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ИД «Финансы и кредит»






Finance and Credit

Current status and instruments for decreasing the dollarization of the monetary and credit sphere of Kyrgyzstan

Vol. 29, Iss. 4, APRIL 2023

Received: 16 January 2023

Received in revised form: 6 February 2023

Accepted: 20 February 2023

Available online: 27 April 2023


JEL Classification: E4, Е52, E58, F31, F41

Pages: 730–746


Zhanna G. GOLODOVA Peoples’ Friendship University of Russia (RUDN University), Moscow, Russian Federation


Subject. The article considers approaches to revealing the essence and role, preconditions and consequences of dollarization of the economy of Kyrgyzstan, and measures taken by the monetary regulator for lowering the dollarization level to decrease the dependence of the national economy on the financial system of Western countries and reduce losses in currency conversion.
Objectives. The aim is to unveil the inconsistency in the assessment of the dollarization role, clarify its classification, identify preconditions, main factors and trends of dollarization in the Republic of Kyrgyzstan, disclose measures taken by the regulator of the monetary system to reduce it, and assess their effectiveness.
Methods. The study rests on methods of scientific knowledge, comparison and generalization, analytical and statistical techniques, and method of coefficients.
Results. The paper discloses crucial aspects of the discussion about advantages and disadvantages of the current dollarization of national economies, systematizes its types, identifies the most important factors influencing this process. The analysis of trends and reasons demonstrated that reducing inflation does not always solve the problem of dollarization. I describe measures taken by the monetary regulator and aimed at decline in dollarization, assess the results of their implementation in the Republic of Kyrgyzstan.
Conclusions. The measures taken by the National Bank of the Kyrgyz Republic (a ban on mortgage and consumer loans in foreign currency, on setting prices in conventional units, introduction of differentiated reserve requirements, etc.) contributed to a decrease in the level of dollarization, mainly in terms of the credit base. They can be used by banking regulators of other countries, including the EAEU, which announced the coordination of their monetary policies and expansion of the use of national currencies in mutual settlements.

Keywords: Eurasian Economic Union, EAEU, Kyrgyzstan, monetary sphere, dollarization, de-dollarization


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