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Wednesday 12 September 2018

Economic Slowdown Continues in Kyrgyzstan


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BISHKEK (24.kg) — Kyrgyzstan’s GDP is falling for the second consecutive month along with the volume of industrial production. However, prices are almost stable, even decreasing for some areas since the beginning of the year.

According to the results of January-August 2018, the GDP of Kyrgyzstan amounted for 310,267.2 bln soms, 0.3% less than last year. At the same time, without taking into account the enterprises developing Kumtor mine, the indicator is more optimistic: 282,686 bln soms, representing 2.1% growth.

Services accounted for the largest share in the GDP, more than 46%. The share of industry is slightly more than 19%, agriculture 11.5% and construction about 7%.

This year, it is extremely difficult for the Kyrgyz government to keep the economic growth at the level of 2017. The fact is that the country’s economy depends very much on the largest gold mining enterprise Kumtor. Gold mining at the enterprise is cyclical. In 2016, poor ore was mined that has led to a sharp decline in the economy. However, more gold has been mined in 2017, so the final economic indicators were not bad.

The situation of 2016 repeats now, when the gold production at Kumtor fell 1.65 times. The volume of production of the precious metal in the second quarter of 2018 amounted to 83,803 ounces, and in 2017 — 138,623 ounces.

Such dependence on one enterprise led to a slight GDP growth in the first half of 2018, and it began to fall since July.

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