Government officials, members of parliament, and entrepreneurs gathered at one of Kyrgyzstan’s largest business associations to discuss pressing issues affecting the country’s business environment, including taxation and efforts to streamline processes for entrepreneurs.
The primary focus of the meeting was the introduction of the electronic bills of lading (EBL) system. The Times of Central Asia has previously reported on the challenges businesses face with this new system. The State Tax Service (STS) has pledged to revise the EBL system by the end of the month to address concerns raised by the business community.
Almambet Shykmamatov, head of the STS, acknowledged that authorities had rushed the implementation of the EBL system without adequately considering the interests of businesses.
“We understand that the market is a complex system that cannot be changed overnight. We are committed to dialogue and compromise. Our goal is not only to regulate but also to support businesses. That’s why continuous engagement with the business community is essential,” Shykmamatov stated.
Beyond electronic bills of lading, entrepreneurs raised concerns over the lack of preventive measures in Kyrgyzstan’s system of fines. Akzhol Isayev, general director of Dordoi Security, highlighted that unlike Russia and Kazakhstan, which have legal provisions for issuing warnings, Kyrgyzstan imposes penalties without warnings.
“Kyrgyzstan has 11 articles with fines, but none that provide for warnings,” Isayev explained. He also noted that some fines, which can reach as high as one million KGS (approximately $12,000), often lead to business closures or encourage corruption.
Shykmamatov admitted that excessive tax pressure can harm the business environment. Consequently, participants decided to establish a working group to review and reform the system of penalties, aiming for a more business-friendly approach.
Sergei Ponomarev, president of the Association of Markets, Trade, and Services Enterprises, emphasized that protecting private property is critical for attracting investment. However, he warned that businesses in Kyrgyzstan are hesitant to invest in real estate due to legal uncertainties.
“An entrepreneur might honestly purchase property, invest in it, and create jobs, only to later discover that the land was acquired illegally 30 years ago. This uncertainty makes businesses afraid to commit to long-term projects,” Ponomarev said.
To address this issue, the business community has proposed the introduction of a statute of limitations for real estate transactions.
“It’s encouraging when the state not only listens to our problems but also offers constructive solutions. I am confident that this approach will improve the investment climate and raise the standard of living for our citizens,” Ponomarev added.
The STS noted that similar meetings have been held with representatives of logistics companies, the Chamber of Commerce and Industry, and the American Chamber of Commerce in Kyrgyzstan.
