The Republic of Kazakhstan once again captured global investor attention with its highly successful sovereign bond issuance in October 2025, underscoring its status as Central Asia’s benchmark borrower. The Ministry of Finance sold a $1.5 billion five-year Eurobond at a record-low 4.412% yield, about 85 basis points above U.S. Treasuries, after attracting nearly $4.4 billion in orders from a geographically diverse investor base spanning Europe, the U.S., and Asia - almost three times oversubscribed. Strong Market Reception and Competitive Pricing This five-year issue achieved the lowest yield in Kazakhstan’s independent history and was one of the tightest-priced five-year sovereign bonds among investment-grade peers, pricing inside higher-rated Poland, and modestly above Qatar’s comparable five-year yield. The Finance Ministry credited the result to investors’ confidence in Kazakhstan’s macroeconomic management and fiscal credibility, strengthened by the country’s ongoing budget and tax reforms enacted in 2025. These measures have reinforced perceptions of policy discipline and institutional reliability, enabling Kazakhstan to secure funding at exceptionally low costs. June 2025: Dual-Tranche Success In June 2025, Kazakhstan executed a $2.5 billion dual-tranche Eurobond comprising a 7-year $1.35 billion note at 5.0% and a 12-year $1.15 billion note at 5.5%. Investor demand was exceptional, with orders roughly twice the issue size from global funds across Europe, the U.S., and Asia. The transaction priced tightly against comparable BBB sovereigns, reflecting market confidence in Kazakhstan’s low debt levels, ample reserves, and consistent reform momentum. Together, the June and October offerings have demonstrated Kazakhstan’s ability to tap international markets repeatedly in 2025 on favorable terms, even amid global volatility. Fiscal Strength and Ratings Support Kazakhstan’s strong market performance rests on a robust fiscal foundation and solid credit ratings. Fitch Ratings has affirmed Kazakhstan’s long-term foreign-currency issuer default rating at ‘BBB’ with a Stable Outlook, noting the country’s low government debt - around 25% of GDP - and substantial sovereign net foreign assets supported by the National Fund and foreign-exchange reserves. Combined reserves and National Fund assets total roughly $93 billion, equal to about 31% of GDP. S&P Global Ratings, which upgraded Kazakhstan’s outlook to Positive in August 2025, forecasts 5.5–5.6% GDP growth and has commended progress in deficit reduction and institutional reform. The agency noted that Kazakhstan’s new Budget and Tax Codes, along with tighter fiscal rules and improved oversight of quasi-fiscal activities, are expected to strengthen fiscal consolidation and institutional transparency. These reforms, together with the country’s moderate debt burden and substantial sovereign assets, have helped sustain investor confidence. Kazakhstan’s ability to issue Eurobonds at yields tighter than some A-rated peers demonstrates that credibility in practice, and market participants now view the country as the regional benchmark sovereign in Central Asia. Uzbekistan: Reform Progress, Higher Yields In February 2025, Uzbekistan raised roughly $1.5 billion equivalent through a multi-currency sovereign issue — a $500 million 7-year U.S. dollar tranche at 6.95%, a €500 million 4-year euro tranche at 5.1%, and a UZS 6 trillion 3-year local-currency note at 15.5%. Total demand reached about $4.2 billion, nearly 2.8 times oversubscribed, underscoring strong...
