Political Overview
In FY 2002, the Kyrgyz Government's activities in the regional security sphere were dominated by its ongoing cooperation in the Global War on Terrorism, most notably providing crucial support to the United States and Coalition forces by hosting a Coalition airbase outside the capital, Bishkek, that supports Operation Enduring Freedom in Afghanistan. Domestically, the government was faced with civil unrest unprecedented since the country's independence, particularly in the southern region of the country. Widespread unrest began in January 2002 in response to the arrest of a parliamentarian for apparently political reasons, and unpopular government policies, most prominently a border agreement with China, and perceived inaction on the part of the government in addressing poverty in the region. The unrest reached a climax in March when six protesters were killed in civil disturbances. The demand that officials responsible for the deaths be punished and interference with the outcome of a parliamentary by-election continues to fuel discontent.
Beyond its efforts to maintain internal order, the Kyrgyz government worked at measures to address growing unemployment, poverty, and the rising activism of extremist political groups, as well as policies aimed at improving the country's investment climate. Unlike previous years, there were no reports this summer of either incursions into the Kyrgyz Republic by the Islamic Movement of Uzbekistan, or armed clashes with Kyrgyz military forces, in Batken Oblast (region). The Government's human rights record remained poor.
Despite government backsliding on democracy, civil society in the Kyrgyz Republic remains the most vibrant and viable in Central Asia. Undue pressure was applied to organizations, media outlets and individuals practicing their right to free speech, assembly and press. A lawsuit blocked the leading independent newspaper from printing for four months. Organizers of a November Kurultai (people's assembly) were denied permission to meet in Bishkek, and many would-be attendees were detained and forcedly removed from the capital. However, despite government harassment, the Kyrgyz Republic's large and active NGO community was able to focus and organize public demands. For example, an NGO-organized campaign led to the repeal of a government decree that would have required government registration of all printing equipment.
The executive branch continues to dominate the judiciary despite constitutional limitations. The Parliament is an increasingly active and responsive legislative body and provides a check on government authoritarianism. A constitutional referendum is scheduled for February 2, 2003. Due to the unexpected publication on January 13 of a new draft, the United States is concerned that the current proposed referendum will not permit adequate time to address serious issues, provide for public discussion of the new draft, or prepare for adequate monitoring of the referendum by the Organization for Security and Cooperation in Europe (OSCE). Non-governmental organizations (NGOs), civic organizations and the media increasingly influence government policy and legislation. Likewise, local governments are increasingly transparent and responsive. Religious tolerance was practiced widely, although the law requires religious groups to register with the Ministry of Justice, and some groups experienced bureaucratic difficulties. Creating an independent judiciary free from government or other influence is essential to further democratic reform in the Kyrgyz Republic.
Economic Overview
Located in the heart of Central Asia, the Kyrgyz Republic is a landlocked country relying on gold, tobacco, hydroelectric energy, and cotton exports to drive its small economy with a GDP of $1.5 billion. The Kyrgyz economy is burdened with a mostly privatized Soviet-era industrial complex that will require private investment, management expertise, and market access in order to drive economic growth and create much-needed employment. In December 1998, the Kyrgyz Republic became the first Eurasian country to join the World Trade Organization (WTO). In FY 2002, the Kyrgyz Republic continued to work on meeting its post-accession commitments, with the help of U.S. Government assistance in this area.
Despite its efforts in the area of economic reform, real progress has been elusive in a country that inherited one of the least competitive economies of the former Soviet republics. GDP declined by 2.6% in 2002. GDP growth had originally been forecast at 4.5 percent for the year, but a large-scale industrial accident in July 2002 at the country's flagship gold venture adversely affected gold production and exports. Positive signs of macro-economic stabilization continue with tax collections increasing by 12.8% for the period January-August 2002. The government expects GDP to rise 5.8 percent next year and industrial output to grow by 9.6 percent after an expected 13 percent fall in 2002. Inflation dropped from 8% in 2001 to 2% for the period January-September 2002. The value of the Kyrgyz som has remained relatively stable during the past three years, fluctuating between 45 and 49 soms/$1. Russia, Kazakhstan, and Uzbekistan remain the Kyrgyz Republic's biggest trading partners, with China becoming more significant in the last several years. There are twenty licensed commercial banks in the Kyrgyz Republic, with total deposits of three billion soms, worth $65.4 million.
Limited access to external markets, a heavy burden of $1.5 billion of external debt, a weak banking sector, judicial interference in bank regulatory matters, an entrenched, bloated bureaucracy, and burdensome regulatory regime all threaten economic and political reform and restrict growth. Poverty and unemployment are widespread and destabilizing problems, particularly in the south where isolation, contentious borders with Tajikistan and Uzbekistan, lack of investment, and ethnic differences contribute to discontent and a restless search for alternatives.
Of the $1.5 billion in foreign debt, $449.7 million is bilateral debt to China, France, Germany, India, Kazakhstan, Korea, Kuwait, the Netherlands, Pakistan, Russia, Switzerland, Turkey and Uzbekistan. Paris Club negotiations in March 2002 were favorable and resulted in the Kyrgyz Republic receiving restructured debt service and principal payments. In 2001, 47.4 percent of the population lived below the poverty line, down from 52.0 percent in 2000. However, the monthly per capita salary was 1,574.5 soms ($33.00), a 0.2-percent decrease in real terms from 2001.
In July, high-ranking government officials, investors, and representatives of the diplomatic community and international financial institutions held a second annual roundtable on improving the country's investment climate. Throughout 2002, a coordination council, secretariat and 19 working groups made up of government, investor, and donor organization representatives made recommendations and prepared draft legislation aimed at removing obstacles to investment and more effectively marketing the Kyrgyz Republic as an investment locale. Despite considerable achievements at the level of government process, the impact of the investment initiative has yet to be felt by the business community.
Overview of U.S. Government Assistance
In FY 2002, the U.S. Government provided an estimated $114.98 million in assistance to the Kyrgyz Republic:
The roughly $94 million in U.S. Government funds budgeted for assistance to the Kyrgyz Republic included approximately $16 million for democracy programs, $12 million for social services including health and education, $17 million for market reform programs, $37 million for security and law enforcement, $6 million for humanitarian assistance, and $6 million for community development programs.
U.S. Government-funded assistance programs tracked closely with U.S. national interests in the Kyrgyz Republic, focusing mainly on promoting security, economic and democratic reform, and social transition. As in previous years, the Kyrgyz Government was on the whole very receptive to U.S. Government-funded assistance programs, but did not always follow through with full institutional support. In FY 2002, U.S. Government-funded security assistance increased significantly to enhance capabilities of the Kyrgyz Republic's Ministry of Defense, Border Guards, and other border security forces and law enforcement agencies in the areas of regional security, border security, nonproliferation and peacekeeping. The September 11 attacks drew greater attention to the need to combat terrorism, weapons proliferation, and drug trafficking in the Kyrgyz Republic and throughout the Central Asian region.
Training, Exchange and Educational Reform Programs
Since FY 1993, U.S. Government-funded exchange programs have brought over 2,350 Kyrgyz citizens to the United States for short-term professional or long-term academic training, including some 310 in FY 2002 alone. These programs give participants an opportunity to develop their skills and establish valuable contacts with U.S. counterparts.
U.S. Department of State - Public Diplomacy Exchanges: In FY 2002, approximately 255 Kyrgyz citizens participated in academic exchange programs administered by the U.S. Embassy's Public Affairs Section in cooperation with the Bureau of Educational and Cultural Affairs (ECA), including high school, undergraduate, graduate, teacher, and international visitor exchanges.
In FY 2002 some 50 Kyrgyz high school students traveled to the United States on the Future Leaders Exchange Program (FLEX) for an academic year. FLEX identifies the Kyrgyz Republic's best and brightest in their formative years and exposes them to U.S. values. For the third year in a row, FLEX alumni organized a Leadership Summer Camp for High School students from throughout the country to impart the leadership skills they gained in the United States. Also this year, FLEX alumni provided educational programs, field trips and a program of art therapy for 50 children receiving treatment at the Bishkek Children's Cancer Center. In a sign that individual alumni are coming into their own, this year a 1995 FLEX alumnus became Vice President at one of Kyrgyz Republic's largest cellular phone service providers.
The FSA Undergraduate Exchange Program had 10 undergraduate participants. These alumni are also beginning to assume higher positions of responsibility. A 1995 alumnus became Director of the Ferghana Valley branch of the international NGO Mercy Corps, a position traditionally filled by international staff. Another alumna who majored in economics launched an agricultural processing firm, making a contribution in a critical area for economic growth.
