2015 Index of Economic Freedom

Kyrgyz Republic

overall score61.3
world rank82
Rule of Law

Property Rights20.0

Freedom From Corruption24.0

Limited Government

Government Spending53.2

Fiscal Freedom93.6

Regulatory Efficiency

Business Freedom73.7

Labor Freedom85.0

Monetary Freedom73.8

Open Markets

Trade Freedom80.2

Investment Freedom60.0

Financial Freedom50.0

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Quick Facts
  • Population:
    • 5.6 million
  • GDP (PPP):
    • $14.7 billion
    • 10.5% growth
    • 3.5% 5-year compound annual growth
    • $2,611 per capita
  • Unemployment:
    • 7.9%
  • Inflation (CPI):
    • 6.6%
  • FDI Inflow:
    • $757.6 million
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The Kyrgyz Republic’s economic freedom score is 61.3, making its economy the 82nd freest in the 2015 Index. Its score has increased by 0.2 point since last year, with improvements in trade freedom, freedom from corruption, and labor freedom outweighing declines in the control of government spending, fiscal freedom, and business freedom. The Kyrgyz Republic is ranked 15th out of 42 countries in the Asia–Pacific region, and its overall score is above the regional and world averages.

Over the past two years, the Kyrgyz Republic has re-established the positive growth in economic freedom it had achieved prior to 2010. Solid gains have been made in opening the economy to trade and investment, but the control of government spending continues to deteriorate.

Compared to transitioning economies in Eastern Europe, the Kyrgyz Republic lags behind in key indicators of economic freedom. Trade freedom has only recently surpassed the global average, and the rule of law remains weak. Corruption, particularly surrounding the president’s family and office, has been well documented. Courts remain largely unreformed, and property rights are weak.



The Kyrgyz Republic is one of Central Asia’s poorest and least stable countries and is sharply divided along ethnic lines. Former Prime Minister Almazbek Atambayev, elected president in 2011 with Moscow’s support, has used questionable legal maneuvers to persecute opponents. Weak governance has encouraged extremist threats, organized crime, and corruption. The government has accumulated high levels of external debt and is heavily dependent on foreign aid. The economy depends heavily on gold exports and remittances from Kyrgyzstani migrant workers, primarily in Russia. Cotton, tobacco, wool, and meat are the main agricultural products, but only tobacco and cotton are exported in any quantity. There has been strong foreign investment, particularly from Russia. In May 2014, Atambayev signed a road map for membership in the Russia-dominated Eurasian Economic Union, saying that his country has little choice but to join.

Rule of LawView Methodology

Property Rights 20.0 Create a Graph using this measurement

Freedom From Corruption 24.0 Create a Graph using this measurement

Corruption is pervasive, and despite many rounds of constitutional and statutory changes, the Kyrgyz Republic has been trapped in a cycle in which political elites rotate from opposition to power and use government resources to reward clients. Government anti-corruption efforts mostly target the opposition. The courts are largely unreformed, judges are often corrupt, and the legal framework is weak.

Limited GovernmentView Methodology

The Kyrgyz Republic’s individual and corporate income tax rates are a flat 10 percent. Other taxes include a value-added tax and excise taxes. The overall tax burden corresponds to 21 percent of domestic production. Non-tax revenue from gold deposits is sizeable. Government expenditures equal 39.5 percent of domestic output, and public debt is equivalent to 48 percent of gross domestic product.

Regulatory EfficiencyView Methodology

Requirements for starting a business have been simplified, but regulatory inefficiency and lack of transparency persist. Completing licensing requirements still takes over 140 days. The labor market remains inefficient, and informal labor activity is high. The 12-month inflation rate reached 6.3 percent in March 2014, but core inflation has been in the single digits since May 2013.

Open MarketsView Methodology

The Kyrgyz Republic’s average tariff rate is 2.4 percent. Tariffs on imported clothing are relatively high. The legal and regulatory environment is challenging for foreign investors. Financial intermediation has increased, but high credit costs severely undermine private-sector development. Credits provided by a banking sector that remains vulnerable to state interference equal less than 15 percent of GDP.

Country's Score Over Time

Bar Graph of Kyrgyz Republic  Economic Freedom Scores Over a Time Period

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Regional Ranking

rank country overall change
1Hong Kong89.6-0.5
3New Zealand82.10.9
7South Korea71.50.3
8Malaysia 70.81.2
10Brunei Darussalam68.9-0.1
12Thailand 62.4-0.9
15Kyrgyz Republic 61.30.2
21Sri Lanka58.6-1.4
25Pakistan 55.60.4
27Bangladesh 53.9-0.2
29Papua New Guinea53.1-0.8
36Solomon Islands470.8
42North Korea1.30.3
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