Kyrgyzstan Drafts $419 Million Plan to Curb Rising Prices

Kyrgyzstan has drafted a plan worth about $419 million to curb rising prices in 2026–2027. The authorities aim to increase food production and build reserves, but fuel imported primarily from Russia remains a major source of inflationary pressure largely beyond the government’s control. The draft was presented to the Cabinet on August 21. During the first seven months of 2026, consumer prices and tariffs in Kyrgyzstan rose by 6.7% from their December 2025 level. Average annual inflation over the same period was 10.7%. Food prices rose particularly sharply, with fresh fruit up 16% and meat products 14.5%. Lamb recorded the largest increase at 23.1%. Horse meat rose by 16%, while beef increased by 14.2%. The authorities have already intervened directly in the meat market. In March, Kyrgyzstan introduced a six-month ban on livestock exports. Temporary state controls on beef and mutton prices also applied earlier this year but expired on May 2. The plan calls for increasing the productive livestock population by at least 20,000 head. Agribusinesses will be eligible for preferential loans, while the dairy and poultry sectors will receive subsidies. Storage facilities with a combined capacity of 18,000 metric tons are planned in all seven regions. Farmers are to receive 68,000 metric tons of seed and the necessary amounts of mineral fertilizer. The government also intends to ensure sufficient wheat supplies for the domestic market and purchase another 20,000 metric tons from local producers for state reserves. The draft would establish direct supply channels for agricultural products and expand the network of retail outlets operating without intermediaries. Kyrgyzstan relies on imports for almost all of its petroleum products. Deputy Energy Minister Nasipbek Kerimov said in July that Russia had supplied about 95% of the country’s annual fuel needs in recent years, with total consumption of around 2 million metric tons. This summer, Russia’s fuel shortages worsened amid refinery outages following Ukrainian drone attacks, high seasonal demand, and transport problems. Moscow tightened restrictions on fuel exports and turned to imports to support domestic supplies. For Kyrgyzstan, the decline in Russian supplies quickly became a problem. According to the National Statistical Committee of the Kyrgyz Republic, the average price of AI-92 gasoline reached 88.24 soms per liter by August 12, around 6% above the July average. AI-95 rose by 12% to 109.24 soms, while diesel increased by 5% to 102.08 soms. The government has already raised its year-end inflation forecast to 14–15% from an earlier projection of 9%, citing rising fuel costs as one reason. The National Bank of the Kyrgyz Republic kept its policy rate at 12% on July 27. Among the external inflation risks, the central bank cited volatile global food prices and possible disruptions to petroleum-product supplies through the Strait of Hormuz. Its medium-term inflation target is 5–7%. Kyrgyzstan cannot quickly replace Russian fuel, but importers have begun seeking supplies farther afield. Kanatbek Eshatov, president of the Association of Oil Traders of Kyrgyzstan, said on August 12 that reduced supplies from Russian refineries had prompted deliveries from...

Kazakhstanis Face Drug Shortages and Soaring Prices

Kazakhstanis are paying significantly more for medicines than residents of many other countries, and often struggle to find essential drugs at all. According to the Agency for Protection and Development of Competition (APDC), rising prices, supply disruptions, and an inefficient procurement system are driving a worsening healthcare crisis. Price Hikes Kazakhstan’s medicine procurement system is complex. In principle, essential drugs should be available to patients free of charge under the guaranteed volume of medical care and mandatory social health insurance. In practice, many face shortages or receive lower-quality substitutes. As a result, patients are often forced to buy medicines themselves, an increasingly unaffordable burden. According to the APDC, inflated prices are caused by several factors. One is the lack of pricing transparency. Previously, drug prices were pegged to the highest prices in reference countries, figures submitted by suppliers without verification. As a result, generics sometimes cost nearly as much as original-brand drugs. Another issue is procurement through intermediaries. Up to 45% of state-purchased medicines are bought not from manufacturers but from local distributors, who add their own markups. Costs are also inflated by expensive inspections. To enter the market, companies must pay for production inspections, fees set independently by a state agency that can reach millions of tenge. These costs are passed on to consumers. To address these problems, the APDC has recommended switching to average reference-country prices, limiting inspections on products from countries with stringent regulations, and transferring inspection services to a state monopoly with controlled rates. It also urges more direct procurement from manufacturers and better verification of supplier costs. Tax Reforms Threaten Further Price Increases Despite already high prices, medicines will soon be subject to new taxes. Under Kazakhstan’s revised Tax Code, beginning in 2026, medical services and the sale of medicines and medical products will be subject to value-added tax (VAT), initially at 5%, rising to 10% from January 1, 2027. An exception will apply to medicines and services provided under the guaranteed medical care package and mandatory health insurance. However, as noted earlier, many patients struggle to access these programs in practice. Pharmaceutical companies warn that these VAT changes will drive prices even higher and lead to fresh shortages. Industry leaders also point to the planned 16% VAT on pharmaceutical raw materials, equipment, and components, calling it a distortion of tax policy and a threat to the sector’s stability. “The market is on the edge. Many drugs are already unprofitable and are being withdrawn. The introduction of VAT will accelerate the outflow. The number of registered medicines in Kazakhstan has already dropped from 12,000 to 6,900,” said Marina Durmanova, President of the Association for the Support and Development of Pharmaceutical Activity. “If no measures are taken, the country could face shortages of key drugs and further monopolization of the pharmacy sector,” she warned. Kazakhstan produces few essential medicines domestically, meaning prices continue to rise month by month. When Medicines Vanish, So Do Lives Price increases are only part of the crisis. Vital medicines frequently disappear...