AKIPRESS.COM - The Asian Development Bank (ADB) has approved an $80 million policy-based lending program to support efforts to diversify the Kyrgyz Republic’s economy and make it more resilient to shocks such as the coronavirus disease (COVID-19) pandemic, ADB said.
Under the second subprogram of the Promoting Economic Diversification Program (PEDP), ADB will provide a $69.3 million policy-based loan and a $10.7 million grant to help the economy transition from a heavy reliance on gold extraction and remittances to broad-based, sustainable, and inclusive growth.
The program supports the implementation of reforms that will enhance trade and investment competitiveness, promote the development of small and medium-sized enterprises (SMEs), improve infrastructure development through public–private partnerships (PPP), develop industry-based skills, and improve fiscal management and social protection resilience.
“As a long-standing partner of the Kyrgyz Republic, this program builds on a strong base of country knowledge, close collaboration, policy dialogue, and reform efforts,” said ADB Director General for Central and West Asia Yevgeniy Zhukov. “We remain fully committed to supporting the Kyrgyz Republic as it continues to gradually diversify its economy.”
“Ultimately, staying the course on these reforms will strengthen the country’s capacity to increase exports and foreign direct investment, improve agricultural production and food security, create more decent jobs, and provide stable incomes through increased SME engagement in the formal economy,” added Mr. Zhukov. “The reforms will also increase investments in economic and social infrastructure and improve vocational education and skills training.”
“The Kyrgyz Republic has taken major steps towards improving the economy’s resilience to future shocks through comprehensive structural and institutional reforms,” said ADB Public Management Specialist Laisiasa Tora. “Even though it is urgent for economic policy to focus on stabilizing the current COVID-19-related health, macroeconomic, and social crises, the government also recognizes that for a small, open, and integrated economy, maintaining efforts to diversify its economy must remain its crucial reform priority.”
In 2019, ADB approved a $50 million grant for the first subprogram of PEDP which helped the government build the foundation for policy and institutional reforms in agriculture, trade and investment competitiveness, SME development, PPP development, and industry-linked skills development.
The Kyrgyz Republic joined ADB in 1994. Since then, the bank has committed more than $1.3 billion in loans, $811 million in grants, and $69 million in technical assistance projects. ADB operations in the country focus on supporting inclusive growth and economic diversification beyond the COVID-19 pandemic, improving access to public and social services, and leveraging regional cooperation and integration.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.