IBC head announced the factors affecting the investment climate this year

On December 14, 2021, IBC Executive Director Askar Sydykov took part in the roundtable “Is there a chance to restore the investment climate in Kyrgyzstan?” held by Economist.kg.

The conditions for investors and entrepreneurs are rather difficult in the country, because even economic growth of 2.4% (4.1% excluding Kumtor) is still a minus compared to 2019, Sydykov said. Therefore, there is still a lot of work to be done.

Social and political instability, constant electoral processes this year affected the attraction of investments.

“A very busy political life negatively affected economic stability. Before any elections, there is a slowdown in investment in any country. Large companies are watching and thinking about what will happen after, whether they will be able to work, and what obstacles may arise,” Sydykov said.

Legislative activities have also affected the investment climate.

This year, constitutional and criminal law reforms have been carried out, and the inventory of legislation continues. All of this affects the business.

“The authorities wanted to introduce a bill on emergency situations in the economy. We managed to convince the president to return it with objections. Taxes also increased, especially in the mining industry. State policy this year has created many uncertainties in subsoil use,” added Sydykov.

The energy crisis negatively affects the investment climate, because new enterprises are not connected to the networks.

IBC head drew attention to the outflow of capital and qualified specialists from the country.

“When we talk with companies, one of the key issues is the lack of staff. Companies say that if it goes on like this, in 5-10 years there will simply be no one to hire, or they will have to hire for a lot of money,” Sydykov said.