Kyrgyzstan developed amendments to legislation for leasing market’s dynamic development

Date: 18:16, 30-11-2016.

Almaty. November 30. Silkroadnews – Kyrgyzstan has developed amendments to legislation for leasing market’s dynamic development, KyrTAG writes.

“Leasing has a great potential for further development in the Kyrgyz Republic. Recent data show the degree of deterioration of equipment and machinery is 90%. Thus, the demand for leasing operations will grow year after year”, Deputy of Minister of Economy of the republic Daniyar Imanaliev said during the discussion on the draft law “On amendments to some legislative acts” (Kyrgyzstan’s law “On Financial Lease (Leasing)”, Kyrgyzstan’s law “On state registration of rights to real estate and transactions therewith”).

He also noted that the proposals developed should become an impetus for further dynamic development of the country’s leasing market.

According to the deputy minister, role of leasing operations in the country’s economy should be significant, as leasing is one of the effective tools to finance entrepreneurship. Leasing operations in the republic have been implemented since 2002. Yet still the leasing use is not sufficient. In 2010-2015 a share of leasing operations within the total financial sector portfolio averaged 0.50% in som and 1.47% in foreign currency.

Among the reasons behind the weak use of leasing there are low awareness by population; unattractiveness of leasing activity for banks as a consequence of “longer term money” attraction need; low interest rate for leasing operations when there is a government support and high interest rate at other financial institutions operating on their own.

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