Fourteen graduate fellows studied in the United States under the Muskie/FSA Graduate Program. This year a Muskie alumnus in higher education brought about a critical change in the Kyrgyz education system by lobbying Parliament to establish high standards for the selection of school directors, thus effectively eliminating an especially pernicious form of patronage.
In addition, a total of 64 Kyrgyz traveled to the United States under the International Visitor (IV) Program, bringing the cumulative total of Kyrgyz IV grantees to over 300. This program continues to have the greatest immediate impact. For example, an alumnus of a recent "Islam in America" IV program worked with a Democracy Commission grantee to prepare a televised commentary on the videotape in which Osama bin Laden effectively took responsibility for the 9/11 attacks. In this timely expose, which was aired repeatedly in the southern regions, the alumnus laid out his views on why Bin Laden's statements and actions were contrary to Islam. Under the project Combating Trafficking in People, Kyrgyz government officials, a Member of Parliament, and an NGO leader who each work with the recently formed Kyrgyz National Anti-Trafficking Council gained insights into U.S. policies and practices to address trafficking in people. The group met with U.S. government officials, local law enforcement representatives, and members of NGOs and international organizations. As a result of the program, participants proposed new trafficking legislation, a rural education program, greater NGO-law enforcement collaboration, and an expanded action plan for the Anti-Trafficking Council.
Four Fulbright scholars and one Fulbright student traveled from the U.S. to the Kyrgyz Republic. One of the Fulbright professors taught an important lesson to her class of future journalists by refusing the university's demands to submit the class's newspaper for censorship - a step that no local professor would have been able to take and still be able to publish the newspaper.
U.S. Department of State - American University of Central Asia: Indiana University continues to support faculty development and administrative training at the American University in Central Asia (formerly known as the American University in Kyrgyzstan) through a grant from the Bureau of Educational and Cultural Affairs. In FY 2002, eight AUCA master's-degree fellows returned from Indiana to the Kyrgyz Republic and began teaching at AUCA in the areas of psychology, economics, political science, journalism, sociology, and literature. Five additional junior faculty members are expected to complete U.S. master's-degree programs in the coming year.
USAID Training Programs: Through the Global Training for Development (GTD) and Strategic Technical Assistance for Results with Training (START) projects, USAID trained over 2,260 citizens of the Kyrgyz Republic, approximately 58% of whom were women, through 103 U.S.-based, in-country, and third-country training programs in FY 2002. Training focused on fiscal and tax reform, higher education, health-care reform, and NGO development. Training also supported youth and education, anti-corruption, and gender initiatives. A seminar on developing admissions and selection testing programs helped Kyrgyz standardized test writers develop the country's first-ever, merit-based scholarship test, with the goal of making the selection process for Ministry of Education university scholarships more transparent and ethical. Senior-level officials participating in a workshop on revenue administration developed a plan to consolidate the country's revenue agencies and adopt fiscal reform measures. Other recommendations generated by the participants were submitted to President Akayev and subsequently became a major part of a new tax code being considered by parliament. Health reform training for doctors in Jalal-Abad Oblast resulted in the immediate addition of the treatment of sexually transmitted infections to family physicians, making treatment much more accessible. Training in critical thinking was provided to teachers introducing a USAID-developed civic education textbook in pilot high schools.
USAID Resource Network for Economics and Business Education (EdNet): Carana, the USAID partner implementing the EdNet program, opened the Central Asian EdNet Academy in Bishkek in September 2002. Through this program, USAID supported local universities by translating and distributing basic materials such as textbooks, computers and audio/visual equipment, and by sponsoring a Visiting International Professors (VIP) program. USAID provided business and economics training to 200 professors and over 6,000 students, offered university faculty and students additional access to modernized teaching methods and provided access to up-to-date case studies and other essential teaching tools appropriate in a market transition economy. USAID advisors collaborated closely with the Ministry of Education to develop and administer the first National Merit-based Testing Program. The test significantly reduces opportunities for corruption in the allocation of academic scholarships. In June 2002, the National Merit Scholarship Test was administered in three languages (Russian, Kyrgyz, and Uzbek) to over 14,000 high school seniors. Most state and several private universities have honored the merits and results of this exam. While the Ministry of Education has agreed to continue this program, numerous challenges exist in making it a sustainable part of the Kyrgyz Republic's system of higher education. First and foremost, the Ministry is yet unable to implement this testing on its own and lacks the resources needed to contract with an international organization to implement it. Additionally, it has not been determined how to award these scholarships in accordance with the professional needs of the country. These are issues that the program will continue to address in the upcoming year. Carana works with students and professors at three institutes of higher education in Bishkek to help establish their respective boards of trustees on the basis of transparency, democracy and fair treatment of students. Unfortunately the draft Law on Education, which includes progressive recommendations by USAID consultants, has not been adopted by parliament. There is an alternative version of the draft Law on Education that lacks a provision for independent Boards of Trustees.
U.S. Department of Agriculture (USDA) - Cochran Fellowship Program: The Cochran Program seeks to transfer knowledge and skills that will assist the Kyrgyz Republic in developing an agricultural system that can meet domestic food needs, and to strengthen and enhance agriculture-related trade ties between the Kyrgyz Republic and the United States. In FY 2002, seven Kyrgyz participated in two-week training sessions aimed at providing skills to improve productivity in the Kyrgyz agricultural sector. Participants from across the country participated in four separate programs: Agricultural Credit (three participants), Fruit and Vegetable Processing (one participant), and Farmers' Association Development (three participants). Program training included technical assistance on food processing techniques aimed at improving rural farm income generation; instruction on marketing techniques; exposure to U.S. fruit and vegetable standards; and development of individual action plans to be implemented upon returning to the Kyrgyz Republic. One Cochran participant from a rural farmer's credit union attributed the credit union's success in implementing international accounting standards to his Cochran training. The alumnus also implemented new credit practices at the credit union based on practices he had observed in the United States. Another Cochran alumnus is drafting amendments and new legislation related to the quality of meat products. A third participant is lobbying Parliament to protect seed farmers' rights and encourage adoption of seed certification standards.
U.S. Department of Commerce - Special American Business Internship Training (SABIT) Program: In FY 2002, four Kyrgyz participants participated in the SABIT Program, bringing the total to 46 since 1995. Participants received training in the areas of road construction, telecommunication and chemical regulatory standards, and commercialization of new technologies. SABIT internships involving regulatory standards addressed a critical need for streamlining of regulatory requirements and adoption of international standards in connection with government economic reform efforts. Alumni reported representation contracts, continuing relationships with U.S. companies, and promotions in FY 2002.
Democracy Programs
USAID Democracy Programs: FY 2002 was a tumultuous year in the development of democracy in the Kyrgyz Republic. On one hand, the Kyrgyz Government responded to public protests with excessive force, detentions, and harassment, resulting on one occasion in the deaths of six protesters. On the other hand, civil society activists in the country were relentless in their efforts to hold the Government accountable for its actions in all spheres. USAID democracy programs were responsive to this situation and were able to leverage assistance to ensure that important civil society advocacy campaigns had the support they needed. USAID democracy programs were also responsive to indications of political will for reform within Government institutions. Programs targeting the Parliament continued to facilitate public hearings involving local NGOs, and it became evident that many parliamentarians have adopted this practice as a matter of procedure for important legislation. Likewise, USAID programs supporting local government responded to the needs of the first directly elected local officials in Central Asia, assisting them with financial management, public budget hearings, and strategic planning. While USAID programs continued to support the development of independent media in the Kyrgyz Republic, this was an area where assistance did not have its desired impact as government pressures and economic constraints continued to hinder the free flow of information on current events and political processes in the country from a variety of independent sources. Nonetheless, USAID support for independent media was instrumental in helping independent media outlets to continue operating and reporting on a variety of issues despite these external barriers. In addition, USAID programs continued to introduce new teaching techniques and materials for the development of civic education in the Kyrgyz Republic's schools and worked with communities in the south of the country to lessen the potential for conflict in the densely populated Ferghana Valley. In FY 2002, USAID-funded democracy programs supporting civil society, independent media, parliamentary procedures, civics education, and local government independence were implemented by the National Democratic Institute for International Affairs (NDI), the International Foundation for Election Systems (IFES), Internews, Counterpart Consortium, Eurasia Foundation, the American Bar Association's Central and East European Law Initiative (ABA/CEELI), the Urban Institute, Mercy Corps, and ACDI/VOCA.
