Contents -- Acknowledgments -- Acronyms and Abbreviations -- Executive Summary -- 1. Kyrgyz Economy-Present Structure and Sources of Growth -- Macroeconomic Developments and Challenges -- Structure of the Kyrgyz Economy -- Implications of the Existing Economic Structure for Growth -- Growth Outlook-Medium Term Versus Long-Term Challenges -- Summary -- 2. External and Domestic Trade Barriers to Integration-"WTO Rules and Beyond" as Vehicle of Kyrgyz Regional and Global Integ -- Trade Regime Assessment and a Snapshot Picture of Developments in Trade -- Turning WTO Membership into a Springboard for Regional and Global Integration -- Integration in a Regional Setting Transforming Weaknesses into Strengths -- The Road Ahead: The Need for a Two-Pronged Strategy and its Organizational Underpinnings -- 3. Cross-Cutting Issues for Business Development and Improved Competitiveness -- Strategy for Building Competitiveness -- Improving the Investment Climate -- Challenges for Improved Competitiveness -- Roadmap for Future Reform -- LIST OF NUMBERED TABLES -- 1.1. Gross Domestic Investment in Selected Transition Economies, 2002 -- 1.2. Structure and Sources of Investment in Fixed Capital, 1999-2002 -- 1.3. Financial Intermediation by the Banking Sector in Selected Transition Economies, 2002 -- 1.4. The Kyrgyz Republic and Selected CIS Countries: Relative Unit Labor Cost, 2002 -- 1.5. The Kyrgyz Republic and Selected CIS countries: Total Factor and 1998-2002 -- 1.6. Kyrgyz Republic GDP, Consumption and Poverty, 1996 -2003 -- 1.7. Output and Labor, 1996-2002 -- 1.8. Source of Growth and Employment in Agriculture, 2000 -- 1.9. Sources of Growth and Employment in Manufacturing, 2001 -- 1.10. Significance of Gold Mining in Kyrgyz Republic -- 1.11. Sources of Growth and Employment in Mining and Energy, 2001.

1.12. Sources of Growth and Employment in Services, 2001 -- 1.13. Trade Margins as a Share of Total GDP, 2001 -- 1.14. Patterns of Export and Main Trading Partners in 2001 -- 1.15. SAM Multipliers and Non-Gold Diversification Indicators, 2001 -- 1.16. Critical Inputs of Economy, 2001 -- 1.17. Relationship Between Occupational Skills, Employment -- 1.18. Growth Accounting for 2002: Negative Shock in Gold and Energy and Normal Growth in the Other Sectors -- 1.19. Implications of Gold-Shock for the Kyrgyz Economy -An Illustration -- 2.1. CIS Countries' MFN Tariff Schedules, 2001-2002 -- 2.2. CIS Countries' Exposure to the International Economy, 2000-2002 -- 2.3. Gross Domestic Product, Foreign Direct Investment, Exports and Imports of Goods and Services in 1996-2003 -- 2.4. Kyrgyz Comparative Export Performance in Kazakhstan and Russian Markets in 1996-2002 -- 2.5. Share of Kyrgyz Trade with FTA Partners, 1996-2002 -- 2.6. MFN Tariffs of Major Non-FTA Partners, 2001 -- 2.7. Principal Exports to the World, 2002 -- 2.8. Transportation's Contribution to the Cost of Kyrgyz Imports (in % of the value of imports in 2002) -- 2.9. Tariff Escalation in Manufacturing Industries in 2002 -- 2.10. Kyrgyz Membership in WTO Accession Working Parties -- 2.11. Principal Exports to the CIS, 2002 -- 2.12. Kyrgyz Participation in Regional Trade Integration -- 2.13. Characteristics of Structure of Tariffs in the Kyrgyz Republic and Russia -- 3.1. Conditions in Entry to Private Business Activity in 1997 and 2002 -- 3.2. Central Asia Governance Indicators, 2002 -- 3.3. Number and Employment of SMEs and Individual -- 3.4. Cross-country Comparison of VAT and Collection Rates, 1999-2002 -- B.1. Broad Distribution of Household Income, 2001 -- B.2. Distribution of Household Income by Oblast, 2001 -- B.3.Sources of Household Income, 2001.

B.4. Distribution of Household Income from Employment by Skills -- E.1. Doha Tariff Cutting Formulas: Effect on Kyrgyz Bound Rates -- E.2. Doha Tariff Cutting Formulas: Effects on Kyrgyz Applied MFN Rates -- E.3. Doha Tariff Cutting Formulas: Effect on Chinese Applied MFN Rates -- E.4. Chinese Tariffs Applied to Imports from Kyrgyzstan -- F.1. Significance of Trade in Services in Central Asian CIS,1998-2003 -- F.2. Exports of Total and to CIS of Commercial Services in 1998 -2003, the Change Between 2000 and 2003 -- F.3. Modes of Supply of Services in 1998-2003 -- LIST OF FIGURES -- 1.1. Features of Recent Economic Outlook -- 1.2. Relative Unit Labor Cost in Industry, Selected CIS Countries, 2002 -- 1.3. Real Effective Exchange Rate, 1995-2003 -- 1.4. Structure of the Economy and Sources of Employment, 2001-SAM -- LIST OF BOXES -- 1.1. Basic Features of the Kyrgyz Social Accounting Matrix (SAM) -- 1.2. From Growth to Household Incomes-A Closer Look -- 2.1. How Kyrgyz Exports Responded to Growing External Demand from Neighboring Russia and Kazakhstan? -- 2.2. Three Reasons Why There Should be No Place for Antidumping in FTA and National Legislation -- 2.3. Services in Regional Agreements -- 2.4. Policy Matrix:Challenges and Responses -- 3.1. Highlights of Financial Sector Reforms -- 3.2. Highlights of Privatization Program -- 3.3. Kyrgyz Republic's Consultative Approach to Strengthen the Investment Climate -- 3.4. Costs Imposed on Firms by Investment Climate Problems: Dairy Industry Value Chain Analysis -- 3.5. Agenda for Business Development and Improved Competitiveness -- APPENDIXES -- A. Pros and Cons of the Sam-Based Model -- B. From Growth to Household Incomes -a Closer Look -- C. Kyrgyz Republic's Natural Resource Endowments -- D. Non-Gold Exports-Diversification Indicators.

E. The Kyrgyz Republic and Market Access Negotiations in the Doha Round -- F. GATS and Kyrgyzstan's Trade in Services -- G. Kyrgyz Republic's 2003 Legislative Reforms to Improve Investment and Business Climate -- References.