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Kyrgyz Republic

Learn more about doing business in the Kyrgyz Republic, a rugged Central Asian country bordered by Kazakhstan, Uzbekistan, Tajikistan and China.

Chaarat Landscape

Geography

Location North eastern part of Central Asia
Area 199,951 km2 (between UK and Greece in size)
Land boundaries South of Kazakhstan, Uzbekistan, Tajikistan and west of China
Terrain Landlocked and mountainous (like Switzerland)
Climate Subtropical in the southwest (Fergana Valley); temperate in the northern foothill zone; dry continental to polar in the high Tien-Shan mountains
Time zone BST +5 (summer) GMT +6 (winter)

People

Population 6.1 million (83% of Central Asian/Turkic descent)
Age Median age 25, 60% of population younger than 30
Religion No official religion; most of the population is Sunni Muslim (75%) and Orthodox Christian (20%)
Language Kyrgyz – state; Russian – official

Government

Parliamentary republic – unicameral democracy. The elected President of the Republic is the Head of State and the Commander-in-Chief of the military. The Prime Minister is the head of government and is chosen from the ruling party or parties.

Capital Bishkek
Administrative divisions Seven provinces and two independent cities (Bishkek and Osh)

History

  • Separated from the Soviet Union in 1990
  • Independence declared on 31 August 1991
  • Constitution adopted in May 1993
  • 1990 – 2010 – power concentrated in presidency
  • 2005 and 2010 two coups resulted in the overthrow of the incumbent presidents
  • Roza Otunbayeva appointed Interim president until December 2011 to oversee transition to constitutional democracy
  • 2010 – referendum ratified the new constitution which reduced the power of the presidency to create a parliamentary democracy
  • This made the Kyrgyz Republic the first FSU republic to complete the transformation from a one party Soviet system to a multi-party parliamentarian democracy
  • Almazbek Sharshenovich Atambayev elected as President in 2011
  • Parliamentary election held in 2015
  • Seventh constitutional referendum held in December 2016 – increased the powers of the prime minister
  • Presidential election held in October 2017 – Sooronbay Jeenbekov (a former Prime Minister) elected

Economics

  • 2016 GDP: US$7.1bn (IMF)
  • GDP per capita: US$1,140 (one tenth of levels in Kazakhstan)
  • Main constituents of GDP: agriculture (20%), metals and mining (14%), industry (13%), services (51%)
  • 79% of electric power generated from hydroelectric plants – exceptionally low cost of power
  • World Bank Ease of Doing Business ranking in June 2016 – 75th out of 190 economies
  • Joined WTO in 1998 and Eurasian Economic Union in August 2015 (other members Kazakhstan, Armenia, Belarus and Russia)

Foreign Investment

  • 2003 Law on Investments and a 2010 Regulation on the Protection of Investments granted foreign investors the same rights as domestic investors
  • Foreign investors are free to repatriate capital and income, and the som is fully convertible
  • The Kyrgyz Republic is a party to the New York Convention on the Recognition and Enforcement of Foreign Arbitration Awards and the Convention on the Settlement of Investment Disputes between States and Nationals of other States (ICSID)
  • Foreign investment has increased steadily since 2010, led by international financial institutions
  • The World Bank and the IFC have 25 active projects for a total investment of US$300m
  • The EBRD has invested €261m and has said it intends to expand its activities in the Republic
  • A nationwide digitalisation program backed by the World Bank and EBRD is installing a fibre-optic network, reducing the costs of Internet access and encouraging IT services exports
  • The Asian Development Bank, the Islamic Development Bank, the Aga Khan Foundation and the US Agency for International Development are providing substantial development assistance
  • Russia has established a US$400m Russia Kyrgyz Development Fund
  • China has committed to several infrastructure projects linked to the Belt and Road Initiative
  • US and UK trade missions to Bishkek in early 2017
  • General Electric has signed an MoU to modernize hydroelectric plants and the power grid. Coca-Cola and the Hyatt Regency hotels group are already invested in the Kyrgyz Republic, as are Russia’s Wimm-Bill-Dann, Gazprom Neft and Beeline