U.S. Department of State - Internet Access and Training Program (IATP): IATP provides equipment and training for the establishment of public-access Internet centers in areas where Internet access is difficult or unavailable. Implemented by the International Research and Exchanges Board (IREX) through a grant from the Bureau of Educational and Cultural Affairs (ECA), IATP expanded the number of its public-access Internet facilities to 15 in FY 2002. The IATP facility in Naryn is credited with providing the first Western news resources to a local radio station, whose FM radio programs, established thanks to a U.S. Embassy Democracy Commission grant, are now the lower-income population's primary resource for objective news and other programs.
U.S. Department of State - Democracy Funds Small Grants Program: Under this program administered by the U.S. Embassy's Public Affairs Section, the Embassy-based Democracy Commission funded 23 grants totaling over $198,500 to local NGOs in support of independent media outlets, journalism training, civic and legal education in the southern and rural areas of the Kyrgyz Republic, information dissemination, and seminars on trafficking and extremism. One NGO grant recipient from the poorest and most remote region of Batken Oblast in the Ferghana Valley organized training programs on leadership and critical thinking. The training provided by the NGO was so popular that the district government joined it in constructing a larger facility to extend its capabilities. In Bishkek, the Democracy Commission provided a grant for the establishment of a children's media center. The center provides civic education to teenagers by publishing a magazine produced by the young people themselves. In rural Talas Oblast, the NGO Lady Shairin was able to establish an information resource center and conduct seminars on women's and children's issues, land reform, and civic activism.
U.S. Department of State - Support for the National Endowment for Democracy (NED): In FY 2002, the Department provided $200,000 in FSA funding to NED to supplement its grant-making activities in the Kyrgyz Republic. NED used this funding to support a network of human rights organizations in the southern part of the Kyrgyz Republic and to promote human rights activities in eastern regions of the country. Programs on human rights have included a special emphasis on civic education and the defense of young people's rights. Human rights training has been offered to police officers and middle-school teachers as well as lawyers and government officials. NED grants have also been used to support the independent press in the Kyrgyz Republic. The Kyrgyz Republic also benefits from NED regional and cross-border programs that support important journals of discussion such as Tsentralnaya Aziya i Kavkaz, as well as programs conducted by Central Europeans to spread experience and training in democratic development.
Economic Development Programs
USAID Accounting Reform Programs: In the area of accounting reform, USAID helped strengthen the accounting profession with the aim of promoting sound corporate governance and sustainable business growth. Pragma, USAID's implementing partner in this area, designed and administered the first Russian language accounting certification program, the Certified International Professional Accountant (CIPA) program, recognized by the International Accounting Standards Board. The Kyrgyz Republic now has over 100 professional accountants who have successfully passed the three exams required for Certified Accounting Practitioners in the Kyrgyz Republic. USAID accounting reform education experts also provided critical guidance to the Ministry of Education in implementing a model accounting curriculum designed to help institutions of higher learning provide well-trained professional accountants and financial managers.
USAID Commercial Law Reform Program: In 2002, through its implementing partner ARD/Checchi, USAID supported the drafting of comprehensive amendments to the Law on Land, as well as revisions to the Land Code. Laws on Leasing, Micro-finance Institutions, and Commercial Arbitration were passed during 2002. Another milestone was reached with the recently signed Law on Commercial Arbitration, which establishes a local enforcement mechanism for foreign arbitration awards and allows for the arbitration of commercial disputes within the Kyrgyz Republic. To leverage that success, ARD/Checchi advisors helped create the Commercial Arbitration Association that will provide an alternative to resolving disputes through the often unpredictable judicial system. ARD/Checchi advisors assisted in the drafting of other key pieces of commercial legislation, including the new draft Laws on Pledges and Mortgages, the new draft Law on Joint Stock Companies, and the new draft Law on Securities Markets, which are being reviewed by Parliament. USAID collaboration with International Finance Corporation (IFC) was instrumental in securing the passage of a new leasing law, which provides entrepreneurs with broader access to manufacturing equipment without requiring long-term contracts or the transfer of title.
As a part of on-going efforts to promote the rule of law, USAID provided assistance to expand a database of judicial opinions to include nearly 10,000 opinions, which includes substantially all opinions issued by commercial courts of the Kyrgyz Republic since their inception. The knowledge that opinions are published and widely disseminated should have a tempering effect on judicial rulings. USAID continued to engage in a wide variety of information dissemination activities, including (1) weekly television programs on tax issues of public interest; (2) publication and distribution of a bimonthly Law and Business Journal, (3) publication of twenty Public Information Brochures on legal topics; and (4) development and dissemination of electronic databases that house a variety of legal information and resources.
USAID Fiscal Reform Programs: In FY 2002, the USAID fiscal reform program implemented by Bearing Point helped the Kyrgyz Republic's Ministry of Finance and Tax Inspectorate formulate and implement economic restructuring policies. A single state body for tax collection was introduced by Presidential Decree on September 26, 2002, as a result of which the State Customs Inspectorate and the State Tax Inspectorate are merged to become the Committee on Revenues. Technical assistance for the development of an automated tax information system, and assistance with government budget planning and the formulation of budget policies at the national and local levels, is continuing. In addition, Bearing Point advisors are working with the Kyrgyz Parliament to improve its fiscal analysis capabilities. Bearing Point also continues fostering government-wide support for a city-administered real property tax plan. In 2002, tax revenues increased by 12.8% over the previous year, but at 13.4% of GDP are still among the lowest in the former Soviet Union.
USAID Banking Reform Program: In FY 2002, USAID helped the National Bank of the Kyrgyz Republic (NBKR) improve its ability to supervise the country's commercial banking sector. USAID-funded Bearing Point advisors developed a bank inspection manual and provided training to banking supervisors in accounting, risk analysis and other topics related to banking supervision.
Corruption and mismanagement of commercial banks, and the NBKR's limited enforcement ability, continued to impede progress in the banking sector during FY 2002. An area of improvement was the development of a new Call Report that enables the NBKR to monitor bank risk more effectively. Banks will be required to submit detailed information on delinquent loans, interest rate risk, and capital components. This information will serve as the basis for the new Off-Site Surveillance system that is being installed.
The NBKR approved Bearing Point's proposal to implement a Bank Supervisors Accreditation Program. This program, which should help improve the effectiveness of the NBKR's bank supervision function, includes a database of 300 questions used to test supervisors on general knowledge of bank accounting, legal issues and asset and liability management, and implements a more rigorous recruitment policy. These efforts should help improve the reputation of the bank supervision function in the eyes of the banking community, government agencies and Parliamentarians. Bearing Point also developed three handbooks to improve the corporate governance of banks. The Board of Directors' Handbook, the Board Members Guide to Bank Reports, and a Guidebook on Internal Controls were used to provide training to both NBKR personnel and bank directors, and, once formally approved by the NBKR, will be provided to Council members of every bank in the country.
USAID Land Reform Project: Through its implementer Chemonics International, USAID is helping to establish in the Kyrgyz Republic the most advanced institutional infrastructure for private land ownership in Central Asia. As a result of the Land Reform Project's urban sales program, six pilot cities received a total of over $100,000 in revenue from the sale of 55 land parcels. The revenues are being used for social spending and reconstruction of municipal infrastructure. Chemonics assisted the City of Tokmok to develop and adopt a market-based set of land use regulations that establish clear guidelines regarding permissible uses. Adoption of the regulations is expected to significantly reduce the incidence of corruption that previously plagued the process of land use permits. The cities of Osh, Jalal-Abad and Cholpon-Ata have prepared draft legal zoning regulations that are now going through the same kind of open review and approval process that was employed by Tokmok. The Land Reform project also prepared a draft water code in cooperation with the Ministry of Agriculture and water user associations.
Through USAID assistance, a cadre of about 70 qualified real estate appraisers has been developed and is beginning to provide services critical to development of a land market. Mortgage underwriting training was provided to financial institutions and public sector representatives to begin laying the foundation for development of a mortgage market. During the past year, the project successfully transferred to its partner NGOs the responsibility of delivering the project's Land Rights Workshops I, II and III, which educate rural citizens on their land rights. The workshops, which are conducted in Kyrgyz, Uzbek or Russian, depending on the target audience, were delivered to over 13,800 persons during the period April 2000-September 2002, of whom more than 37% were women. Through twice-weekly, nation-wide radio broadcasts, and publication and wide distribution of monthly newsletters, the Land Reform project provides farmers and rural citizens with explanations of new laws and regulations affecting their land rights and critical information regarding land reform issues.
