Kazakhstan has signed an agreement with the Asian Infrastructure Investment Bank (AIIB) that will allow it to attract another $6 billion in loans. Minister of National Economy Serik Zhumangarin explained that borrowing abroad is not dangerous for the country's economy. This was reported by Qazaqyia.kz citing Kursiv Media.
Briefing at the Kurultai
During a briefing at the Kurultai, the economy minister was asked why Kazakhstan has increasingly resorted to foreign loans to implement major projects and how the state debt to foreign organizations will change in the future.
The economy minister noted that, just like a person or a company, a state cannot rely only on its own capital for development. To make development faster, borrowed funds are needed. At the same time, when borrowing, strict calculations must be carried out and risks avoided.
"Therefore, I consider it reasonable to attract loans, especially from international financial organizations. The country's development is going much faster. The country's debt as of July 1, 2026 – the state debt amounts to 38.5 trillion tenge. This is only 20.9% of GDP. We have corridors established by the Concept for the Management of Public Finances – 32% to GDP. We belong to countries with low debt. We very carefully monitor how much we borrow, how we borrow and from whom we borrow. Most of the debt – about 75% – is domestic debt. And we have fairly large capital buffers, such as the National Fund. In this regard, citizens can be calm," the minister noted.
How loans will be repaid
The economy minister added that all foreign borrowings are based on how they will be repaid. Previously, loans from the Asian bank were made as direct government loans. Now the government will only provide a state guarantee for loans for specific projects. At the same time, the projects themselves must repay these debts.
Thus, when building a railway, the tariffs for transportation along it must cover the debt and interest on it. If a road is built, the debt is repaid from tariffs for the passage of freight and passenger transport along it.
The minister assured that the state debt will not grow because of new loans, since GDP will grow.
"We plan somewhere around $360–370 billion by the end of this year. This is the same proportion where the denominator is the size of GDP, and the debt-to-GDP ratio will depend on how quickly we grow. We have no desire to borrow thoughtlessly, recklessly, inefficiently and, most importantly, non-transparently," the minister added.
Terms of the AIIB agreement
Earlier, at a Kurultai meeting, presenting the agreement with the Asian Infrastructure Investment Bank, the minister noted that its ratification would increase the volume of advantageous financing. He noted the bank's flexible terms – the repayment period is up to 35 years, and the rate varies from 1% to 1.5%. It depends on the loan currency – dollars, yen, yuan or euros.
"In the first five years after ratification, the framework agreement will allow attracting additional 'long money' on preferential terms into the country's economy in the amount of about $6 billion in sectors such as transport, energy, healthcare, and green finance," said Serik Zhumangarin.
It was previously reported that Kazakhstan directs 11.1% of all state expenditures, which amounts to 3.8% of the country's GDP, to net interest expenses on state debt.