Kyrgyz Republic overview

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Urban scene

In the Kyrgyz republic we focus on:

Fostering sustainable growth by strengthening regional cross-border linkages: As a landlocked economy with a limited domestic market, the Kyrgyz Republic would benefit greatly from deeper regional integration, given its important energy export potential, as well as good regional trade and transit position. In that context, the Bank will aim to help facilitate economic and trade cooperation and integration with the region, by supporting rehabilitation of critical infrastructure, strengthening the exporting sector including through access to finance and advisory, as well as supporting cross-border investments and regional cooperation projects.
 
Enabling SMEs to scale-up and bolster competitiveness: Outside the extractive sector, the economy is dominated by SMEs, with few mid-sized corporates in existence. While deeper regional trade links create opportunities for the best local firms, stronger operating models and core competencies will be needed to better compete. The Bank will thus support competitiveness and sustainable growth of SMEs with viable business models through investment and advisory, promoting in particular skills transfer and operational efficiency improvements, and seek to strengthen the financial sector to facilitate access to finance for SMEs, in particular in local currency. The Bank will also step up its efforts of improving the business environment through policy dialogue.
 
Promoting sustainability of public utilities through commercialisation and private sector participation: To address underinvestment, deficient regulatory environment, weak core competencies, poor financial and operational performance, the Bank will continue to support municipal utilities, where it has a recognized expertise and delivery model in improving operators’ financial condition, operating practices and governance, and seek to support sustainability of power sector by rehabilitating assets and developing a more attractive institutional framework for private investment.
 
In addition, the Bank 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 inclusion gaps in relation to gender and youth across sectors.

EBRD forecast for Kyrgyz Republic Real GDP Growth in 2021 2.5%

EBRD forecast for Kyrgyz Republic Real GDP Growth in 2022 5.0%

The economy posted a small growth of 0.1 per cent year-on-year in the first three quarters of 2021. The recovery is being held back by a drop in gold production and exports despite Jerooy, the country’s second-largest gold mining project, moving to production in March 2021.
 
Excluding the Kumtor gold mine, real GDP grew by 17.7 per cent year-on-year in the first three quarters of 2021, driven by growth in retail trade, transport and communication. Expansion in services was enabled by strong growth in remittances (up 21 per cent year-on-year in US dollar terms in the first eight months of 2021) and the easing of lockdown measures.
 
The surge in consumer demand along with rising global food prices caused inflation to accelerate to 14 per cent in August 2021 from 9.7 per cent in December 2020.
 

Kyrgyz Republic in the EBRD’s 2021-22 Transition Report

 
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