Abylgaziev: Unprofitable state enterprises should be developed as part of PPP

Bishkek, June 21, 2019. /Kabar/. Prime Minister of the Kyrgyz Republic Mukhammedkalyi Abylgaziev held a meeting during which the results of the activities of state enterprises and joint-stock companies with state participation were addressed, the Government’s press service reported.
It was noted that the profitability indicators of many state property objects remain low, and the amount of net profit is decreasing. This concerns such companies as Alfa Telecom, Dastan transnational corporation, Entrepreneurship Development Fund, Naryn and Naiman Hydroelectric Power Stations and others. Expenditure plans of Bishkek Machine-Building Plant OJSC and Guarantee Fund OJSC increased by 206.08% and 162.38%, respectively.
Abylgaziev stressed that increasing the profitability of public property is one of the priorities of the Government.
"The current situation with the management of state property is not in the interests of the country's economy. Out of 106 state-owned enterprises, 51 remain unprofitable. Out of 52 joint-stock companies 22 companies do not bring profit. All state-owned enterprises that do not benefit the budget and the economy should be developed as part of public-private partnership (PPP). The government has introduced key performance indicators, as many companies are unprofitable because of the low quality of management. This year, we must put an end to this important issue and achieve the introduction of clear and effective mechanisms to improve the management of state property," the prime minister said.
In this regard, Prime Minister Abylgaziev instructed the Ministry of Economy and the State Property Management Fund under the Government within a month to prepare a list of state property to be transferred into fiduciary management.
"The introduction of outsourcing will create opportunities for the efficient use of private sector resources, this does not mean transferring into private sector. Problems with the lack of professional staff and funding, low level of corporate governance and accumulated problems with decision-making in public property management still remain unresolved, " the prime minister stressed.
Abylgaziev noted the establishment of National Management Company JSC would allow to introduce a centralized system of management of public companies and to involve top managers in the work. It will also contribute to more effective decision-making aimed at attracting additional resources and investment in public companies in the interests of the country's economy.