Kyrgyzstan

Country Name

conventional long name: Kyrgyz Republic
conventional short name: Kyrgyzstan

Visit our mines:

Tulkubash Kyzyltash

Why Kyrgyz Republic?

Why invest in Mining in Kyrgyz

  • Supportive and competitive mining law – constantly adapting to Western Standards
  • Transparency and certainty of title – titles received by Chaarat
  • Absence of excessive bureaucracy and red tape – all permits received
  • Low corporate taxes – zero for Chaarat
  • Modern infrastructure being expanded providing for a low cost environment
  • Experienced and qualified local workforce – Chaarat sourced most workforce locally
  • Friendly population – Chaarat strong connections with local communities
  • Secure offtake with state smelter buying gold at market prices – Chaarat will not face logistics costs

Why invest in Kyrgyz Republic

  • Trade Hub
    Kyrgyz Republic is the most important transit country in Central Asia region, as the main freight transportation routes are located along its territory - both towards north-east (from Kazakhstan to Russia towards Tajikistan and Afghanistan), as well as towards south-east (connection of Central Asia with China).
  • Visa Free Regime
    Kyrgys Republic creates favorable conditions for the development of tourism and business entries into the country.
  • Bilateral Agreements
    Presently, the Kyrgyz Republic is a party to bilateral agreements on mutual support, encouragement and protection of investment (capital expenditure) with more than 20 countries such as USA, Germany, Switzerland, Kazakhstan, Russia, China, India, South Korea, the United Kingdom and others.
  • Skilled and Cheap Labor
    One of the important characteristics of the Kyrgyz labor market is the fast-growing working population, which is underpinned by the country’s high birth rate.
  • Free Economic Zones
    Free economic zones provide special customs privileges to exporting and importing companies. Companies operating in these zones may import, store, produce or sell goods in the territory of the zone without paying taxes or customs duties.
  • Island of Democracy
    The Kyrgyz Republic is seen as the most democratic and open society in Central Asia, and one of the world’s most open economies. Its transition from a centrally planned to a market economy was one of the most remarkable in the region.
  • Goverment type:
    parliamentary republic
  • Capital:
    Bishkek
  • Geographic coordinates::
    42 52 N, 74 36 E
  • Time difference:
    UTC+6 (11 hours ahead of Washington, DC, during Standard Time)
  • Legal system:
    civil law system, which includes features of French civil law and Russian Federation laws
  • Direct foreign investment – other country residents and companies::
    $6.003 billion (31 December 2017 est.
    $5.21 billion (31 December 2016 est.)
    country comparison to the world: 105
  • Direct foreign investment – Kyrgyz residents and companies abroad::
    $709.3 million (31 December 2017 est.)
    $655.5 million (31 December 2016 est.)
    country comparison to the world: 91
  • Inflation rate (consumer prices):
    3.2% (2017 est.)
    0.4% (2016 est.)
    country comparison to the world: 135

Background

A Central Asian country of incredible natural beauty and proud nomadic traditions, most of the territory of the present-day Kyrgyz Republic was formally annexed to the Russian Empire in 1876. The Kyrgyz Republic became a Soviet republic in 1936 and achieved independence in 1991 when the USSR dissolved. Nationwide demonstrations in 2005 and 2010 resulted in the ouster of the country’s first two presidents, Askar AKAEV and Kurmanbek BAKIEV. Interim President Roza OTUNBAEVA led a transitional government and following a nation-wide election, President Almazbek ATAMBAEV was sworn in as president in 2011. In 2017, ATAMBAEV became the first Kyrgyz president to step down after serving one full six-year term as required in the country’s constitution. Former prime minister and ruling Social-Democratic Party of Kyrgyzstan member Sooronbai JEENBEKOV replaced him after winning an October 2017 presidential election that was the most competitive in the country’s history, although international and local election observers noted cases of vote buying and abuse of public resources. The president holds substantial powers as head of state even though the prime minister oversees the Kyrgyz Government and selects most cabinet members. The president represents the country internationally and can sign or veto laws, call for new elections, and nominate Supreme Court judges, cabinet members for posts related to security or defense, and numerous other high-level positions.
The country is located on the historic roads between Europe, the Middle East and Asia and is located along the Silk Road.

