BUSINESS OPPORTUNITIES IN THE KYRGYZ REPUBLIC

 The Kyrgyz Republic (informally, Kyrgyzstan) is located in the north - east of the Central Asia, and borders Kazakhstan, Uzbekistan, Tajikistan and China. The area is 198.5 thousand km2 (94 % - mountains). Population is more than 5 million people. Major religions are Moslem and Orthodox. National currency is som. Languages are Kyrgyz, Russian.

The country has liberal visa regime for foreigners. VISA, MasterCard/EuroCard cards are accepted in the most banks of capital Bishkek, in large restaurants, supermarkets and resorts. "Kyrgyzstan Airlines", "Uzbek airlines", "Aeroflot", "Turkish airlines", "British Mediterranean" etc. are operating in Kyrgyzstan.

All of the new history of the Kyrgyz Republic is under the sign of market-oriented reforms. Despite some obstacles that are on the way of becoming a democratic country, as well as difficulties in reforming market institutes, Kyrgyzstan is still a predictable and attractive country for foreign investment. In its turn, the Government of the Kyrgyz Republic is constantly working on improving investment environment of the country and understands that it is necessary to improve state service.

The Government of Kyrgyzstan pays special attention to development of industry, trade, and tourism sectors of the country as well as to formation of a favorable investment climate. At present, the process of registering enterprises, getting licenses, its number as well as administrative barriers and tax control were decreased and/or simplified. Economic deregulation is the main goal of the governmental management bodies.

New approaches and methods of resolving political, economical and social issues are embodied in a pilot program named as “The Comprehensive Development Framework of Kyrgyz Republic till 2010”, that was adopted in 2001. Attraction of direct foreign investments was announced to be one of the main priorities of the national economic policy.

Main directions towards effective foreign investments attraction to the economy of the Republic, towards elimination of administrative barriers and towards enforcement of marketing policy of the Kyrgyz Republic are concrete measures in the form of investment matrices secured by normative and legislative acts of the Kyrgyz Republic.

The following governmental measures are taken to remove the barriers on the way of investors and entrepreneurs, to create favorable business environment: Enforcement of corporate governance in a banking sector; Development of non-bank financial sector; Reform of fiscal policy and development of a new tax code; Improvement of legislation of customs; Removal of administrative obstacles and barriers for investments by limitation of interference of state in investment and other entrepreneurship activity (limitation of licenses, permissions, checks); Reform of technical regulation, based on usage of international standards, norms, rules, and recommendations; Introduction of free-trade principles; Creation of attractive conditions for direct investments to prioritized spheres of the republic’s economy (mineral resources industry, energy, tourism, agriculture and processing industry, services, information technologies); Strengthening the protection of investors and their investments; Other measures, which contribute to attraction of investments to the Republic.

New policy of attraction of private investments to the economy of the Republic is already working and there is confidence that the Kyrgyz Republic will have all necessary and sufficient conditions for foreign investors to invest private money and extract market profits. State plays the role of guarantor for keeping favorable and predictable normative and legislative regime of economic activity for domestic and foreign investors.

Attractive Incentives for Foreign Businessmen and Investor:

Liberal Government Policy

Free currency exchange

WTO Membership

Low import duty - less than 10%

Free repatriation in foreign currency for profit, dividend, other forms of income

Private ownership of land

Protection of property rights

Equal treatment policy for foreign investors

                Protection from expropriation

The number of trade relations of the Kyrgyz Republic with other countries has increased in recent years. So, today Kyrgyzstan has trade relations with 109 countries of world trade community. There is the progress in cooperation with these countries in many areas particularly, in export-import operations. Trade relationships with most of these countries were created within the framework of WTO, full member of which Kyrgyz Republic became on December 20, 1998.

External trade regime of the Kyrgyz Republic is one of the most liberal among CIS countries. There are no private or state enterprises with exclusive rights or powers to influence the level or direction of imports and exports. Export and import licensing applies to only eight articles adopted in worldwide practice, including weaponry, explosives, drugs and virulent poisons, precious metals and works of art, etc. The volume of commodity circulation in the Republic keeps its level on about 1,6 billion US$.

The Kyrgyz Republic along with Kazakhstan, Tajikistan, Belarus and Russia, has a common system of payments, equal access to international economic organizations within the framework of the Eurasian Economic Union. Common borders and good trade relations with China have formed a huge potential for export.

On the world market, the Kyrgyz Republic acts as a supplier of electric power, gold, cotton fiber, articles made of wool and cotton, wood, leather materials, tobacco, antimony and mercury. It is a net importer of energy resources, oil products, natural gas, coal, fertilizers and other chemical products, machinery, vehicles and spare parts, and household appliances. Bowels of the Republic are consisted of large stocks of gold, tungsten, tin, antimony, mercury and others metals. Kyrgyzstan takes the third place in the world on manufacture of mercury and the tenth on sale of gold. Foreign business can invest the capital in development of a tourist infrastructure on unique lake "Issyk Kul", and also in creation of joint venture in agricultural sphere and techno parks.

After known March events of 2005, Kyrgyzstan has opened a new page in the contemporary history. New leaders of country have accepted a number of operative measures to achieve recovery of economy, emphasizing on growth of a private sector. The Government purposefully works above liquidation of any barrier interfering successful development of private business and creation of a favorable investment climate. In addition, fight against corruption and recovery of economy's industrial sector are defined as two principle national priorities. Given Kyrgyzstan's geographical location with access to vast market of 2,5 billion consumers in Russia, China and India, it makes Kyrgyzstan a favorable and profitable destination for investment.

We invite you to do business in Kyrgyzstan!

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