In the context of a globally interconnected economy, the concept of Business Ready becomes a key factor for countries striving to improve their economic standing and achieve sustainable development, especially for developing economies like the Kyrgyz Republic. This concept encompasses a wide range of aspects, including the creation of favorable regulatory frameworks, infrastructure development, and support for entrepreneurs and small businesses.

The World Bank's Business Ready (B-READY) program is a comprehensive tool for analyzing and improving key aspects of doing business. It replaces the Doing Business project, offering a more balanced and transparent approach to analyzing the business climate. While the Doing Business project focused primarily on assessing the business environment for small and medium-sized enterprises, B-READY addresses the development of the private sector as a whole. B-READY evaluates parameters such as the regulatory environment, access to resources, and the quality of public services, allowing countries to identify and eliminate obstacles to private sector development.

In the context of the Kyrgyz Republic, it is important to understand that Business Ready is not just a tool for assessing the current state of the economy. It is a mechanism that facilitates the creation of an environment conducive to innovation, investment, and job creation. Addressing issues such as bureaucratic inefficiency and access to financing can help the country strengthen its position in international trade and attract more investments.

Overview of the Business Ready Concept and Its Impact on Economic Development in the Kyrgyz Republic

Understanding the Business Ready concept is crucial for promoting economic growth in the Kyrgyz Republic, as it reflects the readiness of local enterprises to operate in both domestic and international markets.

According to preliminary findings from B-Ready 2024, economies do not need to be wealthy to create a good business environment. A notable example is the Kyrgyz Republic, which scored 74.71 out of 100 in the "Operational Efficiency" section, compared to Rwanda's 81.31 and Georgia's 84.75. Operational efficiency reflects the ease of complying with regulatory requirements and the effectiveness of utilizing public services directly related to companies.

Scores by Section for the Kyrgyz Republic:

According to the 2024 Business Ready report, the Kyrgyz Republic demonstrates high performance in several key areas, including utility services, financial services, and business location. In particular, the utility services sector shows high efficiency in connecting electricity, water supply, and the internet, as well as quality control over the provision of these services. Financial services are characterized by well-established mechanisms for consumer rights protection, transparency in electronic payments, and effective risk management in the banking sector. In the area of business location, the country demonstrates a high level of transparency in regulating land use, zoning, and property registration. Business registration procedures for domestic companies are simplified, and licensing and reporting requirements are clearly defined.

However, despite these achievements, there are areas for improvement in several key aspects. In the area of taxation, there are no effective mechanisms for reviewing tax disputes, and conflict resolution procedures remain complex. In terms of business insolvency, there is no electronic case management system for company liquidation and reorganization processes. In the area of market competition, there are significant restrictions for foreign companies wishing to participate in public procurement. Digitalization issues include insufficient implementation of digital platforms in tax administration, business registration, and land document provision. In the area of labor legislation, there is insufficient protection of workers' rights and minimal use of data on gender and age. Environmental standards also require improvement: there are no requirements for energy efficiency and sustainability in the construction industry.

Analysis of Opportunities to Improve the Kyrgyz Republic's Indicators

To improve these indicators, it is recommended to implement digital platforms for filing tax returns and dispute resolution, which will increase the transparency of tax procedures, especially for foreign investors. In the area of business insolvency, electronic case management systems should be created to expedite company liquidation and reorganization procedures. To strengthen market competition, it is necessary to review restrictions on foreign companies' participation in public tenders and create equal conditions for all market participants. An important step will be the development of digital public services through the creation of a unified platform for business registration and reporting, as well as the digitalization of land and property registration services.

In the area of labor legislation, it is important to strengthen control over compliance with minimum social standards for workers, implement mandatory unemployment insurance, and expand social support measures for low-income segments of the population. In terms of environmental standards, mandatory energy efficiency requirements should be introduced for new construction projects, and incentives should be developed for the implementation of environmentally friendly technologies in the construction and utilities sectors. Finally, to support small and medium-sized businesses, it is advisable to launch financing programs and simplified procedures for registering new enterprises.

Thus, the implementation of these measures will significantly improve the investment climate and increase the competitiveness of the Kyrgyz Republic's economy.

The Impact of Business Ready Indicators on a Country's Investment Attractiveness

High rankings in the Business Ready (B-READY) index directly influence a country's investment appeal. Nations with favorable business climates experience higher levels of foreign direct investment (FDI), contributing to sustainable economic growth.

After implementing reforms aimed at improving business conditions, including reducing tax burdens and expediting registration procedures, Georgia entered the top 10 of the Doing Business ranking, leading to increased FDI and accelerated economic growth. In 2020, Georgia ranked seventh globally in the Doing Business study, achieving the highest position among countries in the Europe and Central Asia region.

Similarly, Estonia, through the adoption of e-government and transparent regulatory procedures, attracted significant investments in the IT sector, fostering the digitalization of its economy. Holding a high 18th place in the Ease of Doing Business ranking, Estonia stands out among other European countries and worldwide. This ranking, which assesses the ease of doing business based on criteria such as company registration procedures, taxation, cross-border trade, investor rights protection, and access to financial resources, underscores the effectiveness of this European country's economic system.

For the Kyrgyz Republic, improving its position in the B-READY ranking could attract major international investors and develop key economic sectors such as energy, agriculture, and tourism.

Conclusion

The Business Ready program plays a crucial role in shaping a favorable business environment and fostering economic growth. For the Kyrgyz Republic, actively utilizing B-READY data and recommendations can be a key step toward attracting investments, supporting small businesses, and building a sustainable economy.

B-READY advocates for the implementation of clear rules and consistent adherence to regulatory norms, promoting fair competition and strengthening investor confidence. For the Kyrgyz Republic, aiming to position itself as an attractive destination for international investments, having a reliable regulatory framework is essential.

Key steps to improve the Kyrgyz Republic's standing in the B-READY ranking include reforms in taxation, infrastructure connectivity, access to financing, and strengthening anti-corruption measures. These changes will not only enhance the country's position in international rankings but also positively impact the overall living standards of the population.

The full B-READY report is available at: https://www.worldbank.org/en/businessready