Should Foreigners be Able to Buy Kyrgyz Land?

Economists are recommending that Kyrgyzstan open the way for foreigners to buy and sell land, as a way of stimulating investment. But they warn that clear guidelines must be set for defining land that is available for commercial purposes.



At an October 14 press conference in Bishkek, Mukhtar Ablyazov, who chairs the board of directors of Kazakstan’s TuranAlem bank, said the current ban on foreign citizens acquiring land is an obstacle to investment. Ablyazov said that if this were not the case, his bank could invest around 100 million US dollars a year in the Kyrgyz economy.



Kyrgyzstan’s land law makes it illegal to place land under foreign ownership. If foreigners inherit property, they must sell it to a Kyrgyz citizen within one year.



Some businessmen and commentators in Kyrgyzstan support the idea of allowing foreigners to buy land. But they warn that before this happens, there must be a clear demarcation between lands owned by the state - farmlands, forests, pastures and other key assets – and areas that could be designated for construction, business or the service sector.



According to member of parliament Omurbek Tekebaev, the move will mean that “investors have a greater interest in putting money into the Kyrgyz economy. I believe [it] will represent no danger to Kyrgyzstan.”



However, economist Jyldyz Sarybaeva says Kyrgyzstan is not quite ready for the change yet, and laws and regulations must be put in place beforehand.





Sarybaeva highlighted the risk that investors from neighbouring states would be particularly interested in land acquisitions, especially around Lake Issyk-Kul lake and other key assets. The move would also cause land prices to rise, she warns, noting that as things stand, foreigners can take out a 49-year lease on land and run their businesses perfectly well without having outright ownership.



Opponents of the scheme say that once the foreigners come in, it will not be long before they own large swathes of Kyrgyzstan. That could leave the country politically and economically dependent on its neighbours.



Tajikan Kalimbetova, who heads Kyrgyzstan’s financial investigation agency, said, “Once a piece of land has been bought by a foreign citizen, it will never come back, but will remain in the hands of the businessman concerned, his heirs, or other citizens of his country in perpetuity.”



(News Briefing Central Asia draws comment and analysis from a broad range of political observers across the region.)