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Kyrgyz Republic: COVID-19 Active Response and Expenditure Support Program

Sovereign (Public) Project | 54169-001 Status: Approved

The Program will, in the short term, help the Government of Kyrgyz Republic mitigate the significant negative economic and fiscal impact of the coronavirus COVID-19 pandemic. The government's planned fiscal stimulus package will protect essential social services, while taking credible steps to contain the spread of the pandemic and to mitigate its impact on the population. The Program was developed in close coordination and consultation with the International Monetary Fund (IMF), which confirmed in its 2020 Debt Sustainability Analysis (DSA) that the country remains at moderate risk of debt distress, with some room for concessional borrowing.

Project Details

Project Officer
Tora, Laisiasa Natakubu Central and West Asia Department Request for information
Country
  • Kyrgyz Republic
Sector
  • Public sector management
 
Project Name COVID-19 Active Response and Expenditure Support Program
Project Number 54169-001
Country Kyrgyz Republic
Project Status Approved
Project Type / Modality of Assistance Grant
Loan
Source of Funding / Amount
Grant 0699-KGZ: COVID-19 Response and Countercyclical Support Program
concessional ordinary capital resources lending / Asian Development Fund US$ 25.00 million
Loan 3913-KGZ: COVID-19 Response and Countercyclical Support Program
concessional ordinary capital resources lending / Asian Development Fund US$ 25.00 million
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Sector / Subsector

Health / Disease control of communicable disease

Public sector management / Public expenditure and fiscal management - Social protection initiatives

Gender Equity and Mainstreaming Effective gender mainstreaming
Description The Program will, in the short term, help the Government of Kyrgyz Republic mitigate the significant negative economic and fiscal impact of the coronavirus COVID-19 pandemic. The government's planned fiscal stimulus package will protect essential social services, while taking credible steps to contain the spread of the pandemic and to mitigate its impact on the population. The Program was developed in close coordination and consultation with the International Monetary Fund (IMF), which confirmed in its 2020 Debt Sustainability Analysis (DSA) that the country remains at moderate risk of debt distress, with some room for concessional borrowing.
Project Rationale and Linkage to Country/Regional Strategy The outlook changed significantly in early March 2020, initially with the closure of the Kyrgyz and Kazakhstan borders with China to contain the outbreak of the pandemic. However, in mid-March 2020, the country reported its first 3 cases. Since then, the pandemic has spread, with 116 confirmed cases as of 2 April 2020. The subsequent collapse in oil prices due to falling demand for energy and the knock on effect on demand in major remittance source countries such as the Russian Federation and Kazakhstan, has amplified the impact of the pandemic on the Kyrgyz economy. Consequently, the IMF estimates economic growth to fall sharply to 0.4% in 2020 (from an earlier forecast of 4.4%) and an external financing gap of 5.0% of GDP (around $400 million) while acknowledging that growth could decline even further if the outbreak worsens and border closures are prolonged (footnote 2). The government's assessment of the overall economic losses based on continuing closure of the borders with China and Kazakhstan range from $63 million (best case scenario, that is, the pandemic is contained in 3 months) to $269 million (worst case scenario, that is, contained in 12 months). The project team's assessment, which focuses mainly on fiscal losses, estimates financing needs of $253 million (a difference of 191% compared to the 2020 national budget target) based on more conservative estimates of revenue, accounting for significant increases in public expenditure and reprioritization and reallocation of existing funds to finance the government's pandemic containment and countercyclical response effort.
Impact Economic and social impacts of COVID-19 pandemic mitigated.
Project Outcome
Description of Outcome COVID-19 outbreak more effectively managed and its immediate adverse social and economic effects reduced.
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

Measures to support the population and food security introduced.

Measures to support COVID-19 health sector response implemented.

Measures to support business entities offered.

Measures to support State budget stability undertaken.

Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location Nation-wide
Safeguard Categories
Environment C
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Responsible ADB Officer Tora, Laisiasa Natakubu
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Public Management, Financial Sector and Trade Division, CWRD
Executing Agencies
Ministry of Finance
Public Debt Department Room 500
58 Erkindik Boulevard
Bishkek 720040, Kyrgzy Republic
Timetable
Concept Clearance 15 Feb 2022
Fact Finding 28 Mar 2020 to 28 Mar 2020
MRM 10 May 2020
Approval 04 May 2020
Last Review Mission -
Last PDS Update 04 May 2020

Grant 0699-KGZ

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
04 May 2020 - - 31 Dec 2020 - -
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 25.00 Cumulative Contract Awards
ADB 25.00 04 May 2020 0.00 0.00 0%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 04 May 2020 0.00 0.00 0%

Loan 3913-KGZ

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
04 May 2020 - - 31 Dec 2020 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 25.00 Cumulative Contract Awards
ADB 25.00 04 May 2020 0.00 0.00 0%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 04 May 2020 0.00 0.00 0%

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Tenders

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Procurement Plan

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