The government of Kyrgyzstan is gradually preparing for the peak of payments on its external debt. For the first time in many years, the deficit of the republican treasury is minimal — only 6.6 billion soms.
What the state earned on
According to the Central Treasury, in 2018, total revenues of the republican budget of Kyrgyzstan amounted to 135,436 billion soms, taking into account the special funds of state-financed institutions and grants of the state investment program.
The tax revenues accounted for the largest receipts. They brought to the budget 107,736.9 billion soms. Including the Tax Service collected 62,065 billion soms, the Customs Service — 41,671.8 billion soms.
Non-tax revenues in 2018 amounted to 22,551.99 billion soms. Including revenues from the special funds of budgetary institutions (for example, payment for the provision of services) amounted to 9,325.8 billion soms, dividends and profits from state-owned companies — 5,468.7 billion soms.
What did the money was spent on?
Budget expenditures in 2018 amounted to 142,069.9 billion soms. Compared to 2017, they increased by 1.5 percent, or by 2,139.1 billion soms.
The budget of Kyrgyzstan is traditionally socially oriented. This means that most of the money is spent on education, social protection and health care.
In addition, every year, servicing of state debt accounts for an increasing part of the expenditures. The state allocates the least amount of money for environmental protection — a little more than 822 million soms.
The state debt of Kyrgyzstan consists of external (foreign loans) and internal (issue and redemption of public securities). In 2018, the costs of its servicing amounted to:
— external — 11,942.7 billion soms;
— domestic — 11,798.4 billion soms.
In addition, the state has invested 24,761.5 billion soms in non-financial assets. This includes expenses for the overhaul of roads — 3,937.3 billion soms and construction of other buildings and structures — 3,311.5 billion soms.
Deficit is reducing
It is interesting that excluding spending on investments in non-financial assets, expenses are significantly lower — 117,308.4 billion soms. However, in the end, they turned out to be higher than the budget surplus.
At the end of 2018, the budget deficit of Kyrgyzstan amounted to 6,633.9 billion soms.
Last year, Kyrgyzstan had a rather difficult time. The expected funds to support the budget from the Asian Development Bank and the International Monetary Fund have not been received.
As a result, Kyrgyzstan received from external sources 10,225.9 billion soms, and repaid liabilities in the amount of 8,245.4 billion soms.
As a result, external revenues were higher than payments on debts by only 1,980.4 billion soms.
But the lack of donor assistance and the annual minimum deficit showed that the country may well tighten its belt and live only within its means. And Kyrgyzstan can also find the missing resources within the republic.
The Ministry of Finance actively sells government securities (treasury bills and bonds).
For 2018, the budget received 18,347.67 billion soms from the issue of government securities.
The most profitable were treasury bonds. They brought to the treasury 15,865.83 billion soms. At least 2,481.83 billion soms were received from placement of treasury bills.
Due to difficulties with foreign aid and increased amount of spending on servicing of the state debt in Kyrgyzstan, the creation of a reserve fund was started. The idea was voiced by the deputy Dastan Bekeshev during the discussion of the budget for 2019. The Prime Minister assured that work in this direction was already underway.
«We are now considering this issue. The reserve fund should pursue two goals. One part of the funds should be distributed in the country, and the other should be directed to the payment of external debts. If you support the budget for 2019, then we will start creating a reserve fund from the first days,» Mukhammedkaly Abylgaziev summed up.