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Moody's predicts 1 percent drop in Kyrgyzstan's GDP in 2022

Moody’s revised its expectations for GDP growth in Kyrgyzstan. Its website reports.

It is noted that in 2022, GDP is expected to fall by 1 percent, and an increase of 2.6 percent is expected in 2023.

The agency notes that remittances from Russia account for more than 80 percent of the total volume of money transfers to the Kyrgyz Republic and about 30 percent of its GDP. Moody’s notes that today and in the medium term, it is likely that the slowdown in economic activity in Russia will lead to a significant reduction in long-term demand for labor migrants, including from Kyrgyzstan.

«Historically, economic cycles in Russia and their impact on remittances and export flows have been offset by financial support from international financial institutions, gold and commodity revenues, and recently — by the positive impact of the devaluation of the som on supporting trade competitiveness.

«But it is unclear to what extent these easing measures can offset the impact of the current shock on the economic, fiscal and financial sectors of Kyrgyzstan,» Moody’s notes.