn, suffers from chronic trade and current account deficits. The ADB assessed that its current account gap in 2023 stood at a negative 50.4%.
6 Small Stans & Mongolia 2023 www.intellinews.com