USAID Legal Assistance for Rural Citizens: To help reduce the risk of conflict, particularly in the Ferghana Valley region, USAID, in cooperation with the Swiss Agency for Development and Cooperation (SDC), significantly increased its support of the Legal Assistance to Rural Citizens (LARC) project, which provides legal services to resolve land-related disputes. During FY 2002, LARC attorneys conducted 79 informational meetings that were attended by over 2,600 participants, gave over 4,500 legal consultations, represented clients in over 800 cases that were settled out of court, and represented clients in 26 cases that were heard in court. During the past year, LARC attorneys were instrumental in helping hundreds of rural citizens resolve their land-related disputes with local authorities. For example, a mother of two was assisted in asserting and winning her claim to an allotment of land following her divorce; the head of a family of eleven was assisted in asserting his claim to, and obtaining possession of, the full allotment of land to which he and his family members were entitled; and a peasant farmer whose land rights were illegally and unilaterally cancelled by the local authorities successfully sued for damages and received a two-hectare land parcel as compensation.
USAID Enterprise Development (EDP) Training and Advisory Services Project: Business training conducted by Pragma reached over 3,000 business people throughout the Kyrgyz Republic, helping to upgrade their skills in marketing, management, managerial accounting, and other business fields. In Talas, one of the country's poorest regions, business training enabled over half of 36 participants to obtain a total of $8,000 in credit for their businesses. Pragma business advisors provided entrepreneurs with a wide range of technical assistance to help solve everyday business problems, and helped to link prospective buyers and sellers through using Pragma's internet-based regional trade network. After working closely with a business advisor, one local juice and jam producer in Cholpon-Ata increased the number of its sales outlets from 143 to 283, boosted production of juice by 68% and jam by 80%, expanded its product line, and significantly increased its exports.
USAID Osh Agro-Processing Initiative: A bilateral Memorandum of Understanding signed in June 2002 officially launched the Osh Agro-Processing Initiative (OAI). The OAI will facilitate the processing, marketing and export of agricultural products. According to the Memorandum, the Government committed to remove constraints to business development. Technical assistance, training, and market development is being provided by USAID contractor Pragma Corporation. Companies, industries and business opportunities with the most potential have been identified and business plans developed. Pragma is providing training in management skills, marketing, leasing, customs, credit, packaging and processing equipment, sanitation, quality standards, and supply chain management. Market appraisals were conducted in seven cities in Siberia and Western Russia. Buyers from Novosibirsk and Omsk are becoming increasingly interested in Kyrgyz produce and processed agricultural products. Offers to buy have come from Kiev and Sofia, Bulgaria. Kyrgyz businessmen participated in trade fairs in Kiev, Almaty and Novosibirsk, helping establish links to potential new markets for Kyrgyz products. A trial shipment of food and household goods sent to Afghanistan to gauge market potential resulted in a request for truckload pricing of cotton fabric.
USAID Support for MASHAV Programs: USAID's support of Israel's Center for Cooperation (MASHAV) helped provide over 700 business consultancies to agro-enterprises on topics ranging from business strategy to stock breeding and trained 364 entrepreneurs. MASHAV's work is credited with creating more than 300 jobs. As an example of the cooperation with OAI, MASHAV started seven new projects in the Osh region using marketing information that Pragma shared following a marketing research trip to Russia.
USAID Micro-Lending Programs: USAID supports four programs aimed at strengthening the country's microfinance industry. These programs include: the Central Asian Microfinance Alliance, the Legal and Regulatory Microfinance Project, support of FINCA's savings and microcredit institution, including its transformation into a bank serving the poor, and support of the Bai-Tushum Financial foundation which provides financial services for rural citizens. In 2002, with USAID support, representatives from the Investor Roundtable and other USAID advisors provided critical assistance in the development of the new Law on Microfinance Organizations. The law was adopted in July 2002 and created the legal and organizational foundation for microfinance activities. In late FY 2002, USAID began a one-year program in collaboration with the IFC to provide assistance to the NBKR aimed at improving its capacity as the supervisory body for the new microfinance legislation. In addition, the IFC launched a major microfinance program aimed at strengthening the microfinance industry in Kazakhstan, the Kyrgyz Republic, Tajikistan, and Uzbekistan - called the Central Asian Microfinance Alliance (CAMFA). Through its cooperative agreement with ACDI/VOCA, USAID provides long-term technical assistance to Bai-Tushum Financial Foundation (BTFF), a rural finance institution that has three branches throughout the Kyrgyz Republic. This technical assistance includes providing strategic planning to create a sustainable rural microfinance institution based on international practices, training executive management, loan officers and accounting staff, putting in place internal control and management information systems, and creating a viable system for financial management. During FY 2002, BTFF continued to build a high quality loan portfolio. It disbursed 1,131 new loans exceeding $1.96 million, 60% of which were to agro-enterprises, and maintaining 97% repayment rate. Since its inception, FINCA has disbursed $53 million in loans to some 147,225 clients while maintaining the repayment rate of 98.8%. In September 2002, the total number of active clients reached 20,248 clients, 87% of whom were women. FINCA provides saving and microcredit services in the Chui, Osh, Jalal-Abad, Issyk-Kul, Naryn, and Batken Oblasts. One of FINCA's two program components is the Small-Enterprise Loan Program. Under this program, FINCA disbursed over $2.3 million in FY 2002, maintaining a repayment rate of 95.8%. As a part of the CAMFA program, USAID will support FINCA's transformation into a private microfinance bank in the Kyrgyz Republic. In addition, with USAID financial support, Mercy Corps International (MCI) disbursed more than $4.5 million in loans to 21,200 small and micro businesses throughout the country, helping over 500 businesses expand their small operations, and increasing access to loans for over 10,000 female entrepreneurs.
Trade and Investment Programs
USAID Regulatory Reform Programs: In FY 2002, ARD/Checchi continued to work on removing investment constraints that impede the operation and growth of businesses in the Kyrgyz Republic. In collaboration with the Government's Secretariat for Attracting Investment, partially funded by USAID, ARD/Checchi worked to create a more favorable investment environment for foreign and domestic investors and generate much-needed economic growth. ARD/Checchi legal experts were instrumental in the drafting and issuance of the Kyrgyz Presidential Decree No. 100. This decree redefined the government's role and relationship with the private sector by officially recognizing and defining the problems of excessive government regulation and other administrative barriers to investment and business development. The decree identifies removal of barriers to trade and business growth as one of the Government's highest priorities and places a one-year moratorium on the adoption of new laws and regulations impacting businesses. With the assistance of ARD/Checchi advisors, the Government successfully defended the previous year's hard-won gains in the area of licensing reform by repealing four proposed resolutions that would have created licensing requirements for 37 additional activities, more than doubling the number of licensed activities and significantly increasing costs to businesses. ARD/Checchi also worked with business and professional associations to develop stronger advocacy for the business community. USAID-financed technical assistance and training was a key factor behind lobbying efforts that prompted regulatory changes in taxation, certification, and business registration regulations. For example, the Committee of Private Entrepreneurs (CPE) worked closely with ARD/Checchi advisors to improve operations, services, and membership. After making those essential improvements, the CPE successfully lobbied for a simplified taxation scheme for private entrepreneurs, now outlined in Government Decree 118.
USAID Customs Reform Programs: In FY 2002, USAID partner Pragma continued to foster increased cooperation and coordination between the Kyrgyz Republic's and Kazakhstan's tax and customs authorities to streamline procedures, limit the potential for corruption and stimulate regional cross-border trade. At the local level, Pragma promoted the dissemination, adoption and implementation of regulations related to trade and investment through education and facilitating dialogue between government and private sector. At the national level, Pragma advisors continued to provide post-WTO accession support to the Kyrgyz Government, and assisted in drafting a new Customs Code largely compliant with WTO and amended Kyoto Convention requirements.
U.S. Department of Commerce - Business Information Service for the NIS (BISNIS): In FY 2002 BISNIS-Bishkek helped a number of infrastructure projects receive consideration for international and USG financing, engaged officials in discussions on ways to improve the country's business climate and generate investment opportunities. The Kyrgyz Republic's Ambassador to the U.S. addressed the first BISNIS Ambassador Roundtable in Washington on the Kyrgyz Republic's standing in the post-9/11 global environment. The Ambassador provided assurances for the U.S. business community that prospects for economic development and collaboration remain. BISNIS activities included briefings about trade and investment opportunities in the Kyrgyz Republic for U.S. firms in Indiana and Kentucky.
