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Kyrgyz Republic and ADB

With ADB's support, the Kyrgyz Republic has sought to reform legal and regulatory frameworks, improve its business environment, make affordable finance available to all, improve the reliability of electricity services, and help its citizens become more employable.

ADB's Work in the Kyrgyz Republic

ADB Membership

Joined 1994

Shareholding and Voting Power

Number of shares held:
31,746 (0.298% of total shares)

Votes:
71,443 (0.537% of total membership, 0.826% of total regional membership)

Overall capital subscription:
$441.52 million

Paid-in capital subscription:
$22.09 million

In recent years, the Government of the Kyrgyz Republic has maintained a strong development agenda to reduce poverty through inclusive economic growth.

With the support of ADB, the government has sought to reform legal and regulatory frameworks, improve the country’s business environment, make affordable finance available to all, improve the reliability of electricity services, and help Kyrgyz Republic citizens become more employable.

Overlooking view of Bishkek, the Kyrgyz Republic's capital and largest city

The Kyrgyz Republic joined ADB in 1994 and the bank has since approved 44 loans ($1.2 billion) and 40 grants ($662 million) from the Asian Development Fund (ADF) as well as 6 grants ($7.5 million) from Japan Fund for Poverty Reduction. ADB has also financed 104 technical assistance projects ($60.2 million).

Cumulative loan and grant disbursements to the Kyrgyz Republic amount to $1.22 billion. These were financed by regular and concessional ordinary capital resources, and the ADF.

Since 1994, ADB has approved 44 loans and 40 grants from the Asian Development Fund as well as 6 grants from Japan Fund for Poverty Reduction and has financed 104 technical assistance projects. Cumulative loan and grant disbursements to the Kyrgyz Republic amount to $1.22 billion.


ADB-Supported Projects and Programs

ADB has placed an emphasis on sustainability and environmental protection in the Kyrgyz Republic’s development. In 2017, work was completed on phase 1 of the $37.5 million Issyk-Kul Sustainable Development Project in the cities of Balykchy, Cholpon-Ata, and Karakol. This 8-year project helped to improve basic infrastructure and preserve the environment of Issyk-Kul lake. The Issyk-Kul Wastewater Management Project, with financing of $36.52 million, was approved in November 2018.

The $38.6 million Climate Change and Disaster-Resilient Water Resources Sector Project, approved in November 2018, will help modernize and maintain infrastructure, enhance agricultural and on-farm water management, and improve disaster risk management. The $30 million Landslide Risk Management Project is planned to begin in 2020.

Through the $21.4 million Naryn Rural Water Supply and Sanitation Development Program, ADB will work to deliver decent living standards, improve health and quality of life for Kyrgyz citizens, and reduce adverse environmental impacts by 2026.


Students attending vocational schools in Karakol, Kyrgz Republic.

ADB remains the largest development partner of the Kyrgyz Republic in education. The $30 million Skills for Inclusive Growth Sector Development Program aims to achieve inclusive growth through improved workforce skills and productivity, and will help develop a market-responsive, entrepreneurial, and inclusive system for technical and vocational education and training. In 2018, the government successfully completed all policy actions of the Strengthening Education System Sector Development Program, with the second (and final) $7 million tranche of the policy grant released in December.

To enhance regional trade for the Kyrgyz Republic, ADB has helped rehabilitate about 1,000 kilometers of major transport corridors and feeder roads. In 2018, the bank approved $78 million for the Central Asia Regional Economic Cooperation Corridors 1 and 3, Connector Road Phase 2. By rehabilitating 138 kilometers of roadway, the project will reduce the cost of transport between the southern and northern regions of the Kyrgyz Republic and shorten the route between Kazakhstan and Tajikistan. With the $10 million Regional Improvement of Border Services Project, ADB is helping construct border crossing point facilities that meet international standards at Karamyk on the Kyrgyz–Tajik border.

The Osh-Gulcha road in the Kyrgyz Republic

Energy security is a top priority for the Kyrgyz Republic. In 2018, the Power Sector Improvement Project was successfully completed, modernizing data systems, enhancing optical metering and communication systems, and rehabilitating major substations. The project has improved service reliability, reduced power losses, and provided transparency and accountability in the country’s energy sector. ADB has also approved $275 million to rehabilitate the Toktogul Hydroelectric Power Plant. With ADB support, the government is preparing the Power Sector Master Plan to cover the coming decade.

ADB is also encouraging private sector participation in the Kyrgyz Republic. The $20 million Rural Financial Inclusion Project will help boost rural incomes and improve livelihoods by providing credit lines to enterprises in the agriculture value chain.

Nonsovereign Operations

As a catalyst for private investments, ADB provides financial assistance to nonsovereign projects and financial intermediaries. Total commitments from ADB’s own funds (in equity and direct loans) in 2018 amounted to $3.14 billion for 32 transactions in economic and social infrastructure, the finance sector, and agribusiness. ADB also actively mobilizes cofinancing from commercial and concessional sources. In 2018, ADB mobilized $3.17 billion of long-term cofinancing and $3.99 billion of cofinancing in trade finance, microfinance, and supply chain finance programs. Total outstanding balances and commitments of nonsovereign transactions funded by ADB’s own resources stood at $12.7 billion as of 31 December 2018.

Cofinancing

ADB began cofinancing operations in the Kyrgyz Republic in 1988. Since then, cumulative direct value-added official cofinancing commitments for the Kyrgyz Republic have amounted to $333.58 million for 12 investment projects and $5.48 million for 11 technical assistance projects.

Projects Cofinanced, 1 January 2014–31 December 2018

Operational Challenges

Government decision-making and private sector investment in the Kyrgyz Republic are impeded by political instability, regional disparities, corruption, and poor management of public finances.

ADB helped develop an e-procurement portal, launched in 2015, that has increased transparency in the use of public funds and improved the efficiency of government procurement.

The bank is also providing technical assistance to strengthen the government’s capacity for managing development projects, to enhance policymaking, and to seize the opportunities and address the risks identified since the Kyrgyz Republic joined the Eurasian Economic Union in 2015.

Future Directions

In September 2018, the ADB Board of Directors endorsed the country partnership strategy (CPS), 2018–2022 for the Kyrgyz Republic to foster sustainable economic growth, leverage regional cooperation to profit from access to larger markets, and improve the quality of life for the Kyrgyz people.

Mother watches over her baby in Kyrgyz Republic. ADB and the Ministry of Health have helped ease the health burden of pregnant women, ensuring safe deliveries and healthy babies in Alay, Chon-Alay, Kara-Kulja, and Nookat raions.

The CPS is expected to provide $641 million in grants and sovereign loans to the country. Sovereign operations will focus on energy, transport, education, public sector management, water supply and sanitation, and agriculture. Private sector support will explore opportunities in agribusiness, energy, and telecommunications.

The CPS will aim to improve access to public and social services across the country. ADB will re-engage in the agriculture sector through project financing to improve services, increase productivity, build resilience to climate change and natural disasters, and improve supply chains to expand access to regional markets.

This article was originally published in the ADB and the Kyrgyz Republic Fact Sheet. Updated yearly, this ADB Fact Sheet provides social and economic indicators on the Kyrgyz Republic as well as concise information on ADB's operations in the country and contact information.

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