IMF Staff Country Reports

This paper presents a detailed study that reassesses potential output in the Kyrgyz Republic in light of recent structural changes and external shocks, including the pandemic and the regional conflict. Using a combination of production function analysis, state-space models, and univariate filters, the paper provides a comprehensive estimate of the country’s evolving productive capacity. The findings indicate a notable rise in potential output growth to 5.3 percent, largely driven by capital accumulation and labor force expansion. A notable driver of recent growth dynamics is the influx of Russian migrants since 2022. However, total factor productivity remains below historical averages.