Kyrgyzstan Weekly: Kyrgyzstan assumes SCO chair; backs dev bank, rail link via Trans-Afghan corridor

August 29, 2025 to September 4, 2025

This week's top 10 stories from Kyrgyzstan, selected from our daily intelligence briefs.

1. Uzbekistan Proposes Linking China–Kyrgyzstan–Uzbekistan Railway to Trans-Afghan Corridor

At the recent SCO Plus summit, Uzbek President Shavkat Mirziyoyev proposed linking the planned China–Kyrgyzstan–Uzbekistan (CKU) railway with the Trans‑Afghan transport corridor to create a unified regional network aimed at accelerating trade and connectivity. Mirziyoyev argued the connection would give Central Asia direct access to South Asian and Middle Eastern markets and shorten routes from East Asia to the Middle East and Southern Europe by roughly 900 km; the CKU is being promoted as a cornerstone for regional connectivity and employment across participating states.

For international professionals, the proposal signals Uzbekistan’s push to leverage multimodal corridors to integrate Eurasian transport hubs and diversify export routes amid shifting geopolitical logistics patterns. If implemented, the linkage would require coordination among China, Kyrgyzstan, Uzbekistan and Afghan stakeholders, raise security and financing considerations for Afghan segments, and could materially affect transit times and trade flows across Eurasia.

From daily brief: 2025-09-04

2. SCO Summit Hands 2025 Chairmanship to Bishkek, Setting Security and Connectivity Agenda

At the Tianjin SCO summit delegates adopted the Tianjin Declaration and a suite of political, economic, energy and humanitarian cooperation measures while formally handing the 2025 chairmanship to Kyrgyzstan — its fourth term leading the Shanghai Cooperation Organization. Bishkek, represented by Ambassador Alikbek Djekshenkulov, seeks to use the chairmanship to prioritize regional security and connectivity: proposals include upgrading the RATS-led counterterrorism and cyber‑defense mechanisms, piloting “smart borders” in mountainous frontier zones, and positioning Kyrgyzstan as a regional cybersecurity hub.

Economic and development initiatives highlighted by the Kyrgyz agenda aim to accelerate the China–Kyrgyzstan–Uzbekistan corridor, harmonize trade standards, boost agro‑exports, and explore creation of an SCO Development Bank; cultural and human‑capital measures include expanded youth and tourism forums, a potential SCO University and an Issyk‑Kul climate/ecology forum. The article underscores the balancing influence of Russia, China, India and Iran as members shape a more multipolar Eurasian framework, with Bishkek using the 2025 chairmanship to assert greater agenda-setting leverage.

From daily brief: 2025-09-03

3. SCO Members Approve Creation of a Development Bank, Kyrgyzstan Assumes 2025 Chairmanship

SCO leaders endorsed the creation of an SCO Development Bank in the Tianjin Declaration, instructing member states to accelerate consultations on its operational framework and to fast-track inclusion of Iran’s authorized bank into the bloc’s financial mechanisms. The decision formalizes a long-discussed plan to finance joint investment projects and deepen economic integration across the SCO’s membership—China, Russia, India, Iran and Central Asian states—building on the Interbank Consortium that has coordinated cooperation for more than 20 years.

Kyrgyzstan assumes the SCO’s rotating chairmanship for 2025 and will host the bloc’s 25th‑anniversary leaders’ summit in Bishkek, where members are expected to address governance, capital structure and project pipelines for the new lender. China’s push for a dedicated institution to support sustainable growth suggests Beijing may play a leading role in capitalization and agenda‑setting, with implications for regional finance architecture and geopolitical influence.

From daily brief: 2025-09-02

4. SCO Chairmanship to Shift from China to Kyrgyzstan for 2025–2026 Cycle

Kyrgyzstan will assume the Shanghai Cooperation Organisation (SCO) chairmanship for the 2025–2026 cycle, succeeding China, Russian presidential aide Yuri Ushakov announced as the SCO summit opened on 31 August in Tianjin. The summit — attended by a record turnout of more than 20 heads of state and senior officials from across Eurasia and beyond — is expected to adopt the SCO Development Strategy to 2035, a long‑term framework aimed at bolstering regional security, stability and economic cooperation.

The handover signals a shift in leadership to a smaller Central Asian state and underscores Moscow’s intent to support Bishkek during its term, Ushakov said. Alongside the strategy, delegates plan to sign additional legal and cooperation agreements to strengthen the organisation’s institutional capacity, reinforcing the SCO’s role as a coordinated regional actor.

From daily brief: 2025-09-01

5. Public Debt Jumps 33% in a Year, Highest Growth Rate in the EAEU

Kyrgyzstan’s public debt surged 33.2% year‑on‑year to $8.4 billion, the fastest increase among Eurasian Economic Union members, the Eurasian Economic Commission reported. The stock comprises $5.2 billion in external obligations and $3.1 billion in domestic debt; by comparison Russia’s debt rose 17.2%, Kazakhstan’s 16.8% and Armenia’s 12.5%. Communications chief Daiyrbek Orunbekov has noted the burden stands at 36.9% of GDP, a level that leaves some fiscal space but narrows headroom if growth slows or financing costs increase.

The rapid expansion heightens questions about sustainability and borrowing strategy as Kyrgyzstan balances development financing against rising risk exposure. Investors and policymakers will monitor whether the government can maintain moderate debt‑to‑GDP metrics while managing external liabilities and refinancing pressures, particularly given the faster pace of accumulation relative to regional peers.

