As debt to China grows Kyrgyzstan pledges to extradite Uighur “terrorists”

27.10.2023, 16:13 exclusive.kz

Kyrgyzstan’s debt to China has grown 37 times over the past 15 years. A failure to repay it in time could result in China’s taking over some important Kyrgyz infrastructure facilities, a think tank has said.

However, the independent Baku-based STEM analytical centre said, takeover of economic assets might not be the main goal behind Beijing’s investments in Kyrgyzstan.

As of 31 August, Kyrgyzstan’s national debt to China amounted to more than 5.84bn dollars. The Kyrgyz borrowings, mainly 20-year loans from China’s Eximbank, have been rapidly growing since 2008, STEM said in a report.

The Eximbank loans have been used for a total of nine projects worth over 2bn dollars – mainly modernisation of roads and power generation facilities.

The biggest project among them is the ongoing upgrade of an alternative road linking Kyrgyzstan’s north and south. Its estimated initial cost was nearly 400m dollars, but the country has already taken almost 700m dollars in loans towards the project, the report said.

As scheduled, the repayments on the Chinese loans will peak in 2025-2027. In theory, they have to be fully repaid by 2035.

Even though the Kyrgyz debt is not a huge sum for China, it is unlikely it will be willing to write it off, the think tanks said.

“If Kyrgyzstan keeps failing to pay off the debt, it is quite probable that the management of some major infrastructure facilities, like the Bishkek thermal power station, the alternative North-South road and the Datka-Kemin electrical transmission line might be taken over by China,” STEM said.

The think tank noted that under its agreements with China, Kyrgyzstan has no right to seek international arbitration in the case of a dispute over its debt to China. Should one arise, it can be only considered in a Chinese court.

At the same time, this year Bishkek has done an important political favour to China.

In its declaration of partnership with China after the China-Central Asia summit in May, the Kyrgyz government was the only one in Central Asia to mention “Eastern Turkestan terrorists”. It also pledged to extradite to China suspected Uighur “terrorists”.

Beijing has been for years fighting alleged Uighur separatism and Islamic radicalism in its western Xinjiang region, seeing it as one of the biggest internal threats. Beijing fears that any anti-Chinese activism in Xinjiang might find support among neighbouring Central Asians, who are ethnically close to the Uighurs.

Thus, STEM said, the Kyrgyz government’s support in keeping tight control over Xinjiang could be one of the reasons behind Chinese investment in Kyrgyzstan.

Meanwhile, the Kyrgyz national coal mining company KyrgyzKomur (KyrgyzCoal) has recently signed cooperation deals with China’s Hebei Jinsheng Mining Engineering, Kashi Shunbaofu Trade and Еxport Trade Corporation.

The Kyrgyz government has also signed deals on building wind and solar power plants with China’s Goldwind Science and Technology and Molin Energy respectively, the STEM report said.