Kyrgyz banks have paid off a third of their external debt

Whilst banks in most countries of the Eurasian Economic Union were increasing their debt to external creditors, Kyrgyzstan moved in the opposite direction. By 1 April this year, the external debt of Kyrgyz banks had fallen by $351.3 million in one go — to $664.9 million.

Over the course of the year, the figure fell by 34.6 per cent. This is the most significant reduction among the EAEU member states.

As a result, Kyrgyzstan has retained the lowest level of external bank debt among the five member states of the union. By way of comparison, the figure stood at $3.7 billion for Belarusian banks, $7.2 billion for Armenian banks, $19.2 billion for Kazakh banks and $106.1 billion for Russian banks.

The share of banks in Kyrgyzstan’s total external debt also fell significantly — from 8.3 per cent to 5.3 per cent. The Kyrgyz banking sector now accounts for less than 0.5 per cent of the external liabilities of all EAEU banks.

Across the Union as a whole, the situation developed in the opposite direction. The aggregate external debt of EAEU banks increased by $12.1 billion, or 9.7 per cent, over the year, reaching $136.8 billion.

Armenia recorded the highest growth, with banks’ debt rising by 42 per cent to $7.2 billion. In Kazakhstan, the figure rose by 31.4 per cent to $19.2 billion, whilst in Russia it increased by 6.4 per cent to $106.1 billion.

Apart from Kyrgyzstan, only banks in Belarus reduced their debt, albeit by a much more modest 13.8 per cent, to $3.7 billion.