From daily brief: 2025-08-31

6. GDP Growth Holds Above 10% Through July as Budget Meets Annual Plan Early

Kyrgyzstan’s economy sustained double‑digit growth through July 2025, with real GDP expansion averaging 11.5% in the first seven months and nominal GDP topping 865 billion soms, Cabinet Chairman Adylbek Kasymaliev said. The government also reported that the consolidated 2025 budget originally set at 708.9 billion soms had been fully executed by late August and now projects full‑year revenues to exceed 1 trillion soms — a first for the country — providing scope for accelerated year‑end spending and public investment.

The upbeat figures signal strong revenue collection and economic momentum but raise questions about sustainability and potential inflationary pressures as nominal aggregates swell. Analysts will watch whether growth broadens beyond short‑term fiscal windfalls, how authorities manage spending to avoid overheating, and the durability of revenue drivers through the remainder of 2025.

From daily brief: 2025-08-30

7. Rail Cargo and Passenger Volumes Rise as China–Kyrgyzstan–Uzbekistan Line Breaks Ground

Kyrgyz state rail operator Kyrgyz Temir Jolu reported robust H1 2025 results, moving 4.94 million tonnes of freight—an increase of 937,300 tonnes year‑on‑year—driven by strong import, export and domestic flows. Imports surged in cement (+173.7%), construction materials (+128.9%) and fuels (+125.4%); exports rose in coal (+121.5%), fuels (+118.5%) and building materials (+114.6%); and domestic freight climbed 182.9% (coal +184.9%). Passenger traffic also improved, with 166,310 riders carried in H1 (up 67,362 year‑on‑year), supported by upgraded high‑comfort coaches and online ticketing for international services. Financially the operator posted 2.11 billion KGS in H1 balance‑sheet income, paid 414.9 million KGS in taxes and 346.7 million KGS to the Social Fund, and implemented 15–30% wage increases from January 1 while beginning staff housing construction.

Strategically, rail infrastructure development is advancing: construction has started on the Fergana tunnel and associated works in Suzak district, Jalal‑Abad, as part of the China–Kyrgyzstan–Uzbekistan railway—an initiative that could materially boost regional connectivity and trade flows if completed. The operational and fiscal gains underscore strengthening domestic and cross‑border demand, but execution risks on large projects and the need to sustain investment and governance will determine whether these gains translate into lasting modal shift and regional integration.

From daily brief: 2025-08-30

8. Double-Digit GDP Growth Leads Eurasian Union as Industrial Output Nearly Doubles Since 2019

Kyrgyzstan’s economy posted its fastest expansion on record, with GDP up more than 13% in H1 2025 following 9% growth in 2024, leaving it the fastest-growing economy among Eurasian Economic Union peers. Year‑to‑date GDP for January–July 2025 reached 865.2 billion soms, a rise of 11.5%, while industrial production has nearly doubled since 2019—from 284 billion soms to 585 billion in 2024—and totaled 375 billion soms in Jan–Jul 2025. Key drivers include services, construction, agriculture and a surge in industry led by oil products, pharmaceuticals (+20%), food processing, light industry (textiles/garments) and building materials.

Officials expect continued industrial expansion with 128 new facilities planned in 2025, projected to create roughly 15,000 jobs after more than 100 openings in 2024 that added about 8,000 jobs. Senior Ministry analyst Talantbek Karasartov attributed the “genuine leap” in recent years to those sectoral gains, signaling stronger domestic production capacity and job creation but also raising questions about sustainability, external demand exposure and infrastructure capacity as output scales up.

From daily brief: 2025-08-29

9. AIIB Explores New Investments in Energy, Transport, and Water During Beijing Talks

During President Sadyr Japarov’s working visit to China, Kyrgyz Deputy Cabinet Chairman and Agriculture Minister Bakyt Torobaev met with Asian Infrastructure Investment Bank (AIIB) Director for Sovereign Investments and Corporate Project Finance Konstantin Limitov to advance existing and prospective financing for Kyrgyz projects. Torobaev outlined flagship projects — the China–Kyrgyzstan–Uzbekistan railway, the Barskoon–Bedel highway, and the Kambar-Ata-1 hydropower plant — and discussions concentrated on accelerating AIIB-supported initiatives in Kyrgyzstan while identifying new opportunities in energy, transport, agriculture and water supply.

No new funding commitments were announced, but both sides agreed to close coordination and a results-oriented approach, signaling potential pipeline growth for transport links and power generation tied to regional connectivity and energy-security priorities. The meeting positions the AIIB as a likely partner as Kyrgyzstan pushes strategic projects amid heightened engagement with China; specific timelines and financing envelopes were not disclosed.

From daily brief: 2025-09-04

10. Japarov to Attend SCO Summit in Tianjin with Chairmanship Hand‑Over to Kyrgyzstan

Kyrgyz President Sadyr Japarov will visit China from August 31 to September 3 to attend the Shanghai Cooperation Organization (SCO) Heads of State Council meeting in Tianjin and events marking the 80th anniversary of Victory in World War II. The summit is expected to formalize the transfer of the SCO chairmanship to Kyrgyzstan, giving Bishkek responsibility for setting the bloc’s agenda over the next year on security, economic and energy cooperation; high-level documents including the Tianjin Declaration and agreements to deepen political and sectoral coordination are slated for signing.

Japarov is also scheduled to hold a bilateral meeting with Chinese President Xi Jinping, a signal that Kyrgyz-Chinese economic and infrastructure ties could feature prominently during Kyrgyzstan’s chairmanship. Sagynbek Abdumutalip, head of the presidential administration’s foreign policy department, said the president will present Kyrgyz priorities for the upcoming SCO term (kabar.kg; sputnik.kg; 24.kg).

From daily brief: 2025-08-31