3. BACKGROUND TO KYRGYZSTAN

3.1 Geography

Kyrgyzstan is a small, landlocked, mountainous country in the very centre of Central Asia with an ethnically mixed population of roughly 5 million people (see Table 1 for characteristics of the country and its economy). Bishkek is the capital and largest city. Kyrgyzstan borders China to the east and the former Soviet republics Kazakhstan to the north, Uzbekistan to the west and Tajikistan to the south-west. The Kyrgyz Republic became independent in August 1991 and joined the Community of Independent States (CIS) in December of the same year. Since then the country has gone through a difficult phase of economic, social and political transition. Categorised as a "low-income country" by the World Bank (World Bank 2002), it is considered to be the second poorest ex-Soviet republic after Tajikistan.

Table 1: Key characteristics of the Kyrgyz Republic

Sources: ¹ (World Bank 2003c), ² (UNDP 2002), ³ (UN 2003a, p. 39), ⁴ (World Bank 2003b)

Map from the Perry-Castañeda Library Map Collection
http://www.lib.utexas.edu/maps/cia03/kyrgyzstansm03.gif

The relief of the country is dominated by the ranges of the Tien Shan massif which passes into the Pamir in the very south. Nearly 90 percent of the total territory of Kyrgyzstan lies in altitudes of 1,500 m.a.s.l. and higher (Abdymomunov 2001a) and more than 40 percent of the whole territory lies above 3,000 m.a.s.l. (von Maydell 1983). Only about 7 percent of the total area is suitable for arable agriculture. Kyrgyzstan has a continental climate with considerable variations between the regions.

Thanks to its mountains, Kyrgyzstan is rich in water resources which are crucial for agricultural irrigation and which are also used to produce hydroelectric power. It also has significant deposits of gold and rare metals, minor deposits of coal and natural gas, which are being exploited, and deposits of other mineral resources such as mercury, lead, and zinc. Kyrgyzstan relies on imports of mineral fuel, but is a net exporter of electricity.

3.2 Population and migration

The population of the country is composed of more than 60 ethnic groups with Kyrgyz, Uzbek and Russians making up more than 90 percent of the total population (see Table 1 above) (UN 2003a, p. 39). Kyrgyz and Uzbek are Turkic ethnic groups, Sunni Muslim and speak related Turkic tongues. Traditionally the Kyrgyz lived as nomadic herdsmen and horsemen, while the Uzbek have a sedentary tradition. The vast majority of Uzbek in Kyrgyzstan live in the lower parts of the fertile Fergana valley in the south of the country.

In demographic terms, the population of the Kyrgyz Republic is young. Children and teenagers (age 0-15) comprised 38.1 percent of the population in 1999 (National Statistical Committee 1999). Due to topographic conditions the majority of the population is concentrated in the south of the country. More than half the population lives in the densely populated Fergana Valley.

The ethnic composition of the population has changed considerably over the past decades. The emigration of Russians and other Slavic nationalities, which began in the late 1980s (Heleniak 1997), increased dramatically in the early 1990s at the height of the economic crisis to reach its peak in 1993 (UN 2003a, p. 40). The German population has experienced a mass exodus.

Internal, mainly economically motivated, migration processes have been characterised by a few city centres attracting people from all over the country and a constant outflow of migrants from all oblasts to the capital Bishkek and the surrounding Chui Oblast. This has aggravated social problems in cities, in particular in Bishkek with its already overstretched infrastructure (UN 2003a, p. 9, 25 and 65). Temporary labour migration to other CIS countries, especially to Russia, has considerably increased since independence. Such migrants are typically young people leaving to make a living abroad and to support their families back home with transfer payments.

3.3 History

For many centuries the territory of today’s Kyrgyzstan was part of larger, ever changing political entities. The Kyrgyz were organized in changing confederations of clans, nominally under the suzerainty of different rulers and successive overlords. The affiliation to traditional clan or tribal groups still plays an important role amongst ethnic Kyrgyz today. From the middle of the nineteenth century the Russians gained influence in the Tien Shan. In 1876 the Khanate of Kokand, the last independent Khanate controlling the area of today’s Kyrgyzstan, fell to the Russian Tsar (Choukourov and Choukourov 1994, p. 200). After the Bolshevik Revolution of 1917 and the following civil war Kirghizia, as it was known at the time, was included within the various territorial entities of the Soviet Union. It became a Soviet Republic in 1936 within its present borders.

