OREANDA-NEWS. May 04, 2009. International Business Council held an Open Meeting on the subject:  “How to stimulating business during the global financial crisis”.  Representatives of business community, government agencies, international financial organizations, as well as deputies of the parliament, international and public organizations took part in the meeting, reported the press-centre of International Business Council.

Deputy Minister of Economic Development and Trade (MEDT), Sanjar Mukanbetov, reported on the measures developed by the Government to support and develop entrepreneurship in the context of the financial crisis.

An essential condition for sustainable development is the withdrawal of small and medium-sized businesses from the shadow economy. A MEDT working group develops a Strategy for withdrawal of small and medium-sized businesses from the shadow economy. In May, the document will be submitted to the Government and business community, and IBC will take an active part in discussions.

The Government is improving the state regulatory policy in the field of inspections, as well as legislation on entrepreneurship. The MEDT program on enterprise development will provide promotion of small and medium business in the regions.
 
Mukanbetov also informed about the allocation of the Russian US300 million loan. Due to the loan will the annual GDP will grow by one or 1.5 percent; 18.5 thousand new jobs will be created; nominal wages will increase by 20 percent, and the unemployment rate will decline from 8 percent to 6.9 percent. Sanjar Mukanbetov also explained the terms of allocation of the Russian loan.

On behalf of the business community, the financial manager of Coca-Cola Bishkek Bottlers JSC, Dinara Iskakova, made some suggestions to help improve the business, and thus increase state revenues.

First of all, it is necessary to decide the problem with the sales tax. Object of taxation for sales tax shall be the sale of goods, performance of works and provision of services.  Currently, the sales tax is calculated at two percent for producers and at 1.5 percent for importers.

Iskakova offered a single rate of the sales tax of one percent for all types of activities keeping the VAT rate of 12 percent. As a result, the tax administration should become more simple and transparent, while the government could encourage local manufacturers.

Currently, one of the most discussed topics is the taxation on the basis of the voluntary patent. There are 27 distributors of the Coca Cola products in the regions, and some of them have refused to cooperate with the company because of unprofitability of their activities, said Iskakova.

In the regions, tax services provide a limited number of patents. Regardless of whether a distributor has a patent or not, tax services require to pay sales tax and to switch to taxation on the basis of the tax contract, said Iskakova. She suggested that the patent payments should cover all taxpayer’s obligations to the state budget.

Dinara Iskakova also suggested that the tax authorities should publish and distribute among taxpayers manuals on tax payments.

Head of EBRD Bishkek Office, Kenji Nakazawa, informed about EBRD position and EBRD strategy after global financial crisis. The financial sector, including both banks and micro-finance institutions, continues to be a key area of the EBRD operations.  In response to the financial crisis, EBRD will enhance its support to the financial sector in the country (expansion of the MSE finance program).

The development of private businesses remains EBRD’s key priority under the Early Transition Country Initiative, said Kenji Nakazawa.  EBRD will expand its successful Direct Lending Facility and Direct Investment Facility programs to directly finance local enterprises.
The Head of EBRD Bishkek Office also described the criteria for funding of individual loans.

Director of KfW Central Asia  Stefan Christian Lutz presented the Office activities in Kyrgyzstan. German Development Bank KfW promotes the development of housing, environmental protection, education, infrastructure and social sphere. The Bank contributes to small and medium-sized businesses, companies in the formative stage.

Stephen S. Lutz reported on the possibilities of cooperation with KfW. This can be participation in competitions within the framework of infrastructure projects, as well as participation in tenders under the credit lines in the financial sector.

International Finance Corporation (IFC) is strongly committed to helping the Kyrgyz Republic create opportunity for people to escape poverty during financial crisis. Kyrgyzstan joined IFC in 1993. IFC commitments to the country have reached nearly \\$75 million, including investments and other advisory services with a focus on leasing, microfinance, housing finance, and corporate governance.

IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. IFC PR Manager Kymbat Ybysheva informed about IFC activities and financial products. IFC fosters sustainable economic growth in Kyrgyzstan by supporting private sector development, mobilizing private capital, and providing advisory and risk mitigation services to businesses and government. In Kyrgyzstan, IFC finances micro-, small and medium businesses in agriculture, mining, manufacturing, etc. Ybysheva also explained how to apply to the IFC.

Head of Senior Experten Service (SES) office in Kyrgyzstan, Klaus Lehrke,  informed about SES activities in the country. SES was founded the German Chamber of Industry and Trade, the Federal Association of German Industry and other organizations. SES promotes the development of economic and social programs in partner countries, implementing European standards. SES provides free practical help to local workers in various sectors of the economy.

SES  supports the development of the economical and social programs in our country. The experts render free of charge practical help to improve professional experience of skilled workers and management personnel. Klaus Lehrke explained who can invite the experts. These are small and medium enterprises, training centers, state and private educational organizations, and others.