The business week was a continuation of the previous one and was marked by such an important events as discussion of the Decree of the Head of State on the protection of investors in the country. At the same time, trade and economic ties with Uzbekistan are noticeably strengthening. The National Bank carried out another intervention in the foreign exchange market.
However, the week was also marked by such negative factors as a decrease in the nominal size of wages and the publication of the growth of the country's population, which found itself below the poverty line.
In general, the week gave rise to a more optimistic view of the recovery of the entire economy of the country.
Global Money Week. The Global Money Week has started in Kyrgyzstan on March 22, which is held in all regions of the country under the motto "Take care of yourself and your money".
The Global Money Week is an annual large-scale campaign conducted in more than 175 countries around the world to improve the financial literacy of children and youth.
Kyrgyzstan has been conducting the Global Money Week since 2015 in order to train a culture of savings in children and youth and provide access to financial education.
During the week, the National Bank, state bodies and other organizations, including public and international ones, commercial banks and microfinance organizations will hold general educational activities on financial literacy in compliance with all sanitary standards: lessons on financial literacy in schools, guest lectures and trainings in universities, tours and open days in commercial banks, national competitions of video clips and children's drawings, original piggy banks, and various activities in social networks, posted with hashtag #GMWKyrgyzstan2021.
Agreement with Chaarat. The State Agency for the Promotion and Protection of Investments under the Ministry of Economy and Finance of the Kyrgyz Republic signed this week a memorandum of partnership and cooperation with the shareholders of Chaarat Zaav CJSC, a subsidiary of the British Chaarat Gold Holdings Limited, on partnership and cooperation in attracting investments, and also in the development of a number of projects in the regions and the solution of priority tasks.
Reportedly, investors plan to invest more than USD 110 million in the construction of a gold recovery plant and infrastructure facilities at the Chaarat deposit in Chatkal region of Jalal-Abad Oblast over the next two years. This will contribute to the creation of more than 800 new jobs at the enterprise, with the employment of the local population. In addition, more than KGS 14 million are allocated annually for the needs of the region: construction of roads, bridges, education, repair of medical institutions, schools, and so on.
Leasing contracts. It was announced this week that in 2020, leasing activities were carried out by 14 companies, which have concluded more than 560 contracts.
According to data of the National Statistics Committee of the Kyrgyz Republic, all leasing agreements were concluded on the basis of financial leasing.
The total value of such contracts in 2020 amounted to KGS 1.3 billion, or 12.6% less than in 2019.
Protection of entrepreneurs. This week, the International Business Council of the Kyrgyz Republic made a proposal to consider primarily systemic issues concerning a wide range of business entities.
It was announced by Deputy Executive Director of the IBC Dastan Imanaliev at the visiting meeting of the Council for Business and Entrepreneurship Development under the speaker of the Kyrgyz Parliament.
The participants of the meeting determined the issues to be included in the work plan of the Council. Within two days, the working groups of the Council considered 43 proposals from various business associations, including the IBC, the Association of Telecom Operators, the Chamber of Tax Consultants, NABA, JIA, the Institute of Business Ombudsman, the Union of Banks and others.
IBC submitted several proposals to the Council for consideration, including issues of labor legislation, amendments to the Tax Code, the Criminal Procedure Code and the Criminal Code of the Kyrgyz Republic.
Reduced wages. It was announced this week that the decrease in the real growth of average monthly wages in January 2021 amounted to 5%, in nominal terms the wages were at the level of KGS 17 thousand 966.
According to data of the Ministry of Economy and Finance of the Kyrgyz Republic, the number of officially registered unemployed at the end of February 2021 amounted to 78.4 thousand people and increased compared to the corresponding period of 2020 by 2.1% (a decline of 1.3% in January - February 2020).
To serve public debt. KGS 5 billion 457.8 million were allocated from the national budget of Kyrgyzstan to service public debt during the period of January-February 2021.
According to data of the Kyrgyz Ministry of Economy and Finance, of these:
- the public external debt – KGS 3 billion 049.4 million;
- the public internal debt – KGS 2 billion 408.4 million.
As of Jan. 31, 2021, the amount of the public debt (external + internal) amounted to USD 4 billion 954.11 million (KGS 420,108.67 million).
