Policy paper

UK–Kyrgyzstan development partnership summary, March 2024

Published 27 March 2024

Introduction

The International Development White Paper sets out a re-energised agenda for the UK working with partners to accelerate progress on eliminating extreme poverty, tackling climate change and biodiversity loss, and accelerating progress on the United Nations Sustainable Development Goals (SDGs) by 2030. In a contested world, where ODA alone will not be enough, achieving the vision as set out in the SDGs requires a radical rethink in our approach to international development. The White Paper sets out how our partnerships are central to this approach. These are founded on mutual respect, with an emphasis on country ownership, accountability, transparency and common values. This Country Development Partnership Summary details how the approach detailed in the White Paper will be put into practice with Kyrgyzstan.

Country context

Kyrgyzstan is a mountainous, landlocked lower-middle income country, bordered by Kazakhstan to the north, Uzbekistan to the west, Tajikistan to the southwest, and China to the east. With a youthful population (7 million^{[footnote 1]}, with more than 50% under 25^{[footnote 2]}, substantial natural resources, including minerals, forests, arable land, and pastures, Kyrgyzstan has significant potential for the expansion of its hydropower, agriculture and tourism sectors. However, growth rates have lagged (averaging 3.1% between 2010 and 2021^{[footnote 3]}, given overdependence on migrant remittances and gold^{[footnote 4]}, along with challenges in economic management and corruption^{[footnote 5]}, which means this potential is not fully realised.

Despite significant progress in poverty reduction in recent years^{[footnote 6]}, the COVID-19 pandemic has undone many of these gains, with the national poverty rate rising back up to 33.3% in 2021. This also led to reversals in in gender equality, with lower economic participation of women, and higher reported instances of gender-based violence.^{[footnote 7]} Kyrgyzstan faces a number of interlinked risks that threaten to further hold back development including disputed borders; food and water security; and is highly vulnerable to the impacts of climate change and natural disasters. Energy, water, and climate are interconnected regional issues in Central Asia – Kyrgyzstan is the only country in Central Asia whose water resources are almost completely on its own territory and has a key role to play in regional co-operation.

Since independence in 1991, Kyrgyzstan has undergone complex social, economic, and political changes with three presidents being removed through popular protest. The most recent change (October 2020) led to constitutional changes and a return to a presidential system of government. Kyrgyzstan remains the ‘most free’ country in Central Asia, according to international indices. However, recent trends have resulted in shrinking space for civil society and independent media^{[footnote 8]}. Weak institutions and corruption continue to hamper governance.

The Government of Kyrgyzstan has a high level of ambition under the National Development Strategy 2040, to increase per capita income by close to four times and deliver significant increases in the quality and scale of public services. This will require substantial structural reform and the development of a new, sustainable growth model driven by the local private sector and reduced dependence on extractives and remittances.

Why and how: the UK’s development offer with Kyrgyzstan

In Kyrgyzstan, the UK aims to support a more resilient, stable, prosperous future for the country and the wider region, a more open, inclusive society, and a greener, more sustainable economy. HMG’s work in Kyrgyzstan directly contributes to the Government of Kyrgyzstan’s Vision 2026; IR23 and the four priority areas of the IDS as well as the delivery of the Sustainable Development Goals (SDGs). Our priority areas of focus on development include:

Reform

Enabling economic growth, for example, through targeted support to the digital economy and Small and Medium Enterprises (SMEs). We advocate for changes in regulation, legislation, and business environment practices and support privatization reforms. We support investments education reforms as an enabler of growth; as well as interventions which contribute to poverty reduction. We work to address Gender Based Violence (GBV) and greater access to GBV services; as well as to create an enabling environment for civil society engagement and media freedom.

Climate

We promote regional stability, address local conflicts and climate change through regional co-operation on energy and water. We support alignment with the Paris Agreement and COP26 outcomes and implementation of regional and national climate/nature plans towards a credible pathway to net zero. We work with the private sector and communities, for example, with businesses to design ways to reduce carbon emissions. We also work with civil society, to advocate on climate issues and support climate vulnerable communities.

Prosperity

We aim to drive job creation in Kyrgyzstan. We work directly with SMEs, in particular those led by women and youth, building their capacity, and helping them grow. We combine this with the opportunities created through the Developing Countries Trading Scheme (DCTS) and by supporting British business in the country, especially on renewable energy, extractives, digital and education.

Key programmes

Bilaterally, we have moved away from stand-alone, country-focused interventions to regional ODA programmes. Our top programmes include:

• Central Asia Effective Governance for Economic Development (EGED):
  • budget: £25 million
  • duration: 2020 to 2025
  • expected outcome: Improved effectiveness, accountability and transparency of economic policy delivery on selected reform priorities the region
• Climate, Energy and Water Security for Central Asia region (CEW-CA)
  • budget: £19.5 million
  • duration: 2024 to 2030
  • expected outcome: improve Central Asia’s resilience and sovereignty by delivering low carbon and climate resilient growth across the region, through strengthened regional cooperation
• UK-Central Asia Green Inclusive Growth Fund:
  • budget: £18 million
  • duration: 2024 to 2029
  • expected outcome: improved SME capacity and increased flow of green investment finance in Central Asia

The top 3 Centrally Managed Programmes (CMPs) are listed below. We also have smaller scale engagements through international programme targeting climate action.

• Reproductive Health Supplies Programme
  • duration: 2019 to 2025
  • expected outcome: Meeting the contraceptive needs of over 20 million women per year to: reduce unintended pregnancies and maternal deaths; to improve maternal, newborn and child health, and to contribute to universal health coverage
• Global Tax and Public Goods (GTP):
  • end date: 2024
  • expected outcome: strengthening tax institutions and mobilizing revenues at the domestic level
• Global Partnership for Education (GPE)
  • end date: 2021 to 2026
  • expected outcome: Addressing the global learning crisis, including the setbacks posed by COVID-19, particularly to girls

Who we work with

We work in partnership with like-minded countries, including the: US, EU, Germany, Switzerland, and Japan. We are a founding member of the Development Partners Coordination Council – the country donor platform. We work closely with International Financial Institutions, particularly the World Bank, Asia Development Bank and International Monetary Fund, as well as UN agencies, including Resident Coordinator Office, UNDP, UN Women, United Nations Population Fund (UNFPA), International Organisation for Migration. We work with a wide range of partners in the Government of Kyrgyzstan, in particular Ministry of Economy and Commerce, Ministries of Natural Resources and Digital Development, along with other key state bodies such as National Bank of Kyrgyzstan and National Statistical Authority. We work across the UK government, e.g., with the Ministry of Defence (MoD) and the Department of Business and Trade (DBT) to deliver ODA and non-ODA programming.

Links:

• Kyrgyzstan National Development Strategy 2040
• Kyrgyzstan GOV.UK page
• Kyrgyzstan DevTracker page

1. https://www.ceicdata.com ↩

2. UNICEF ↩

3. GDP growth (annual %): Kyrgyz Republic Data (worldbank.org) ↩

4. Remittances contributed 32.7% of GDP in 2021 – World Bank; Gold 8-10% of GDP in 2021: IMF. ↩

5. Kyrgyzstan is 144/180 on Corruption Perception Index ↩

6. The percentage of the population in poverty fell from 39.9% in 2006 to 20.1% in 2019 – World Bank ↩

7. The pandemic has significantly affected patterns of GBV: from January to March 2020, registered 65% more reports of DV than  in the same period in 2019 – World Bank (PDF, 1.8MB) ↩

8. Kyrgyzstan dropped 50 places in the 2023 World Press Freedom Index ↩