Learning Curves: Moving to a Market Economy: ADB Support for the Kyrgyz Republic
The Kyrgyz Republic has made considerable headway in its transition to a market economy since the breakup of the Soviet Union by adopting liberal trade policies and other market mechanisms. Indeed, the Kyrgyz Republic was the first member of the Commonwealth of Independent States accepted into the World Trade Organization. The country has achieved moderately high economic growth averaging 4.6% per annum over the past 15 years. Poverty incidence fell from 50% in 2003 to 34% in 2010.
The Asian Development Bank (ADB) and other development partners have contributed to the transition process. But it is by no means complete: the Kyrgyz Republic continues to face major challenges and risks. Among them: infrastructure constraints, including unreliable power supply; insufficient fiscal and institutional capacity preventing the effective delivery of basic social services and impeding efforts for more inclusive growth. In governance, the Kyrgyz Republic does not fare well in international rankings. Frequent changes in the government and internal disputes since independence in 1991 have disrupted reforms. What is more, the country faces enormous risks connected with the rising incidence and severity of natural disasters.
This Learning Curves summarizes the country assistance program evaluation for the Kyrgyz Republic which assesses ADB's country strategies and program from 1994 until 2010. ADB support was rated satisfactory, although major constraints and risks remain.