Kyrgyzstan evaluates 100-Day Programme

BISHKEK – Kyrgyzstan’s new government announced an ambitious 100-Day Programme to reform and modernise the state when it first came into power December 1.

The deadline was March 30, and authorities say they achieved 90% of their goals. Economists are now weighing in on how to finish the job. The aim of the 100-Day Programme was to downsize and improve the government, improve conditions for business and agriculture and attract foreign investment.

The Economy and Anti-Monopoly Policy Ministry, responsible for 22 of the programme’s 57 items, nearly fulfilled its plan, said minister Temir Sariyev. “We drafted a simplified value-added tax (VAT) refund bill, adopted a number of documents on gradually reducing the sales tax, granted tax and non-tax breaks to enterprises in subsidised regions and gave tax exemptions to funds invested by businesses to develop educational and healthcare institutions,” he said.

Prime Minister Omurbek Babanov and other officials presented a report on the programme April 12, saying the main goals have been implemented.

The government is planning to finish reforming the law-enforcement, education and security systems in Kyrgyzstan, Babanov said, adding that it has already increased efforts to fight corruption, taken measures to support business and provided 700m KGS (US $15m) in agricultural credits at an annual interest rate of 7%. Further, an executive order was signed April 12 establishing a special microcredit company within the Youth Ministry to will help young farmers, with a government allocation of 1 billion KGS (US $21.4m).

Deputy Economy and Anti-Monopoly Policy Minister Sanzhar Mukanbetov told Central Asia Online April 12 that the government also received 80m KGS (US $1.7m) more in tax revenues than expected, because companies that didn’t pay taxes before have now paid. The money will be spent on developing educational reforms. The ministry eliminated 1,987 of 18,000 civil service jobs, saving about 804.8m KGS (US $17.5m) per year, he said. It also created two state inspection services, removed redundant functions in various governmental agencies, and adopted a list of state agencies that had the right to inspect businesses.

“The overall downsizing of the government has saved us $21.7m (1 billion KGS) per year, and we also reduced government corruption,” said Deputy Prime Minister for Economy and Investment Dzhoomart Otorbayev.

At a meeting March 26, Babanov said the government should focus on results. “Reforms should not be undertaken for the sake of appearances or a checkmark,” he said. “Positive changes have to exist not just on paper but in real life.”

“Dismantling the financial police, creating a mortgage bank and reducing bureaucracy are certainly pluses,” said MP Ravshan Dzheenbekov, an opponent of Babanov from the Ata-Meken Party. “But these are just adjustments. The government must think strategically and plan for longer-term economic and social development.”

The 100-Day Programme included infrastructural projects such as the Datka electrical substation and new power lines in southern Kyrgyzstan, a second north-south expressway and the reconstruction of the Osh and Tamchy airports. The projects haven’t started, Dzheenbekov said.

However, Vasily Yefremov, an economist at Bishkek Humanities University, argued that the mere existence of discussion at such a high level with regional and international partners means the projects have started. “These projects require large investments, and we can get investments in these projects precisely by discussing them at meetings,” he said.

Entrepreneurs have yet to see serious changes, but the government has allocated 2 billion KGS (US $42.8m) to farmers for spring planting, Yefremov said. “This is fairly substantial assistance to both farmers and the entire agricultural industry as a whole,” he said. The important thing for the 100-Day Programme was to initiate a series of significant economy-boosting reforms, Sariyev said. He cited a review of tax laws and reducing the inspection and licensing burden for business as programme successes.

“There is still a lot that needs changing, but the main thing is that we’ve chosen the right path,” he said.

Some programme shortcomings

“The reforms require money, but there is none, so the results aren’t there,” said Marat Kazakbayev, a political analyst. “There are positive results such as downsizing the state ... but 100 days is not enough.”

The programme has laid the groundwork, and now it is the authorities’ duty to build on this foundation, Sariyev said. The government must continue its work on reforms, Mikhail Khalitov, deputy director of the Union of Entrepreneurs of Kyrgyzstan. But he added: “The best thing would have been to phase in a plan over a few years with all activities clearly itemised. What’s more, this should go through the process of parliamentary review and approval. Such a programme would have given us impetus and a direction for development.”

The task at hand is “to come up with a long-term plan for the country’s development,” agreed Omurbek Abdyrahmanov, an MP from Ata-Meken. “The best thing would be a five-year time frame that takes into account the terms of this parliament and the president, which coincide with each other. The government must present its vision for the country’s development to parliament and to society and then adjust [this vision] by taking account of criticism.”

“The 100-Day Programme has set the tone for Kyrgyzstan’s economy, and this is really important for the future,” Sariyev said.

Asker Sultanov contributed to this report.