BISHKEK, September 22, 2008 – Today, a Financing Agreement for a US $3 million IDA grant was signed between the World Bank and the Kyrgyz Republic for the Capacity Building for Economic Management project (CBEM). Minister of Economic Development and Trade Akylbek Japarov signed the Agreement on behalf of the Kyrgyz Republic, and Country Manager Roger J. Robinson signed it on behalf of the World Bank.
The objective of the project is to assist the authorities to establish and institutionalize a sound framework and capacity for economic policy making and implementation in the Kyrgyz Republic, which is one of the major factors for achieving a high and sustainable economic growth.
Recent developments show that the government of the Kyrgyz Republic has managed to maintain macroeconomic stability and growth despite severe exogenous shocks. Due to regulatory reforms implemented over the last year, the country’s rank in the Doing Business survey has been improved significantly from 99 to 68 out of 181 countries. Nevertheless, the authorities recognize that further development of the capacity to manage the economy for sustained economic growth and to implement policies to improve the business environment remain fundamental tasks which require further strong efforts.
Accordingly, the project is designed to reach the following objectives: a) contribute to government-wide macro-economic policy development and decision making through establishing strong inter-ministerial coordination and interface; b) support the process of economic policy development and implementation through enabling public institutions (and particularly the MEDT, through capacity building and restructuring) to formulate sound and analytically informed policy measure and proposals; and c) support reform of employment practices and wages in the civil service by building the capacity of the government in this area.
The project will provide direct support to the key economic agencies responsible for economic development in the Kyrgyz Republic to develop technical and institutional arrangements for establishing broad parameters of economic policy and screening significant policy proposals for their consistency with the overall framework of economic policy, particularly taking into account their impacts on the fiscal stance and the business environment.
The Ministry of Economic Development and Trade was assigned as the project implementing agency. MEDT Minister Japarov believes that “the project will greatly help us to implement the ministry’s Strategic Development Plan, the principal objective of which is to develop and implement policies consistent with a well functioning market economy and stable and transparent business environment, as well as to establish a mechanism for economic coordination at the center of the Government.”
World Bank Country Manager Roger J. Robinson noted that the grant in many areas will be complemented by technical assistance being provided or to be provided by other agencies including the IMF and SDC, ADB, USAID and DFID. “We believe that the effort of these development partners will be consolidated under strong leadership of the Kyrgyz government and will result in establishing sound mechanisms of decision making and strengthening public administration, which will be essential for future growth and poverty reduction”, - said Mr.Robinson.
The Capacity Building for Economic management project has a four year duration and is expected to start in autumn of the current year.
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