Small and Medium-Sized Enterprises in the Kyrgyz Republic from 2008 to 2012.

It is well known that private entrepreneurship has become the engine of economic progress in new industrial countries.

The right to private property and its inviolability, enshrined in the new Constitution of the Kyrgyz Republic, has undoubtedly played a revolutionary role in the development of private entrepreneurship in Kyrgyzstan.

The exit from the economic crisis, the rise in the living standards of the people, each family, and every citizen of Kyrgyzstan will largely depend on the activation of civilized, honest entrepreneurial activities of our business people.

In recent years, a certain layer of entrepreneurs has formed in Kyrgyzstan - a social layer of owners. They have created thousands of enterprises of various organizational and legal forms in almost all sectors of the national economy of the republic.

However, the new entrepreneurship, which we associated with hopes for overcoming the crisis, has received some development but still does not make a significant contribution to the recovery of the economy. It currently operates with the aim of quick enrichment, capital accumulation without a tangible productive effect. The main field of their activity remains trade mediation. The exception is rural entrepreneurs who have created peasant or farming households and their cooperatives.

What is the matter?

Partly, it is due to the fact that a number of problems have accumulated recently, hindering further growth of entrepreneurship, and there is a lack of effective interaction between state institutions and entrepreneurial structures.

It is necessary to take urgent measures to partially or completely eliminate various bureaucratic restrictions on the development of entrepreneurship, small and medium-sized businesses, such as licensing requirements, export and import restrictions, price and profit controls, limitations on access to credit resources, etc.

The greatest difficulty for small commodity-producing enterprises lies in obtaining bank loans to finance their production activities. Unfortunately, banks have primarily focused on financing commercial operations with quick returns.

To address all these issues, attention must be paid to the Law "On State Support and Protection of Private Entrepreneurship" to enshrine legislative measures for the support and protection of private entrepreneurs. Of course, the law should also define the responsibilities of entrepreneurs to the state and society.

However, no less important today is the sincere patriotic desire of entrepreneurs to help their people, their young country with its still fragile economy. A true entrepreneur will never lose sight of the interests of their state and their people.

Unfortunately, negative phenomena, such as criminal accumulation of money and property, are prevalent in the entrepreneurial environment, which law enforcement agencies must combat relentlessly and uncompromisingly.

In short, the state must create favorable conditions and provide support for a new qualitative leap in the development of entrepreneurship. By expanding civilized interaction between state and entrepreneurial structures, we can solve not only economic but also social problems.



In 2012, there were 11,900 small and medium enterprises operating in the territory of the Kyrgyz Republic. As of January 1, 2013, the number of individual entrepreneurs who registered their businesses was about 298,000 people. On average, from 2008 to 2012, the share of gross value added produced by small and medium enterprises accounted for more than 40 percent of GDP.
By the end of 2012, its volume amounted to 127,800.2 million soms, or 42 percent of GDP.

The number of people employed in the small and medium enterprise sector (excluding peasant and farming households) in 2012 increased by 9 percent compared to 2011, and by 28 percent compared to 2008, reaching 385,400 people, or 16.9 percent of the total number of employed in the economy. Over the past three years, there has been a decrease in the number of employees in small and medium enterprises. However, in 2012, compared to 2011, it increased by 1.9 percent, totaling 87,500 people. The majority of workers are employed in industrial enterprises - 34.7 percent, in organizations dealing with real estate operations, rental, and providing consumer services - 17.7 percent, and in construction - 14.5 percent.

The average monthly salary of employees in small and medium enterprises has been steadily increasing, and in 2012 it amounted to 7,065 soms, which is 10.5 percent higher than the previous year. However, despite this growth, the salary of employees here remains below the average level in the republic (10,726 soms). Moreover, the salary of employees in small and medium enterprises in all regions, except for Bishkek (8,289 soms), is lower than the average across the republic.

The volume of industrial production by small and medium enterprises (including unofficial activities in flour and bread production) in 2012 amounted to 36,813.1 million soms, which is 8.7 percent less than in 2011, but 1.6 times more than in 2008. The share of industrial products produced by small and medium enterprises in the total volume across the republic decreased over the previous three years; however, in 2012 it increased to 26.9 percent.