Azernews.Az

By Kamila Aliyeva

The government of Kyrgyzstan will allocate 2.6 billion soms to support exports and import substitution.

This was stated by Kyrgyz Deputy Prime Minister Tolkunbek Abdygulov during a working meeting with the Prime Minister Sapar Isakov on October 4, KyrTag reported.

"A program to support exporters has been developed within the framework of the project of the Cabinet of Ministers ‘Jany Dorogo Kyrk Kadam’. Necessary changes in the budget, which are supported by the parliamentary profile committee, have already been made. The government will allocate 2.6 billion soms from the budget to subsidize interest rates in order to support domestic producers focused on export and import substitution by the end of the year," he said.

The financing scheme is similar to the program of support of agricultural producers,

"Commercial banks themselves select participants, work with borrowers, give them the necessary funds and, then, the funds only for subsidizing interest rates are allocated from the budget," the deputy prime minister said.

Abdygulov also noted that within the framework of the program, all enterprises that will work for export should present their projects, licenses and certificates of quality. The enterprises can apply to the bank in case they possess all the necessary documents.

Azizbek Omorkulov, Chairman of the Board of RSK Bank JSC, informed that by the end of the year it is planned to draw funds in the amount of 300 million soms.

“We will be able to finance basic and current assets. To finance fixed assets, we will issue a loan for up to 5 years, for working capital — up to three years. In this case, it is necessary to have a certificate of origin and the absence of a negative credit history and debts for taxes and other obligations and payments to the budget. Priority will be given to enterprises that have contracts for the supply of products to neighboring countries, contracts for the purchase of raw materials from local producers and with a positive dynamics of job growth. At once I will say that in case of misuse of the loan, its rate will stop to be preferential and will increase to 30 percent,” he said.

In 2016, the volume of foreign trade amounted to $5.4 billion and demonstrated a decrease by 1.4 percent compared with 2015. Agricultural and engineering products occupied the largest share in the structure of exports. Last year the volume of coal exports amounted to 29.2 percent, glass products to 27.4 percent, ores and precious metals to 45.4 percent in the total export structure

Kyrgyzstan's economy advanced 3.8 percent year-on-year in 2016, compared to 3.5 percent growth a year earlier. Industrial output increased by 4.9 percent, driven by metal ores, manufacture of refined petroleum products, food products and production of precious metals.

In 2016, the GDP growth has reached 3.8 percent. The forecasts say that the real GDP growth of Kyrgyzstan will be 2.9 percent in 2017. The risks which can affect the GDP growth in 2017 are instability of the global economy, dependence of the economy on world prices for gold and energy resources, risks for increase of inflation due to the growth of food prices and others.

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Kamila Aliyeva is AzerNews’ staff journalist, follow her on Twitter: @Kami_Aliyeva

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