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On 25 February 2021 the President of Kyrgyzstan Sadyr Japarov met with Russian business figures at the Russian Union of Industrialists and Entrepreneurs as part of his working visit to Russia.
In his welcoming address the RSPP’s President Alexander Nikolaevich Shokhin described this meeting as a particularly important one for Russian business from the perspective of identifying new opportunities to collaborate and to put forward their own proposals and ideas.
In his speech the President of Kyrgyzstan Sadyr Japarov emphasised that his country attaches great importance to maintaining and strengthening the strategic partnership and cooperation between Kyrgyzstan and Russia, particularly in the fields of trade and investment.
Sadyr Japarov identified that it is in both countries’ mutual interests to move ahead with joint projects in priority sectors of the economy including energy, ore mining, agriculture, mineral resources, manufacturing and tourism. He said that Kyrgyzstan also has huge potential in the field of light industry, for opening joint export-oriented businesses in the textiles industry and food-processing facilities (including construction of commercial logistics centres where agricultural produce can be pooled and subsequently delivered to the markets of the EEU and other countries).
“Given the strategic nature of the Kyrgyz-Russian relationship, it is now more important than ever for us to give new impetus to the expansion of full-scale commercial and economic relations and cooperation in production and investment. We have a clear understanding of the need to deliver major investment projects in practice, and these in turn will facilitate the development of small and medium-sized business, as well as the diversification of connections, the creation of new production capabilities, and increasing the number of added links in the production and service cycle,” the President of Kyrgyzstan said.
Sadyr Japarov listed the economic transformations that are planned once the country’s proposed constitutional reforms are complete. First of all, special focus will be given to attraction of reputable investors with international recognition and strong reputations, and favourable conditions will be created for them. Efforts will also be made to ensure that projects are made as accessible as possible. There are plans to offer significant concessions for investors, including measures to safeguard their rights and interests.
Companies welcomed a statement made by Almambet Shykmamatov, director of Kyrgyzstan’s Agency for Promotion and Protection of Investments, that the draft of the new Constitution includes a provision offering government guarantees to investors. No such provision was specified in the country’s previous constitutions.
“Today Kyrgyzstan is changing its economic model and taking more active steps toward integration through the EEU. Our energy sector has substantial potential for investments, including small and medium-sized hydroelectric power projects. Our aim is to become one of the top 50 countries in the global competitiveness index,” Almambet Shykmamatov said, listing a number of projects that are most promising from an investment perspective, including the construction of the Sary-Jaz Cascade, the Kirov Reservoir and the Issyk-Kul circular road. In this context, a list of 21 major investment projects was provided to the Russian contingent.
Another positive piece of news for Russian investors was an announcement that the Agency for Promotion and Protection of Investments is to be reformed into a National Agency under the direct patronage of the President, as well as the announcement of plans to work alongside the government to develop a national programme as a matter of priority under the provisional title of ‘Kyrgyzstan - an inviting place for investors and business’.
Mr Shykmamatov invited Russian investors to attend the First Kyrgyz-Russian Investment Forum, which is due to take place in Kyrgyzstan in the summer of 2021, to discuss specific investment projects and the expansion of Kyrgyz-Russian business relations in more detail.
The general director of the Russian Export Centre (REC) Veronika Nikishina then expressed the REC’s readiness to continue providing comprehensive support for Russian exports to Kyrgyzstan, including at the level of offering concessionary financing instruments for exporters.
The RSPP President Alexander Shokhin then said, addressing the honoured guests from Kyrgyzstan: “We are ready to ascend to the highest levels of economic cooperation with you. Russia and Kyrgyzstan are strategic partners in trade. The current decline in volumes of trade is a consequence of the general fall in production due to the pandemic. Russian direct investments in Kyrgyzstan’s economy are down for the second year in a row, but the potential to work together to increase non-oil and gas exports is clear. In this crisis it is particularly important to have a stable and predictable business climate and protection for investments,” he said, adding that the RSPP is ready to work together with its Kyrgyz counterparts both within the format of the two countries’ business associations and through the EEU, making use of the opportunities afforded by multilateral institutions. This applies both to cooperation in traditional industries and to relations in the digital and IT sectors.
As regards meetings during international forums, Alexander Shokhin specified that such interactions may take place in a mixed format.
