In the Kyrgyz republic we focus on:
Stabilising and developing the financial sector: The EBRD promotes stabilisation, intermediation and confidence building in the financial sector. It does so by providing financial institutions with targeted loans, where possible in local currency, possible equity investments, and through technical assistance and policy dialogue.
Supporting development of local private enterprises: The EBRD will target its support at projects in the corporate sector that aim to increase productivity, production of higher value-added goods and products that can be competitive in foreign markets, raising business standards, and improving energy efficiency.
Strengthening critical infrastructure: We co-finance regional and municipal infrastructure, including water supply, solid waste management and urban transport. Many projects put a particular emphasis on energy efficiency. Due to debt sustainability concerns, any public infrastructure projects would be financed with co-financing grants or concessional loans from other IFIs or bilateral donors.
Policy Dialogue: The EBRD conducts policy dialogue to address remaining issues in the investment climate, to further its efforts to strengthen the regulatory and legal basis for energy efficiency investment and to improve the macro-prudential environment for local currency finance. We will continue to support the Secretariat of the Council for Business Development and Investment through ongoing technical assistance.
In addition, the EBRD will seek to support through the above priorities the reduction of regional economic disparities, by increasing its outreach to less developed rural areas, in particular in the southern regions, and addressing gender gaps across sectors.
The EBRD’s latest Kyrgyz Republic strategy was adopted on 25 February 2015
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EBRD forecast for Kyrgyz Republic Real GDP Growth in 2015 3.0%
EBRD forecast for Kyrgyz Republic Real GDP Growth in 2016 3.1%
GDP growth in the Kyrgyz Republic is expected to decline to 3.0 per cent in 2015 from 3.6 per cent in 2014. The slowdown reflects sharply lower remittances from Russia and more difficult export environment due to recession, depreciation of the Russian rouble and sharply slower growth in Kazakhstan, the country’s main trading partner and a source of remittances. Increased investment carried out using financing provided by Russia and Kazakhstan as part of the accession to the Eurasian Economic Union will help partially mitigate negative impact of external factors. Sharply lower oil prices are also expected to provide a boost to consumption and growth, since the country is a significant net oil/petroleum importer. However, lack of permanent solution to the issues surrounding the Kumtor gold mine remains material downside risk to growth. The som has depreciated significantly in 2014 and 2015, notwithstanding the National Bank’s heavy interventions. However, international reserves remain comparatively high. Inflation is expected to remain elevated at around 10 per cent in 2015 reflecting the exchange rate pass through. In 2016, growth is expected to remain subdued, projected at 3.1 per cent, and there are likely to be increasing fiscal and social pressures, reflecting legacy from lower remittances and returning migrants in 2015, and negative effects of continued recession in Russia and sluggish growth in Kazakhstan in 2016.