International credit rating agency Moody’s has maintained Uzbekistan’s long-term credit rating at “Ba3”, while upgrading the outlook from “stable” to “positive”, Gazeta.uz reports. The decision reflects the agency’s growing confidence in the country’s reform momentum, macroeconomic management, and fiscal discipline.
The Ba3 rating indicates a speculative (non-investment grade) credit standing with moderately high risk. While countries in this category can attract foreign capital, investors typically demand higher returns to offset perceived risks. However, the positive outlook signals that Moody’s may consider upgrading the country’s rating if reform implementation continues effectively.
Moody’s emphasized Uzbekistan’s steady economic growth, its shrinking budget deficit, and relatively low government debt compared to peers with similar ratings. The agency noted that the Uzbek government’s commitment to institutional and governance reforms could significantly enhance policy effectiveness and institutional quality over time, laying a foundation for a future credit upgrade.
One of the key pillars of these reforms is Uzbekistan’s ambitious privatization program, which, if fully implemented, could help accelerate sustainable economic development. In combination with ongoing fiscal discipline, these efforts may strengthen economic resilience over the medium term and unlock the country’s broader potential.
Moody’s also cited several structural strengths underpinning the current Ba3 rating:
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A diversified economy with strong growth prospects;
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A favorable demographic profile;
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A moderate debt burden, much of which is on concessional terms.
Nevertheless, the agency highlighted some ongoing challenges that continue to limit further upgrades:
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Low per capita income;
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Limited competitiveness;
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Institutional weaknesses, albeit with encouraging progress;
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Moderate political risks.
Moody’s left Uzbekistan’s rating ceilings unchanged:
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Ba1 for local currency obligations;
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Ba3 for foreign currency obligations.
The two-notch difference between the sovereign rating and the local currency ceiling reflects the large role of the state in the economy and unpredictability of policymaking, though these concerns are partially offset by manageable external vulnerabilities, including a narrowing current account deficit and low external debt on favorable terms.
Additionally, the gap between local and foreign currency ceilings is attributed to weak fiscal and monetary policy frameworks, as well as capital flow restrictions, which could tighten further under stress conditions.
Saida Mirziyoyeva, assistant to the president and head of the Working Group on Sovereign Credit Rating Improvement, commented on the revised outlook via her official Telegram channel. She described Moody’s decision as “a reflection of the international community’s recognition of the reform program being led by our President, and a confirmation that we are on the right path.”
She emphasized that Uzbekistan is now viewed by foreign investors as a reliable partner capable of sustaining economic growth even amid global volatility.
“This improved outlook marks the first step toward our strategic goal of achieving investment-grade credit status by 2030. Reaching that goal will require collective effort, driven by greater economic competitiveness and a continued commitment to macroeconomic stability,” she stated.
CentralasianLIGHT.org
June 16, 2025