Kyrgyzstan’s economy grew by 11.1% in the first seven months of 2026, but households also faced double-digit inflation. Annual price growth reached 11.5% in July. The latest poverty figures show that 24% of the population remained below the national poverty line in 2025.
According to the latest macroeconomic review by the Eurasian Development Bank (EDB), the expansion has been driven primarily by a surge in investment and strong consumer demand.
Kyrgyzstan’s growth rate exceeded those reported by several Central Asian neighbors, although the figures cover different periods. Kazakhstan’s economy expanded by 4.1% in January–July. Uzbekistan and Tajikistan grew by 8.5% and 8.2%, respectively, in the first half of the year. The EDB forecasts growth of 10.2% for Kyrgyzstan over 2026 as a whole.
Average real wages, adjusted for inflation, rose by 15.3% in January–June. This indicates stronger purchasing power among wage earners on average, but does not establish an improvement across all households.
Investment increased by 58.8% over the first seven months. Budget financing for investment increased by about 70%, while bank financing rose to 4.3 times its previous level. Fixed-capital investment financed by foreign direct investment rose to 15.3 times its previous level.
Budget revenues also increased by 48.8% in the first half of the year, while the republican budget recorded a surplus equivalent to 6.1% of GDP.
Price Growth Remains in Double Digits
Annual inflation reached 11.5% in July, up from 11% a month earlier. The pressure is visible in everyday purchases. In July alone, average prices for horsemeat rose by 5.4%, lamb by 4%, and beef by 3.9%, although potatoes became cheaper. Housing and utility costs were also rising rapidly, with annual inflation in that category reaching 11.2%.
Fuel prices are another source of pressure. The National Bank says higher global oil prices, amid the conflict in the Middle East and concerns over petroleum supplies, have raised the cost of imported fuel. Those increases then feed into transport and production costs across the economy.
By August 24, the National Bank put annual inflation at 11.7%, with prices up 7.3% since the start of the year. On the same day, it kept its policy rate at 12%. The central bank cited persistent inflationary pressure, including higher import costs and production expenses. Its inflation target range is 5%–7%.
The EDB expects inflation to end 2026 at about 11.5%, still well above that range.
IMF Proposes Changes to Public-Sector Pay
The International Monetary Fund has also examined public-sector compensation. In a technical assistance report published on September 2, it notes pay raises of 50% for doctors and 25% for nurses in 2024. The report also records a 63% increase in remuneration for the social sector in 2026.
According to the IMF, large, infrequent pay increases can add to inflationary pressures and make government spending more difficult to manage.
The IMF recommends moving away from large, episodic increases toward more regular salary adjustments that account for inflation, available fiscal space, and labor market conditions. This would make wage growth and government spending more predictable.
Nearly One in Four Remained Below the Poverty Line
Rapid economic growth still coexists with a large low-income population.
According to the latest annual data from the National Statistical Committee, the poverty rate fell to 24% in 2025 from 25.7% a year earlier. Some 1.779 million people lived below the national poverty line, 62.2% of them in rural areas.
The rate was higher among children. Some 906,400 people under the age of 18 lived in poverty, representing 29.7% of the country’s child population.
The national poverty line in 2025 was 70,963 som per person per year – about $810, or less than $68 a month.
Despite the decline in overall poverty, extreme poverty increased from 2.7% to 3.6% in 2025. The number of people living below the extreme poverty line reached 268,100, with 74.2% of them in rural areas.
The figures also underline the continuing importance of labor migration. The Statistical Committee estimates that without income earned by Kyrgyz workers abroad, the 2025 poverty rate would have been 34.9% rather than 24%.
The poverty figures cover 2025 and do not yet show how growth in 2026 has affected low-income households.
