The stock exchanges of the Kyrgyz Republic are experiencing a period of unprecedented activity, with trading volumes surging to remarkable new highs, particularly in early 2025. This boom, most notably on the Kyrgyz Stock Exchange (KSE), signals a growing dynamism within the nation’s capital markets, driven by a confluence of factors including significant primary market issuances and a shifting macroeconomic landscape.
A Tale of Two Exchanges: KSE and BTS
Kyrgyzstan’s capital market landscape is primarily defined by two entities: the Kyrgyz Stock Exchange (KSE) and the Stock Exchange of Kyrgyzstan (BTS).
The Kyrgyz Stock Exchange (KSE), established in 1994, held its first auctions in May 1995, initially to facilitate the privatization of state-owned enterprises. It became a joint-stock company in 2000, with Turkey’s Borsa Istanbul becoming a shareholder the same year, followed by the Kazakhstan Stock Exchange in 2001. Current shareholders also include the Russian-Kyrgyz Development Fund, BNC Finance, and Kyrgyzstan’s State Property Fund. As of early 2025, the KSE listed 23 companies with a market capitalization of USD 1.8 billion , though other data from the Sustainable Stock Exchanges Initiative indicates 37 listed companies with a domestic market capitalization of approximately USD 407 million.
The Stock Exchange of Kyrgyzstan (BTS), historically known as CJSC “Exchange Trading System,” was founded in 1999 by local broker-dealers without initial foreign involvement. After an agreement in March 2011 to consolidate securities trading onto the KSE’s platform, BTS suspended its own trading activities for over a decade, focusing on depository services. Trading on the BTS floor officially resumed in July 2022. Current shareholders include “LLC Registrar of the Central Bank” and “LLC Osh Commodity and Stock Exchange,” along with 15 brokerage companies.
The Surge in Trading Volumes
The most striking development has been the dramatic increase in trading activity on the KSE.
Year-to-date figures for 2025 (as of early June) show a total trading volume on the KSE reaching an astonishing KGS 50.14 billion. This figure already dwarfs the KGS 28.88 billion recorded for the entire year of 2023.5
This explosive growth appears largely driven by the primary market, which accounted for KGS 48.03 billion of the KSE’s volume in early 2025, compared to KGS 2.11 billion from the secondary market. Listed securities also dominated, with KGS 47.56 billion in volume versus KGS 2.58 billion for non-listed securities during the same period.
Recent daily figures also reflect increased dynamism. For instance, on June 3, 2025, total transactions on the KSE amounted to KGS 1.34 million, a 60.9% increase from the previous session, primarily driven by secondary market activity which reached KGS 1.03 million.6
In terms of asset classes on the KSE, corporate debt trading showed particular strength in early 2025, totaling USD 150.5 million in January-February, surpassing equity trading (USD 104.9 million) and government bond trades (USD 13.9 million) for the same period. This performance saw the KSE outperform several regional peers in the Eurasian Economic Union (EAEU) in equity trading during these months, including markets in Armenia, Belarus, and Kazakhstan’s Astana International Exchange (AIX). However, Kazakhstan’s main exchange (KASE) and Russia’s Moscow Exchange reported significantly larger volumes, highlighting the relative scale.
The reactivated BTS has also quickly made its mark. By the end of 2022 (from its July resumption), it registered 52 transactions with a total securities trading volume of KGS 3.07 billion. While comprehensive annual figures for 2023 are not readily available, BTS facilitated significant placements, including two tranches for the State Development Bank of the Kyrgyz Republic in August 2023, each totaling KGS 5 billion. Another major transaction was the placement of OJSC “Electric Stations” shares in June 2023, amounting to approximately KGS 5.4 billion. BTS has also been innovative, introducing a derivatives market (futures and options) and facilitating the first Sukuk (Islamic securities) issuance in the Kyrgyz Republic in 2023.
What’s Fueling the Growth?
Several interconnected factors appear to be contributing to this heightened activity:
- Macroeconomic Tailwinds: The Kyrgyz Republic’s economy has shown resilience, with real GDP growing by 6.2% in 2023, following a strong 9.0% expansion in 2022. The IMF noted an average annual growth of 9% for the 2022-2024 period. Inflation moderated significantly from 14.7% in December 2022 to 7.3% in December 2023. The National Bank of the Kyrgyz Republic (NBKR) maintained its policy rate at 13.00% throughout 2023 , but has since reduced it to 9.00% as of May 2025.
- Significant Issuances: Large-scale placements by state-related entities have been a major driver. For example, in April 2024, additional share issues of Electric Stations OJSC and National Electric Grid of Kyrgyzstan OJSC, totaling KGS 20 billion, were placed on the KSE’s primary market. Government securities are also regularly issued via the KSE.
- Regulatory Environment and Reforms: The Kyrgyz government is actively seeking foreign direct investment (FDI) and has introduced measures like investor visa programs. The tax burden on profit repatriation for foreign investors has been reduced. A new Bilateral Investment Treaty with Kazakhstan was signed in April 2024, aiming to enhance investor protection. The KSE itself has mandated ESG reporting since 2014 and published an ESG guide in 2023.
- Eurasian Economic Union (EAEU) Dynamics: Membership in the EAEU since 2015 has had a complex but generally positive indirect impact through trade, remittances, and the activities of institutions like the Russian-Kyrgyz Development Fund (an KSE shareholder).
Navigating an Emerging Market
Despite the impressive growth in trading volumes, Kyrgyzstan’s capital markets are still considered underdeveloped and characteristic of a frontier market. Liquidity can be thin outside of major issuances, and the KSE Index, while reaching an all-time high of 4,636.1 points in February 2025 , can be heavily influenced by a few large entities. Historical stock market turnover ratios have been modest.
Investor protection and the overall investment climate remain areas of concern. While the legal framework largely aligns with international standards, consistent enforcement and robust protection of property rights are ongoing challenges. The nationalization of the Kumtor gold mine in 2021, for instance, impacted investor sentiment.
The Path Ahead
The outlook for Kyrgyzstan’s stock exchanges is promising, with the IMF forecasting GDP growth of 6.8% for 2025, moderating to around 5.25% in the medium term. The World Bank also projects healthy regional growth. Continued macroeconomic stability, successful implementation of financial sector and governance reforms (including IMF recommendations to align capital markets legislation with international standards ), and an improved investment climate will be crucial for sustained development.
The recent surge in trading volume is a clear indicator of increasing activity and potential. However, transforming this into deep, liquid, and resilient capital markets requires ongoing commitment from policymakers, regulators, and market participants to address underlying structural challenges and build lasting investor confidence.
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