AKIPRESS.COM - More fiscal space can be created by reducing expenditure and strengthening public finance management in Kyrgyzstan, IMF staff mission said following visit to Kyrgyzstan.
The wage bill can be contained by reducing the headcount through attrition, limiting wage indexation to below inflation, and rationalizing the public sector employment and compensation framework.
Gradually raising electricity tariffs and reforming the energy sector would reduce subsidies and generate fiscal savings, part of which should be used for targeted social assistance to the most vulnerable.
These measures should be supplemented with PFM reforms to improve budget preparation and execution, including wage bill management, its transparency, and limit extra-budgetary funds such as the Stabilization fund.
Strengthening the efficiency of social protection should be a priority to prevent further increase in poverty.