U.S. Trade and Development Agency (TDA): FY 2002 marked the first TDA-funded projects in the Kyrgyz Republic, with a definitional mission on the gold-mining sector to determine how to best structure its development, and $246,800 for a feasibility study on implementing an e-government system to facilitate government services for the public.
U.S. Export-Import (Ex-Im) Bank: Ex-Im Bank is currently off-cover for all financing programs in the Kyrgyz Republic.
Energy and Environmental Programs
USAID Power-Sector Programs: PA Consulting Group is implementing USAID's principal energy activity in the Kyrgyz Republic, a small community hydropower demonstration model that commenced this spring. The small hydropower plant is located on the Naiman canal near the village of Jangy-Naukat. The electricity that the plant will provide will benefit approximately 20,000 people and increase productivity of local businesses. The first tranche of local contributions to the project has been secured. The demonstration model is supported by the public charity fund "Meerim," which provided financial support and expressed its willingness to replicate the project at other locations.
USAID Energy Efficiency Programs: A USAID winterization demonstration model was completed in two public schools in Kara-Balta. The model, based on the installation of an automated system of heat flow regulation, was implemented by PA Consulting Group. The Kara-Balta city administration has promised to replicate the project using anticipated savings from the project.
USAID Water Management Programs: The main transboundary water and energy conflict in the Aral Sea Basin is related to the operation of the Toktogul Reservoir in the Kyrgyz Republic. A conflict has arisen between the winter energy needs of the Kyrgyz Republic, the summer irrigation needs of downstream countries, and the timing of resulting water flows to the Aral Sea. Possible short- medium- and long-term options to reduce this conflict are being evaluated. A short-term option is the rapid reduction of technical and non-technical energy losses in the Kyrgyz power system. PA Consulting Group will implement an energy loss reduction demonstration program. Additionally, USAID sponsored PA Consulting Group's evaluation of the Kambarata Number 1 and 2 hydroelectric projects (designed in the 1980s) upstream from the Toktogul Reservoir. The study assesses the projects' viability as long-term options for the Kyrgyz Republic's power system expansion that could help mitigate the water and energy conflict. In FY 2002, USAID's water-sector data management initiatives implemented by PA Consulting Group continued on a dual course: upgrading data monitoring systems for water allocation decisions and providing training to use and apply this data in transboundary and national water management decisions. Successful installation of a demonstration automated meteorological station led to the procurement of five additional stations that will be used to support improved snowmelt and hydro-meteorological forecasting. Training of hydro-meteorological agency (hydro-met) staff resulted in the successful installation of two World Bank-financed transboundary stream monitoring stations. Kyrgyz staff also underwent two weeks of on-the-job training at the hydrological forecast center in Tashkent. This training could lead to improved cooperation and hydrologic forecasts for water resources shared by the Kyrgyz Republic and Uzbekistan. A USAID-funded system for communication of this data between all hydrological stations in the region is also underway. The implementation of this system will allow the Kyrgyz Republic hydro-met to receive digital data from the recently installed automated stations and to distribute this data to local and regional users in near real-time. USAID's on-farm water management activities, implemented by PA Consulting Group, made substantial progress with the design, procurement, manufacture and installation of fifteen water control and measure structures in the Kyrgyz Republic. Irrigation water measuring structures designed and constructed for the Sahi-Darya Water User Association in Osh Oblast were adopted for use in a World Bank Project supporting water user associations in the Kyrgyz Republic.
Social-Sector Programs
USAID Primary Health Care Programs: In close collaboration with the World Bank, USAID is developing models of primary health care nationwide, emphasizing community involvement and higher-quality, better-financed care. Communities are becoming involved in their health care through popular open-enrollment campaigns that enable people to select their own doctors. Open-enrollment campaigns involved one million people from Bishkek and the neighboring Chui Oblast. More families benefited from quality care provided at the community level, since 68 percent of family doctors and 49 percent of families nationwide completed standard retraining programs. Family medicine retraining and continuing medical education have been institutionalized, as the last of five classes of trainers graduated from their year-long program, resulting in completed staffing of all oblast-level family medicine training centers. Nursing took a giant step forward with the founding of the first Faculty of Family Medicine Nursing in the Commonwealth of Independent States. This faculty is the first nursing education department in Central Asia to be headed by a nurse, a graduate from a one-year nurse faculty development program funded by USAID. Early results from the introduction of hospital co-payments in two oblasts indicate that people who are hospitalized now pay less in co-payments than they previously paid under-the-table, and the increased revenues from co-payments are permitting hospitals to increase their stocks of medications and supplies. In two oblasts where reform has progressed furthest, savings from reducing excess hospital buildings and excess staff permitted increased expenditures on drugs (93-170%), staff salaries (20-35%); and food and supplies for patients (13-14%).
USAID Infectious Disease Programs: USAID is providing technical assistance to the Kyrgyz Republic's Ministry of Health in implementing the World Health Organization (WHO)-recommended Directly Observed Treatment, Short-Course (DOTS) tuberculosis strategy nationwide. The focus of the program is to strengthen and standardize DOTS clinical and laboratory training and monitoring of program implementation in close collaboration with the WHO. USAID's implementing partner, the U.S. private voluntary organization Project HOPE, opened an office in Bishkek last year to assure the quality of the training and monitoring of the DOTS program. To allow policy makers to rapidly analyze TB trends and make informed decisions, USAID is extending nationwide the TB electronic case-based surveillance system developed in Kazakhstan. In 2002 USAID participated in the World Bank assessment of the TB and HIV situation in the prisons of Kyrgyz Republic. According to this assessment, the situation in prisons is serious. In 2001, the TB case notification rate in the prison population was almost 41 times higher than the TB case notification rate in the general population. For that same year, the mortality rate in the prison population was 150 times higher than the mortality rate in the civilian population.
Although by global standards HIV prevalence in Kyrgyz Republic remains relatively low with a concentrated epidemic among injecting drug users, there is potential for an uncontrolled and widespread HIV/AIDS epidemic. By September 2002, the Kyrgyz Republic reported 322 HIV positive cases but the true figure is estimated as 10 times higher. Under-estimation results from the lack of proper diagnostic systems and absence of an efficient surveillance system. USAID and the Center for Disease Control and Prevention (CDC) are helping establish two sentinel surveillance sites in Bishkek and Osh, where the largest HIV-positive populations are currently found, and have trained experts to gather and analyze the data. USAID is also collecting behavioral information in high HIV-transmission locations, to better focus AIDS prevention programs in the bars, clubs, parks and other sites where the need is greatest.
Security, Regional Stability and Law Enforcement Programs
U.S. Department of Defense - Cooperative Threat Reduction/Defense and Military Contacts: In FY 2002, as part of an ongoing effort under the Defense and Military Contact Program, about $400,000 was allocated to support defense and military contacts with Kyrgyz Republic under the coordination of the U.S. Central Command (CENTCOM). These programs seek to promote our counterproliferation, demilitarization, and defense reform objectives by fostering dialogue and cooperation with NIS militaries. FY 2002 included over 20 information and professional exchanges with the Kyrgyz Republic focused on developing a professional Officer/NCO Corps, improving disaster response, defense restructuring, and resource management.
U.S. Department of Defense - Counterproliferation Programs: In FY 2002, the DoD/FBI Counterproliferation Program expended approximately $387,000 for the Kyrgyz Republic to support criminal investigations/operations training and interagency crisis incident management training. Under the DOD/US Customs Service Counterproliferation Program, an estimated $155,000 in assistance was provided for training in tracking.
U.S. Department of Defense - Partnership for Peace (PFP) Program - Warsaw Initiative: The Kyrgyz Republic is an enthusiastic participant in NATO's Euro-Atlantic Partnership Council (EAPC) and PFP, and was an early supporter of the Central Asian Peacekeeping Battalion (CENTRASBAT) regional cooperation concept as well. They also participated as observers in the NATO PFP exercise Combined Endeavor 2002 and the initial planning for Combined Endeavor 2003 and Peace Shield 2003. Under PfP programs jointly sponsored by NATO and the U.S. Government's Warsaw Initiative, Kyrgyz military officials attended planning conferences, joint exercises and other events. The Kyrgyz Republic was allocated an estimated $250,000 in Warsaw Initiative funding to enable it to participate in NATO/PFP exercises in 2002. The Ministry of Defense (MOD), Kyrgyz National Guard (KNG) and Ministry of Ecology and Emergency Situations (MEES) also participated in a state partnership program with the Montana National Guard that included basic infantry training, combat lifesaving courses, mountain rescue and survival training, and planning for an international workshop on emergency response. A major highlight this year was the International Workshop on Emergency Response that included over 230 people from 17 countries. In addition, the Kyrgyz are active participants in programs sponsored by the DoD's Marshall Center in Germany, and in regional and multilateral fora on security, including those sponsored by the United Nations, the Organization for Security and Cooperation in Europe (OSCE) and the U.S. Government.
