The Kyrgyz Republic is a post-Soviet landlocked country in Central Asia, which gained its independence as a result of the Soviet Union’s collapse in 1991 and is located in the immediate vicinity of Kazakhstan, Uzbekistan, Tajikistan and China. As a small country with large neighbours, the Kyrgyz Republic has to rely on sound and well-balanced foreign relations. With around one-third of the population living below the poverty line, it is one of the poorest countries in Central Asia. While the Kyrgyz Republic was initially ready for reform immediately after independence, the pace of reform has slowed significantly. President Japarov, newly elected in January 2021, has strengthened his powers and introduced a presidential system of government.
There are now major development policy challenges relating to economic development and the health sector. The economy is largely undiversified and highly dependent on natural resources. The local financial sector is underdeveloped, which prevents necessary investments. With regard to the health sector, the government lacks the funds to provide adequate health care for the population.
KfW Development Bank has been operating in the Kyrgyz Republic since 1992. On behalf of the German Federal Government, it supports projects in the following areas:
KfW Development Bank has devised several programmes to promote sustainable economic development. For example, micro and small enterprises in rural areas receive loans at favourable terms, improving income opportunities and diversificaton of the economy. KfW also supports the financing of housing so that medium and low-income households can improve their living conditions.
In consultation with the international donor community, KfW is participating in projects to strengthen the health sector, such as the Programme for Results, in order to reinforce basic health care provision. KfW also supports projects to modernise hospital and laboratory infrastructure. The aim is to improve the quality of services and to provide easier access to these services for the population in rural areas.
KfW’s commitment makes an important contribution to overcoming significant development challenges and hence contributes to diversification of the economy and an improvement of the living conditions in the country. In the context of implementing of the “BMZ 2030” reform strategy, bilateral development cooperation with the Kyrgyz Republic is being phased out, so that no further commitments are scheduled apart from the ongoing projects and measures.