[{"bbox": [97, 152, 1134, 313], "category": "Text", "text": "Further, since Kumtor is now fully state-owned, it should be brought under the same tax regime as other gold mining companies and its dividends should be channelled to the budget to reduce the deficit. The revenue loss from tax exemptions estimated at 3.5 percent of GDP (2021 Article IV consultation) requires reassessment in view of the new tax code and the changing structure of the economy due to the COVID pandemic and the impact of the war in Ukraine. The IMF expressed its willingness to provide the technical assistance to help the authorities implement a holistic reform of tax policy and administration, including an assessment of tax expenditures."}, {"bbox": [97, 318, 1134, 584], "category": "Text", "text": "More fiscal space can be created by reducing expenditures and strengthening public finance management. Limiting nominal wage growth to below inflation and freezing public employment at the current levels would yield fiscal savings of about 1.5 % of GDP per year by 2027; allowing headcount reduction through attrition and public employment optimisation, including by steadfast implementation of the Presidential decree of 2022 to reduce central government headcount by up to 30 %, would generate more savings. A comprehensive reform of the public sector compensation and employment framework should also be pursued. Gradually raising electricity tariffs and lowering operating costs in the energy sector would reduce subsidies and generate fiscal savings, some of which should be used for targeted social assistance to the most vulnerable. These measures should be supplemented with PFM reforms to strengthen wage bill management; implement IFMIS modules for budget preparation and payroll; and limit extra-budgetary funds such as the Stabilization Fund."}, {"bbox": [97, 589, 1134, 750], "category": "Text", "text": "During the reporting period, the MoF was able to demonstrate a notable progress in introducing technology based services, like e-procurement, digitalisation of input data for public services, including social allowances, submission of updated tax declarations, electronic payment of public services, accompanied by automated internal controls. Interconnection of the MoF with important data bases such as “E-Kyzmat” and “Tunduk” has been advanced, allowing for improved control over public human resources and public services. The transactions made under the Mandatory Health and Insurance Fund are being integrated into the central treasury system."}, {"bbox": [97, 755, 1134, 862], "category": "Text", "text": "The latest Public Expenditure and Financial Accountability (PEFA) assessment for the Kyrgyz Republic was published in August 2021, marking a clear improvement from the previous PEFA done in 2015: 7 indicators present an A score (5 in 2015), 13 present a B/B+ score (10 in 2015), 7 present a C/C+ score (9 in 2015) and 2 present a D/D+ score (4 in 2015)."}, {"bbox": [97, 867, 1134, 1104], "category": "Text", "text": "The authorities acknowledge the problem of corruption and fighting corruption is high on the agenda of the government. Both the National Development Strategy 2019-2040 and the National Development Programme 2021-2026 emphasise fight against corruption as a cross-cutting priority of the State. They agreed on the need to strengthen governance, fight corruption and improve implementation capacity for AMLand CFT. In recent years, the President, Parliament, and Government offices have adopted numerous legal acts and taken measures to enhance both the prevention and prosecution of corruption crimes. They also intend to reform SOE governance, optimise the number of non-strategic commercial SOEs. Meanwhile, Kyrgyzstan ranked 140/180 in the 2022 and 2021 Transparency International Corruption Perceptions Index with a score of 27/100, thus showing a deterioration from 2020 when the score was 31 and rank was 124."}, {"bbox": [97, 1111, 1134, 1247], "category": "Text", "text": "In broad outline, neither the PFM Strategy 2017-2025 of the Kyrgyz Republic nor the National Development Strategy 2040 include clear provisions on **Gender Responsive Budgeting (GRB)**. However, the National Strategy for Gender Equality 2022-2030 (adopted in 2022) includes preparatory actions for the development of Gender-Responsive Budgeting. The EU strongly advises the national authorities to include implementation costs of the newly adopted National Gender Equality Strategy 2022-2030 and its Action Plans in the new PFM Strategy 2026+."}, {"bbox": [97, 1251, 1134, 1623], "category": "Text", "text": "The Kyrgyz Republic, like other countries in the region, is particularly exposed to the risks of global warming, and needs to develop its own climate adaptation policy to strengthen resilience. This requires creating fiscal space for additional public spending on green infrastructure, healthcare, training and education, and social safety nets. Despite its low carbon footprint, the country should also contribute to global mitigation efforts by reducing air, soil, and water pollution, expanding renewables, and raising electricity tariffs to recover cost, which would attract private investment in clean power generation. The Government has made strong commitments to address **climate-related challenges**, and as part of their plan, they have prioritised green energy, agriculture and industry, environmentally friendly transportation, sustainable tourism, waste management, and green cities. Addressing climate-related challenges would open new opportunities for more sustainable and greener growth. The Action foresees to provide technical assistance in order to improve the planning and execution of the national budget. Although mainstreaming of climate-related considerations into the budget process with an effective impact on decision-making is not expected, the Action is expected to strengthen the link between the country's development priorities and budget allocations. As such the action is expected to indirectly support the way water sector and climate priorities are being taken into account for budget allocation purposes."}, {"bbox": [1027, 1681, 1144, 1706], "category": "Page-footer", "text": "Page 12 of 34"}]