Facilitating Smallholder Farmers’ Market Access
In the OIC Member Countries
99
Cotton production is declining primarily because production costs are rising. To benefit
from economies of scale, cotton should be grown on a minimum of 3.0 hectares, but the
average Kyrgyz cotton farm is about 0.4 hectares. Little land is available for rent, and when
it is, rents are high. Agricultural machinery, including harvesting combines, is scarce and
costly, and so is labor, ever since Uzbekistan closed its borders in 2010 and the supply of
cheap labor dwindled. For these reasons, more farmers are abandoning cotton to grow
maize and rice.
Cross-cutting issues impacting smallholders’ access to markets
GOVERNANCE AND INSTITUTIONS
shows changes in five key governance indicators for Kyrgyz Republic between
2002 and 2012.
As the figure shows, Perceptions associated with “Voice and Accountability” improved
between 2002 and 2012. However, other indicators have fallen, some considerably.
Although perceptions of governance have not fared too well, the 2013 Business
Environment and Enterprise Performance Survey (BEEPS) finds improvements in the local
business climate since 2008, especially for electricity; courts; crime, theft, and disorder; tax
administration; and practices of informal economy competitors. Limited improvements are
reported for tax rates, skills and education of labor, transport, and customs and trade
regulations. Key obstacles to doing business include concerns about political outcomes, tax
rates, corruption , and skills and education of labor.
With regard to regulations and bureaucracy perceptions on interactions with the
government improved, but the quality of public services is reportedly worsening. The
FIGURE 59: GOVERNANCE INDICATORS FOR KYRGYZ REPUBLIC, 2002 AND 2012
Source: Worldwide Governance Indicators (World Bank 2014i).