Macroeconomics
According to Kyrgyz official statistics, Kyrgyzstan’s total GDP in 2011 was US$5.919 billion, the economic growth rate was 5.7%, and the per capita GDP was US$1,127. In Kyrgyzstan’s GDP in 2011, agriculture accounted for 18% of GDP, industry accounted for 20.7%, construction accounted for 4.9%, and the service industry accounted for 44.9%. The national economy of Kyrgyzstan is based on multiple ownership systems, mainly agriculture and animal husbandry, with a weak industrial base, mainly producing raw materials. In recent years, Kyrgyzstan has adjusted its economic reform policy, steadily and gradually transitioned to a market economy, and implemented economic system reforms centered on privatization and denationalization. The economy has maintained a low growth trend, industrial production has resumed growth, and prices have been relatively stable. , inflation levels also fell to their lowest level since independence.
Advantages of attracting investment
Kyrgyzstan has a high degree of economic freedom, relatively loose market access, and obvious advantages in transit transportation. However, at the same time, the legal system is still in the process of improvement, and lax law enforcement, traditional prejudice against foreign investment, and corruption still have a great impact on the investment environment in Kyrgyzstan. Kyrgyzstan is an important hub of the ancient Silk Road and an important channel connecting Europe and Asia. It has a significant radiating effect on Central Asian neighboring countries such as Uzbekistan, Kazakhstan, and Tajikistan. About 70% of China’s exports to Kyrgyzstan are re-exported to Central Asian neighbors. In addition, since Kyrgyzstan is a member of the WTO and the Eurasian Community, it is also convenient to export products to the CIS, Europe, and West Asian countries.
Bilateral trade
Since the establishment of diplomatic relations between China and Kyrgyzstan, bilateral trade has basically maintained a steady growth trend, especially in recent years. Affected by the financial crisis in 2009, the bilateral trade volume between China and Kyrgyzstan dropped by 43.5% to US$5.276 billion. In 2011, as Kyrgyzstan’s political situation stabilized, bilateral trade volume recovered, reaching US$4.976 billion, a year-on-year increase of 18.5%, of which China’s exports were US$4.879 billion, an increase of 18.2%, and imports were US$98 million, an increase of 36.0%. According to Chinese customs statistics, in recent years, the main categories of goods exported from China to Kyrgyzstan include knitted or crocheted clothing and clothing accessories; other textile products; complete sets of items; old textiles; shoes, boots, leggings and similar products and clothing accessories. In recent years, China’s imports from Kyrgyzstan mainly include copper and its products; rawhide (except fur) and leather; steel; ore, slag and ash.
Production and Financing
Domestic industrial water consumption in Kyrgyzstan is US$0.17/cubic meter, and industrial electricity consumption is US$0.03/kWh. Kyrgyzstan is an agricultural country, with about 36% of the labor force engaged in agriculture. In addition, there are few job opportunities and low wages in the country, resulting in a large number of labor immigrants. In 2011, the average monthly salary of Kyrgyz workers was US$193. Kyrgyzstan’s banks are small and have high loan interest rates, so they do not yet have the financing conditions for Chinese companies. The main forms of foreign investment in Kyrgyzstan are direct investment and indirect investment, including physical objects, real estate, purchase of corporate stocks, bonds, intellectual property rights, corporate profits and profits. Foreign companies can merge and acquire Kyrgyzstan companies through full acquisitions and partial equity participation.