Mutual supplies. Kyrgyzstan and Uzbekistan agreed on mutual supplies of electricity.
In order to accumulate water in the Toktogul reservoir and to provide agricultural consumers in Uzbekistan with irrigation water during the 2021-2023 growing season, an agreement was reached on mutual supplies of electric power in the amount of up to 750 million kWh at a notional price per 1 kWh.
Thus, the supply of electricity from Uzbekistan to Kyrgyzstan will be carried out from March to October 2021 and in March-April 2022, with the subsequent return of this amount of electricity to Uzbekistan in the period from June to August 2021-2023.
Supply of products. It was announced this week that in April 2021, Kyrgyzstan will receive 500 tons of vegetable oil and 3 thousand tons of granulated sugar.
The Ministry of Agriculture, Water Resources and Regional Development reported that in order to ensure food security and stabilize prices in the domestic food market for basic foodstuffs, on behalf of Prime Minister Ulukbek Maripov, the State Material Reserves Fund under the Ministry of Emergency Situations of the Kyrgyz Republic began to purchase granulated sugar and vegetable oil from Russia.
In this regard, contracts were signed for the supply of 506 tons of sunflower oil and 3,046 tons of granulated sugar. The delivery of these products to Kyrgyzstan is planned for April this year.
Poverty line. Due to the COVID-19 pandemic in Kyrgyzstan, 700,000 people find themselves below the poverty line.
According to data on the World Bank website, the COVID-19 crisis has negatively affected the labor income of the population - the main factor in poverty reduction. Combined with the fall in the purchasing capacity of the population due to inflation, this situation has made citizens vulnerable to the economic consequences of the pandemic.
The poverty rate in Kyrgyzstan in 2020 is estimated to have increased by 11 percentage points from 20.1% in 2019 (national data). As a result, another 700,000 people fell below the poverty line, a huge figure for a country with a population of 6.6 million.
Violations by Vertex. This week, the Jogorku Kenesh hosted a meeting of the temporary deputy commission to investigate the activities of Vertex Gold Company LLC in Chatkal region, its impact on the environment and compliance with the requirements of the legislation in the field of the mining industry.
According to a publication on the parliament's website, during the meeting, the members of the commission, having studied the activities of Vertex Gold Company LLC, noted the lack of proper control by the relevant government agencies on the export of gold ore and concentrates from the Jamgyr gold deposit, as well as the lack of an accurate weight fixing mechanism and gold content in the exported ore.
As a result of the meeting, the commission decided to carefully study all the facts of violation, starting from 2010, as well as the amount of damage caused to the economy of Kyrgyzstan.
Currency intervention. The National Bank of Kyrgyzstan this week carried out another intervention to maintain the som exchange rate, selling USD 43.7 million.
This is the fourth intervention since early 2021. For three months of this year, the National Bank sold a total of USD158 million: in January - USD 45.7 million, and twice in February - USD 38 million and USD 30.6 million.
Currently, the official dollar exchange rate is 84.8 Kyrgyz soms per one US dollar.
Joint construction. It was officially announced this week that Kyrgyzstan and Uzbekistan will jointly build the Kambar-Ata HPP-2.
This was stated by Minister of Energy and Industry of the Kyrgyz Republic Kubanychbek Turdubaev on the results of the 9th meeting of the Kyrgyz-Uzbek intergovernmental council, held in Tashkent this week.
“We have prepared a roadmap and today we are discussing the issues of updating the feasibility study of the project. At the same time, we are starting to work out the terms of our cooperation and will prepare a draft agreement,” he said.
Supply to Uzbekistan. Kyrgyzstan will supply coal to Uzbekistan, Minister of Energy and Industry of the Kyrgyz Republic Kubanychbek Turdubaev told.
He said that the Uzbek side has expressed interest in supplying coal from Kyrgyzstan.
“We have compiled lists and information on our coal mining companies. We are now discussing opportunities, volumes, delivery logistics and price,” he said.
Turdubaev noted that the Uzbek side expressed a desire to import 600 thousand tons of coal annually.
“We gave them information on 21 of our deposits,” the minister added.
In addition, the minister of energy said that they discussed the supply of oil products in order to load oil refineries in Kyrgyzstan.
Kabar News Agency
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