Debt ticks up, but Kazakhstan’s foreign borrowing stays safe
Kazakhstan’s government external debt has risen 36% over the past decade to $17 billion, but remains at a highly safe level of just 6% of gross domestic product, according to an analysis by Kursiv Research.
Read also: Kazakhstan’s external debt in 2025 and budget for 2026 visualized.
The Ministry of Finance has successfully executed a long-term strategy shifting its primary borrowing focus toward the deep domestic market. Ten years ago, the sovereign debt portfolio was split evenly between domestic and foreign liabilities. Today, domestic debt — mainly treasury bonds of varying maturities — comprises 75% of government liabilities, having quadrupled in dollar terms to reach 17% of GDP.
Focus on fiscal discipline
Vice Minister of Finance Dauren Kengbeil noted that current fiscal policy focuses on expanding the state revenue base and gradually narrowing the budget deficit to curb the need for new borrowing.
By the first quarter of 2026, Kazakhstan’s central government debt reached $73 billion, representing 96% of total public debt, while local municipal liabilities accounted for the remaining 4%. When state guarantees and obligations are factored in, total government-backed liabilities rise to $81 billion, or 26% of GDP. This overall public debt burden remains exceptionally low compared to peer developing nations like South Africa, Brazil, and Thailand.
Eurobonds and currency diversification
Eurobonds remain the cornerstone of government external liabilities, totaling $10 billion and accounting for 58% of the external portfolio by late 2025. These international issuances enjoy highly competitive funding yields; in late October 2025, the sovereign country secured a 4.412% coupon on its five-year dollar Eurobonds, a tight spread of less than one percentage point over comparable U.S. Treasuries. Direct loans from development banks make up most of the remainder, offering favorable terms linked to structural reforms.
The broader currency profile of the government’s external debt has also diversified significantly. The share of U.S. dollar-denominated liabilities fell from 62% to 51% over the decade, while tenge-denominated external debt surged from 3% to nearly 26%. Furthermore, short-term external debt maturing within 12 months represents just 0.7% of the total, insulating the state from immediate refinancing risks.
Strict limits on leverage
Kazakhstan manages its sovereign exposure through a strict «net foreign assets rule» to maintain long-term stability. Under this guideline, the combined external debt of the government, state-guaranteed liabilities, and state-owned enterprises must not exceed the foreign currency assets of the National Fund. This metric stood at a comfortable 0.69 at the end of 2025, safely below the statutory limit of 0.75.
