Kyrgyzstan was the first Central Asia Republic to declare Independence in 1991 and emerge as a democratic and liberal reform oriented country. A comprehensive programme of market reforms includes privatization, restructuring, price liberalization, full current market account convertibility, adoption of modern business legislation and great strides towards creating a dynamic financial sector.
Kyrgyzstan is a small landlocked country, but has a strategic location bordering Kazakhstan, Uzbekistan and China and is not far from the huge markets of Russia and India.
It has predominantly agricultural economy, but has been one of the most progressive in the Central Asia. Kyrgyzstan aims to create a favorable investment climate and is making efforts to provide beneficial conditions to foster further investment.
Kyrgyz Republic has implemented a successful trade liberalization policy, avails the most liberalized trade regime among the CIS countries , and has been rewarded with WTO, which provide a membership with an a open quota for inexpensive re-export.
Last spring’s political unrest temporarily dampened the enthusiasm of international investors, but more importantly it led to the ouster of the country’s “out of favour” regime and a new democratic government taking power in the fall.
The International Monetary Fund is predicting the Kyrgyzstan economy will roar back this year after a disappointing 2010. It’s forecasting a 7 % growth in 2011 which, as the following table shows, is easily one of the highest rates in Central Asia.
Other analysts agree that Kyrgyzstan’s economic conditions should continue to improve over the medium term. MarketResearch.com, for example, is predicting growth rates of four percent in 2011 and 5 percent in 2012.4
The political developments over the past year have no doubt hand a hand in strengthening Kyrgyzstan’s economic outlook. More than 90 % of voters approved the referendum on Kyrgyzstan’s new constitution last June, which replaced the presidential model with a parliamentary democracy. It was followed by October’s general election which took place peacefully and was assessed by the Organization for Security and Cooperation in Europe as ‘largely free and fair.’
The Kyrgyz people are working hard to nurture their investor-friendly business climate – and the world is taking notice. According to the IFC and World Bank study, Doing Business 2011, Kyrgyzstan rests in the top quarter of the world’s countries in overall ease of doing business. The ranking of 183 economies puts this small Central Asian nation ahead of countries like Luxembourg, Spain, Italy, India and China. And it shows that the business regulation climate there is only getting better, with Kyrgyzstan climbing 3 spots in the world rankings this year. Kyrgyzstan – with its welcoming business climate, vast mineral resources, and strategic location in the very heart of Asia –– has to be considered one of the ‘up and comers’ in the global Rare Earth race.