29 Jul 2009 14:19

Kyrgyzstan to contain inflation at about 10% in 2009

BISHKEK. July 28 (Interfax) - Inflation in Kyrgyzstan will not exceed the target of 10% in 2009, Economic Development and Trade Minister Akylbek Zhaparov said at a government meeting on Tuesday.

"It's possible that inflationary rates will be even lower than the forecasts at the end of the year following a seasonal decline in prices in the second half," he said.

Inflation statistics so far have not differed much from the forecasts, he said.

Kyrgyzstan saw inflation of only 0.6% in the first half of 2009 due to a slowdown in growth in global prices for key commodities in addition to the government's monetary, credit, budget and tax policies, he said.

GDP grew 0.3% in real terms in the first half of 2009, he said.

Exports declined 17% (excluding gold) in the period due to a reduction in external demand. Wire transfers by Kyrgyz migrants fell almost 30% in the period. The reduction in private sector revenue led to a decline in domestic household demand, which, in turn, led to a 24.3% drop in imports and less budget revenue from VAT payments.

Trade turnover with Russia and Kazakhstan fell the most in the period. Exports to Russia and Kazakhstan fell 66% and 45.7%, respectively, while imports from these two countries declined 30.7% and 21.6%.