The Chamber of Commerce and Industry of the Kyrgyz Republic held last week a joint session of the Chamber's Committee on the development of small and medium-sized businesses and the Subcommittee on the development of handicrafts in the Kyrgyz Republic. The event was attended by representatives of state bodies, commercial banks, business community and artisans who came to Bishkek from regions the country.
Chairman of the small and medium-sized development committee Avazbek Kerimbayev said that under the pandemic conditions, domestic business faced difficult economic conditions and suffered considerable losses. He suggested finding a way out of this situation jointly.
"Today we see a decline in all areas of the economy, especially in the service sector, where almost 50% of small and medium- sized businesses (SMB) are involved. For its part, the CCI of the Kyrgyz Republic has submitted to the Government its proposals to overcome the crisis related to the provision of financial support to entrepreneurs. In its turn, the Government planned to allocate KGS 14 billion from the budget, but today many representatives of SMB complain about the lack of access to concessional lending. Also, due to quarantine, most business representatives, having found themselves in a difficult financial situation, got into the register of unscrupulous payers, which negatively affects their credit history. Therefore, the main purpose of today's meeting is to discuss the accumulated problems of small and medium-sized businesses, and develop proposals for their solutions," Kerimbayev said in his opening speech.
Representative of the country's Economy Ministry Nurbek Umetaliyev informed in the framework of the program to support entrepreneurs, the Government of the country has decided to allocate KGS 14 billion for affordable lending. For this year, a tranche of KGS 4 billion was disbursed, and the remaining KGS 10 billion will be transferred to commercial banks in 2021.
Chairwoman of the Subcommittee on the development of handicrafts of Kyrgyzstan’s Chamber of Commerce and Industry Zhypara Raimkulova said that due to the worsening economic situation related to the coronavirus pandemic, Kyrgyz handicraft production was on the verge of bankruptcy.
"The pandemic stopped the tourism industry, and at the same time stopped the sale of handicraft products. Small stores closed and artisans sent their workers on vacations without pay, which also contributed to increased unemployment in the country. The pandemic showed the weaknesses of this industry. We do not have a single internet platform, there is no system in place to work with marketplaces where we can offer our products. Among the artisans, there is no agreed vision for a way out of the crisis. All small businesses work in a fragmented manner, making their products from raw materials of different quality," Raimkulova said.
As an anti-recessionary measure, she suggested that the Government should consider the abolition of rent for artisan production for the period of quarantine, reducing tax and social contributions.
"Otherwise, Kyrgyzstan's handicrafts industry, whose representatives are custodians of cultural heritage, may be on the verge of closure," the chairwoman argued.
As a successful example, she cited Nepal, which has never before produced sheep and wool, became known worldwide as a producer of felt. According to Raimkulova, the authorities of this country created the most favorable conditions for the development of this sphere, so it became very difficult to compete with cheap products of Nepalese.
"Kyrgyzstan needs to restore the former glory of Kyrgyz felt and wool, and in this case we can’t do it without state support. We need to promote the Kyrgyz brand at all levels, to fashion natural wool-made felt products, to make social videos, and broadcast them in the media. The pandemic will not disappear anywhere, so we need to learn to coexist with it and find new ways to solve problems," Raimkulova concluded.
The meeting participants agreed on the need to conduct research in the handicrafts industry to compile a single database, which will allow to combine small businesses. Such a step will help to bring the export of handicraft products to a new level. For this purpose, the Ministry of Agriculture should consider opening a modern wool testing laboratory according to the requirements of the International Wool Textile Organization (IWTO), without which it will be practically impossible to develop new markets.
During the meeting, the necessity to create an enterprise with modern technological equipment for wool washing and manufacturing of the primary product of processing – top, was stressed. According to the participants, a large trading company should deal with promotion of products of domestic craftsmen. This requires compliance with the unified quality standards and mass production. The craftsmen are sure that this is the only way felt products can compete with the manufacturers of other countries.
The issue of lack of modern laboratory for quality control in Kyrgyzstan was also pointed out by head of Dan Agro Azyktary company Uran Niyazaliyev.
According to him, existing laboratories in Kyrgyzstan do not meet the standards of other of the Eurasian Economic Union (EAEU).
"For example, our laboratories do not analyze pesticides. As a result, our declarations are incomplete. We have to do reanalysis in Russia or Kazakhstan. Therefore, laboratory analysis costs us twice as much. Rates of our laboratories are separate issue, in neighboring Kazakhstan they are 4 times cheaper!,” Niyazaliyev noted with perplexity.
At the end of the meeting the parties agreed that all voiced problems and proposals will be submitted for consideration of the Kyrgyz Government to find solutions. Also corresponding letter-appeal will be sent to the Economy Ministry, Ministry of Culture and the Ministry of Agriculture, Food Industry and Land Reclamation.
The participants noted the importance of organizing dialogue platforms on the platform of the Chamber of Commerce and Industry of the Kyrgyz Republic, the main functions of which include protection and promotion of the business community of the country.
Reported by Kabar (Kyrgyzstan).