U.S. Department of State - Foreign Military Financing (FMF): In FY 2002, FMF was used to support the Kyrgyz Republic's most immediate military assistance priorities. As the Kyrgyz Republic's armed forces are currently functioning on less than par equipment and with major gaps in critical gear needed for day-to-day security operations, filling these gaps were the top priorities for our assistance in FY 2002. In FY 2002, $2 million in FMF funding was used to fund: requirements for communications and mountaineering equipment for the MOD; parachutes and uniforms for the KNG; and chemical-biological protective gear and environmental sampling equipment for MEES. Prior-year FMF funding was used to provide 187 "man-pack" high-frequency (HF) radios, 25 vehicle-mounted HF radios, spare parts, and encryption devices. In FY 2003, FMF will continue to fill major gaps in security requirements, but will seek instead to do more to provide lasting capabilities and infrastructure -- in line with promoting the Kyrgyz Republic's combat and counterterrorism capabilities. Engagement will include continued work in the area of peacekeeping, and potentially new work in search and rescue capability. Requirements for FMF will include additional training, communications equipment, personal soldier gear, and vehicles.
U.S. Department of State - International Military Education and Training (IMET): Through IMET, the U.S. Government has sought to encourage and facilitate greater participation and more active cooperation by the Kyrgyz Republic in NATO's Partnership for Peace (PFP) and related activities, and has also encouraged the government to reform its military along Western professional and democratic lines. In FY 2002, the Kyrgyz Republic was allocated $600,000 in IMET funds. Twelve Kyrgyz military officers received a full year of IMET-funded English language instruction at the Defense Language Institute in San Antonio, as well as follow-on military training. IMET-funded English language laboratories were established at the MOD, KNG and MEES during 2001, and in FY 2003 the MOD lab will be relocated from the MOD headquarters to the Koi Tash brigade. Also in FY 2002, Expanded IMET (E-IMET) funded a month-long senior defense management seminar in Monterey, California, and a weeklong AIDS strategic planning conference. The most frequently requested training has been and continues to be special forces training, summer/winter mountain warfare and survival training for border defense. This is directly related to needs in the area of combating terrorists and insurgents in the region. Terrorists continue to pose a serious threat to the Kyrgyz Republic and its neighboring countries via the Kyrgyz Republic's territory. From 1994 through 2002, 53 Kyrgyz have participated in IMET-sponsored courses, and 23 individuals have participated in E-IMET programs.
U.S. Department of State - Export Control and Related Border Security (EXBS) Program: Points of entry where both Kyrgyz Customs Service and Border Guards operate remain high-risk areas for the movement of materials related to weapons of mass destruction (WMD) and other weapons trafficking. Over the past three years, the U.S. Government allocated $9 million in FREEDOM Support Act-funded EXBS assistance for the Kyrgyz Republic to enhance border security and prevent weapons proliferation. In the aftermath of the September 11 terrorist attacks, an additional $10.5 million in EXBS assistance for strengthening the Kyrgyz Republic's border security was provided under the Emergency Response Fund supplemental ($5.5 million) and Emergency Supplemental ($5 million) appropriations. The ERF funds are being used for both standard EXBS assistance and for the high-priority EXBS-Aviation/Interdiction Project (EXBS-A/IP) to enhance air patrol and aviation interdiction capabilities of the Ministry of Defense and Border Guards to prevent weapons proliferation and complement counter-terrorism assistance. Assistance being provided under EXBS-A/IP includes Mi8-MTV helicopters, upgrades, spare and repair parts, infrastructure support and training.
Under the EXBS Program in FY 2002, the U.S. provided equipment, training and support assistance, including in-country oversight through an EXBS Program Advisor residing in Bishkek. Assistance provided the Kyrgyz Border Guards, Customs Service and MOD includes radios, computers, base stations, vehicles and shelters to assist in patrolling and securing the Kyrgyz Republic's mountainous border regions. EXBS assistance also includes infrastructure support for the Border Guards operating between ports of entry, including border shelters, night-vision goggles, vehicles, body armor, communications equipment, and helicopter/ aviation spare parts. The Kyrgyz Republic has also received Central Asian Regional Communications Link equipment for communication with counterpart border security officials from other Central Asian states in the event of border crisis or other emergency. In August 2002, a Customs Interdiction Tool Kit (CITK) was delivered to the Kyrgyz Republic, following an International Border Interdiction Training (IBIT) course on land-border interdiction methods in Hidalgo, Texas. The IBIT Phase Two training to be held in the Kyrgyz Republic in January 2003, will train border guards and customs officials in use of tools in the kit, border interdiction procedures and inventory control. Kyrgyz officials also participated in drafting a Regional Transit Agreement for Central Asia and the Caucasus. A group of 14 officials from Kyrgyz Customs participated in a USCS "train-the-trainer" course in Bishkek in August 2001, and in September, a USCS regional integrity-awareness seminar in Bishkek improved skills of 24 Kyrgyz participants. In September 2002, a delegation of seven Kyrgyz senior officials participated in a weeklong EXBS-funded Licensing Procedures and Practices training workshop conducted by the Department of Commerce.
U.S. Department of State - Support for Science Centers: The Kyrgyz Republic, a member of the International Science and Technology Center (ISTC) since 1995, actively promotes nonproliferation objectives of the Center. In FY 2002, the Department of State funded $1 million in peaceful research by former WMD scientists in Bishkek and other locations on projects concerned with structures to promote seismic protection; a center for modern irrigation technologies; ecology of areas adjacent to uranium production; and pollutants and climate fluctuations over the Tien Shan mountain range. Funding for FY 2003 likely will remain at the same level.
U.S. Department of State - Support for the Civilian Research and Development Foundation (CRDF): In FY 2002, the CRDF activated one new Cooperative Grant Program award for $60,000 and awarded two new travel grants to Kyrgyz applied scientists. CRDF received two proposals from Kyrgyz-U.S. research teams in response to the Special Competition for Research on Minimizing the Effects of Terrorist Acts on Civilian Populations. The CRDF continued support for the International Geodynamics Research Center (IGRC). IGRC is a collaborative effort of the Kyrgyz Academy of Sciences' Institute of Seismology (KIS) and the Russian Academy of Science's Bishkek Filial of the Institute of High Temperature (IVTAN). Its mission is to provide a central location for the international scientific community to conduct geodynamics research. IGRC also supports the maintenance and repair of the Kyrgyz Seismic Network (KNET), which gathers real-time data on naturally occurring regional seismic activities. KNET's ability to detect man-made seismic activities has helped provide verification of compliance with international non-proliferation treaties in locations as distant as Pakistan.
U.S. Department of State - Anti-Crime Training and Technical Assistance (ACTTA) Program: In FY 2002, the State Department's Bureau of International Narcotics and Law Enforcement Affairs (INL) focused assistance on increasing the ability of the Kyrgyz Government to restrict, contain, and deter cross-border trafficking of heroin, opium, and other illicit drugs originating from Afghanistan. In December 2001, a letter of agreement (LOA) was signed to fund the construction of a model customs post forty miles south of the town of Sari-Tash on the border with Tajikistan. This $250,000 project will provide the Kyrgyz Government with operational equipment and training for narcotics interdiction and prosecution. The project will serve as the launching point for further INL-funded counter-narcotics efforts in the region. During FY 2002, INL-managed programs in the Kyrgyz Republic also delivered commodities for border controls and interdiction, and provided technical assistance and training, including consultations and training by the Justice Department's International Criminal Investigative Training and Assistance Program (DOJ/ICITAP) in civil disturbance management. INL supported an updated assessment of law enforcement institutional capabilities undertaken by ICITAP in 2002. INL also continued to fund training to support law enforcement development in Kyrgyz Republic. The FBI conducted a course on basic crime scene investigation in June. In addition, 22 officials from the Ministry of Internal Affairs received training at the International Law Enforcement Academy (ILEA) in Budapest in February 2002.
