Even as Bishkek is unable to pay the huge external debt to China, President Jeenbekov invites Beijing to develop major transport and agriculture projects in the country
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New Delhi: A victim of China’s debt trap under the guise of Belt and Road Initiative (BRI), Krygyzstan has asked Beijing to consider the country’s debt payment. The appeal of consideration was made by President Sooronbai Jeenbekov to the Chinese State Counselor and the Minister of Foreign Affairs Wang Yi.
The official statement from Bishkek requesting Beijing to consider its debt stems due to a nose-diving economy of the country. According to government statistics, Kyrgyzstan’s GDP plummeted 6.1 percent year-on-year in the January to July period, as coronavirus containment measures weighed on construction and services activity. Moreover, remittances, which make up almost 30 percent of GDP, dropped sharply in the first half of the year overall, reflecting lockdowns abroad and the weak global economy.
The pandemic has also reeled pressure on the fiscal and current account deficits as government revenues evaporate, forcing authorities to look for international help to avoid a crisis. In August, the Asian Infrastructure Investment Bank (AIIB) approved a $50 million loan and the Eurasian Fund for Stabilization and Development greenlighted a $100 million loan to counter the fallout from the COVID-19 pandemic.
Thus, taking into account the negative impact of the pandemic on the macroeconomic situation, President Jeenbekov suggested considering the possibility of facilitating and prolonging payments on Kyrgyzstan’s external debt to China. The statement was officially released by the Presidential press service.
An exchange of views has taken place on the priority areas of the Kyrgyzstani-Chinese bilateral and multilateral cooperation.
The head of state has conveyed greetings to President Xi Jinping and has expressed gratitude to the Chinese Government for the provided humanitarian assistance, as well as for sending medical experts to fight the COVID-19 pandemic. President Jeenbekov also added on his interest in further developing economic cooperation between the countries, focused on priority projects in the fields of agriculture, transport, and roads.
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‘The Kyrgyzstani side is interested in the implementation of new models of cooperation, in such areas as e-commerce and information technology, which in turn contributes to the activation of trade and economic ties between the countries,’ the statement read.
Meanwhile, Yi expressed gratitude to the Kyrgyzstani President for the meeting and read out a message from Jinping, which states that bilateral relations between the countries have stood the test of the outbreak of the COVID-19 pandemic. Yi claimed that China now seeks to focus on strengthening cooperation in the post-pandemic period, including through the BRI initiative.
