Selling to Government
Many government entities finance public works projects by borrowing from multilateral development banks. Please refer to the “Project Financing” Section in “Trade and Project Financing” for more information. There is an official public procurement agency operating in accordance with the public procurement law. (This law is available at Ministry of Justice website) Over the past two years, the law on public procurement has undergone significant changes. Since April 2022, companies with a state share of 50 percent or more were allowed not to hold tenders on the public procurement website. In July 2023, President Japarov signed a law on simplification of the public procurement procedures which allowed direct purchases from “one source” but did not eliminate competitive tenders entirely. The law was criticized by representatives of civil society and International Financial Institutions. They noted that the adoption of the law will likely increase corruption and reduce public oversight over purchases. President Japarov rescinded his support of the law and has sent it back to Parliament for consideration. The government has indicated its intent to further limit or eliminate competitive tenders in favor of single source contracts in the final version of the draft bill. Also in March 2023, the president signed a decree, according to which state-owned companies are recommended to purchase goods from domestic manufacturers as a matter of priority. Instructions and standard documents and forms for “Unlimited Bidding” can be found in Russian at https://info.zakupki.kg/293—pravovaya-informaciya-i-dokumenty/.
Additionally, procurement of goods and services for projects financed by international donors is announced through common international channels of tender information. Unfortunately, some government actions occur outside of regularized procurement channels. In some cases, tenders are announced only one or two days prior to the bidding deadline. In such instances, insider knowledge provides advantages to well-connected companies. U.S. firms bidding on government tenders may need to provide notarized documents translated into Russian, and in some instances hard copies are required. Companies should read tender requirements carefully and take into account the time it takes to courier documents to the Kyrgyz Republic (1-2 weeks).
U.S. companies bidding on government tenders may also qualify for U.S. Government advocacy. A unit of the U.S. Commerce Department’s International Trade Administration (ITA), the Advocacy Center, coordinates U.S. Government interagency advocacy efforts on behalf of U.S. exporters bidding on public-sector contracts with international governments and government agencies. The Advocacy Center works closely with a network of the U.S. Commercial Service worldwide and inter-agency partners to ensure that exporters of U.S. products and services have the best possible chance of winning government contracts. Advocacy assistance can take many forms but often involves the U.S. Embassy or other U.S. Government agencies expressing support for the U.S. bidders directly to the foreign government. Consult the Advocacy Center for Foreign Government Contracts and for additional information.
Financing of Projects
Price, payment terms, and financing can be significant factors in winning a government contract. Many governments finance public works projects through borrowing from the Multilateral Development Banks (MDBs). A helpful guide for working with the MDBs is the Guide to Doing Business with the Multilateral Development Banks. The U.S. Department of Commerce’s ITA has a Foreign Commercial Service Officer stationed at each of the five different MDBs: the African Development Bank; the Asian Development Bank; the European Bank for Reconstruction and Development; the Inter-American Development Bank; and the World Bank. Learn more by contacting the Advocacy Liaison for World Bank, the Advocacy Liaison for African Development Bank or Advocacy Liaison for European Bank for Reconstruction and Development.