Press Release No. 15/242

Press Release: IMF Staff Concludes Visit to the Kyrgyz Republic

May 28, 2015

An International Monetary Fund (IMF) mission led by Edward Gemayel visited Bishkek from May 21-27, 2015. The visit took as part of a regular dialogue with the authorities to assess the performance of the Kyrgyz economy, following approval on April 8 by the IMF Executive Board of a new three-year arrangement under the Extended Credit Facility (ECF).

At the end of the visit, Mr. Gemayel issued the following statement:

“The economy is performing relatively well despite the economic slowdown in Russia and the region, although the risks to the outlook remain on the down side. Non-gold growth remains resilient at 3.4 percent in March; the exchange rate strengthened recently, reflecting ruble appreciation; and 12-month inflation slowed to 7.9 percent in April. However, worker remittances fell in the first 3 months of the year by 33 percent, trade slowed, and non-performing loans (NPLs) and deposit and loan dollarization increased.

“The mission welcomes the progress made toward achieving the end-June quantitative targets and in the area of structural reforms, specifically: the development of the Medium-Term Debt Strategy; the reorganization of the State Tax Service and the introduction of the simplified tax filing procedures; as well as progress toward introducing amendments to the Tax Law and selecting the provider for integrating the treasury with the interbank payment system.

“The mission encourages steadfast implementation of several outstanding reforms that would allow for a timely completion of the first review under the ECF, namely: the review of the public sector compensation system and the public investment program; adoption of the budget code; finalization of the audit of the Debt Recovery Agency (DEBRA); and adoption of the Banking Code. A safeguards assessment of the National Bank of the Kyrgyz Republic (NBKR) will need to be completed by the time of the first review as well.

“During its visit, the mission met with Prime Minister Temir Sariev, NBKR Chairman Tolkunbek Abdygulov, Minister of Finance Adylbek Kasymaliev, and other officials. The mission also met with representatives of the banking sector and the diplomatic and development partner community.

“The team would like to thank the authorities and all whom it met for their hospitality and productive discussions.”