Central Asia: Problems of External Debt and Its Sustainability

This paper is devoted to one of the most urgent problems of Central Asian economies in transition, i.e. external debt and its sustainability within systemic transformation process. On the basis of vast current statistical data the problems of structure and dynamics of external debt are analysed and some policy recommendations are made. Basic transfer equations and two-gap models are used as tools to measure external debt. The paper attempts to find solutions considering both specific causes of the external debt itself and debt problems via related balance of payments issues. In conlcusion, it emphasized the necessity to deal with external debt through policies in all spheres of debt management, foreign trade and the flow of international financial resources implemented simultaneously. It proves that only the cumulative effect of all measures will allow the rather complex and persistent character of external debt to be overcome.Central Asian Independent States, External Debt, Indebtedness Indicators, Debt Sustainability