ADB Provides $50M to Support Fiscal and Public Management Reforms in Kyrgyz Republic

The funding for subprogram 1 of the Sustainable Fiscal Management and Governance Improvement Program includes a $43 million policy-based concessional loan and a $7 million Asian Development Fund grant.

The Asian Development Bank (ADB) is providing $50 million to support fiscal and public management reforms in the Kyrgyz Republic. This initiative aims to enable more public funding for the nation’s low carbon transition and climate adaptation needs while integrating gender inclusiveness into budget processes.

The funding for subprogram 1 of the Sustainable Fiscal Management and Governance Improvement Program includes a $43 million policy-based concessional loan and a $7 million Asian Development Fund grant.

Economic Vulnerability

The Kyrgyz economy is particularly vulnerable to macroeconomic shocks due to a lack of economic diversification, governance weaknesses, and limited fiscal space. These limitations also restrict the government’s capacity to respond to emerging challenges. Given that the Kyrgyz Republic is one of the most vulnerable countries to the impacts of climate change, the government is prioritizing strengthening public financial management to ensure funding to key sectors. This includes structural reforms to improve fiscal sustainability, domestic resource mobilization, public sector governance, and efficiency to foster economic growth.

Program Goals

ADB’s Sustainable Fiscal Management and Governance Improvement Program, consisting of two subprograms, aims to:

Strengthen public financial management.

Improve corporate governance and procurement of state-owned enterprises.

Enhance tax policy and administration.

Increase transparency and accountability in public administration.

The program is expected to support resilient and inclusive economic growth through a series of complex and challenging institutional reforms.

Expert Opinions

“The approval of this program signifies ADB’s commitment to assisting the Kyrgyz Republic in overcoming its development constraints and strengthening governance through anti-corruption policies and initiatives to achieve sustainable, resilient, and inclusive economic growth,” said Yevgeniy Zhukov, ADB Director General for Central and West Asia. “The program aims to improve the efficiency of public institutions and public finance management to ensure sound governance and greater transparency.”

“By focusing on climate-sensitive and gender-responsive public financial management, the program will contribute to sustainable and inclusive economic growth,” added Hanif Rahemtulla, ADB Principal Public Sector Specialist.

Partnership Milestone

This year marks the 30th anniversary of the partnership between ADB and the Kyrgyz Republic, a cooperation spanning more than 217 projects and technical assistance in key economic sectors. Since the Kyrgyz Republic joined ADB in 1994, the bank has committed public sector loans, grants, and technical assistance totaling $2.6 billion to the country.

The Sustainable Fiscal Management and Governance Improvement Program underscores ADB's ongoing commitment to fostering sustainable development and governance in the Kyrgyz Republic.