VZCZCXRO3563
OO RUEHAST RUEHBI RUEHCI RUEHDBU RUEHLH RUEHNEH RUEHPW
DE RUEHEK #0052/01 0210138
ZNR UUUUU ZZH
O 210138Z JAN 10
FM AMEMBASSY BISHKEK
TO RUEHC/SECSTATE WASHDC IMMEDIATE 2972
INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEATRS/DEPT OF TREASURY WASHDC

UNCLAS SECTION 01 OF 02 BISHKEK 000052 
 
SIPDIS 
 
DEPARTMENT FOR SCA; 
 
E.O. 12958: N/A 
TAGS: ECON EAID EFIN PREL KG
SUBJECT: KYRGYZSTAN'S IMPROVING BUDGET TRANSPARENCY 
 
REF: STATE 1923 
 
¶1. SUMMARY: The Kyrgyz Government has taken significant steps 
to increase the transparency of its budget and has a detailed 
plan to further improve its budget process.  The 2010 budget 
passed by Parliament in December is available on the internet 
and provides detailed figures in many areas.  In 2009 the 
Government committed itself to implement International Public 
Sector Accounting Standards and President Bakiyev issued a 
decree that detailed the Government's plan for public finance 
management reform through 2013, which should improve 
transparency. Post will continue to support greater budget 
transparency through a USAID project that is assisting the 
Government in improving its tax and financial policy, and 
will continue to coordinate with international organizations 
that are assisting in this area, including the World Bank and 
International Monetary Fund.  End summary. 
 
¶2. The Kyrgyz Government is expected to receive USG 
assistance that falls under the FY 2010 SFOAA, including IMET 
and FMF funding as well as technical assistance and training 
provided through various USG assistance programs. 
 
2010 Budget Available On The Internet 
------------------------------------- 
 
¶3. The Kyrgyz 2010 budget, as passed by Parliament in 
December, is publicly available on the Parliament's internet 
site in Kyrgyz and Russian at 
www.kenesh.kg/zp/lps.aspx?view=projectinfo&id =123971. Some of 
these documents are also available on a new independent 
internet site, www.budget.kg, supported by the Soros 
Foundation.  President Bakiyev has not yet signed the budget 
passed by Parliament so the Ministry of Finance has not yet 
posted the budget.  Bakiyev is expected to sign the budget in 
the next couple of weeks.  By law the Government is required 
to make budget information public, aside from secret 
information related to national security, although the law is 
not specific regarding what level of detail is required. 
 
¶4. The budget documents passed by Parliament and available on 
its internet site provide both an overview of the budget as 
well as attachments with a number of quite detailed 
breakdowns of the budget.  This year for the first time the 
budget passed by Parliament also includes a three-year 
projection, covering the 2011 and 2012 budgets as well as the 
2010 budget.  The budget documents also include information 
on foreign assistance grants and loans. While the budget 
appears to be mostly complete, it does not include detailed 
information on all revenues and expenditures. 
 
¶5. The Kyrgyz Government's 2010 budget process was 
complicated this year by a significant government 
reorganization President Bakiyev announced in October.  The 
reorganization led to a major rewriting of the initial draft 
budget prepared by the Government.  The rewriting of the 
budget meant that it was not completed and sent to Parliament 
until one week before Parliament began to debate the budget, 
limiting the time available to the public to review the 
proposed budget. 
 
¶6. The State Accounts Chamber conducts an end of year audit 
of the budget, which is usually sent to Parliament in March 
or April.  According to the head of the Soros Foundation 
Kyrgyzstan Budget Transparency Program, Nurlan Djoldoshev, 
the results of the audit are publicized in the media, but in 
the past the publicly available information was not detailed. 
 
Improving Budget Transparency 
----------------------------- 
 
¶7. The Kyrgyz Government has plans to continue to improve its 
budget process, in coordination with international 
organizations including USAID, the International Monetary 
Fund, and the World Bank.  In July, 2009 the Government 
adopted a decision to implement International Public Sector 
Accounting Standards.  In October, 2009 President Bakiyev 
issued a decree that the Government would implement an action 
plan on public finance management reform for 2009-2013.  The 
sixteen page decree lists many specific actions to be 
undertaken by various government ministries and bodies. Among 
the goals of the action plan is to ensure the budget covers 
all government revenues and expenditures. The IMF Resident 
Representative told Emboff that the IMF supported the 
Government's adoption of the decree and intended to continue 
to provide technical assistance, along with other donors, to 
help the Government implement the plan. 
 
¶8.  Through USAID, the U.S. Government continues to provide 
assistance to the Kyrgyz Government on improving effective 
 
BISHKEK 00000052  002 OF 002 
 
 
implementation of the tax code, preparation of financial 
statements according to International Public Sector 
Accounting Standards, and putting in place mechanisms for 
more effective audit by the Accounts Chamber.  This project 
is scheduled to continue through 2010 and will end in 2011. 
GFOELLER