U.S. Department of State - Anti-Terrorism Assistance (ATA): In FY 2002, ATA-trained Kyrgyz security and law enforcement officials responded to the scene of an attempted assassination of a senior Kyrgyz official. With the initial use of skills learned in two of the courses—-post-blast investigation and terrorist crime scene investigation—the Kyrgyz law enforcement team was subsequently able to safely conduct search warrants and raids on suspected extremist hideouts that resulted in several arrests and the seizure of extremist literature and three arms caches. Overall in FY 2002, over 200 Kyrgyz personnel participated in ATA training in the following seven course topics: post-blast investigation; crisis response teams; explosive incident countermeasures; rural border operations; terrorist crime scene investigations; WMD awareness seminar; and consultation/information management in case investigation.
Humanitarian Programs
U.S. Department of Agriculture (USDA) - Food Aid: In FY 2002, USDA allocated $3.36 million for the provision of approximately 3,950 metric tons of food commodities to the Kyrgyz Republic. Under USDA's Food For Progress Initiative, donated food commodities were distributed by the U.S. private voluntary organization Mercy Corps International (MCI) directly to orphanages, hospital patients, schoolchildren and disaster victims, and through food for work activities to repair irrigation systems in rural farm communities. Additionally, MCI operated a monetization program to support credit and water association programs. The credit program will increase the sustainability of six credit institutions by providing additional loan capital, capital assets and training. The water-user association program will make irrigated water available to ten irrigation user associations on a sustainable basis.
U.S. Department of State - Coordinator's Office Humanitarian Assistance: In FY 2002, the Humanitarian Programs Division of the Office of the Coordinator of U.S. Assistance to Europe and Eurasia delivered $21.15 million in U.S. Defense Department (DoD) excess and privately donated humanitarian commodities to the Kyrgyz Republic at a cost of $1.02 million to the U.S. Government. The majority of assistance provided was high value pharmaceuticals delivered by the U.S. PVOs CitiHope and Americares. In addition, Counterpart International distributed DoD excess relief supplies.
U.S. Department of Defense (DoD) - Humanitarian Assistance and Demining Programs: In FY 2002, DoD's Humanitarian Assistance Program approved three humanitarian assistance projects in the Kyrgyz Republic. The Marble Village School renovation project was approved in September for $157,000. Two orphanage renovation projects were approved in September and October, the Dom Rebyonok for $217,000 and Voenno-Antonovka for $176,000. Oversight personnel will ensure the projects are completed correctly and under budget. A humanitarian assistance/disaster preparedness (HADP) team completed a tour of the region in September, and released a report that prioritizes U.S. Central Command's future efforts in the Kyrgyz Republic.
Partnership Programs
USAID Health Partnership Program: The American International Health Alliance's (AIHA) Health Partnership Program is supporting a partnership between the Kyrgyz State Medical Academy (KSMA) and the University of Nevada School of Medicine focused on developing primary health care, with an emphasis on educating health professionals. In September 2001, the University of South Florida Health Sciences Center joined the partnership. The project is concentrating on faculty and curriculum development, and on producing related educational materials for training and retraining community-based primary care practitioners, nurses and health-care administrators. The partners have made significant progress in faculty and curriculum development in the areas of interdisciplinary collaboration for teaching primary care, health care administration, and nursing. KSMA faculty have learned new teaching methodologies and created new teaching modules. KSMA created new departments for health management and higher nursing education, and opened a new teaching clinic. In addition, a multi-disciplinary Community Assessment Team has been established and trained in skills related to strategic planning and community assessment tools and methodologies. The AIHA Program has been extended through September 30, 2003.
Cross-Sectoral Programs
Peace Corps: The Peace Corps program in the Kyrgyz Republic reopened in March 2002 with the return of three volunteers, after 53 volunteers were evacuated to the United States in late September 2001. On December 23, 2002, the Peace Corps swore in 63 new volunteers, making a total of 66 volunteers in country. They will work primarily in rural areas of the country, focusing on sustainable economic development in local non-governmental organizations and English language teaching in secondary and higher education institutions.
Eurasia Foundation: In FY 2002, the Eurasia Foundation awarded 34 grants totaling approximately $466,000 to NGOs in the Kyrgyz Republic, with an average grant size of nearly $13,000. Half of these grant funds supported civil society development, with the remainder targeting improvements in the areas of private enterprise and, to a lesser degree, public policy and administration. In large part, the Foundation's grants help to increase the impact of other U.S. Government programs in the country. One of the Foundation's cross-border initiatives was a three-country television newsmagazine with episodes produced and aired cooperatively by television stations in the Kyrgyz Republic, Uzbekistan, and Tajikistan. This project is promoting both the development of independent media in the Kyrgyz Republic and the sharing of information across borders in the Ferghana Valley, helping to dispel negative stereotypes about the neighboring states and ethnic groups in the region. As part of a competition to strengthen consumer rights in the Ferghana Valley, the Foundation awarded a grant to Spravedlivost, a human rights protection organization based in a Jalal-Abad Oblast, to support a hotline and walk-in service to assist consumers in resolving complaints. The project included a series of television shows and newspaper columns highlighting important consumer issues.
Programs Promoting the Objectives of the Silk Road Strategy Act (SRSA) of 1999
In FY 2002, a number of U.S. Government-funded assistance programs contributed to the objectives laid out in the SRSA: promoting reconciliation and recovery from regional conflicts; fostering economic growth and development; promoting infrastructure development; increasing border control capabilities; and promoting democracy, tolerance, and the development of civil society. Please see the above sections for numerous examples of programs that contributed to one or more of these objectives.
Preview of FY 2003 Programs
While the Kyrgyz Republic has thus far dealt successfully with the threat posed to its security by the armed insurgency, the threat could be a long-term problem that will require additional training of the Kyrgyz Republic's military and strengthening of its border. It is also important that the Kyrgyz Republic move forward with economic reform and creation of a business climate conducive to investment in order to decrease unemployment and thereby reduce the possibility that disenchanted young people, particularly in the southern areas of the country, will be attracted to the militant ideology of the insurgents and other extremist movements. Support for agricultural processing to create jobs and encourage rural residents not to migrate to cities where there is no employment combined with conflict prevention efforts will be key. Key economic reform issues facing the Kyrgyz Republic are the implementation of existing market-oriented laws, the recognition of secured property rights for investors, and the establishment of a stronger, more independent banking sector.
The U.S. Government will continue to encourage the Kyrgyz Government to support democratic development and civil society, including efforts to enhance the parliament's transparency and openness by supporting public hearings, public debates, and greater dialogue with NGOs. In FY 2003, USAID will be reformulating its strategy for civil society development and will be conducting a competitive solicitation for proposals to implement it. Priority areas will be in promoting the sustainability of local NGOs in the Kyrgyz Republic and further fostering grassroots advocacy not only among NGOs, but also among local community members. USAID will also begin a new program to support human rights organizations in the Kyrgyz Republic through Freedom House. This program will work to improve the professionalism of human rights monitors and advocates and will promote the development of better communication and information sharing between such groups. In response to the increasing problem of trafficking in persons (TIP), USAID will solicit proposals for a new program to combat trafficking through information dissemination and advocacy. In response to the local elections of December 2001, USAID's local government initiative will work increasingly with all 22 cities in the country, as well as with nine larger villages, to increase local governments' capacity, transparency, and accountability to their citizens. USAID will increase its engagement with the judiciary and will begin training criminal and non-commercial civil judges on issues related to the rule of law and the independence of the judiciary. In other areas, USAID will continue to support the development of independent media and provide legal support to journalists and independent media outlets that are pressured by the state, will continue to implement its pilot civics education program in targeted schools, and will continue to promote the effectiveness of parliamentarians to check the power of the executive branch of government. Finally, depending on the outcome of the constitutional reform, the scheduling of parliamentary elections, and the political will of the Government to allow for political development, USAID will consider providing increased support to the development of political parties in the country.
USAID will continue to support the monitoring and evaluation component of the Kyrgyz Republic's tuberculosis program to improve its impact. The dramatic increase in sexually transmitted infection (STI) rates increases the risk for a more generalized heterosexual HIV epidemic. To combat this problem, the MOH has decided that STI treatment needs to be available at the community level within PHC clinics. USAID is supporting the first such pilot in the north of the Kyrgyz Republic and initiating a second in the south. If successful, these efforts are expected to lead to a nation-wide program.
During FY 2003, the State Department plans to create an endowment for the American University of Central Asia (AUCA), in partnership with the Open Society Institute. The purpose of the endowment will be to ensure the sustainability of AUCA, which serves as a model of U.S.-style education for the region.
