Kyrgyzstan Parliament set to requisition gold company

Following parliament’s passage of a bill allowing the government to take under state control for three months joint stock companies deemed to be contravening regulations environmental or other regulations, it is set to begin the process of a state takeover of the Kumtor Gold Company on 17 May. President Sadyr Japarov signed the bill into law on 14 May. 

The government presently owns 26 per cent of Kumtor Gold Company’s shares. Centerra Gold, the company’s majority shareholder, believes the move is intended to force it out of the country. Japarov led a mass protest at the mine site in Issyk-Kul, in the northeast, in 2013, which turned violent.

Such developments are likely to halt significant recent increases in FDI flows into the country, which could harm projected GDP growth of six per cent this year after an eight per cent contraction in 2020. Further government intervention in business under Japarov is highly likely.