USD 77.80
EUR 87.84
RUB 1.09

Growth of dollar exchange rate may cause lack of funds for debt servicing

There is a risk of a shortage of funds budgeted to service the state external debt in case of a growth of the exchange rate of the U.S. dollar to Kyrgyz som. Draft budget of Kyrgyzstan for 2020 says.

Payments in U.S. dollars prevail in the currency structure of the republic’s fulfilled obligations on its foreign debt. Their share varies from 84.7 to 85.4 percent for 2020-2022.

The expenses on servicing the external debt in 2020 will amount to 16,163.3 billion soms.

At least 4,328.7 billion soms will be interest payments, and 11,834.6 billion — payments on the main amount.

At the same time, the Ministry of Finance does not voice forecast exchange rates for the next three years. The draft budget only notes that the forecast exchange rates of foreign currency to the U.S. dollar were calculated on the basis of actual prevailing rates from July 2018 to July 2019.

Experts from the Eurasian Development Bank expect that the dollar will cost 68.2 soms in the Kyrgyz Republic in 2020. And in 2021, in their opinion, the American currency will rise in price to 69.6 soms.