The Investment Policy Review (IPR) of Kyrgyzstan assesses the country's potential to attract foreign direct investment (FDI) and to diversify flows beyond the extractive sector. The report highlights location advantages, challenges as well as recent policy reforms that have contributed to shaping the country's trade and investment regimes.
The IPR finds that the legal framework specific to FDI is adequate, but its implementation raises concerns and could be strengthened. Whereas reforms positively impacted the general business climate in key areas (e.g. business facilitation, taxation, land surveying, and several aspects of the labour legislation) in recent years, there is still room to further enhance State capacities to effectively implement policies and increase transparency in public administration.
The IPR also proposes a strategy to target investments which could significantly contribute to sustainable development, in particular with regards to employment creation and poverty reduction. Priorities for investor targeting should include garments and textiles, tourism, and agro-industries, where foreign presence has been limited despite high potential. Improving the sustainability of mining and promoting business linkages should also be pursued. Finally, the promotion of public-private partnerships (PPPs) to foster FDI attraction in infrastructure projects is recommended. The newly established investment promotion agency will have key role to play in achieving these objectives.
