Over the course of three years, the State Service for Regulation and Supervision of Financial Markets and the World Bank will work towards raising the quality of audit services and building trust in the audit profession, as well as strengthening financial reporting capacity and raising public accountability of state-owned enterprises. In addition, the KAREP project will help SMEs to bridge their accounting knowledge gap and compile financial statements acceptable to local banks, thus, contributing to improvement of access to finance for smaller businesses.

“KAREP is an important government-driven and government-led initiative to modernize and strengthen corporate financial reporting policies and practices in the public and the private sector in Kyrgyzstan. This will contribute to improved governance through the adoption of international best practices in financial reporting and auditing. This is an ambitious goal, but we certainly have the right partners to succeed,” said Ambassador of Switzerland to the Kyrgyz Republic Véronique Hulmann.

“Increasing transparency and accountability of the Kyrgyz economy is among the priority tasks of the Kyrgyz Government’s “40 steps to New Era” and also of the 2014-2020 Strategy for development of financial reporting of the Kyrgyz Republic,” said Sanjar Mukanbetov, head of the State Service for Regulation and Supervision of Financial Markets. “The project will contribute to building a more transparent relationship between the state and the private sector, which is prerequisite for promoting competitiveness, diversification, productivity and job creation in the Kyrgyz Republic.”

Bolormaa Amgaabazar, World Bank Country Manager in the Kyrgyz Republic stressed the importance of the effective financial reporting as a measure to improve business environment in the Kyrgyz Republic. “The improved understanding and use of financial information will establish a basis for informed decision making by business owners, investors and lenders, enhanced supervision by regulators and better access to finance for growing enterprises.” said Bolormaa Amgaabazar.

The project will benefit the Kyrgyz business community and other stakeholders, including state and privately owned companies, SMEs, Kyrgyz government and regulators, accounting and audit profession in general, as well as students majoring in related disciplines. It will be managed by the Centre for Financial Reporting Reform (CFRR), the World Bank’s specialist center in Vienna for providing knowledge and advisory services to support reforms in financial reporting.

The Government of Switzerland provides assistance for the development of the Kyrgyz Republic. The overall objective of its cooperation program is to promote peace and social cohesion as well as responsive and inclusive institutions and a sustainable development to improve the well-being of the population. Over the last 25 years Switzerland has granted more than CHF 360 million to Kyrgyzstan to support the transition process. For more information, please visit www.eda.admin.ch/bishkek

The World Bank’s overall mission in the Kyrgyz Republic is to reduce poverty, promote economic growth and shared prosperity. 50 percent of the World Bank’s assistance to the Kyrgyz Republic is in the form of grants. The other 50percent is in highly concessional credits – no interest, and only a 0.75 percent service charge. Credits are repayable in 38 years, including a 6-year grace period, while grants require no repayment. The financial assistance to the Kyrgyz Republic since 1992 amounts to over US$ 1.1 billion. For more information, please visit: www.worldbank.org/kg

The event was organized in the framework of the Public Service Improvement Project financed by the Government of Switzerland through the Swiss Agency for Development and Cooperation (SDC) and implemented by a consortium of organizations composed of Helvetas Swiss Intercooperation and the Development Policy Institute.

The Service Improvement Action Plan aims to identify in a participatory manner priority public and municipal services as well as to plan and improve the organization and provision of these services. The Service Improvement Action Plan of the Ak-Chiy Aiyl Aimak focused on the repair and rehabilitation of water infrastructure and also on the organization and sustainability of the service provided to more than 1000 people.

During public hearings broadly attended by the population, a new tariff for drinking water was discussed and thereafter approved by the local council. The municipality also introduced new mechanisms for effective management of drinking water services, such as municipal-private sector partnership and allocation of subsidies for vulnerable groups of the population who cannot afford paying for the service.

“The service of drinking water supply in Ak-Chiy municipality was looked at in a systemic manner, from the rehabilitation of the water system, to the enhancement of the management capacities of the self-government, the establishment of a tariff system that would allow sustainable and affordable provision of quality services as well as the maintenance of the system, and the creation of a subsidy mechanism ensuring that all citizens will have access to water,” – said Véronique Hulmann, Ambassador of Switzerland to the Kyrgyz Republic.

"After having applied a methodology elaborated by the project, we calculated the most optimal tariff for all. Despite the fact that after the calculation, the tariff has doubled, the population reacted to this with understanding, because everyone knew that earlier the tariff was adopted without justifications and calculations," - said Elmira Sultanbayeva, Chairwoman of the Ayil Kenesh.

In total, the Swiss financed Public Service Improvement Project supports the implementation of 36 Service Improvement Action Plans of rural municipalities for a total of 92 million soms, including 30% contributions from the municipalities. The priority services that will be supported by the project are sustainable access to safe drinking water, rehabilitation and accessibility of preschools and schools, improvement of communal and housing services in municipalities, etc.