This study was conducted in order to increase budget transparency in Kyrgyzstan, in particular the revenue side of the budget, to improve transparency in the work of the customs authorities. The main objective of the study is to identify problems in reliability of statistics of Kyrgyzstan’s foreign trade turnover. Objectives of the study:
 

• identify differences in statistics of foreign trade activity;
• identify the level of budget losses;
• determine the impact of the budget on the potential losses of the budget;
• develop proposals and recommendations on improving foreign trade statistics.

The study was conducted with the use of "mirror" customs statistics methodology. The study revealed significant differences in the import/export data of China and the Kyrgyz Republic. The values and volumes of discrepancies indicate high corruption risks in the sphere of customs regulation of the Kyrgyz Republic.

As part of the research, a team of experts carried out a comparative price analysis of selected goods of daily consumption, which compares the prices of imported goods customs with retail sales price and identifies reasons for substantial price difference.

Expert calculations show that the potential loss of budget revenues may increase the wages of public sector employees by 1.5 times. This level of budgetary losses suggests the need for drastic management measures plane willed political decisions.

This research was conducted as part of the project "Promotion of budget transparency in the Kyrgyz Republic" by independent experts of the Precedent Partners Group and with support of the Ministry of Economy and the Council of Defense in the Office of the President of the Kyrgyz Republic. The project was funded by USAID and UNDP.