The Cabinet of Ministers of Kyrgyzstan has amended the procedure for providing state guarantees to entities of the national economy. The new rules expand support opportunities for strategic projects while simultaneously tightening requirements for borrowers.
Under the updated regulations, a state guarantee may not exceed 80 percent of the total obligations under a loan, leasing agreement, or bank guarantee, including the principal debt, interest, and other payments.
At the same time, state and municipal bodies, enterprises with more than 50 percent state ownership, and national investment projects may receive guarantees covering up to 100 percent of obligations.
The document also introduces an administrative fee of 200,000 soms for reviewing applications for state guarantees.
The requirement does not apply to state and municipal institutions or companies with a dominant state share.
The list of documents required to obtain a guarantee has been significantly expanded. Applicants must now provide:
— financial statements;
— a business plan;
— certificates confirming the absence of tax and social insurance debts;
— credit bureau data;
— for infrastructure and industrial projects — a feasibility study and project cost estimates.
In addition, the government has obtained the right to annually monitor the liquidity of funds used to secure issued guarantees and to conduct additional credit risk assessments for major projects.
New service fees for issuing guarantees have also been established. The amount will depend on the project’s risk level, the financing currency, and the form of the guarantor’s liability.
Separate concessions are provided for projects considered strategically important for the economy, food security, and national security that involve state participation. Such projects may receive a deferral on fee payments for up to 36 months.
The resolution will enter into force in ten days.
