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President of Kyrgyzstan suggests forgetting external debt topic

«Let’s forget the topic of external debt. Even if our external debt increases to $10-15 billion, there is no need to worry,» the President of Kyrgyzstan Sadyr Japarov said in an interview with Kabar news agency.

According to him, in 2020 the country’s external debt amounted to about $5 billion. This amount represented external debt accumulated over 30 years. Except for the construction of Datka — Kemin substation, an alternative North — South road and the modernization of the heating and power plant, no significant work was carried out for this amount.

But these three projects became projects that would not pay for themselves even in 40 years.

Sadyr Japarov

«We needed all three projects. I’m not saying we shouldn’t have implemented them. Kyrgyzstan needs all three projects like air. But they will not pay for themselves even in 40 years. Their cost was overestimated two or three times. If we compare prices, it turns out that similar constructions and works are carried out in European countries two or three times cheaper than in our country. Even a student will be able to calculate how much money will be spent on the construction of a HPP. The North — South road and Datka — Kemin substation are also expensive. This is not the fault of the Chinese side, who provided the loan. It is the fault of our government and our officials. The money was stolen,» he believes.

The head of state said that the Kyrgyz Republic would repay all its external debt by 2035.

The period of the largest payments coincided with the time of work of his team. But Sadyr Japarov is confident that there will be no problems. The state of the economy has improved.

«As long as there is peace and stability in our country, we will easily pay. Remember: we will pay the previous debts at the expense of the people, from the republican budget. Because there are no self-sufficient projects yet. All the money received disappeared like water through sand,» Sadyr Japarov emphasized.

He said that from now on every dollar of received loans would be spent on specific projects.

As an example, the president cited the construction of Kambarata HPP 1. About $5-6 billion will be spent on the project. The payback period will be 13-15 years from the start of operation.

«When the time comes to repay the debt on this project, the republican budget and the people will not pay. The construction of Kambarata HPP 1 will pay off by the time the debt repayment period comes. The World Bank is providing a $500 million loan for 50 years with a 10-year grace period without interest. This is the first time in the history of Kyrgyzstan when a loan on such terms has been obtained. Therefore, even if our external debt increases to $10-15 billion, we should not worry,» Sadyr Japarov said.

According to him, the most important thing is that by 2035 we will fully repay the previous debts.

«In the future, we will take loans for payback projects. The republican treasury and people’s pockets will not be affected, of course, not taking into account the debts taken for road construction. We also have small and medium-sized hydroelectric projects that will pay off in 7-8 years. We should also invest in them. We have many other projects in other areas. I will not tell you everything in detail. We are implementing them with private investors and, if possible, at the expense of the budget,» the head of state concluded.