Uzbekistan plans to borrow $4.5 billion in 2023, which is in line with the target figures envisaged in 2022 but has not been reached. The total public debt is projected to reach $29.2 billion in 2022 and $32.6 billion in 2023.

Finance Minister Timur Ishmetov informed the Legislative Chamber about the draft state budget for 2023. In his remarks, he also touched upon plans for the public debt.

“By the end of 2022, the public debt is expected to top $29 billion 215 million, and next year (2023) - $32 billion 62 million. It is forecasted that the share of public debt to the GDP next year, as well as this year, will be 36 percent,” Ishmetov said.

MP Botir Mardaev asked about the agreements that will be signed on behalf of the Republic of Uzbekistan and under the guarantee of external debt in 2023.

“The total value of the agreements is at $4.5 billion, of which $2 billion is to support the state budget, $2 billion is for the budget deficit (this is $500 million less than last year), and $2.5 billion is to support the financing of investment projects (this is more than last year by $500 million). To what extent is this change compatible with the government's foreign debt strategy? - asked the deputy.

Timur Ishmetov noted that in the Public Debt Law the upper limit of the state's external debt should not exceed 60 percent of GDP, and when it reaches 50 percent, the government should take measures to optimize budget expenditures, channel the debt into infrastructure and the social sphere.

“The $2 billion and $2.5 billion you mentioned… we originally planned to have an annual debt limit of $4 billion. In 2020, the pandemic hit and we had to increase our spending. In addition, we had to increase borrowing by 5 billion to finance the deficit. From next year (2023) we plan to reduce the total debt to 4.5 billion.

It doesn't matter how much of the total spending goes to the budget, how much for projects, or what the total amount of external debt is. We would like the budget deficit to be 3 percent, which should be our highest in the medium term. Then we work on reducing external debt to reduce the deficit. To finance projects and cover the budget deficit, it is necessary to attract 2-2.5 billion of external debt, therefore, a limit of 2-2.5 billion has been set,” the minister said.

The MPs adopted the 2023 State Budget Bill in the first reading. 112 MPs supported the project, one voted against, three abstained, 9 did not vote.