Development Fund Could be Vulnerable to Abuse
Development Fund Could be Vulnerable to Abuse
The government in Kyrgyzstan is creating a special fund for development projects, which NBCentralAsia experts say may fall prey to abuse if its management system is not made accountable.
On June 18, the Kyrgyz parliament passed a law setting up a state Development Fund, which will to finance national development projects using government revenue from the Kumtor gold mine
The Kyrgyz government owns some of the shares in the Canada-based Centerra company which mines gold at Kumtor in the north of the country. The government recently initiated talks with Centerra with the aim of increasing its share of the stock, which may be worth up to 350 million US dollars, according to official statistics released earlier this year.
Finance Minister Akylbek Japarov has told parliament that other revenue sources for the fund may include rent paid by the United States for the use of the military airbase outside the capital Bishkek, receipts from privatising the energy sector, and an annual allocation of 60 million dollars from the state budget.
Experts polled by NBCentralAsia say the new institution will not be effective unless the government manages the funds openly and transparently.
Member of parliament Kanybek Imanaliev fears that the fund will not be made accountable to the public given that it was set up by the government and its board of directors will be appointed by the president.
“Ordinary people won’t have access to this fund, so it will finance those projects that are proposed by officials, and this means there is considerable scope for corruption,” said Imanaliev.
However, economist Sapar Orozbakov believes that the fund can be properly managed if non-government organisations, NGO, keep a watchful eye on how it is run.
“The role of NGOs in Kyrgyzstan is very well developed in comparison with other Central Asian countries. If they are able to supervise the process, a degree of transparency can be achieved in the operation of funds like,” he said.
People will place a lot of confidence in the development fund if representatives from international financial institutions and NGOs are included on the board of directors, says economist Jumakadyr Akeneev.
(News Briefing Central Asia draws comment and analysis from a broad range of political observers across the region.)
On June 18, the Kyrgyz parliament passed a law setting up a state Development Fund, which will to finance national development projects using government revenue from the Kumtor gold mine
The Kyrgyz government owns some of the shares in the Canada-based Centerra company which mines gold at Kumtor in the north of the country. The government recently initiated talks with Centerra with the aim of increasing its share of the stock, which may be worth up to 350 million US dollars, according to official statistics released earlier this year.
Finance Minister Akylbek Japarov has told parliament that other revenue sources for the fund may include rent paid by the United States for the use of the military airbase outside the capital Bishkek, receipts from privatising the energy sector, and an annual allocation of 60 million dollars from the state budget.
Experts polled by NBCentralAsia say the new institution will not be effective unless the government manages the funds openly and transparently.
Member of parliament Kanybek Imanaliev fears that the fund will not be made accountable to the public given that it was set up by the government and its board of directors will be appointed by the president.
“Ordinary people won’t have access to this fund, so it will finance those projects that are proposed by officials, and this means there is considerable scope for corruption,” said Imanaliev.
However, economist Sapar Orozbakov believes that the fund can be properly managed if non-government organisations, NGO, keep a watchful eye on how it is run.
“The role of NGOs in Kyrgyzstan is very well developed in comparison with other Central Asian countries. If they are able to supervise the process, a degree of transparency can be achieved in the operation of funds like,” he said.
People will place a lot of confidence in the development fund if representatives from international financial institutions and NGOs are included on the board of directors, says economist Jumakadyr Akeneev.
(News Briefing Central Asia draws comment and analysis from a broad range of political observers across the region.)
