The International Debt Report 2023 from the World Bank provides valuable insights into Turkmenistan's external debt scenario. The comprehensive analysis covers key indicators, including total external debt, debt service, net financial flows, creditor composition, and debt terms.
Total External Debt and Economic Indicators
Turkmenistan grapples with a total external debt of $4.5bn in 2022. This figure is essential, signifying the magnitude of Turkmenistan's financial obligations globally. External debt stocks as a percentage of exports and Gross National Income (GNI) remain unspecified, creating a gap in understanding the economic health of the nation.
Debt Service and Financial Flows
The debt service as a percentage of exports and GNI is undisclosed in the report. However, net financial flows, encompassing both debt and equity, total $703mn. Turkmenistan experiences net debt inflows of -$233mn, indicating a reliance on borrowing, while net equity inflows stand at a substantial $936mn, providing an additional dimension to the nation's financial landscape.
Creditor Composition and Debt Terms
Examining the creditor composition reveals insights into Turkmenistan's international financial relationships. Multilateral creditors, including the World Bank and Asian Development Bank, constitute a significant portion. Bilateral creditors, led by Japan and Korea, play a crucial role, contributing 57% collectively.
The breakdown of average terms on new debt commitments from official and private creditors is crucial for assessing Turkmenistan's borrowing practices. Unfortunately, detailed information on grace periods, maturity, and interest rates is not provided in the report.
Long-Term External Debt and IMF Engagement
A detailed analysis of long-term external debt stocks showcases Turkmenistan's evolving financial obligations. The report does not specify the use of IMF credit and Special Drawing Rights (SDR) allocations.
Historical Trends
In 2010, Turkmenistan's total external debt stocks were $1.68bn, which increased to $4.5bn in 2022. A closer look at long-term external debt stocks reveals an initial $1.5bn in 2010 an it peaked at $7.7 bn in 2018, which demonstrates percentage change of approximately 413.3%. The subsequent years saw fluctuations, culminating in $4bn in 2022, where we can see approximately 48.05% decrease.
Special Drawing Rights (SDR) allocations remained constantly at record low $97mn in 2018-2019, and peaked at $418mn in 2021. Therefore, the percentage change from 2018-2019 to 2021 is approximately 330.93%.
Short-term external debt stocks decreased from $306mn in 2018 to $100mn in 2022. Hence, the percentage change shows approximately 67.32% derease throughout four years. Disbursements, representing long-term financial transactions, showcased an fluctuations as well, peaking at aroud $2bn in 2018 and stopping at $610mn in 2022, which concludes 69.5% decrease.
Turkmenistan faces a significant external debt burden, and the International Debt Report 2022 provides a snapshot of its current financial landscape.
Earlier Daryo reported that Tajikistan faces a considerable external debt challenge, amounting to $6.7bn.
Analysis based on the World Bank International Debt Report 2023 and additional financial data
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