The Kyrgyz Republic and Tajikistan have a number of similarities, most notably informed by a Soviet-era legacy regulatory environment and geography. Both countries suffer from a low level of business density and an overall weak private sector. According to the WB-Doing Business ranking, key obstacles to more private investments are the low level of protection afforded to investors, high rates of informality, corruption, excessive business regulation and access to electricity. In the aggregate this leads to slower economic growth, less employment and stagnant high poverty levels.

The main goal of the Program is to further improve the business environment in Tajikistan and Kyrgyzstan, which attracts investments and allows the private sector to grow further and create employment. It is expected that by the end of this consolidation phase of the Programme, businesses will benefit from annual compliance cost savings of around USD 25 million annually. This reflects the aspired reduction in the administrative burden through simplification to business regulation and tax administration.

Government officials deliver more private sector oriented services.

Training centres have been assisted and curricula developed in order to ensure regular trainings of officials.

The inspections, permits and licensing regimes are better functioning. More efficient and transparent procedures, supported by adequate ICT, are in place.

Improved tax administrations: higher transparency and knowledge of tax procedures to reduce potential for rent seeking and inconsistent administrative procedures.

Local partner institutions deliver Corporate Governance Services to businesses independently of donor assistance.

Businesses benefit from improved Corporate Governance structures.

Risultati principali attesi:  

Trained government officials of varoius ministries and agencies in Tajikistan and Kyrgyzstan.

Increased access to information materials for businesses.

Regular interaction between the private sector and the governments takes place.

Local partner institutions and businesses benefit from trainings in Corporate Governance.

Risultati fasi precedenti:  

Previous SECO supported investment climate interventions led to a simplified regulatory environment. SMEs beneift from annual compliance cost savings of USD 15 million across the Kyrgyz Republic and Tajikistan.

With SECO support in Tajikistan, new framework laws on permits and inspections were adopted resulting in the introduction of risk based inspections, the use of checklists during inspections, and an 85 percent reduction in the number of permits.

In the Kyrgyz Republic SECO also supported activities such as the introduction of Risk-Based Tax Audit methodology and databases, which has now started to be rolled out nationwide with the anticipated result of more efficient tax audit and less discretion among local officials.

Fase 2 31.07.2015 - 31.12.2017   (Completed)