Tashkent, Uzbekistan (UzDaily.uz) — S&P Global Ratings assigned the Andijan regional administration long-term issuer credit ratings of BB- in both local and foreign currencies on 6 November 2026. The outlook is stable, according to the agency.
Andijan, located in the Ferghana Valley in easternmost Uzbekistan, benefits from strong financial performance and the absence of commercial debt, the agency said. Analysts cited the region’s low level of prosperity and uncertainty stemming from an unstable institutional environment, which limits predictability, as constraints on its rating.
The stable outlook reflects a balance between the region’s track record of balanced budgets and low debt burden, on the one hand, and the risks posed by an unstable regulatory framework governing Uzbekistan’s local and regional authorities, on the other. Key budget decisions are made by the central government, while regions, including Andijan, have limited influence over them.
S&P noted that the central government frequently changes its approach to major taxes, transfers and expenditure responsibilities. The latest such changes took place in late 2025.
This undermines the stability of the region’s revenue and expenditure commitments and makes medium-term planning more difficult.
Debt and liquidity management practices are still at an early stage, according to the analysts. For example, the practice of placing funds in commercial banks was introduced only in 2026, and its effectiveness has yet to be tested.
The agency describes the region’s economy as weak by both national and international standards. GDP per capita is estimated at US$2,800–US$2,900, or around 64% of the national average.
At the same time, Andijan is among Uzbekistan’s more industrialised regions, ranking fourth nationally and accounting for 10.5% of the country’s industrial output. This is largely due to the automotive cluster centred around the UzAutoMotors plant in Asaka. S&P estimates that real GDP per capita growth in 2027–2028 will average around 6.5%, in line with the national forecast.
The agency expects the region to maintain strong budget performance. Andijan Region is projected to post a balanced budget or a small surplus over the next three years.
According to S&P, the region’s operating revenue totalled 6.27 trillion soums in 2025, while operating expenditure amounted to 6.21 trillion soums, resulting in an operating balance of 62.5 billion soums. For 2026, the agency expects operating revenue of around 6.2 trillion soums and an operating surplus of 45.8 billion soums.
Social spending accounts for 80% of the regional budget, limiting its flexibility. S&P forecasts that capital expenditure will increase from 292 billion soums in 2026 to 650 billion soums in 2027, in line with the region’s goal of investing more in infrastructure. These investments are expected to be financed mainly through capital transfers from the central budget.
The region’s debt burden remains very low. Current legislation prohibits local and regional authorities from taking on commercial debt, while any budget deficit is covered by additional transfers from the central government.
Andijan has no commercial debt, while its debt to the central budget does not exceed 1% of operating revenue, including transfers. Direct debt at the end of 2025 stood at 22.5 billion soums, equivalent to 0.4% of operating revenue.
The sector of entities linked to the regional authorities is small. The regional administration holds stakes in approximately 50 companies, mainly farmers’ markets. The agency has identified no cases of regional subsidies, capital injections or emergency support for these companies. Districts and cities across the region are also financially stable, supported by the central government.
The region’s liquidity is expected to remain sound, supported by its almost debt-free position. Andijan is entitled to receive concessional budget loans to cover liquidity shortfalls. According to S&P, access to external financing is limited by the underdevelopment of the country’s capital market and banking sector.
The agency may downgrade the rating if changes in relations between Andijan and the central government weaken support for the region and lead to a deterioration in its budget performance or debt position.
An upgrade could be considered over the longer term if the institutional environment for local and regional authorities improves significantly, becoming more predictable and transparent, and regions gain greater influence over central government decisions.
The quality of financial management in Andijan itself would also need to improve.
