Transparency crucial to attracting foreign aid

"Our main concern over providing Kyrgyzstan with assistance is transparency, because corruption is a serious obstacle preventing donors from increasing their aid," Kiyoshi Ishii, the resident representative of the Japan International Cooperation Agency (JICA) in Kyrgyzstan, told IRIN on 18 October. Kyrgyzstan, a landlocked country with almost no natural resources, has become increasingly dependent on foreign aid. Today, its foreign debt equals its national GDP, a situation challenging to the role and tasks of international donors. JICA provides technical assistance by training Kyrgyz specialists in various fields, including seismology, crime prevention and anti-terrorism, drug control, public health, business and farming. Largely a rural country, Kyrgyzstan has just started implementing private farming to overcome the disastrous effects of 70 years of Soviet-style centralised agriculture. "Private farming has been established, yet the system is not well managed. Farmers don’t have enough money to make the necessary investments to develop their production. They are unable to buy machines, fertilisers, or to transport their produce to markets," said Ishii. In rural areas, social, educational, health structures have failed to adapt to the exigencies of a market economy, and have often collapsed as subsidies from the centre were gradually cut. Micro-financing has accordingly become a priority for most donors towards reinvigorating the economy. Having been a component of the Soviet Union's integrated economy, Kyrgyzstan's industry has also been paralysed. The transition to the market economy, launched 10 years ago when Kyrgyzstan gained independence, has led to the closure of almost all its factories. While unskilled management is generally blamed for poor results, donors also mention lack of initiative on the part of the Kyrgyz government. "The Kyrgyz government should take more responsibility towards guaranteeing its ability to repay its loans. Without reliable monitoring, without a good democratic system, without participatory decision-making, donors become reluctant to give money. Donors need to see their money well utilised," Ishii stressed.