REGIONAL CORNER: CHUI OBLAST, Kyrgyzstan

 

By Irina Mukambaeva

 

The Chui oblast is located in the northern part of the Kyrgyz Republic, bordering on Kazakhstan, and has a population of about 765,000. The region, the most economically developed in Kyrgyzstan, occupies a favorable geographic position and has an extensive communications network and highly developed industry. Chui oblast is also a key transportation hub for Kyrgyzstan given the concentration of major railway and highway routes and the international airport outside of Bishkek. In December 1999, renovation and upgrading of the Bishkek airport—including modernization of the runway, navigation equipment, airport terminal, and other facilities—will be completed. German construction firm Hochtief is the general contractor for the project and U.S. consulting company firm CH2MHill is the project manager.

 

Agricultural output accounts for 64.2 percent of the Chui oblast’s GDP, and the industrial share is 35.8 percent. Grain, sugar beet, vegetables, potatoes, milk and meat are the main agricultural products. Major industries are food processing, light and construction material industries, nonferrous metallurgy, and industrial engineering (machine-building). Major enterprises in the oblast include the Kara-Balta mining complex (nonferrous metals), the Kant cement and slate complex (67 percent of which was recently purchased by a Luxembourg company through a privatization tender), Ainek company (glass sheet), the Kitlap company (noodles), the Kyrgyz Chemical-Metallurgical Plant (rare-earth metals), Kasiet company (wool processing), and the Tokmak canning plant.

 

Examples of joint ventures with foreign partners operating in the oblast are sugar and ethylene spirit production (U.K.), noodles (China), and gasoline and diesel fuel (U.S.). U.S. companies currently operating in Kyrgyzstan include Newmont Mining, Caterpillar (mining equipment and power generators), Comsat (Bethesda, MD), Motorola (communications), Coca-Cola, and Procter & Gamble (consumer goods).

 

The Bishkek Free Economic Zone (FEZ) is located in the Chui valley, near Bishkek. Having attracted foreign investment worth $4.1 million, the FEZ is home to 416 companies: 325 enterprises with foreign investment, 152 foreign, and 29 local enterprises. The most prominent investments in the Bishkek FEZ are the Plaskap-Bishkek Plant (Turkish plastic bottle and cap maker), Corona Ltd. (Kyrgyz-Russian JV, production and bottling drinking water), Volare (New York, NY, apparel), Eridan-FEZ (Kyrgyz-Russian-Irish JV, windows and doors), and Full-Mobile (Kyrgyz-Italian JV, furniture). The major benefits for a company registered in the FEZ include exemption from several kinds of taxes and duties and exemptions from quotas and licensing for the export of goods manufactured in the FEZ.

 

The Chui oblast has trade ties with 49 countries, and its balance of trade is positive. The major exports are nonferrous and rare-earth metals, construction materials, yarn, and agricultural products. The main export markets are Germany, Kazakhstan, Uzbekistan, France, and Russia. The major imports are petroleum products, coal, and food products.

 

The most promising investment opportunities for U.S. companies are in the extraction of gold and rare-earth metals, nonferrous metallurgy, hydropower, agriculture, food processing and packaging industry, tourism, and electronics.

 

For more information on the Chui region, contact the Chui Oblast Administration, Department on International Cooperation and Trade, Torogul Bekov, Department Head, at tel: +996(312) 22-35-75, 22-39-75 or fax: +996(312) 22-54-93. For information on the Bishkek FEZ, contact Mr. Emil Ibraimov, Director General, Bishkek Free Economic Zone, at tel:+ 996 (312) 21-17-22 or fax: +996 (312) 62-01-13.

 

Irina Mukambaeva is the BISNIS representative in Bishkek.