The government of Kyrgyzstan has made a decision that will allow the garment industry of the country to be removed from the shadow economy. For those working in this business, standards are established that create real conditions for the legalization of the industry. Now a huge army of shadow businesses can work on a patent on a voluntary basis, which is undoubtedly more profitable than giving large sums to inspectors every month. Today in Bishkek, dozens of underground factories operate, which supply the largest wholesale markets in the region with garments. No one really knows what the real scale of this underground industry is. “For the country, this industry is unique, because only it works for export,” said Saparbek Asanov, chairman of the Light Industry Enterprises Association. “Our garment products are fully export oriented.” Only in 2004, according to the data of the Association of light industry enterprises “Legprom”, 8 million units of products were exported to Russia in the amount of 800-900 thousand soms (the official rate is 41 soms for 1 US dollar-approx. Ed.). Exported to Kazakhstan twice. “It turns out that in a year we at least produce 30 million garments. According to official data of the National Statistical Committee in 2004, the export of our products amounted to 1.5 billion soms. But, according to our data, - notes Asanov, - this figure ranges from 7 to 20 billion soms. For comparison, I will say that the industrial volume of the republic in 2004 amounted to 52 billion soms. In fact, it turns out that half of all products are made by garment workers. ”
Now in the clothing industry, according to the Association, more than 150 thousand people work. It should be noted that the so-called labor migrants are mainly engaged in this area. According to Asanov, they help promote the brand “Made in Kyrgyzstan”. According to domestic producers, it was possible to conquer the markets of neighboring countries due to a successful combination of low prices and high quality. More than 70% of labor migrants are selling garments of Kyrgyz (not Chinese) production in Russia and Kazakhstan.
If it goes on at the same pace, then Kyrgyzstan “risks” becoming the “new Asian tiger” in the economy at the expense of sewers. Dordoi, the largest wholesale market in Central Asia, is littered with Kyrgyz-made garments. The daily turnover of this market exceeds hundreds of thousands of US dollars. Its services are used by citizens of all countries of Central Asia, including the Uyghur part of China, citizens of Russia, Pakistan, South Korea, Iran and Turkey.
“In recent years, the Dordoi market has expanded, the cost of containers has increased, and container rental has risen by almost 70% over the year. All this indirectly indicates the presence of demand and the development of sewing production in Kyrgyzstan, ”says Elsa Kim, owner of the famous Alexandra private sewing company.
Unfortunately, the pillars of the country's former light industry are either completely collapsed or reoriented, such as the Kyrgyz Worsted Woolen Mill, which is a promising supplier of woolen fabrics, transferred to private ownership (a controlling stake belongs to the Russian company Sibresursy) and reoriented with release of civil range for the manufacture of fabrics for power structures. The Osh garment factory has been turned into an academic building of the Kyrgyz-Uzbek University, but the Osh Silk Mill has been almost completely destroyed. The case when the Tokmak worsted spinning enterprise “Kasiet” brought wool from Moscow (!), Which was much talked and written by local journalists, is indicative of that.
For reference. According to the data provided by the Internet company Wisco, the clothing industry in the republic is represented by factories located in the cities of Bishkek, Osh, Karakol, Talas, Jalalabat, with a total workforce of over 6,100 people. The share of the clothing industry in the total volume of production of light industry is 16.7%. In 2000, the index of physical volume of output in the textile and clothing industry as compared with 1999 was 103.3%. The production of sack cloth increased by 7.1%. Over the same period, the output of silk fabrics decreased by 72%, knitted goods of hand and machine knitting by 51.9%, carpets and rugs by 34.8%, knitted socks of hand and machine knitting by 13.1%.
In order to fully legalize this industry, an international exhibition will be held in Bishkek at the beginning of March, at which the Legprom Association of Light Industry Enterprises is going to present a wide range of its products.
According to sewers, to go to the legalization of their production, they were prompted by the fact that they needed government support for the effective growth of exports of clothing products from Kyrgyzstan to Russia.
The current head of government, Felix Kulov, emphasized in his project socio-economic program that, along with agriculture and the food industry, light industry is also the economic priority of his party Arnamys / Dignity. This is what the specialist says. Sapar Orozbakov, Director of the Bishkek Center for Economic Analysis: “In my opinion, the priority industry should not be electronics, not tourism, not service, but garment production, which in the conditions of Kyrgyzstan has a future. No industry in our country is developing as rapidly as clothing manufacturing, creating thousands of jobs. According to statistics, in the cost of garments, the cost of wages (which, as we know, is terribly low) is 30 percent. This gives our dressmakers a huge competitive edge. ”
To legalize the industry, manufacturers, with the support of the Ministry of Industry, Trade and Tourism, have developed a draft decree, which has already been approved by the government of the country. Now, in order to legitimize their business, it is enough for a janitor to acquire a patent, the cost of which is determined by the amount of equipment. So, for 10 sewing machines you will need to pay $ 26 and 25% of this amount to the Social Fund. For every 10 cars above this value, you must pay $ 13. The workers of sewing shops are offered to purchase a patent for $ 4 and also transfer a quarter of this amount to the Social Fund. This situation allows workers to receive a pension in the future. Previously, they were simply deprived of such an opportunity. “There is only one obstacle to the legalization of sewing production,” notes Asanov. - Now we definitely need to make changes to the new version of the Tax Code, which is now being considered in Parliament. Otherwise, it will turn out that before the adoption of the new Tax Code we will work on patents, and after its adoption everything will be destroyed. ”