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  • MALIK ABAKIROV: “GUARANTEE IS AN EFFECTIVE TOOL FOR SME SUPPORT”

    MALIK ABAKIROV: “GUARANTEE IS AN EFFECTIVE TOOL FOR SME SUPPORT”

    Press conference.

    On January 31, 2019, a press conference was held at the Kabar news agency by the Chairman of the Board of OJSC “Guarantee Fund” Malik Abakirov with the participation of the representatives of the leading media “Kabar”, “Ala-Too-24”, “Birinchi Radio”, “KTRK”, “ElTR”, “Pyramid”, “AKI-press”, radio “Maral”, newspapers “Erkin-Too”, “Bagyt.kg” and others. It was dedicated to the results of the activities of OJSC “GF” for 2018.

     The Chairman of the Board of OJSC “Guarantee Fund” (OJSC “GF”) Malik Abakirov told reporters about the results on the activities on support for small and medium enterprises (SMEs) of the republic, providing entrepreneurs with access to financing. The main direction of the activities is the provision of financial guarantees to entrepreneurs on case of insufficient collateral for bank loans.

    Capitalization of OJSC “GF”

     In accordance with the order of the Government of the Kyrgyz Republic dated June 25, 2018 No. 217-p, the authorized capital of OJSC “GF” increased by KGS 300 million and amounts to KGS 582 million. At the end of 2018, the assets of OJSC “GF” amounted to KGS 819.7 million, of which own capital was KGS 613 million.

    About guarantees for entrepreneurs

    In 2018 OJSC “Guarantee Fund” provided substantial support to SMEs, providing a total of guarantees in the amount of KGS 507 million. The volume of bank loans under guarantees amounted to KGS 1.779 billion. From the beginning of its activities in 2016 and as of December 31, 2018, Open Joint Stock Company “GF” issued 656 guarantees in the amount of KGS 755 million, and the amount of loans received by entrepreneurs under the guarantees of the Fund amounted to KGS 2.752 billion. According to the results of 2018, a profit was received in the amount of KGS 25.6 million, while the plan was 14.8 million, an increase reached 173 percent.

    Thanks to guarantees, 1225 new jobs were created, 5887 existing ones were supported. Export-oriented and import-substituting projects were issued 48 guarantees for KGS 141 million. Women entrepreneurs were issued 196 guarantees in the amount of KGS 224 million.

    Guarantees were provided in the following sectors: agriculture and fishing – 20%, manufacturing – 18%, processing of agricultural products – 14%, trade – 24%, tourism – 10%, transport – 6%, services – 7%, construction – 1%. In terms of regions, the quantitative distribution of guarantees is as follows: Bishkek city – 25%, Chui region – 17%, Naryn region – 17%, Osh region – 12%, Jalal-Abad region – 7%, Batken region – 7%, Issyk-Kul region – 8%, Osh – 4%, Talas region – 3%.

    RKDF loans

     In 2018 OJSC “GF” twice received a loan from RKDF amounting to KGS 100 million each. The first was successfully disbursed in the same year. The amount of guarantees issued for 65 projects amounted to KGS 100.5 million.

    In September 2018, a new loan agreement was signed with the RKDF. As of January 1, 2019, 13 percent of the loan was disbursed. The amount of guarantees issued for the implementation of 5 projects amounted to KGS 13.2 million.

    In accordance with the agreement, these loans are directed to support regional entrepreneurs.

    About the program implementation of OJSC “GF”

    OJSC “GF” implements projects under the program “One region – one enterprise”. The main goal of the program is to open new enterprises or new directions in existing enterprises in the regions. Within the program, 27 projects are being implemented. The amount of guarantees provided for OROE projects, including export, is KGS 80 million.

    The program “Restoration of agricultural machinery in the Kyrgyz Republic” was developed and is being implemented, in the framework of which DOS TJM LLC will assemble Topoz tractors. In 2018, 4 tractors were manufactured. Under the guarantee of OJSC “GF”, a loan was obtained from Aiyl Bank to expand production. Also, with the support of the GF, the company moved to a new production base in Kant and intends to start a stable production of tractors of various modifications for farmers and peasant farms.

    The company plans to produce attachments and the gradual localization of production. In the future, the production of electric tractors will be arranged here.

    At the end of the press conference, Malik Abakirov, the Chairman of the Board of OJSC “GF”, answered the journalists’ questions. Then a presentation of the book “Access to finance for SME: Guarantee Fund” took place. The authors are Malik Abakirov and Syrgak Abakirov. The book covers the history and formation of guarantee funds in Kyrgyzstan and the role of small and medium enterprises in the economy. It also provides international experience in the provision of guarantees.