Download FDI policy in Kyrgyz Republic

FDI policy in Kyrgyz Republic
Interesting facts
I Issyk-Kul: 2nd lake in
I 8000 кm2 – eternal
the world on water
transparency
glaciers
I 80 touristic zones
Why KYRGYZSTAN?
The lowest tax regime
Liberal investment
environment
Neighborhood
with large
economies
Rich mineral reserves
Strategy and Goals of FDI
• Draft strategy on stage of development
• To double the FDI by 2017
• GDP growth
• Poverty reduction
Reforms for improvement of investment
climate
1. Priorities
- Fight against corruption;
- Creating favorable conditions for business.
2. The key measures in fight against corruption are:
- reduction of the state apparatus by 20%,
- exclusion of unjustified interference of state bodies into the activity of business
entities,
- reduction of state services from 20 thousand to 380;
- reduction of licensed activities from 500 to 180.
3. Also administrative obstacles and restrictions in the sphere of investment activity
are being actively eliminated.
- administrative barriers and restrictions elimination ;
- legal environment improvement;
- liberalization of internal and external trade regimes.
Investment Legislation of Kyrgyz Republic
The law on
investment in
Kyrgyz Republic
The law on publicprivate partnership
in Kyrgyz Republic
Subsoil law
• Equal rights
• National regime
• Infrastructure development
• Raising of private capital to
public projects
• Effective management
• Market mechanisms of
mining regulation
• Fight against corruption
FDI policy making and
coordination
• The government of KR, Ministry of economy
and line ministries responsible for FDI policy
promotion
• The only body coordinating the FDI policy is
Ministry of economy
Trade policy
• Open policy, the KR is the member of the WTO
(tariffs, taxes and licences)
• KR is preparing to enter the Custom Union
Rating of Kyrgyzstan on ease of Doing Business
Index (Doing Business)
Ministry of Economy of Kyrgyz
Republic
Indexes
Kyrgyzstan
Doing business
Орду
Starting a business
68
Receipt of
permissions for
construction
66
12
Connecting to power
networks
Property registration
180
Receipt of credits
13
9
Protection of
investors
Taxation
22
International trade
182
Execution of
contracts
bankruptcy
procedures
70
127
132
Comparative analysis of Kyrgyz Republic
rating on ease with other countries of region
for 2013
Kazakhstan
50
Kyrgyz Republic
68
Region average index
71
Moldova
78
Russian Federation
92
Ukraine
112
Tajikistan
143
Procedures
(quantity)
quantity of d
Days
Expenditures
Starting a business
2
8
2,7% from GDP revenue
per capita
Property
registration
4
6
0,3% of cost of asset
Cheap and skilled labor force
Ministry of Economy of Kyrgyz
Republic
Cost of electricity
Average Salary
900
0.12
800
0.1
700
600
0.08
500
0.06
400
300
0.04
200
100
0.02
0
2009
Kazakhstan
Kyrgyzstan
2010
2011
Russia
0
Kyrgyzstan
Kazakhstan
Russia
Tax regime
I Value Added Tax (VAT)
I Profit Tax (PT)
I Income tax (IT)
12%
10%
10%
I Retail sales tax
I Limit on the expatriation of profit
I Inheritance tax
Tax type
Kyrgyzstan
China
Kazakhstan
Tajikistan
Uzbekistan
Russia
VAT
12%
17%
12%
20%
20%
18%
PT
10%
15-25%
10-20%
25-30%
9-35%
10-18%
IT
10%
5-45%
10%
8-13%
10%
13%
Environmental and Social issues
• National sustainable development strategy of
the KR for 2013-2017
• Line ministries developed their own policies
(FEZ, Green economy and programs)
What sector are attractive?
Agriculture
Hydropower industry
Mining
Tourism
What sector are attractive?
Ministry of Economy of Kyrgyz
Republic
ICT
Transport and
Logistics
Light industry
Lessons learned
• Political stability
• Coordination of the policies
• Country image