The week turned out to be quite chaotic due to the intensification of the actions of the regulatory authorities. Some business entities were forced to make up for the damage caused to the state, and a number of other firms even closed due to problems with tax payments. The business community is concerned about the creation of a state commission to inspect large companies such as Kumtor. At the same time, the Tax Service collected more taxes than before, oil traders tried to justify themselves due to the increase in prices for fuels and lubricants, and the Antimonopoly Service - due to the increase in prices for food and other goods.
On the whole, the week was controversial and clearly showed the strong influence of external factors on the domestic market.
The reason for the rise in prices. The Association of Oil Traders of Kyrgyzstan this week gave an explanation about the current situation on the fuel and lubricants market in Kyrgyzstan, which is experiencing a significant increase in prices.
One of the first factors that influenced the rise in prices was a significant devaluation of the Kyrgyz som against the US dollar, since, according to global practice, the purchase of oil products from refineries is carried out in international currency, and the sale on the territory of Kyrgyzstan is in Kyrgyz soms.
The second is a significant increase in selling prices at Russian factories, which in turn is due to several factors:
- since the end of 2020, the global demand for petroleum products has increased in connection with the gradual recovery of the world economy;
- prices for petroleum products are formed on international trade exchanges - the price is added up taking into account the existing supply and demand;
- global growth in oil prices - according to data as of Feb. 24, 2021 the price of Brent crude oil exceeded USD 67 / barrel, while at the beginning of 2021 Brent crude oil was USD 51.5 / barrel - an increase of 31%;
- since the beginning of the year, there was a deficit in the gasoline group on the fuel market of the Russian Federation due to technical problems at the Khabarovsk refinery. This became the reason that gasoline was supplied to the Far East of the Russian Federation from three refineries from other regions and the Federal Reserve;
Contacts with Pakistan. Ambassador of Kyrgyzstan to Pakistan Erik Beishembiev met with the leadership and representatives of All Pakistan Textile Mills Association (APTMA) as part his working visit to the city of Lahore, Punjab Province.
During the meeting the development of Kyrgyz-Pakistani cooperation in the textile industry was discussed.
Issues of transport and logistics ties between Kyrgyzstan and Pakistan were also debated.
At the end of the meeting, the sides expressed readiness to promote the establishment of business contacts between the business circles of the two countries.
Legality for everyone. In connection with the increasing dissatisfaction in society with the actions of state bodies in relation to the private sector on tax and other mandatory payments, the director of the Investments Promotion and Protection Agency Almambet Shykmamatov said that state inspection bodies and private business must find a balance, while both must obey the main basis - the law.
He said that the main factor in attracting investments and developing private entrepreneurship is the reputation and image of the state.
“For a long time, a stable slogan sounded in the country - “all conditions for business” and “paradise for investors”. But, in fact, the slogan remained only in oral form and practically no attempts were made to improve the investment climate. It was the same with regard to private entrepreneurship. Against the background of constant leapfrog and irresponsibility, some unspoken, conditional, mutually beneficial relations have been created between business and the inspection authorities. That is, according to the principle "I give to you, you give to me." And that was fine with everyone. But it cannot go on that long. The country is undergoing cardinal transformations, order is being established,” he said.
Reasons of price rise. Director of the State Agency for Antimonopoly Regulation of Kyrgyzstan Shukhrat Sabirov explained the reasons why prices for socially important goods are increasing.
He said the Antimonopoly Agency conducts constant monitoring of prices on the country's market.
"We have all witnessed that the prices of food products and other socially important goods are increasing. In case if prices will grow by 20% in one month, then the state takes urgent measures - the state regulation of prices is introduced. There has not been such a drastic price increase this year," he said.
Sabirov stressed this trend is observed not only in Kyrgyzstan, but all over the world.
"Our republic is more dependent on imported products. For example, the country’s self-sufficiency for vegetable oil makes only 15%, and the rest is imported from abroad. If two years ago the country provided itself with sugar in full, last year Kyrgyzstan was provided with sugar only by 50%, eggs also by 50% and so on," he explained.
In addition, Shukhrat Sabirov noted that one of the main causes of rising prices is the weakening of the national currency against the dollar and euro.
Oil prices. Director of the State Agency for Antimonopoly Regulation of Kyrgyzstan Shukhrat Sabirov said that the rise in prices for fuels and lubricants is observed not only in Kyrgyzstan, but throughout the world.
He said that prices for fuels and lubricants rose in Kyrgyzstan by 10-15% over the month. “One of the main reasons is that the price of oil has increased all over the world. And we completely import petroleum products. On the commodity exchange, the price of fuels and lubricants is approaching USD 67 per barrel. In Russia, prices are rising at oil depots, moreover, in the Russian Federation there is also a difficult problem with the cost of fuel. Despite this, our oil traders work and fuel and lubricants are supplied to the republic in full,” Sabirov said.
He also noted that the republic will also be fully provided with fuel and lubricants by the spring field work.
The speculation will be screened out. It was announced this week that the State Agency for Antimonopoly Regulation of Kyrgyzstan will not allow speculation in commodity prices.
Director of the agency Shukhrat Sabirov said that monitoring of prices in the market will be continued in the future. “We hold meetings and negotiations with large companies in order to regulate prices and prevent unjustified overpricing of goods. We will not allow speculation. Basically, in the regions, we conduct monitoring, and in case of unjustified overpricing, our employees, together with the Financial Police, carry out appropriate work, issue fines and orders,” he said and cited as an example, when last year during quarantine there were sharp overpricing of some goods.
Business concern. The business community of Kyrgyzstan this week expressed its concern about the ongoing inspections of economic entities in Kyrgyzstan. The work of the state commission to study the effectiveness of the development of the Kumtor gold deposit, the developer of which turned to the International Business Council to protect its rights and ensure compliance with the country's legislation, is of particular concern.
As follows from the letter of the state commission addressed to the management of Kumtor Gold Company, it is planned to check practically any documentation of the company. The head of the state commission, deputy of the Jogorku Kenesh Akylbek Zhaparov asks to provide full and unhindered access to all commission members to all required financial and economic, legal, technical, environmental, administrative and other documents and also provide temporary offices, office equipment for their work from March 3 until the completion of the commission's work from 9.00 am to 22.00 pm. At the same time, a list of commission members, experts and specialists, consisting of more than 20 people, is indicated, which, as indicated, can be expanded.
Tax damage. Gergert Sport's sporting goods store in Bishkek was sealed this week.
According to the explanations of the State Service for Combating Economic Crimes, the authorities revealed facts of evasion from the payment of customs duties and taxes on an especially large scale. According to data, it is about 21 million soms.
“We received materials from the customs service. The financial police started pre-trial proceedings," the head of the investigation department of the State Service for Combating Economic Crimes Kuanichbek Risbaev said.
The investigation established that the goods in the name of Gergert Sport were purchased in European countries. In particular in Spain, Germany and France. These countries confirmed that the goods were sold in the name of Gergert Sport. However, customs declarations were altered along the way. And they came to us on the basis of customs declarations in the name of a private person A. Talasbekova like other shoes that cover the ankle.
"What does this mean? There are answers from these countries. There are also responses that the supplier firm in the UK has been liquidated. Why is this done? This is done in order to change the name of the goods, thereby changing the code of the customs declaration and concealing the real value of the goods, which leads to the concealment of customs payments. The goods that were sent to Talasbekova's address were seized and confiscated within the framework of pre-trial proceedings in the Republic of Belarus. There is the same fact, the goods were in transit through Belarus, but the law enforcement agencies of the Republic of Belarus revealed this fact and confiscated the goods," Risbaev said.
Kabar News Agency
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