EDB Macroeconomic Outlook: Eurasian economies to grow to 9.3% in 2026

ArmInfo. Investment activity and domestic demand will remain key growth drivers for most countries in the Eurasian region, despite moderate global economic  growth and persistently elevated interest rates,  according to the  Macroeconomic Outlook for 2026-2028, published by the Eurasian  Development Bank (EDB).

According to the Bank's analysts, the region's GDP will grow by 2.3%  in 2026, with Kyrgyzstan (9.3%), Tajikistan (8.1%), Uzbekistan  (6.8%), and Kazakhstan (5.5%) remaining the leaders. "Inflation will  continue to slow to 6.4% in 2026, thanks to prudent monetary policy.  Investment remains the main driver of growth in the region,  particularly in manufacturing and mining, energy, and construction.  Commodity markets will move in mixed directions: oil prices will fall  slightly, while metals and gold will remain high.  The dollar is  gradually losing its share of central bank reserves, but its role in  settlements remains stable," the EDB forecast states.

Analysts at the Eurasian Development Bank predict that the aggregate  GDP growth rate of the seven member states will be 2.3% in 2026. At  the same time, most countries will maintain high economic activity.  GDP growth is projected for 2026: 5.3% in Armenia, 1.8% in Belarus,  5.5% in Kazakhstan, 9.3% in Kyrgyzstan, 1.4% in Russia, 8.1% in  Tajikistan, and 6.8% in Uzbekistan.  However, according to the Bank's  analysts, the global economy will grow at a slightly slower rate than  in 2024-2025 and will gradually adapt to new trade restrictions. In  the United States, growth is expected to be around 1.6% in 2026, amid  tariff conflict and high debt levels. The Eurozone economy will grow  by 1.1%, mainly due to increased government spending on defense and  infrastructure. China will remain the driver:  its economy could grow  by 4.6% in 2026, supported by government stimulus for domestic  demand.  Inflation in the US and the eurozone will remain above  target levels in 2026-2028. However, interest rate dynamics will  differ. In the US, rate cuts will be slow due to rising costs amid  tariff conflicts. Meanwhile, according to EDB analysts, the ECB  completed its rate cut cycle in 2025 and will begin gradually raising  them in 2026-2027.

The Macroeconomic Forecast notes that, after a period of low interest  rates in the 2010s, economies have returned to higher, "normal"  interest rate levels, characteristic of the pre-cheap money era. This  creates additional risks for financial stability and investment, as  companies and governments are forced to refinance significant amounts  of debt. As a result, interest rates will constrain global economic  growth due to increased interest payments and reduced availability of  funds for investment.  EDB analysts elaborate on this issue in a  separate Box 1 of the report. In 2025-2027, mixed dynamics are  expected in commodity markets: oil prices will decline slightly due  to increased supply, while metal prices will rise due to the  expansion of infrastructure projects and the development of "green"  energy. Gold prices will remain elevated due to increased demand for  it as a reserve asset amid geopolitical instability and the trend  toward de-dollarization. EDB analysts also analyzed the changing role  of the dollar in the global economy and concluded that the dollar's  share of central bank reserves is slowly and steadily declining, but  its use in international settlements continues to grow, while its  role in credit and deposit transactions remains stable.

"The projected dynamics of the global economy and commodity markets  will not create serious obstacles to economic growth in the Eurasian  region, but will not become a growth driver either. Lower oil prices  will limit export revenues for energy-exporting countries (Kazakhstan  and Russia), but will not significantly impact their economic growth.  For net oil-importing countries (Armenia, Belarus, Kyrgyzstan,  Tajikistan, and Uzbekistan), lower prices will improve terms of trade  and help curb domestic price increases," the forecast states.  At the  same time, it is noted that high gold prices will increase foreign  exchange earnings for regional exporters (Kyrgyzstan, Tajikistan, and  Uzbekistan). "In 2025, the economy of the EDB region will return to a  moderate, equilibrium level after two years of record growth."

According to EDB estimates, the region's GDP will grow by 1.9% by the  end of 2025, following 4.5% in 2024. This slowdown is primarily due  to the cooling of the Russian economy. At the same time, several  Central Asian countries are expected to experience record growth  rates by the end of 2025. High growth rates have allowed Central  Asian countries to maintain stable external debt levels, despite  active capital mobilization. This increases their investment  attractiveness compared to other developing economies, where the debt  burden has increased significantly," EDB analysts note. They also  note that in 2026, the region's economy will continue to grow at a  steady pace of 2.3%. "In most countries, growth will remain high  thanks to active investment. Inflation will gradually decline towards  the target level. Price growth in the region will slow to 6.4% in  2026 from 7.5% in 2025, in the absence of additional shocks, thanks  to the prudent monetary policy of regulators in EDB member  countries," the forecast states.