Kyrgyzstan - Succeeding with Raiffeisen

In cooperation with the BMZ, the DGRV has been supporting cooperative forms of cooperation in rural Kyrgyzstan by providing consultancy and assistance in funding investment since the year 2002. The DGRV has helped to establish adequate framework conditions for cooperatives, notably to draw up the new Kyrgyz cooperative law. In addition, the DGRV has set up the "Raiffeisen Fund Kyrgyzstan" with funds from the BMZ; this is a credit fund for the financing of investment loans and, to a lesser extent, current assets at favourable conditions for cooperatives in the agricultural and food-processing sectors.
In addition to fundamental reforms at the political and legal levels, a lasting political and economic stabilization of Kyrgyzstan calls for improved economic and social living conditions for the population generally. To achieve this, individuals must be urged to make greater efforts of their own and mobilize their own resources. Cooperative forms of organization are particularly well suited to foster such developments and add momentum to them, notably in the rural areas. Smallholders and small business people can be supported successfully by cooperative forms of self-help.
A Kyrgyz farmer owns on average some two hectares of land; the purchase of new farming technology is therefore an enormous burden on the individual. This is why many farmers’ groups have sprung up across the country to purchase (used) farming technology together and make it available to their members. Under certain conditions, the purchase of such machinery can be funded by the Raiffeisen Fund Kyrgyzstan. Other examples of funding include investments for the processing of fruit and vegetable, the establishment of milk-processing plants, the building of stables and potato storage facilities.
The cooperative investment projects make an important contribution to regional development and the rural economy. New jobs and better incomes can help to reduce poverty considerably, especially in structurally weak regions. In addition, democratic community initiatives are strengthened in Kyrgyzstan. Support of remote areas contributes to a more balanced development between the regions and revitalizes local trade when means of production are purchased locally. It invigorates local markets and opens up new market segments.
The positive results of DGRV project activities and the Raiffeisen Fund Kyrgyzstan have met with a great deal of interest in the country from both potential lenders and international organizations, which are increasingly cooperating.