The World Bank study on Kyrgyzstan Comprehensive Diagnostics of the Country for 2018 analyzes the trends and factors of the economic growth of the Kyrgyz Republic in the past, and also determines measures for further poverty reduction and ensuring well-being for all.
Over the past 20 years, economic activity in the Kyrgyz Republic had based mainly on gold mining, export of labor migrants, import and re-export of goods in large bazaars.
Such a «model» of economic growth led to an increase in the well-being of the population, but was not the result of a targeted, long-term economic policy. Due to the global and regional economic situation, the former growth factors of the Kyrgyz Republic have largely exhausted themselves.
Currently, the economy of Kyrgyzstan is characterized by a small scale, a high share of «shadow» economy and low productivity in the private sector. However, it is the private sector that is the only long-term source for creating high-quality and sustainable jobs.
Therefore, the country needs a strategy to stimulate private investment, along with improving the targeting of social protection programs.
To do this, the Kyrgyz Republic needs to increase the rationality of public spending, ensure compliance with legal norms and improve the business climate. Other priorities include increase of agricultural productivity, development of the mining industry and hydropower, as well as improvement of external competitiveness and entry into the new markets.
These measures will enable further economic growth for the poor. As of today, according to the international poverty line, about 20 percent of the population of the Kyrgyz Republic is poor.
