How did the Kyrgyz Republic implement?

Post-independence (1990s to mid 2000s)

Donors have played a key role in the Kyrgyz Republic since independence, but that role has evolved over time. A WHO paper in 2000 described the relationship among donors as progressing through phases of co-existence, communication, and cooperation.

Co-existence: In the immediate aftermath of the Soviet Union’s collapse, the Kyrgyz Republic desperately needed help, but donors were funding an eclectic mix of programs that did not add up to a strategic approach. To take a few examples, the Japanese International Cooperation Agency paid for equipment at a hospital, the Swiss Development Agency developed plans to build two new hospitals, the Danish Development Agency purchased insulin and hearing aids, USAID experimented with health financing schemes, and UNICEF focused on diarrhea and pneumonia.

Communication: In early 1994, the Kyrgyz Government requested the assistance of the WHO to address the crisis of the health sector in an organized way, and the Ministry of Health and the WHO Regional Office for Europe signed a memorandum of understanding. This work, which resulted in the Manas program, helped incorporate all donors in a single conversation. In mid-1994, 47 bilateral and international donors met in Bishkek to discuss how they would work together. Subsequently, most donor-funded programs - in health at least - were aligned with the Manas framework. For example, USAID’s work on health financing was now organized in conversation with the Manas team. Some experts have called this an informal sector-wide approach, whereby donors chose to think in a coordinated way about their engagement in the country.¹

Cooperation: In the mid-1990s, the World Bank and International Monetary Fund faced persistent criticism that they prioritized macroeconomic growth over poverty reduction and quality of life in their work with developing countries. In response, the Bank proposed what it called a Comprehensive Development Framework (CDF) in 1999 that laid out a more collaborative and transparent process for its country-level work. The Kyrgyz Republic was one of the World Bank’s early partners on the CDF.²

The CDF was based on the idea that the Bank’s work in country should be consistent with a long-term vision and strategy and, that the vision and strategy should be owned by the countries. The hope was that all stakeholders could line up behind the vision and strategy, which is more or less what had happened with Manas five years before.

Ultimately, almost 50 developing countries went through the World Bank’s process. The Kyrgyz Republic’s CDF, finalized in 2001, set an overarching target of reducing poverty in the Kyrgyz Republic by half over the decade, but it was not an anti-poverty program per se. Instead, it addressed a huge range of priorities for the country - including governance, infrastructure, education, and health. Per the Bank’s guidance, the government also produced an interim poverty reduction strategy paper (followed in 2003 by the National Poverty Reduction Strategy, or NPRS), which laid out a series of medium-term action steps to achieve the long-term vision and strategy contained in the CDF.³

As the names suggest, the CDF and the NPRS were not actual investments or policies; they were a framework and a strategy, and each specific investment or policy that followed needed to make its way through the ordinary process. With the CDF in place, though, donors had a blueprint for how to engage in the Kyrgyz Republic.

When the planning process for Manas Taalimi began in 2004, many donors formalized their sector-wide approach, or SWAp, as described above. The idea behind the SWAp is to guarantee that the Kyrgyz Government would own the reform effort, to maximize the value of donor contributions by keeping them tightly coordinated, and to build capacity within the Kyrgyz Government by providing structured technical support.⁴

Recent times (late 2000s onward)

For the first two decades after independence, the Kyrgyz Republic was considered a “donor darling.” For a variety of reasons, ranging from the strong leadership of the first president to the lack of other viable options, the Kyrgyz Republic was more open to working with donors than the other newly independent Central Asian countries. In the past decade, however, changing dynamics have cut into donors’ influence on Kyrgyz policies and programs. Donors are still heavily engaged in the country, but they have less of a free hand.

There are three main reasons for this evolution.

First, politics have changed within the Kyrgyz Republic. Kyrgyz society has matured, resulting in the hardening of interest groups and lobbies that are able to articulate specific demands of the government. At the same time, after a generation of independence, Kyrgyz leaders are much more confident in designing and executing policy. (There is a joke among Kyrgyz that, at first, the government did not know the difference between grants and loans. That is, it assumed everything was still free.) As the vacuum in political priorities has been filled by local advocacy, and as the asymmetry in experience between Kyrgyz bureaucrats and donors has diminished, the Kyrgyz Republic has become less of a blank slate for the international community.

Second, as the Kyrgyz economy has grown, donor money has played a decreasing role in the functioning of society. In the mid-1990s, when donors helped drive the design of the Manas program, the Kyrgyz Republic was simply unable to fund a health care system without support. In more recent years, the Kyrgyz Republic’s budget has grown significantly, so donor funding is a smaller piece of the pie. One way to see the declining importance of aid is to follow the trajectory of net ODA as a percentage of the national budget. This figure reached its height, 63 percent, in 1999. It had declined steadily to 19 percent by 2016, the most recent year available. As the relative importance of donor money declines, so does the relative salience of donor ideas.

Third, China and Russia joined the more traditional donors and development organizations, and they are less interested in influencing Kyrgyz social policy. Consider this example of how Russia views aid to the Kyrgyz Republic: in 2009, Russia pledged a $150 million grant, forgiveness of $193 million in debt (in exchange for a stake in a military goods manufacturer), a $300 million concessional loan, and $1.7 billion in financing for a hydroelectric project.⁵ It is difficult to say what percent of Kyrgyz foreign aid China and Russia account for, but according to reports almost 40 percent of the Kyrgyz Republic’s total debt is owed to China.⁶

According to some stakeholders, these factors together have closed what had been a 20-year window of opportunity for creative social policy reform that resulted in successes such as Manas and Manas Taalimi.