She noted that even despite efforts to address financing issues, the establishment of laboratories, and the resolution of border problems, high production costs remain a serious obstacle to competing with neighbors such as China and Uzbekistan.
“Previously, the development of the industry was supported by a number of factors, including a favorable ruble exchange rate, soft tax regimes, and a patent system. However, in the current conditions, businesses need to adapt and focus on systematically reducing costs,” she added.
According to Tursunakunova, the cost of production is determined by raw material prices, labor costs, and rental expenses. As a result of events in Ukraine and changes in the market environment, order volumes have significantly decreased, and wages in the industry now mainly depend on output rather than a fixed rate.
The entrepreneur also emphasized the need to change production processes. In particular, she highlighted that transitioning to a conveyor system instead of individual tailoring could significantly increase production volumes, ensure stable quality, and reduce costs through specialized operations.
Additionally, Tursunakunova proposed to intensify the development of technoparks with special tax and customs conditions similar to free economic zones. This would allow for the import of raw materials and fittings without VAT, provided that they are subsequently processed and exported as finished products, which would significantly reduce production costs.
“Reducing production costs will give Kyrgyzstan the opportunity to become competitive in regional and international markets,” she concluded.
