At the Eurasian Week forum in Bishkek, Maxim Vorobyev, Director of Analytic Research at the International Trade and Integration Research Center (ITI), spoke with a correspondent of the Sputnik Kyrgyzstan radio station.
Vorobyev pointed out that a country's participation in an integration association opens up huge opportunities for businesses but also poses huge risks.
"First of all, it’s a challenge to the competitiveness of your products or your services. Only those who will be able to meet this challenge, will be fit to develop further. This challenge is a necessary condition for the existence of global economy and for integration into this economy. The Kyrgyz authorities were perfectly right in setting this ambitious task. I think that this step is definitely correct. True, we won't see any effect after six months, but I'm hundred percent positive about the outlook for the next five to seven years – this will definitely strengthen the economy," Maxim Vorobyev emphasized.
In this respect, the rapidly growing markets of China are of interest, especially since Kyrgyzstan has a common border with this trade partner. However, it is extremely difficult to prepare for the competition there, which is also a challenge, and it will be very hard to move forward without meeting this challenge.
"One of the key tasks is to create value chains. Members of integration associations might each get a specialization so that each country would bring its own link to this value chain and would enter foreign markets with this product," Vorobyev suggested.
The experience of a number of European countries shows that such an approach can be very effective, especially for smaller countries. For example, Slovenia started to specialize in the production of car parts and created production facilities with the aid of producers and investors. Today, Slovenia has an important place in European economy due to its participation in the value chains. Uzbekistan has adopted a similar strategy and is currently creating facilities for production of vehicle components.
Kyrgyz businesses have every chance of gaining a foothold in the Eurasian economy, but first the country needs to find its niche, identify its competitive strengths, explore them, and capitalize on them.
Maxim Vorobyev also visited the Prospects for the Development of the Construction Materials Industry as Part of the Eurasian Integration session of the Eurasian Week forum. Read more here.