A year ago Kyrgyz Republic (KR) has applied for a financial credit from the ACF to support the budget and to finance the country’s reconstruction after the shocks of 2010. At that time, the Kyrgyz Republic has just begun the process of joining the Eurasian Development Bank (EDB). The ACF Council of Experts in February 2010, and subsequently the ACF Council, in its meeting on 4th July 2011, recommended that Kyrgyz Republic completes the EDB accession procedure prior to the consideration of this credit by the ACF Council, due to the fact that only upon the completion of accession procedure EDB will have the status of an international organization on the territory of the acceding country with all the necessary credentials. This status is necessary to allow EDB, as the ACF Resources Manager, to efficiently monitor the utilization of resources and the implementation of the agreed conditions of the requested credit. The ACF Council had also recommended that the Bank’s status as an international organization on the territory of KR was identical to its status in five other Member States of the Bank. On 28th July 2011 the Bank Council unanimously voted to admit KR as a Member State to the Bank, and on 26th August the Republic has paid its share into EDB’s authorized capital. On 14th September 2011, the Agreement has been signed between the Government of Kyrgyzstan and EDB on the terms of the Bank’s residence on the territory of the Republic, which has already been ratified by the Parliament and confirmed by the Decree of the President of Kyrgyz Republic. Thus, KR fulfilled the recommendations of the ACF Council associated with the provision of the financial credit.
Meanwhile, financial and economic situation in the country is changing. It is now noticeably different from the situation that existed at the time when the application for this credit was originally filed. Kyrgyzstan shows strong economic recovery (GDP growth is above 8% so far in 2011); gold exports and remittances of migrant workers have increases substantially. The country’s fiscal capabilities have changed as well. Currently the ACF Resources Manager, in close collaboration with KR’s Ministry of Finance is reviewing specific budgetary needs which the requested credit will support. Upon completing this work, the Manager will submit its proposals to the ACF’s Council of Experts, which, in turn, will present its recommendations on this application for the consideration of the ACF Council, which consists of six Ministers of Finance of ACF Member States.
