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The country's debt-to-GDP ratio has also increased significantly in recent years. In 2010, 
Uzbekistan's external debt was equivalent to 14% of its GDP. By 2020, this figure had 
increased to 46%. The increase in debt-to-GDP ratio suggests that Uzbekistan's debt burden 
has become a significant economic concern. 
Economic Indicators: 
Uzbekistan's economy has grown at an impressive rate over the 
last decade. The country's GDP increased from $38 billion in 2010 to $65 billion in 2020. The 
average annual growth rate was 6.2%. The growth was driven by the country's agriculture, 
manufacturing, and service sectors. Uzbekistan has also benefited from its strategic location, 
as it serves as a gateway to Central Asia and the wider region. 
However, the country faces several economic challenges that have an impact on its debt 
dynamics. Uzbekistan has a high poverty rate, with more than 14% of the population living 
below the poverty line. The country also faces high inflation, which has averaged around 10% 
over the last decade. The high inflation rate has eroded the purchasing power of the 
Uzbekistani Som, the country's currency. Furthermore, the country's banking sector faces 
several challenges, including non-performing loans and weak governance. 
Policy Responses: 
The Uzbekistani government has taken several policy responses to 
manage its debt burden. In 2017, the government announced a series of economic reforms 
aimed at diversifying the country's economy, improving the business climate, and attracting 
foreign investment. The reforms included the liberalization of the foreign exchange market, 
the reduction of taxes on small and medium-sized enterprises, and the privatization of state-
owned enterprises. 
The government has also implemented measures to address the country's banking 
sector's challenges. In 2020, the Central Bank of Uzbekistan launched a program to 
recapitalize banks and reduce non-performing loans. The program includes the creation of a 
state-owned asset management company that will acquire and manage non-performing loans. 
Furthermore, Uzbekistan's government has taken steps to improve its debt management 
practices. In 2019, the government established the Ministry of Finance's Debt Management 
Department to oversee the country's debt portfolio. The department is responsible for 
developing debt management strategies, monitoring debt sustainability, and coordinating 
with international financial institutions. 
Impact on GDP: 
The increase in Uzbekistan's external debt has had a mixed impact on 
the country's GDP. On the one hand, foreign borrowing has enabled the government to finance 
its infrastructure projects, which has contributed to economic growth. The country has 
invested in transport infrastructure, such as the construction of a new railway line connecting 
Uzbekistan to Afghanistan, and the modernization of its airports. Uzbekistan has also invested 
in its energy sector, with the construction of a new gas pipeline to China. 
On the other hand, the increase in external debt has also increased the country's debt 
service obligations, which have put pressure on the government's budget. The debt service 
payments have increased from $424 million in 2010 to $1.4 billion in 2020. The high debt 
service payments have reduced the government's ability to invest in social sectors such as 
health and education. The reduction in social spending has the potential to impact human 
development and social welfare indicators in the long run. 

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