1. Money Transfers of Labor Migrants as on of the Income Sources and Poverty Reduction in Kyrgyz Republic Choro Doolotaliev Research and Study Group Economic Department National Bank of Kyrgyz Republic

2. Contents 1. Overview of living standard indicators of Kyrgyz population 2. Money transfers from labor migrants to Kyrgyz Republic

3. № Living standard indicators, Kyrgyz Republic, 2004-2008*2004200520062007 2008 1Average nominal monthly salaries per 1 employee, som 22402613327039705378 2Average nominal monthly salaries per 1 employee, US$ ** 52,563,781,4106,4147,1 3Minimum consumer basket (per capita), soms per month 1725,91836,62377,22795,93571,0 4Minimum consumer basket (per capita), US$ ** 40,544,859,274,997,7 5Ratio of average nominal monthly salaries to minimum consumer basket, % 111,5122,8124,8128,8136,8 6Money incomes of population, sом 827,4955,91111,51417,32028,6 7Inflation-adjusted Money incomes of population, sом 804,6908,91055,11132,41622,9 8Money income of population, US$ ** 19,423,327,738,055,5 9Overall poverty incidence, % 45,943,139,935,031,7 10Urban poverty, % 28,329,826,723,222,6 11Rural poverty, % 55,550,847,741,736,8 12GDP per capita, som 1852619617219182710735619 13GDP per capita, US$ ** 434,2478,3545,7726,6974,0 14Number of unepmloyed, thousands 185,7183,5188,9191,1195,6 *Source: National Statistics Committee, KR **Own calculations of Research and Study Group

4. Years Average Nominal Monthly Salaries per 1 employee, US$ PPP-adjusted GDP, US$ Kyrgyz Republic (KR) Russian Federation (RF) Republic of Kazakhstan (RK) Kyrgyz Republic (KR) Russian Federation (RF) Republic of Kazakhstan (RK) 1 200452,5233,8208,01698,110740,17734,6 2 200563,7291,0256,01729,011832,08732,0 3 200681,4368,0324,01818,9131739961,6 4 2007106,4464,3428,01998,614692,411086,1 5 2008147,1595,8505,02156,716085,411862,4 Comparative Table of average nominal salaries and PPP-adjusted per capita GDP, Kyrgyzstan, Russia, Kazakhstan, 2004-2008, US$*. *Source: Own calculations of the Group, based on NSC, NB of KR, Statistics agencies of Russian Federation and Kazakhstan.

5. 20042005200620072008 1Total employed, of which 1991,22077,12096,12152,72184,3 2Agriculture, hunting and forestry 773,9799,0760,0742,1742,9 3Ratio of agricultural employment to total employment, % 38,938,536,334,534,0 Average annual employment in the economy and agriculture2004-2008, thousands*. 20042005200620072008 1 Total poverty45,943,139,935,031,7 2 Urban poverty28,329,826,723,222,6 3 Rural poverty55,550,847,741,736,8 * Source: NSC of Kyrgyz Republic Poverty in Kyrgyz Republic, 2004-2008, %*. * Source: NSC of Kyrgyz Republic

6. Dynamics (left axis) and growth rates (right axis) of migration flows from Kyrgyz Republic Bars: Migration in absolute numbers, Line: Growth rates of migration * Source: NSC of Kyrgyz Republic

7. Распределение общего объема денежных доходов населения. 20042005200620072008 1Total Money Income, % 100 2Including in each income quintile: Quintile 1 (poorest) 5,44,95,15,26,8 3Quintile 2 10,19,510,09,711,5 4Quintile 3 15,214,515,414,716,3 5Quintile 4 23,222,324,122,623,1 6Quintile 5 (richest) 46,248,845,447,842,3 7Ratio Quintile5/Quintile1 (Income devaiation coefficient), times 8,69,98,99,26,2 8Gini coefficient (income concentration coefficient) [1] [1] 0,4220,4330,4460,4220,363 [1] [1] Gini coefficient – indicator that shows the level of actual deviation of income from absolute equality or absolute inequality. If incomes of all are equal, Gini coefficient equals 0, meanwhile, if it is assumed that entire income is concentrated by one individual, it equals 1. Thus, coefficient values fall within range of 0 to 1. The colser to 1, the more unequal is distribution of income among the population.

8. Money transfers through Money Transfer Operation systems as share of GDP of Kyrgyzstan Left Axis, Bars: Absolute values in US$ mln, Right axis, Line, % in GDP of KR

9. Remittances of individuals, made via transfer systems 1 (million USD) 20052006200720082009 balance270,8430,3625,51 138,2893,2 inflow297,7470,0688,21 205,5966,7 CIS countries262,8436,7648,81 141,4894,4 Kazakhstan0,20,07,027,931,4 Russia262,6436,6641,81 113,5862,9 Other0,0 0,10,0 Countries of far abroad34,933,439,464,172,3 Belgium0,0 0,10,5 Great Britain0,9 1,81,4 Germany0,0 0,10,20,7 USA33,932,238,361,469,5 Others0,00,10,00,20,3 outflow26,939,762,767,373,6 CIS countries25,238,560,265,071,8 Kazakhstan0,0 0,22,50,7 Russia25,238,460,062,571,1 Other0,0 Countries of far abroad1,71,22,52,31,8 Belgium0,0 0,1 0,2 Germany0,0 0,20,4 USA1,1 2,11,71,1 Others0,50,1 1 Anelik, Blizko, Contact, Migom, MoneyGram, Western Union, Unistream, Zolotaya Korona, Leader, Sibcontact, Bistraya Pochta, Allur and other systems of transfers and transfers via SP“Kyrgyzpochtasi”

10. Recommendations 1.Improved statistical recording and measuring in the country will allow improving calculation of incomes, including those of the poor. 2.Implementing studies of the impact of money transfers from labor migrants on the income level of population and poverty reduction (broken down per regions of Kyrgyzstan). 3.Increasing educational levels of the population, including of the poor, which gives them opportunities for the employment abroad. 4.Legalization of labor migrants will protect their rights against illegal actions of recipients and employers, thus ensuring uninterrupted flow of money transfers from labor migrants to the country.

11. Thank You