flag Kyrgyzstan Kyrgyzstan: Economic Outline

Economic Indicators

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Landlocked Kyrgyzstan is a low-middle-income country and one of the poorest in Central Asia. Its economy is heavily dependent on gold exports (which generally account for one-tenth of the country's GDP and almost half of the exports), as well as remittances from citizens working abroad, primarily in Russia (equating to more than one-fourth of GDP), which decreased in recent years due to the deterioration of the Russian economy (a trend that is likely to be exacerbated by the Russia-Ukraine conflict). The cumulative effects of the COVID-19 pandemic and the political tensions that characterized 2020 plunged Kyrgyzstan into its worst recession since 1994, with a decrease of 8.6% of GDP. The economy rebounded only marginally in 2021 (+3.7% as per the IMF estimates); however, the Kyrgyz Republic has shown resilience to the spillovers from the war in Ukraine and is estimated to have grown by 5.5% in 2022, driven by gold production, trade, transportation, and agriculture (IMF). Growth in 2023 is expected to decelerate to 3.5%, as the projected global slowdown and the contraction in Russia start to weigh on the Kyrgyz economy, followed by 3.6% the following year (IMF).

The budget deficit, which is mainly due to infrastructure financing, is 60% funded by concessional loans and foreign grants. In 2022, the general government deficit, which includes lending to state-owned enterprises in the energy sector, was projected to have expanded to 5.2% of GDP from the previous year's 0.8%, mainly because of a substantial rise in public sector salaries and pensions, as well as public investment, which has counteracted efforts to enhance tax administration that resulted in a notable boost of about 6 percentage points in tax revenue as a share of GDP. The debt-to-GDP ratio was estimated at 60.4% in 2022 and should remain stable over the forecast horizon, but elevated fiscal deficits may result in a moderate build-up of public debt in the medium term (IMF). Annual inflation increased to over 15% during the year, mainly due to high global food and fuel prices, but core inflation also rose to double digits and the rate is expected to decline only marginally to about 10% by end-2023. The country has been trying to attract foreign investment to expand its export base, including the construction of hydroelectric dams, but a difficult business climate and disputes with foreign investors hindered the country’s attractiveness. Kyrgyzstan maintains close relations with China, which has helped the country finance infrastructure projects. The main challenge for policymakers is to strengthen macroeconomic stability, rebuild policy space for future shocks, mobilize financing for development needs, and raise growth potential by advancing reforms (IMF).

Kyrgyzstan is one of the poorest countries in the region (the Asian Development Bank estimates that 20.1% of the population lives below the poverty line), but the poverty rate is expected to gradually decline. Income inequality in the country has been decreasing since 2006, and the Gini index stands at 29% (World Bank, latest data available). Unemployment was estimated at 4.8% in 2021 by the World Bank (latest data available). In 2022, the country’s GDP per capita (PPP) was assessed at USD 5,771 by the IMF.

 
Main Indicators 20222023 (E)2024 (E)2025 (E)2026 (E)
GDP (billions USD) 11.6712.6813.6614.6915.65
GDP (Constant Prices, Annual % Change) 6.33.44.33.94.0
GDP per Capita (USD) 1,7181,8301,9302,0332,123
General Government Gross Debt (in % of GDP) 49.247.046.146.046.1
Inflation Rate (%) n/a11.78.66.65.5
Current Account (billions USD) -5.43-2.53-0.84-0.87-0.76
Current Account (in % of GDP) -46.5-20.0-6.1-5.9-4.8

Source: IMF – World Economic Outlook Database - October 2021.

Note: (e) Estimated Data


 
Monetary Indicators 20162017201820192020
Kyrgyzstani Som (KGS) - Average Annual Exchange Rate For 1 GHS 17.5215.8315.0113.4213.82

Source: World Bank - Latest available data.

 

Main Sectors of Industry

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 16.6 26.9 56.6
Value Added (in % of GDP) 12.1 24.0 52.1
Value Added (Annual % Change) 7.3 10.9 4.6

Source: World Bank - Latest available data.

 
Socio-Demographic Indicators 2024 (e)2025 (e)2026 (e)
Unemployment Rate (%) 9.09.09.0

Source: IMF – World Economic Outlook Database - Latest available data

 

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The Active Population in Figures

201820192020
Labour Force 2,526,2022,565,0162,440,848

Source: International Labour Organization, ILOSTAT database

 
201720182019
Total activity rate 63.64%62.45%62.35%
Men activity rate 78.35%77.74%77.70%
Women activity rate 49.27%47.51%47.34%

Source: International Labour Organization, ILOSTAT database

 

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Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Score:
63,7/100
World Rank:
78
Regional Rank:
13

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation

 
 

Country Risk

See the country risk analysis provided by Coface.

 

Indicator of Political Freedom

Definition:

The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

Ranking:
Partly Free
Political Freedom:
5/7

Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House

 

Indicator of Freedom of the Press

Definition:

The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

World Rank:
79/180

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Sources of General Economic Information

Main Online Newspapers and Portals
24 KG
Kabar Kyrgyz National News
AKIpress News Agency
Useful Resources
Ministry of Economy
Government of Kyrgyzstan (website in Russian and Kyrgyz only)
National Bank of the Kyrgyz Republic
 
 

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Latest Update: December 2023