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: / Strategies / Comprehensive Development Framework for the Kyrgyz Republic (2001)




Kyrgyzstan Review, 10 years ago




EXECUTIVE SUMMARY

The new era will undoubtedly require new approaches for timely and effective resolution of the most important problems of the state, society and individuals. Today we already must think about tomorrow. In a short period of time, we must develop a new policy for the development of our society that would meet the upcoming realities.
 
Askar Akaev
 
One peculiarity of the present development of the Kyrgyz Republic is the aspiration of the society towards renovation in response to the challenges of integration into the global community and changes related to this process. Radical reforms aimed at creation of a democratic state, maintenance and development of common human values, economic and social development have been implemented throughout the 10 years of the state sovereignty. In doing so, however, the nation has faced a number of serious problems, the principal ones being the economic crisis, depreciation of living standards, an increase in the level of poverty and a growing burden of international debt.
Openness and democratic nature of reforms in the country and the quest for an appropriate position within the international community have gained political and financial support on the part of international agencies and foreign states thus allowing to significantly alleviate the burden of occurring problems.
The process of consistent and active renovation objectively requires development of a long term strategy aiming to overcome existing problems and satisfy basic needs of citizens.
The Comprehensive Development Framework for the Kyrgyz Republic until 2010 (CDF) - is a long term strategy, implementation of which will allow to overcome existing problems in a systematic way, and will provide for a dynamic development of the state and the society in the political, social and economic areas. The strategy is based on the effective application of the nation's human and natural potential for development through the formation and participation of partnerships comprising the state, the private sector, civil society and the international community.
The overarching goal of the CDF is to achieve political and social well being, economic prosperity of the people of Kyrgyzstan, together with freedom, human dignity and equal opportunities for all.
The CDF reflects principal approaches in addressing problems faced by the state and the society, that have been developed on the basis of the national consensus through broad consultations and coordination with all branches of power, private sector and civil society. The Document identifies the ideology, prospects and expected outcomes of the current and upcoming reforms aimed at meeting the peoples needs.
The statement of the national vision identifies the overall development goal and its three basic constituent parts, as well as their components. The national vision focuses on the improvement of the material well being of people, provision of human freedoms, dignity and equal opportunities for all. The three basic parts of the overall goal are effective and transparent state governance; fair society providing human development and protection; sustainable economic growth and development.
Following the formulating of the national vision and the objectives that flow from it, the report provides a general assessment of the situation in the country, including a description of the positive results of the reforms carried out from 1991 to the year 2000. The document then looks at the range of problems faced by the republic in all areas of its political, social and economic life. This is followed by a summary of the problems that require most immediate attention - the national priorities for comprehensive development. The issues that need to be tackled urgently are inter-linked, suggesting strongly that the intended broad-based approach is the appropriate - possibly the only - course of action.
The main directions of the chosen path are reflected in the strategy of the national renovation to be adopted in dealing with the issues facing the Republic. The strategy is aimed specifically at achieving the nations three primary goals, stated above, so it is broken down into three component strategies, each one setting out detailed measures to be taken in the political, social and economic arenas of the nation. These are summarized in an action plan set out in the form of a matrix.
In essence, the strategy aims to resolve the nation's main problems - poverty and debt - by first significantly improving the administration of the state in order to create an environment within which the private sector can develop, flourish and provide the employment necessary to raise incomes and reduce poverty. The state will, at the same time, focus its activities in the social sphere, with more efficient and effective approaches to caring for the needy and disadvantaged in the community.
The strategy relies, first, on a shift in the patterns of investment from a dependence on state investment based on official borrowing abroad, to a greater reliance on private sector investment supported by domestic savings and foreign direct investment. Secondly, the strategy relies on substantial improvements in state budget management, emphasizing qualitative changes in all state organs, with better tax collection and more efficient and effective use of budget resources for community programs and investment in basic infrastructure. Such a shift in patterns of investment and in budget management should make it possible to attack both the poverty and debt problems.
The consequences of the measures proposed under the strategy have been quantified and set out as economic and financial projections to the year 2010. This forecast covers macroeconomic issues, the state budget, the public investment program, savings of the population and direct foreign investments, as well as the consequences of the projected changes in the management of public debt.
An average annual GDP growth rate of 5 per cent in real terms is necessary to achieve the aims of the adopted strategy. This could be achieved if private investment, including foreign direct investment, rises from its current level of about 9,2 per cent of GDP to almost 16,8 per cent in the year 2010. At the same time, the budget deficit would need to decline from about 10,3 per cent to 2,8 per cent of GDP. This means that, although they would rise in absolute terms, national budget outlays would fall relatively from the current level of about 25,9 per cent of GDP to about 21,8 per cent of GDP in the year 2010, while budget tax revenues would rise from 12,1 per cent to 15 per cent of GDP.
On such a scenario, the official external debt situation would be improved, falling from its current level of about 137,2 per cent of GDP to about 72 per cent in the year 2010. At the same time, a reduction in poverty to about half its present level could be anticipated. 
The document relies upon participatory approaches to the implementation of the CDF - through involvement of all branches of the state power, private sector and civil society, as well as through cooperation with international agencies and donor states. The National CDF Council will provide an overall guidance and coordination of the implementation process. The National Council will work through its Secretariat established under the President of the Kyrgyz Republic, which in addition to planning, coordinating and monitoring the implementation of actions within CDF will also make an evaluation of achieved results.
Successful achievement of the overall CDF goal depends upon the understanding by all stakeholders that the destiny of Kyrgyzstan, well being of the people and dignified future of the nation come as a result of painstaking and committed efforts and knowledge of each and every Kyrgyz citizen.