Economy of Kyrgyzstan slows down, prices begin to rise

The National Statistical Committee of Kyrgyzstan presented preliminary results of the social and economic development of the country for 11 months of 2017. Figures show: GDP growth slowed down, but still remains positive.

GDP growth: modest, but positive

As a result of November, Kyrgyzstan’s GDP amounted to 430.1 billion soms. Compared to the same period of 2016, the indicator grew by 4 percent.

Without considering enterprises developing Kumtor deposit, the situation is not less positive. GDP amounted to 388.3 billion soms and grew by 3.9 percent compared to 2016.

This is quite understandable. Exactly by the end of last year, gold production at Kumtor mine had grown that immediately affected the growth of the economy.

But the comparison of indicators with the beginning of the year says that the economy is growing more slowly than we would like. Compared with January, GDP growth slowed down by 3.9 percent.

Industrial positive

The industry also shows growth on the basis of the results of 11 months. The volume of production is estimated at 204 billion soms with an increase of 12.5 percent compared to the same period in 2016.

Without taking into account the enterprises developing Kumtor, the indicators are even better. The volume of production sector is estimated at 115.8 billion soms. In comparison with January-November 2016, a record growth of 21 percent was registered.

At the same time, the volume of food production increased, including canned fruit and vegetables (2.4 times), sugar (1.5 times), flour and cereals (by 23.9 percent) and dairy products (9.7 percent).

Price increase forecasts come true

In November, compared with October, the growth of consumer prices and tariffs in the republic was 0.9 percent. The most significant increase was in non-food products (by 2 percent), alcoholic beverages and tobacco products (by 1 percent). In November, growth in prices for food and non-alcoholic beverages was registered — 0.6 percent.

At the same time, tariffs for services rendered to the population decreased by 0.3 percent in November. This is due to 1.5 percent decrease in prices for transportation services.

The maximum price increase was recorded in Osh (2.1 percent), and the lowest — in Bishkek (0.4 percent).

Since the beginning of the year, the price increase in the republic has amounted to 2.9 percent.

Tobacco products increased in price the most (by 22.4 percent) along with services (by 6.1 percent). Prices for food and non-alcoholic beverages increased by 1.2 percent, non-food products — by 3.5 percent. At the same time, alcoholic beverages dropped by 2.8 percent.

The maximum increase in consumer prices and tariffs since the beginning of the year was observed in Osh region — 8.3 percent. In Bishkek, the rate rose by 1.9 percent.

We buy tires, sell clothes

In January-October, Kyrgyzstan’s foreign trade turnover amounted to $ 4,929.9 billion, including the trade with the states of the Eurasian Economic Union ($ 1,872.6 billion.)

The imports dominate in the structure of trade — $ 3.5 billion. This is 7.3 percent more than in 2016. As for exports, compared with the previous year, it grew by 12.1 percent. This is ensured by the increase in the supply of polished glass (2.1 times), dried fruit (1.8 times) and butter (1.6 times).

In October 2017, compared with October 2016, the volume of exports decreased by 15.2 percent — mainly due to reduction in the export of gold (by 40.9 percent).

Analysis of the dynamics of trade of Kyrgyzstan with the countries of the Eurasian Economic Union showed an increase in exports and a significant decrease in imports. Thus, exports to the countries of the union are estimated at $ 486.1 million. This is 26.8 percent more than in 2016.

Import from EEU countries amounted to $ 1,386.5 billion. Compared with the previous year, growth of 3.6 percent was registered.

Russia accounts for the largest share in the republic’s mutual trade with EEU countries (58.1 percent) along with Kazakhstan (39.7 percent). The statistical date did not mention significant changes in indicators due to the difficulties that were noted at the Kyrgyz-Kazakh border in October.

The data for 11 months say that Kyrgyzstan will end the year with a modest, but a plus in the economy. However, we can not count on the fact that in 2018 everything will be the same. Experts predict a sharp drop in GDP due to a decrease in gold production at Kumtor. The situation of 2016, when the economy and industry seriously shrank, can repeat again.