“Provided that there are no radically new strains that are capable of overcoming reinfected or vaccinated people’s antibodies, I think the WEF will take place, Sochi will take place (the World Economic Forum and the Russian Investment Forum in Sochi - Ed.) and things will start up again. These forums will take place in a mixed format in any event,” he stated.
Alexander Shokhin did not rule out the possibility that the Petersburg International Economic Forum in 2021 could take place as an in-person event.
“It is possible that the Russian health authorities will give us the go-ahead and that the Petersburg International Economic Forum will be more of a real-life event. It is still possible that in late June we will be able to meet in St. Petersburg,” the RSPP head stated.
The final stage of the meeting was devoted to matters of practical cooperation between Russian and Kyrgyz companies and to presentation of projects.
Representatives of Russian business raised practical proposals for discussion regarding cooperation with Kyrgyzstan in the field of education, the agricultural industry (construction of a major biotechnologies centre) and healthcare (establishment of health spa resorts). Proposals were voiced to set up alternative energy production facilities in Kyrgyzstan, and contours were drawn for major automotive projects as well as plans for a global renewal of the transport infrastructure in Kyrgyzstan's cities and for interactions in the field of science and high technologies.
“We are already in the process today of implementing projects to set up production of monocrystalline plates for solar panels. And I would like to stress once more that we do not only want to see cooperation in building solar equipment but also in creating real production facilities. Kyrgyzstan is a solar country, I think it has everything you need in order to supply technologies and panels to other countries, and we are hoping to work together on that,” one member of the RSPP's Executive Bureau, the chairman of the board of directors of the Renova Group, said. He also noted the need for the localisation factor to be taken into account during tendering processes in order to give genuine investors the opportunity to compete in open tenders.
The Russian Presidential special envoy for international collaboration in the electric power industry Sergei Shmatko expressed hope that a long-term national programme will soon be approved in Kyrgyzstan for the stable implementation and development of electric power pricing policy, and in particular that a special law on taxation in the field of hydroelectric power will be passed. “That is always a huge plus for the investor, when you have a special law and a long-term perspective,” he said.
During his closing speech the RSPP’s President Alexander Shokhin noted that Kyrgyzstan’s new leadership team has set itself the objective of providing a stable and predictable business climate in the country.
“The country’s new Constitution brings back government guarantees for investors, the legislative base is being radically reviewed, and all this is helping to strengthen the business links between our countries,” he said.
The President of the Kyrgyz Union of Industrialists and Entrepreneurs Danil Tursunbekovich Ibraev, who acted as moderator of the event alongside Alexander Shokhin, thanked Mr Shokhin and the entire RSPP team for organising this meeting within a tight deadline. “Mr Shokhin’s team has given us a master class, being able to set up this forum in a single evening. What this shows is not that we don’t have a lot of time to plan and do things, but rather that we know how to get things done quickly,” Mr Ibraev said.
Alexander Shokhin then recalled Chingiz Aitmatov’s novel The Day Lasts More Than a Hundred Years and added: “It has been an intense day of course, though it hasn’t exactly lasted a hundred years. But nonetheless, both during the preparations for this meeting, and today when we met with the president and spoke substantively about business, we could see that we can expect the 21st Century to be a hundred years of cooperation between Russia and Kyrgyzstan.”
Following President Sadyr Japarov’s visit to the RSPP it was agreed that a roadmap will be drawn up to function as a kickstarter for practical steps on all the business proposals that were voiced, and that action groups will be set up to deliver them.
In addition, according to the meeting’s agenda the companies KORTES and CHETRA signed a memorandum of cooperation aimed at setting up a Kyrgyz-Russian joint venture to produce heavy mining machinery in the Kyrgyz Republic.
The event was attended by around 40 heads of major Russian companies, including the RSPP executive bureau member and chairman of the board of directors of the Renova Group Viktor Vekselberg, the RSPP executive bureau member and President of Rostelecom Mikhail Oseevsky, the General Director of the Russian Export Centre (REC) Veronika Nikishina, the deputy general director of Russian Railways Vyacheslav Pavlovsky, the Russian Presidential special envoy for international collaboration in the electric power industry Sergei Shmatko, the heads of the companies Severstal, FosAgro, VympelCom, Hyundai Motor CIS and the leaders of the RSPP’s specialised committees and commissions. The President of Kyrgyzstan's delegation included most of the country’s government, all the deputy prime ministers with responsibility for the economy, ministers for the relevant industries and the new Kyrgyz Ambassador to Russia Gulnara-Klara Samat.