EDB: Kyrgyzstan is the second most integrated EAEU economy after Belarus

AKIPRESS.COM - Despite a decline in the significance and intensity of Kyrgyzstan's mutual trade with the EAEU countries in 2018, these indicators remain high due to the country being the second most integrated EAEU economy after Belarus, the Eurasian Development Bank reported.
These findings are presented in the report titled Main Trends in the Kyrgyz Republic's Integration Development in 2018 prepared by the Centre for Integration Studies at the EDB's Directorate for Research.
The significance and intensity of the Kyrgyz Republic's mutual trade with the EAEU countries weakened in 2018 as a result of reduced mutual trade (both exports and imports) with almost all Union countries, except Russia. In this context, increased exports to Russia offset the negative effect on mutual trade flows and the economy in general as a result of a decrease in trade with other EAEU countries, Kazakhstan in particular. Another important factor behind the decline in the significance and intensity of mutual trade was a considerable increase of trade with other countries.
As a result, the Kyrgyz Republic's exports to the EAEU countries grew by 0.1% and imports decreased by 4% in 2018. While exports remained almost the same quarterly, imports grew because of an increase in oil product supplies throughout the year driven by higher energy prices in 2018. Other major categories of imports remained rather stable. The Kyrgyz Republic's main exports in 2018 were clothes and ores; which accounted for 25% and 18% respectively of the country's intra-Union supply. Copper and copper items, dairy products, eggs and honey also had a significant share while other commodity exports remained below 5%.
The financial channel remains an important instrument for integration. Remittances from Russia and Kazakhstan increased in 2018 and continue to stimulate the consumer and investment components of domestic demand, as well as the overall balance of payments, by compensating a significant foreign trade deficit. The Russian-Kyrgyz Development Fund is an example of an investment instrument used to implement various joint investment projects in the Kyrgyz Republic.
The country's corporate cooperation with the EAEU countries continues to develop, especially with companies inRussia and Kazakhstan. The key areas for cooperation are gas and oil products, mining and metallurgy, transport, the power sector, banking and insurance, agriculture and the food industry. However, there are occasional cases when Kazakhstan or Russia return agricultural or food products produced in the Kyrgyz Republic. The country, on its part, is working proactively to set up necessary laboratories and certification centres with the financial and technical assistance from its EAEU partners to avoid such incidents in the future.