  • Location:
    Central Asia, west of China, south of Kazakhstan
  • Geographic coordinates:
    41 00 N, 75 00 E
  • Area - comparative:
    slightly smaller than South Dakota
  • Land boundaries:
    total: 4,573 km
    border countries (4): China 1063 km, Kazakhstan 1212 km, Tajikistan 984 km, Uzbekistan 1314 km
  • Climate:
    dry continental to polar in high Tien Shan Mountains; subtropical in southwest (Fergana Valley); temperate in northern foothill zone
  • Elevation:
    mean elevation: 2,988 m
    lowest point: Kara-Daryya (Karadar'ya) 132 m
    highest point: Jengish Chokusu (Pik Pobedy) 7,439 m
  • Natural resources:
    abundant hydropower; gold, rare earth metals; locally exploitable coal, oil, and natural gas; other deposits of nepheline, mercury, bismuth, lead, and zinc

Population Overview

  • Population:
    5,849,296 (July 2018 est.)
    country comparison to the world: 114
  • Ethnic groups:
    Kyrgyz 73.5%, Uzbek 14.7%, Russian 5.5%, Dungan 1.1%, other 5.2% (includes Uyghur, Tajik, Turk, Kazakh, Tatar, Ukrainian, Korean, German) (2019 est.)
  • Languages:
    Kyrgyz (official) 71.4%, Uzbek 14.4%, Russian (official) 9%, other 5.2% (2009 est.)
  • Religions:
    Muslim 90% (majority Sunni), Christian 7% (Russian Orthodox 3%), other 3% (includes Jewish, Buddhist, Baha'i) (2017 est.)

Financial Overview

Cotton, wool, and meat are the main agricultural products, although only cotton is exported in any quantity. Other exports include gold, mercury, uranium, natural gas, and - in some years - electricity. The country has sought to attract foreign investment to expand its export base, including construction of hydroelectric dams, but a difficult investment climate and an ongoing legal battle with a Canadian firm over the joint ownership structure of the nation’s largest gold mine deter potential investors. Remittances from Kyrgyz migrant workers, predominantly in Russia and Kazakhstan, are equivalent to more than one-quarter of Kyrgyzstan’s GDP.

Following independence, Kyrgyzstan rapidly implemented market reforms, such as improving the regulatory system and instituting land reform. In 1998, Kyrgyzstan was the first Commonwealth of Independent States country to be accepted into the World Trade Organization. The government has privatized much of its ownership shares in public enterprises. Despite these reforms, the country suffered a severe drop in production in the early 1990s and has again faced slow growth in the last decade as the global financial crisis and declining oil prices have dampened economies across Central Asia.

Kyrgyz leaders hope the country’s August 2015 accession to the Eurasian Economic Union (EAEU) will bolster trade and investment. Large-scale trade and investment pledged by Kyrgyz leaders has been slow to develop. Since acceding to the EAEU, the Kyrgyz Republic has continued harmonizing its laws and regulations to meet EAEU standards, though many local entrepreneurs believe this process as disjointed and incomplete. Kyrgyzstan’s economic development continues to be hampered by corruption, lack of administrative transparency, lack of diversity in domestic industries, and difficulty attracting foreign aid and investment.

Tax regime

Kyrgyz Republic gold tax rates in effect from 1 July 2016

RoyaltyNon-tax**Fixed royalty totalPrice per 1 troy ounce in US$Revenue taxTOTAL 7% + revenue tax
FromTo
5%2%7%<13001%8%
5%2%7%1,3011,4003%10%
5%2%7%1,4011,5005%12%
5%2%7%1,5011,6007%14%
5%2%7%1,6011,7009%16%
5%2%7%1,7011,80011%18%
5%2%7%1,8011,90013%20%
5%2%7%1,9012,00014%21%
5%2%7%2,0012,10015%22%
5%2%7%2,1012,20016%23%
5%2%7%2,2012,30017%24%
5%2%7%2,3012,40018%25%
5%2%7%2,4012,50019%26%
5%2%7%≥2,50120%27%

**Non-tax is a payment to the local budget for infrastructure projects in the vicinity of the mine.

No restrictions on repatriation of capital or payment of dividends

100% Foreign ownership permitted

Mining is regulated by the State Committee for Energy, Industry, and Subsoil Management (SCEIS)