During the early years of the Soviet era rapid progress was made in the fields of economy and education, reflected, for example, in quickly rising literacy rates (Pomfret 1995, p. 106). The agricultural collectivization in the early 1930s met strong resistance but was enforced upon the rural communities by the Soviet leaders. Industrial development was mainly pushed during the post-war period, but agriculture remained the backbone of the economy (Pomfret 1995, p. 108). It is widely acknowledged that, on the whole, living standards improved during the Soviet rule and that the country took many important development steps characterised by the progress made in key areas such as agriculture, education, health or industrial development.

3.4 Government system

Kyrgyzstan is a presidential republic with a strong executive, comprising the president and the government, and a parliament due to be changed from a two chamber to a one chamber system. The Constitutional Court, the Supreme Court and other court bodies comprise the judiciary. Ministries and a powerful presidential apparatus form the administration. The President, who is elected by the citizens for a period of five years, appoints the Prime Minister and the other members of the government upon recommendation of the Prime Minister. Members of the parliament are elected for five-year terms in popular elections.

Administratively the country is organized in seven provinces (Russian: Oblast) and the capital Bishkek. The provinces are further divided into districts (Russian: Rayon) including, besides the district’s centre, towns and municipalities (Kyrgyz: Ail Okmot). These municipalities typically comprise several villages and hamlets. Provinces, the capital Bishkek, districts and municipalities are governed by the head of the state administration at the appropriate level and have their own self-government assemblies (Kyrgyz: Kenesh). On the local level, there are usually additional, informal as well as legally formalised institutions, such as village heads, elders’ councils and courts and women’s and youth councils, concerned with customary and written laws, local social problems and conflicts. Governors of oblasts and heads of district administrations are appointed by the president with agreement of the respective assemblies (Matsuzato 2001), whereas heads of municipalities, villages and members of the assemblies on all levels are elected in direct elections.

3.5 Economy

The breakdown of the Soviet Union’s integrated economy and the sudden stop of direct and indirect subsidies from the central Soviet budget had dramatic consequences for all sectors of the economy in newly independent Kyrgyzstan. The country embarked early on what is seen as the most ambitious economic reform programme among the former Soviet republics in Central Asia, including price liberalization, privatization, agricultural and land reforms, and an early introduction of its own currency, and gained considerable support for its determined reform agenda from the international community.

During the first years of independence, from 1991 until 1995, the country experienced drastic reductions in output and income in all sectors of the economy. Hyperinflation and rising unemployment led to a dramatic increase in poverty and inequality. The industrial sector virtually collapsed and agriculture again became the dominant sector in the early 1990s. After a first macroeconomic stabilization the country’s economy recovered from 1996 until 1998. However, this recovery was mainly based on growth in a few sectors (notably agriculture, gold mining and energy). High budget and balance of payment deficits made the economy extremely vulnerable (World Bank 2001b, p 11). In late 1998 the country slid into a financial crisis mainly triggered by the Russian rouble crisis, from which it recovered only in 2000 when economic growth resumed. It is estimated that in 2002 GDP reached about 70 percent of its level in 1990 (UN 2003b, p. 11). So, after a sharp post-Soviet dip the Kyrgyz economy is now on the path of recovery and growth whilst still being fragile and prone to external shocks.

Today, the agricultural sector still plays a key role in Kyrgyzstan’s economy. In 2002 it was responsible for more than one-third of GDP and employed half of the economically active population. Industry accounts for approximately 20 percent of GDP, but is less significant in terms of employment. The importance of trade, transport and services for the economic performance and employment has considerably grown since the mid 1990s to the level of about one third of GDP generated in this sector (UN 2003a, p. 41; World Bank 2003c). It has to be stressed that within the country there are important regional economic disparities between economically more dynamic regions, such as the capital Bishkek and its surroundings in the north of the country, and remote rural regions mainly in the south and in the centre of the country. Rural areas have often relapsed into subsistence agriculture and a non-cash economy. Furthermore, it is important to note that the informal sector, not included in official statistical data, plays an important role in the country.

Despite some success of the reforms, the Kyrgyz economy still faces a number of crucial challenges, including diversifying its economy, reducing the heavy burden of external debt, strengthening governance, expanding exports, increasing investments, developing small and medium businesses and agriculture (UN 2003a; World Bank 2003a), the latter in particular in marginalized rural areas.