During FY 2003, the State Department's INL Bureau plans to provide greater staff support at post as well as continue with law enforcement development programs. An amendment to the original LOA, expected to be signed shortly, will provide for the procurement of basic drug control equipment, including testing equipment, computers and administrative support equipment, night vision equipment, and vehicles. FY 2002 supplemental funding that will come on line will advance drug and crime programs and provide coordinated support to UNDCP programs including the establishment of a Drug Control Agency, judicial reforms and border interdiction initiatives.
On October 1, 2002, the Kyrgyz Border Guards from the Ministry of Defense, and the Border Control Directorate from the National Security Service combined to form the new State Border Guard Service. FY 2003 EXBS assistance will monitor, advise and assist the GOKG transition from an MOD-oriented Border Security Force and Ministry of Interior Border Control to an autonomous State Border Guard Service. We expect program priorities will continue to focus on nonproliferation, export controls and border security. In FY 2003, objectives include increasing equipment and training for detecting, interdicting and reacting to WMD hazards; building capacity for interdiction in mountainous environments; support for WMD reaction teams in Sadovoye and Osh; technical assistance for border sites; and identifying, training and equipping "Expert Assistance Contact Teams". Objectives also include equipment and training for Kyrgyz Customs personnel to detect and seize WMD and dual-use items at air and rail ports; establishment of Kyrgyz Customs anti-corruption and seizure incentive programs; improving revenue collection procedures; and assisting the Kyrgyz Government in drafting laws that meet international norms in customs operations, anti-corruption, licensing and other areas. Assistance will address both political and legal frameworks including a WMD agreement and the Regional Transit Agreement. Assistance is intended to improve infrastructure and motivation of border security personnel, help secure land borders, equip and train the Kyrgyz Government to operate a nationwide Border Management Information System and standard visa system, equip and train Kyrgyz Government officials to operate a four-season mountainous and cold weather WMD trafficking, detection and deterrence capacity, including building on EXBS-Aviation/Interdiction Project border patrol capabilities, and enhancing regional cooperation among border management agencies.
FY 2002 FUNDS BUDGETED FOR U.S. GOVERNMENT ASSISTANCE TO KYRGYZ REPUBLIC,
INCLUDING EMERGENCY RESPONSE FUND (ERF) AND EMERGENCY SUPPLEMENTALS
(millions of dollars, rounded to the nearest $10,000, as of 12/31/02)
| FREEDOM SUPPORT ACT (FSA) FUNDS |
FY 2002 |
ERF Supplemental |
Emergency Supplemental |
TOTAL |
| U.S. AGENCY FOR INTERNATIONAL DEVELOPMENT (USAID) | ||||
| - Economic Restructuring |
$0.85 |
|
|
$0.85 |
| - Private-Sector Initiatives |
$9.95 |
|
$5.50 |
$15.45 |
| - Environmental Management |
$1.50 |
|
$0.20 |
$1.70 |
| - Democratic Reform |
$4.70 |
|
$2.33 |
$7.03 |
| - Social-Sector Reform |
$4.50 |
|
|
$4.50 |
| - Cross-Cutting/Special Initiatives |
$3.00 |
|
$8.23 |
$11.23 |
| - Eurasia Foundation |
$1.00 |
|
|
$1.00 |
| - Parking Fine Withholding |
$0.00 |
|
|
$0.00 |
| TOTAL USAID |
$25.50 |
|
$16.26 |
$41.76 |
| TRANSFERS TO OTHER AGENCIES | ||||
| U.S. DEPARTMENT OF COMMERCE | ||||
| Business Information Service for the Newly Independent States (BISNIS) |
$0.08 |
|
|
$0.08 |
| Special American Business Internship Training (SABIT) Program |
$0.20 |
|
|
$0.20 |
| TOTAL U.S. DEPARTMENT OF COMMERCE |
$0.28 |
|
|
$0.28 |
| U.S. DEPARTMENT OF STATE | ||||
| Bureau of Educational & Cultural Affairs (ECA) - Public Diplomacy Exchanges |
$3.54 |
|
$1.27 |
$4.81 |
| EUR Bureau - Public Diplomacy Programs (including Democracy Commissions) |
$0.66 |
|
$0.37 |
$1.03 |
| Coordinator's Office (EUR/ACE) Humanitarian Assistance - Transp. Costs/Grants |
$1.01 |
|
|
$1.01 |
| Export Control & Related Border Security (EXBS-FSA) [not including direct transfers to USCS] |
$3.50 |
|
$5.00 |
$8.50 |
| Bureau of Internatl. Narcotics & Law Enf. Affairs (INL) - Anti-Crime Training & Tech. Assist. |
$0.50 |
|
$8.00 |
$8.50 |
| TOTAL U.S. DEPARTMENT OF STATE |
$9.21 |
|
$14.65 |
$23.86 |
| U.S. CUSTOMS SERVICE (USCS) - EXBS Aviation/Interdiction Project (AIP) |
|
$3.50 |
|
$3.50 |
| U.S. DEPARTMENT OF AGRICULTURE (USDA) - Cochran Fellowship Program |
$0.10 |
|
$0.10 |
$0.20 |
| U.S. DEPARTMENT OF ENERGY - Nuclear Reactor Safety |
|
|
$0.50 |
$0.50 |
| U.S. DEPARTMENT OF THE TREASURY - EBRD Loan Programs |
$0.80 |
|
|
$0.80 |
| NATIONAL SCIENCE FOUNDATION / CIVILIAN R&D FOUNDATION (NSF/CRDF) |
$0.25 |
|
|
$0.25 |
| TOTAL TRANSFERS TO OTHER AGENCIES |
$10.64 |
$3.50 |
$15.25 |
$29.39 |
| TOTAL FY 2002 FSA FUNDS BUDGETED |
$36.14 |
$3.50 |
$31.50 |
$71.14 |
| OTHER U.S. GOVERNMENT FUNDS (AGENCY BUDGETS) |
FY 2002 |
ERF Supplemental |
Emergency Supplemental |
TOTAL |
| U.S. DEPARTMENT OF AGRICULTURE (USDA) - PVO / NGO Food Distribution Programs |
$3.36 |
|
|
$3.36 |
| U.S. DEPARTMENT OF DEFENSE (DoD) | ||||
| Cooperative Threat Reduction (CTR) |
$0.40 |
|
|
$0.40 |
| Warsaw Initiative |
$0.09 |
|
|
$0.09 |
| DoD/Customs Counterproliferation |
$0.16 |
|
|
$0.16 |
| DoD/FBI Counterproliferation |
$0.39 |
|
|
$0.39 |
| U.S. Central Command (CENTCOM) Humanitarian Asstistance Program - Transp. Costs |
$0.39 |
|
|
$0.39 |
| TOTAL DoD |
$1.43 |
|
|
$1.43 |
| U.S. DEPARTMENT OF STATE | ||||
| International Military Education & Training (IMET) |
$0.60 |
|
|
$0.60 |
| NADR / Anti-Terrorism Assistance (ATA) |
$0.94 |
|
|
$0.94 |
| NADR / Export Control & Border Security (EXBS) |
|
$2.00 |
|
$2.00 |
| NADR / Science Centers |
$1.00 |
|
|
$1.00 |
| DRL Bureau - Human Rights & Democracy Fund (HRDF) |
$0.25 |
|
|
$0.25 |
| ECA Bureau - Public Diplomacy Programs (ECE Account) |
$0.54 |
|
|
$0.54 |
| Warsaw Initiative / Foreign Military Financing (FMF) |
$2.00 |
|
$9.00 |
$11.00 |
| International Information Programs (IIP) |
$0.01 |
|
|
$0.01 |
| Peacekeeping Operations (PKO) |
$0.20 |
|
|
$0.20 |
| TOTAL U.S. DEPARTMENT OF STATE |
$5.54 |
$2.00 |
$9.00 |
$16.54 |
| PEACE CORPS |
$1.06 |
|
|
$1.06 |
| TOTAL FY 2002 AGENCY FUNDS BUDGETED |
$11.39 |
$2.00 |
$9.00 |
$22.39 |
| TOTAL FY 2002 U.S. GOVERNMENT FUNDS BUDGETED (FSA + AGENCY FUNDS) |
FY 2002 $47.53 |
ERF Supplemental $5.50 |
Emergency Supplemental $40.50 |
TOTAL
|
| VALUE OF TRANSPORTED DoD EXCESS & PRIVATELY DONATED COMMODITIES |
$21.15 | |||
|
TOTAL FY 2002 U.S. GOVERNMENT ASSISTANCE |
TOTAL $114.68 | |||
