Kyrgyzstan has been an independent republic since 1991. The current constitution was adopted in May 1993. Both the president and parliament are directly elected by universal suffrage for a 5-year term.
Although the constitution provided for a relatively equal distribution of powers, over the years Akayev has, by means of referendums, drawn more and more power to the president. For example, the president can elect the prime minister, initiate legislation, dissolve parliament and recommend members for the Supreme Court. He also has considerable influence in appointing ministers, ambassadors and local officials. Current Prime Minister Kulov is in favour of limiting presidential power.
In 1994, instead of a unicameral parliamentary system, a bicameral system was introduced, consisting of a Legislative Assembly with 35 deputies and a People's Assembly with 70 deputies. Following a referendum in 2003, a unicameral system with 75 representatives was re-established after the parliamentary elections in 2005. Currently, there are proposals to bring this system back to a bicameral system and to return to a mixed electoral system, instead of the first-past-the-post system.
Compared to the other Central Asian republics, the Kyrgyz government showed 'less authoritarian' aspirations. After independence in 1991, Kyrgyzstan was an example among former Soviet republics and enjoyed broad assistance from international donors. In recent years, however, political and economic reforms under President Akayev have stagnated. In March 2002, for example, five demonstrators were shot dead during a demonstration against the government's policy that got out of hand in the southern Kyrgyzstan district of Aksy.
The new government, led by President Bakiyev, who was elected in July 2005, gives priority to constitutional and judicial reform. In addition, there is a major corruption problem, which is now one of the new government's top priorities.
Although international observers are positive about Bakiyev's intentions, elite groups still play a major role in Kyrgyz politics. There is an uneasy coalition because of divisions between the northern and southern factions of the ruling elite. With a president from the south and a prime minister from the north, a balance is currently being found to keep these tensions in check. Another potential threat to political stability is Islamic militant groups.
Developments in the Ferghana Valley play an important role for political stability in Kyrgyzstan. In this valley, which borders Kyrgyzstan, Uzbekistan and Tajikistan, Kyrgyzs, Tajiks and Uzbeks live on a relatively small area on both sides of the border, which has led to ethnic tensions and border incidents from time to time in the past. The unclear demarcation of the borders in the valley hampers the development of the local economy and trade. In addition, minefields have been set up in the border area, especially on the Uzbek side, causing casualties every year. The revolution has again increased unrest in the area.
The current political situation is described in the history section.
In the aftermath of the Russian economic crisis (1998), the Kyrgyz economy now seems to be slowly recovering. Real GDP growth shows an upward trend; after the strong growth of 2001-2003, growth started to slow down somewhat in 2004, but in recent years the economy has been growing strongly and in 2017 the economy grew by 4.6%. The Kyrgyz National Bank has pursued a tight policy in recent years, which has stabilised the exchange rate and inflation. Nevertheless, the budget deficit and external debt are at a relatively high level. Also, the economic reform process and the improvement of the investment climate have been slow.
An attempt is being made to solve the budget deficit as much as possible with domestic loans. Reducing the external debt is one of the priorities of economic policy. Internal financing should also promote the development of domestic capital markets and the banking system.
GDP growth depends mainly on the extraction and export of gold in Kumtor. Apart from the gold sector, domestic demand is strong, thanks to improved macroeconomic stability and rising wages. Traditional export markets are also doing well. Problematic is the low investment in other gold mines and other key sectors, such as electricity and agriculture. Reforms are needed in the areas of corruption, taxation and the level of regulation.
There is a steady rise in imports, while exports are rising relatively less. Kyrgyzstan therefore faces a constant trade deficit. This is partly compensated by investments. In addition, the country remains dependent on development aid.
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