Scepticism About Government Pledge to Boost Business
Scepticism About Government Pledge to Boost Business
If the Kyrgyz government’s plans to promote business activity are to have any success, the administration of the state itself must first be reformed, say local economists.
On October 10, Prime Minister Felix Kulov signed off on a national programme to develop commercial activity over the next two years, with the central aim of creating a favourable environment and sound footing for business to flourish. As targets by which to measure success, the government wants to see 175,000 small and medium-size enterprises, SMEs, in existence when the programme ends in 2008, and they should be contributing 45 per cent of the country’s gross domestic product.
Commenting on these goals, economist Jyldyz Sarybaeva said they are attainable as long as Kyrgyzstan is politically stable and the economy grows at between five and seven per cent each year – but she warns that it will take more than the planned two years to get there.
Sarybaeva believes that the key to success will lie in the substantive measures that are developed to address the problems businesses now face. “There must be better banking services for SMEs, and businesses need to be able to take out loans on favourable terms,” she said. “The legislation governing the operation of SMEs also needs to be reviewed.”
Businessmen in Kyrgyzstan are more sceptical of the government programme, and say SMEs are only going to grow if the authorities sweep away all the bureaucratic hurdles that currently stand in their way. In short, the business sector cannot make progress unless the entire apparatus of state administration is reformed, they say.
According to Temir Sariev, a member of parliament who is also a businessman, “Kyrgyzstan already has favourable conditions for business, in the main, for example a simplified taxation system. The problem is the bureaucracy, which obstructs SME development. The entire system for granting permits is tied up in red tape and completely corrupt. It’s this state-sector corruption that is holding business back.”
Other commentators interviewed by NBCentralAsia shared this view, and said that the government’s programme was full of aims but short on detail. Economist Orozbek Duisheev, formerly a member of parliament, noted that the programme makes no mention of curbing corruption and red tape.
(News Briefing Central Asia draws comment and analysis from a broad range of political observers across the region.)
On October 10, Prime Minister Felix Kulov signed off on a national programme to develop commercial activity over the next two years, with the central aim of creating a favourable environment and sound footing for business to flourish. As targets by which to measure success, the government wants to see 175,000 small and medium-size enterprises, SMEs, in existence when the programme ends in 2008, and they should be contributing 45 per cent of the country’s gross domestic product.
Commenting on these goals, economist Jyldyz Sarybaeva said they are attainable as long as Kyrgyzstan is politically stable and the economy grows at between five and seven per cent each year – but she warns that it will take more than the planned two years to get there.
Sarybaeva believes that the key to success will lie in the substantive measures that are developed to address the problems businesses now face. “There must be better banking services for SMEs, and businesses need to be able to take out loans on favourable terms,” she said. “The legislation governing the operation of SMEs also needs to be reviewed.”
Businessmen in Kyrgyzstan are more sceptical of the government programme, and say SMEs are only going to grow if the authorities sweep away all the bureaucratic hurdles that currently stand in their way. In short, the business sector cannot make progress unless the entire apparatus of state administration is reformed, they say.
According to Temir Sariev, a member of parliament who is also a businessman, “Kyrgyzstan already has favourable conditions for business, in the main, for example a simplified taxation system. The problem is the bureaucracy, which obstructs SME development. The entire system for granting permits is tied up in red tape and completely corrupt. It’s this state-sector corruption that is holding business back.”
Other commentators interviewed by NBCentralAsia shared this view, and said that the government’s programme was full of aims but short on detail. Economist Orozbek Duisheev, formerly a member of parliament, noted that the programme makes no mention of curbing corruption and red tape.
(News Briefing Central Asia draws comment and analysis from a broad range of political observers across the region.)
