Partners in the Kyrgyz Republic are trained in strategic planning for the development of the National Programme for the transition from the informal to the formal economy for the period 2023-2026
On December 14-15, 2023, in Bishkek, more than 30 members of the interagency working group took part in a training seminar on strategic planning, during which they analyzed political and legal measures aimed at reducing the informal economy (employment) and preventing their spread in country.
16 December 2022
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The interdepartmental working group was established by order of the Ministry of Economy and Commerce of the Kyrgyz Republic.
In her opening speech, Ainura Usenbekova, Deputy Minister of Economy and Commerce of the Kyrgyz Republic, emphasized that “the structure of the labour market contributes to a high level of informal employment. The total share of informally employed workers reached 71.8% of the total employed population. In urban areas, the degree of informality is lower (64.3%) than in rural areas (76.1%). In general, men are more involved in the informal sector than women (77.2% versus 63.2%). This can be explained both by the overall dominance of men in the labour market and by the larger proportion of women working in the formal sector.”
The group work revealed that the key factors affecting the participation of the labour force in the informal economy and the growth of informal employment in the Kyrgyz Republic are, among other things, the global economic downturn, the decline in production, inflation and rising prices, the increase in poverty, lack of access to loans.
Mikhail Pouchkin, Deputy Director of the ILO Office for Eastern Europe and Central Asia, emphasized that “The problems of the informal economy, which employs 2 billion people in the world, have always been of particular relevance and have been in the area of close attention of the ILO. Most often, informal workers are deprived of social protection, labour rights and decent working conditions. Social justice and decent work are often inaccessible and little known to informal workers, so the very recognition of the need to develop a National Strategy for the Transition from the Informal to the Formal Economy for the Kyrgyz Republic is an important step.”
During the training, the participants were introduced to the key concepts, policy frameworks and methodologies for the transition from the informal to the formal economy needed to develop a strategy. They improved their strategic planning skills; identifying the key goal, challenges, priorities, and actions to be implemented at the country level during the period 2023-2026. The importance of coordination and social dialogue among key stakeholders was particularly emphasized.
Kalygul Saliev, legal adviser to the business association JIA, noted that “government bodies are making efforts to withdraw businesses from the non-observed sector of the economy and workers from informal employment. So, for example, on November 4, 2022, the Law of the Kyrgyz Republic “On Amendments to the Laws of the Kyrgyz Republic “On Tariffs of Insurance Contributions for State Social Insurance”, “On State Social Insurance” was adopted. The law reduced the rates of insurance premiums for small and medium-sized businesses, depending on the amount of revenue and the actual number of employees.
Based on the results of fruitful work, the following 4 priority areas for the future National Strategy were developed: improving the legal framework to reduce barriers to the formalization of informal economic activity; stimulating and supporting the formalization of informal economic activity; increasing legal culture and reducing tolerance in society towards the informal economy; strengthening cooperation in identifying and monitoring the informal economy.
At the end of the seminar, Rysgul Babaeva, Deputy Chair of the Federation of Trade Unions of Kyrgyzstan, once again emphasized: “The need to solve the problems associated with informal employment is fixed in the signed General Agreement dated April 29, 2022. Trade unions are concerned that 71.8% of workers are informally employed and cannot count on state guarantees and payments for basic health and social services. We believe that informal workers should have access to decent working conditions.”
As a next step, the members of the interagency working group will be divided into thematic subgroups in order to develop activities and a monitoring mechanism within each of the above priority areas.
The training was organized within the framework of the International Labour Organization (ILO) project "Transition from informal to formal employment" together with the Departments of INWORK , SOCPRO and ACTRAV, ILO, Geneva.
In her opening speech, Ainura Usenbekova, Deputy Minister of Economy and Commerce of the Kyrgyz Republic, emphasized that “the structure of the labour market contributes to a high level of informal employment. The total share of informally employed workers reached 71.8% of the total employed population. In urban areas, the degree of informality is lower (64.3%) than in rural areas (76.1%). In general, men are more involved in the informal sector than women (77.2% versus 63.2%). This can be explained both by the overall dominance of men in the labour market and by the larger proportion of women working in the formal sector.”
The group work revealed that the key factors affecting the participation of the labour force in the informal economy and the growth of informal employment in the Kyrgyz Republic are, among other things, the global economic downturn, the decline in production, inflation and rising prices, the increase in poverty, lack of access to loans.
Mikhail Pouchkin, Deputy Director of the ILO Office for Eastern Europe and Central Asia, emphasized that “The problems of the informal economy, which employs 2 billion people in the world, have always been of particular relevance and have been in the area of close attention of the ILO. Most often, informal workers are deprived of social protection, labour rights and decent working conditions. Social justice and decent work are often inaccessible and little known to informal workers, so the very recognition of the need to develop a National Strategy for the Transition from the Informal to the Formal Economy for the Kyrgyz Republic is an important step.”
During the training, the participants were introduced to the key concepts, policy frameworks and methodologies for the transition from the informal to the formal economy needed to develop a strategy. They improved their strategic planning skills; identifying the key goal, challenges, priorities, and actions to be implemented at the country level during the period 2023-2026. The importance of coordination and social dialogue among key stakeholders was particularly emphasized.
Kalygul Saliev, legal adviser to the business association JIA, noted that “government bodies are making efforts to withdraw businesses from the non-observed sector of the economy and workers from informal employment. So, for example, on November 4, 2022, the Law of the Kyrgyz Republic “On Amendments to the Laws of the Kyrgyz Republic “On Tariffs of Insurance Contributions for State Social Insurance”, “On State Social Insurance” was adopted. The law reduced the rates of insurance premiums for small and medium-sized businesses, depending on the amount of revenue and the actual number of employees.
Based on the results of fruitful work, the following 4 priority areas for the future National Strategy were developed: improving the legal framework to reduce barriers to the formalization of informal economic activity; stimulating and supporting the formalization of informal economic activity; increasing legal culture and reducing tolerance in society towards the informal economy; strengthening cooperation in identifying and monitoring the informal economy.
At the end of the seminar, Rysgul Babaeva, Deputy Chair of the Federation of Trade Unions of Kyrgyzstan, once again emphasized: “The need to solve the problems associated with informal employment is fixed in the signed General Agreement dated April 29, 2022. Trade unions are concerned that 71.8% of workers are informally employed and cannot count on state guarantees and payments for basic health and social services. We believe that informal workers should have access to decent working conditions.”
As a next step, the members of the interagency working group will be divided into thematic subgroups in order to develop activities and a monitoring mechanism within each of the above priority areas.
The training was organized within the framework of the International Labour Organization (ILO) project "Transition from informal to formal employment" together with the Departments of INWORK , SOCPRO and ACTRAV, ILO, Geneva.