Rational financing basis for biodiversity conservation in Kyrgyzstan

In mid-July, BIOFIN presented the primary expert assessment of strategies and policies on conservation and financing of the environment in Kyrgyzstan to representatives of state finance institutions, scientific circles and environmental authorities.

The assessment revealed that the country did not invest enough in environment protection and biodiversity conservation. It showed that the country’s state budget expenditures on environment protection make up just 0.5% of total expenditures or 0.17% of GDP and much less on biodiversity. 

Understanding the current expenditure a country spends on biodiversity conservation is a key part of the BIOFIN process and a crucial step, along with the financial needs assessment, in determining the country biodiversity financing gap.  Finance Plans can be formulated based on this important information. 

The assessment showed the country is not successful in implementation of environment strategies. For example, the funding needs to implement key biodiversity and climate change strategies (NBSAP, Ramsar Wetland Action Plan, Walnut Forest Programme, Snow Leopard Conservation, Biodiversity and Forest  Adaptation Action Plan) is 7.3 billion Kyrgyz soms (US106 million) per year, meanwhile the average budget for environment purposes  is 742 million Kyrgyz soms (US$ 10.7 million) over the last 4 years. 

A significant part of the state budget is spent on subsidies, some of which together with preferential taxes may have a negative effect on the environment, biodiversity and climate change adaptation efforts despite making profits for producers and service consumers. The potentially harmful subsidies make up 13% out of the state budget and only 1% of subsidies has positive impact on environment. 

An example of a potentially harmful subsidies in Kyrgyzstan is regulation of tariffs for irrigation water, that potentially lead to the ineffective water using. The Government keeps prices at low level (in vegetation period the tariff for water is 0,03 Kyrgyz soms per cubic meter) and people may use more water they need. 

Diagram. Subsidies in KR in 2017, % in total republican budget

The assessment clearly points to a need both to increase funding of priority measures and to use the opportunity offered by adopting programme budgeting to ensure spending is effective and achieves results. It demonstrates importance of rational financing of biodiversity and ecosystems as a pledge for sustainable development of the country. 

A representative of the Ministry of Finance, Nurida Baizakova, emphasized the importance of the assessment during the presentation. 

“We are also interested in engaging key ministries and departments, scientific circles and civic society in the process of increasing investments in environmental protection, biodiversity conservation and climate change adoption. We are working on forming the convincing economical grounds now,” she said. 

The assessment was undertaken as part of the The Biodiversity Finance Initiative (BIOFIN) together with UNDP-UNEP Poverty-Environment Initiative Project.